NETLIVE COMMUNICATIONS, INC.
PERFORMANCE SHARE PROGRAM TRUST
This Trust Agreement made this 4 day of March, 1997, by and
between NetLive Communications, Inc. ("Company") and R. Xxxxxx
Xxx(the "Trustee").
WHEREAS, Company has adopted the NetLive Communications, Inc.
Performance Share Program as a nonqualified deferred compensation
plan;
WHEREAS, Company wishes to establish a trust (hereinafter
called "Trust") and to contribute to the Trust Company stock that
shall be held therein, until distributed to Plan Participants in
such manner and at such times as specified in the Plan;
WHEREAS, it is the intention of Company to tie performance of
the Participants' Accounts under this Trust to the performance of
the Company, which is, in turn, tied in significant part to the
performance of the key employees participating in 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:
Section 1. Establishment of Trust
(a) Company hereby deposits with the Trust in trust 300,000
shares of its common stock, which shall become the principal of the
Trust to be held, administered and disposed of by Trustee as
provided in this Trust Agreement.
(b) The Trust hereby established shall be irrevocable. It
shall not be subject to the claims of the Company's creditors, but
shall be maintained for the exclusive purpose of providing benefits
to Plan Participants.
(c) The Trust is not intended to be a grantor trust, but is
intended to be a taxable trust pursuant to Section 641 et seq. of
the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly. The Trust is a funded trust and, as such,
it is intended that each Participant in respect of whom an Account
is maintained be taxed in accordance with Section 402(b) of the
said Code.
Section 2. Definitions
(a) "Account" means the separate account established and
maintained under the Fund with respect to each Participant to
provide a source of funds for the benefits payable by the Company
to, or with respect to, each such Participant under the Plan.
(b) "Change of Control" means a change of control of the
Company as defined in Article I, Section 1.3 of the Plan.
(c) "Company" means NetLive Communications, Inc. and any
successor thereto, or to the business thereof, by whatever form or
manner resulting.
(d) "Fund" means the stock, and any money and other property
held by the Trustee under this Agreement.
(e) "Participant" means a participant in the Plan.
(f) "Plan" means the NetLive Communications, Inc. Performance
Share Program.
(g) "Share" means common stock and/or preferred stock issued
by the Company.
(h) "Trust" means the trust provided for under this
Agreement.
(i) "Trustee" means the trustee of the Trust.
Section 3. Accounts
(a) At the time the Company allocates Shares contributed to
the Trust for a Participant, it shall notify the Trustee of such
fact and an Account shall be established by the Trustee under the
Fund with respect to such Participant and the amount so contributed
or directed to be allocated shall be credited to such Account. Any
subsequent contributions to the Trust with respect to the benefits
of such Participant and all earnings thereon also shall be credited
to such Account. Any taxes or other expenses paid with respect to
an Account shall be debited to that Account. The Company shall
provide the Trustee with such information or reports as are
necessary to credit contributions to the Account maintained with
respect to each Participant.
(b) The Trustee shall have responsibility for the maintenance
of Account records.
(c) Any benefits becoming payable under the Plan to a
Participant shall be paid form the Fund and charged against the
Account maintained with respect to the benefits of such
Participant. No payment shall be made form the Fund to or with
respect to a Participant to the extent that such payment would
exceed the balance then remaining in the Account maintained with
respect to the benefits of such Participant.
(d) Once established, an Account shall be maintained with
respect to the benefits of each Participant until it has been
liquidated through distribution to the Participant, or a
beneficiary thereof.
Section 4. Distributions to Plan
Participants and Their Beneficiaries
(a) Company shall deliver to Trustee a schedule (the
"Distribution Schedule") that indicates the distributions in
respect to each Plan participant, that provides instructions
acceptable to Trustee for determining what is to be distributed,
the form in which such amount is to be paid (as provided for or
available under the Plan), and the time of distribution. Except as
otherwise provided herein, Trustee shall make distributions to the
Plan Participants in accordance with such Distribution 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 distribution of benefits pursuant to
the terms of the Plan.
(b) The entitlement of a Plan participant to benefits under
the 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.
Section 5. Return to Company
Company shall have no right or power to direct Trustee to
return to Company or to divert to others any of the Trust assets
before all distribution of benefits have been made to Plan
Participants pursuant to the terms of the Plan. Any Shares
forfeited by a Participant when such Participant's service to the
Company is terminated, or upon occurrence of any other forfeiture
event set forth in the Participant's Award certificate, shall
revert to the Trust and shall not be returned to the Company. Such
forfeited Shares shall be available for future award to
Participants under the Plan.
Section 6. Investment Authority
(a) Trustee shall hold the Shares deposited in the Trust and
any dividends of Shares received by the Fund. All voting or other
rights associated with Shares held in the Fund shall be exercised
by Trustee or the person designated by Trustee, and shall in no
event be exercisable by or rest with Plan Participants or the
Company.
(b) Trustee shall reinvest any cash dividends on Shares as
Trustee deems appropriate.
Section 7. Disposition of Income
During the term of this Trust, all income received by the
Trust, net of expenses and taxes, shall be accumulated and
reinvested.
Section 8. Accounting by Trustee
Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions
required to be made, including such specific records as shall be
agreed upon in writing between Company and Trustee. Within 60 days
following the close of each calendar year and within 60 days after
the removal or resignation of Trustee, Trustee shall deliver to
Company a written account of its administration of the Trust during
such year or during the period from the close of the last preceding
year to the date of such removal or resignation, setting forth all
investments, receipts, disbursements and other transactions
effected by it, including a description of all securities and
investments purchased and sold with the cost or net proceeds of
such purchases or sales (accrued interest paid or receivable being
shown separately), and showing all cash, securities and other
property held in the trust at the end of such year or as of the
date of such removal or resignation, as the case may be.
Section 9. Responsibility of Trustee
(a) Trustee shall act with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent
person acting in like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and with
like aims, provided, however, that Trustee shall incur no liability
to any person for any action taken pursuant to a direction, request
or approval given by Company which is contemplated by, and in
conformity with, the terms of the Plan or this Trust and is given
in writing by Company. In the event of a dispute between Company
and a party, Trustee may apply to a court of competent jurisdiction
to resolve the dispute.
(b