Exhibit 10.1
IRREVOCABLE TRUST
AGREEMENT
TO PROVIDE FOR CERTAIN
POTENTIAL CLAIMS OF BE, INC.
THIS TRUST AGREEMENT, dated as of
April 9, 2004, is made by and between BE, INC., as Grantor (the
“Grantor”), WILMINGTON TRUST COMPANY, a Delaware
banking corporation (in its individual capacity, the “Trust
Company”, and not in its individual capacity but solely as
Resident Trustee hereunder, the “Resident Trustee”) and
Dan S. Johnston, an individual (in his individual capacity,
“Johnston”, and not in his individual capacity but
solely as Trustee hereunder, the “Trustee”) and their
successors upon the terms and conditions set forth
below.
Recitals
:
WHEREAS, the liquidation,
dissolution and winding up of the Grantor have been approved
pursuant to a plan of liquidation in accordance with Delaware
law;
WHEREAS, the Grantor may have a
potential or a contingent tax obligation due the State of
California (the “California Claim”), the exact amount
of which cannot be determined;
WHEREAS, to close its business
operations in the State of California, the Grantor must obtain a
tax clearance certificate and provide for payment of any potential
California Claim;
WHEREAS, Grantor wishes to form a
Delaware statutory trust to provide for the payment of such of the
California Claim as Trustee, in its sole discretion, shall
recognize pursuant to the terms of this Agreement, or ultimately
determined to be due and owing by a court of competent
jurisdiction;
WHEREAS, Resident Trustee and
Trustee have agreed to act pursuant to the terms of this Agreement
and have agreed to hold the Trust Property (as hereinafter defined)
in trust pursuant to the express terms of this
Agreement;
NOW THEREFORE, with the intent to be
legally bound hereby, the Grantor, Resident Trustee, and Trustee
adopt the following Trust:
ARTICLE I
ORGANIZATION
1.01. Grantor hereby appoints the
Trust Company to act as Resident Trustee hereunder and Johnston to
act as Trustee hereunder and grants, assigns and delivers to
Trustee and to the Resident Trustee, and each of the Trustee and
the Resident Trustee hereby accepts, the property listed on Exhibit
A (the “Trust Property”) which, together with all
proceeds and income therefrom, are to be held by the Trustee or the
Resident Trustee pursuant to the terms of this
Agreement.
1.02. Name . The Trust
created hereby shall be known as Be, Inc. California Claims Trust
in which name the Trustee, and the Resident Trustee to the extent
expressly provided herein, may conduct business, make and execute
deeds, mortgages, leases, contracts and other instruments; acquire,
invest, hold, pledge, mortgage, lease, assign, convey and transfer
Trust Property, or other property; and sue and be sued.
1.03. Office . The office of
the Trust shall be in care of Trustee or at such other address as
the Trustee may designate.
1.04. Purposes and Powers .
The purpose of the Trust is to engage in the following activities
and only the following activities: (i) holding such Trust Property
transferred to or otherwise acquired by it; (ii) administering,
investing, reinvesting, and disposing of the Trust Property; (iii)
determining the validity of the California Claim; (iv) to pay,
compromise, litigate or otherwise settle the California Claim; (v)
determining the validity of claims other than the California Claim;
(vi) subject to the approval of the Court, to compromise, pay or
litigate claims other than the California Claim; (vii) activities
which are necessary, suitable or convenient to accomplish the
foregoing or are incidental thereto or connected therewith; (viii)
to conduct its business, carry on its operations and have and
exercise the powers granted to a Delaware statutory business trust
in any state, territory, district or possession of the United
States, or in any foreign country, that may be necessary,
convenient or incidental to the accomplishment of the purposes of
the Trust; (ix) to enter into, perform and carry out contracts of
any kind necessary to, convenient to, or incidental to the
accomplishment of the purposes of the Trust; (x) to sue and be
sued, complain and defend, and participate in administrative or
other proceedings, in its name; (xi) to appoint, hire, terminate
and/or replace agents, employees and/or independent contractors of
the Trust, and define their duties and fix their compensation;
(xii) to make, execute, acknowledge and file any and all documents
or instruments necessary, convenient or incidental to the
accomplishment of the purposes of the Trust; (xiii) to make
distributions to the Grantor, or, upon its dissolution and
liquidation, to its Permitted Assignees (as hereinafter defined),
but only after the California Claim has been fully resolved as
herein provided; (xiv) to file and pay taxes on any and all income
earned on the Trust Property.
1.05. Appointment of the Resident
Trustee . The Grantor also appoints the Trust Company as
Resident Trustee for purposes of satisfying the criteria of 12
Del . C . § 3807(a).
1.06. Declaration of Trust;
Definitions . Each of the Trustee and the Resident Trustee
hereby declares that it will hold the Trust Property in trust upon
and subject to the conditions set forth herein. It is the intention
of the parties hereto that the Trust constitutes a statutory trust
under Chapter 38 of Title 12 of the Delaware Code. All capitalized
terms herein are used as defined in Article IX of this Agreement.
The parties further intend that the Trust qualify as an investment
trust that is classified as a trust under Treasury Regulation
§ 301.7701-4(c), and it is neither the purpose nor the intent
of the parties hereto to create a partnership, joint venture or
association taxable as a corporation. In furtherance of the
foregoing, the purpose of the Trust shall be to protect and
conserve the trust estate, and the Trust shall not at any time
engage in or carry on any kind of business or any kind of
commercial or investment activity, except as provided in Section
4.02 hereof. In no event shall the Trustee, the Resident Trustee or
any other Person have any power to vary the investments of the
Trust or to substitute new investments or reinvest except in
furtherance of the purpose of this Trust.
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1.07. No Liability of Grantor,
Trustee or Resident Trustee . Except as otherwise expressly
provided for herein, no Grantor or Permitted Assignees shall be
subject to any liability whatsoever to any Person in connection
with the Trust Property or the acts, omissions, obligations or
affairs of the Trust. Except as may be provided in Article VI, no
trustee (including the Trustee and the Resident Trustee) shall be
subject to any personal liability whatsoever to any Person in
connection with the Trust Property or the acts, omissions, or
obligations of the Grantor, or the acts, omissions, obligations or
affairs of the Trust.
1.08. Situs of Trust . The
Trust will be located and administered at the offices of the
Trustee or the Resident Trustee and at such other locations as the
Trustee, in its sole discretion, shall determine. The Trustee and
the Resident Trustee may maintain one or more bank accounts at such
locations as the Trustee and the Resident Trustee determine for
receipts and disbursements of income and principal of the
Trust.
ARTICLE II
RESTRICTIONS ON
TRANSFER
2.01. Spendthrift . Except as
provided below, the interest of the Grantor in either the income or
the Trust Property of the Trust shall not be alienated in any
manner, assigned, encumbered, or transferred, in whole or in part,
by the Grantor without the express written consent of the Trustee,
which consent may be given or withheld in Trustee’s sole and
absolute discretion. Grantor’s interest in the Trust shall be
exempt from execution, attachment, distress for rent, and other
legal or equitable process which may be instituted by or on behalf
of any creditor or assignee of Grantor. Notwithstanding the
foregoing, upon the completion of the dissolution and liquidation
of the Grantor, Grantor’s contingent interest to receive the
Trust Property after resolution of the California Claim may be
assigned to the Permitted Assignees provided that the Grantor
notifies the Trustee (i) that it has fully dissolved and liquidated
and (ii) of the names, addresses, federal identification numbers,
and percentage interest of the Permitted Assignees.
ARTICLE III
INVESTMENT AND APPLICATION OF
TRUST FUNDS
3.01. Application of Income and
Principal.
(a) Income with respect to and
proceeds of Trust Property as well as Trust Property itself held by
the Trustee shall be applied by the Trustee in the following
order:
(i) first, to pay any amounts due to
the Trustee or Resident Trustee in its individual capacity under
this Agreement;
(ii) second, to pay any other
expenses of the Trust, including federal and state income taxes on
the income generated by the Trust Property, and the retention of
advisors to assist in determining or litigating the California
Claim;
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(iii) third, to pay the expenses of
the Trust, including its advisors, incurred in investigating,
responding to or litigating claims, other than the California
Claim, that might be asserted against the Trust, notwithstanding
that such claims may have been barred, were not suspected or known
and were not reasonably anticipated at the time of the
Trust’s formation; and
(iv) fourth, to pay or fund a
reserve to pay, the expenses associated with the distribution of
the trust property to Grantor or Permitted Assignees.
(b) Income and proceeds with respect
to the Trust Property held by the Trustee as well as Trust Property
itself after the application of funds pursuant to Section 3.01(a)
shall be applied in the following order:
(i) first, to pay the State of
California in satisfaction of the California Claim in such amount
as the Trustee, in its sole and absolute discretion, shall
determine is appropriate, or as a court of competent jurisdiction
shall finally determine;
(ii) second, to pay Claimants other
than the State of California, if any, in satisfaction of claims in
such amount as the Trustee shall determine is appropriate, but only
after application to and approval from the Court to permit such
payment; and
(iii) third, after resolution and
payment of the California Claim and thereafter, any other claims
that may be approved by the Court, payment shall be made to the
Grantor or, if Grantor has been fully dissolved and liquidated, to
the Permitted Assignees.
3.02. No Segregation of Moneys;
No Interest . Subject to Section 3.01, moneys received by the
Trustee or the Resident Trustee hereunder need not be segregated in
any manner except to the extent required by law and may be
deposited under such general conditions as may be prescribed by
law, and neither the Trustee nor the Resident Trustee shall be
liable for any interest thereon.
ARTICLE IV
AUTHORITY AND DUTIES OF THE
TRUSTEE AND THE RESIDENT TRUSTEE
4.01. General Authority .
Each of the Trustee and the Resident Trustee is authorized to take
all actions required or permitted to be taken by it pursuant to the
terms of this Agreement.
4.02. Specific Authority .
Without limiting the Trustee’s general authority, the Trustee
is hereby authorized and directed to take the following
actions:
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(a)
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To retain any
and all real property, partnership interests, stocks, bonds, notes,
securities and/or other property constituting the original Trust
Property or added thereto, without personal liability on the part
of the Trustee for any decrease in value thereof;
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(b)
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To sell at
public or private sale, exchange for like or unlike property, grant
and convey, lease, assign or transfer, for terms longer or shorter
than this Trust, borrow money and pledge or mortgage, as security
therefore, any or all property, real or personal, or any interest
therein, held as part of the Trust Property;
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(c)
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To invest any
money available for investment in such real estate, partnership
interests, stocks, bonds, notes, securities and/or other property
as may be deemed by the Trustee appropriate, irrespective of the
rules of investment applying to trustees under any present or
future laws of the State of Delaware or elsewhere and without any
duty on the part of Trustee to diversify investments;
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(d)
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To vote
directly or by proxy any shares of stock, partnership interests,
bonds or other securities held hereunder;
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(e)
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To accept from
time to time additions of real or personal property to the Trust
Property in such amount or amounts as Trustee may determine to be
desirable;
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(f)
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To determine
whether expenses and other disbursements, including any expenses in
connection with the operation, maintenance, improvement and
protection of any Trust Property, shall be charged against
principal, income, or partly against principal and partly against
income, and such determination shall be conclusive upon all
Persons;
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(g)
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To rely upon
such information with respect to assignment, heirship,
relationship, survivorship, identity or any other fact, relative to
determining to whom any Trust Property and/or the income therefrom
shall be paid or distributed, as Trustee shall reasonably believe
is correct, without any personal liability for so doing;
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(h)
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To retain any
and all property constituting the Trust Property undivided, if more
convenient to do so, until physical division becomes necessary in
order to make any distribution therefrom and, until such division
is made, to allocate to each share of the Trust Property its
proportionate part of the receipts and expenses;
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(i)
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To retain any
and all property constituting the Trust Property, or a part hereof,
in bearer form or in its own name or in the name of its nominee or
nominees, without disclosing its fiduciary capacity; and
Trustee’s personal liability shall be neither increased nor
decreased thereby;
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(j)
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To make any
division or distribution of the Trust Property herein provided for
in cash or in kind, or partly in cash and partly in kind, and to
value and apportion the property to be so divided or distributed,
which valuation and apportionment shall be final and conclusive
upon all Persons;
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(k)
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To operate and
manage such business as shall constitute part of the Trust Property
and shall be authorized to take any and all actions necessary to
duly constitute such business and maintain its status, or change
its status or operation as Trustee shall deem
appropriate;
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(l)
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To retain
accountants, legal counsel and other professional advisors and to
pay for the same out of the Trust Property without diminution of
compensation otherwise payable to it;
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(m)
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To defend or
settle the California Claim as Trustee, in its sole discretion,
shall determine to be appropriate and to pay, discharge or
otherwise satisfy the California Claim; and
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(n)
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To defend or
settle claims other than the California Claim as Trustee shall
determine to be appropriate and to pay, discharge or otherwise
satisfy such other claims, but only after application to and
approval from the Court to permit such payment or
actions.
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4.03. General Duties . It
shall be the duty of the Trustee to discharge (or cause to be
discharged) all of its responsibilities pursuant to the terms of
this Agreement and to administer the Trust in accordance with the
terms hereof.
4.04. Accounting and Reports to
the Grantor, the Internal Revenue Service and Others
.
(a) The Trustee shall (i) maintain
or cause to be maintained the books of the Trust on a calendar year
basis and on the cash method of accounting, (ii) deliver to the
Grantor, within 60 days of the end of each Fiscal Year, or more
often, as may be required by the Code and the regulations
thereunder, a copy of the annual financial statement of the Trust
for such Fiscal Year and a statement in such form and containing
such information as may be required by such regulations, (iii) file
such tax returns relating to the Trust, and make such elections, as
required under any applicable state or federal statute or rule or
regulation thereunder, (iv) cause such tax returns to be signed in
the matter req
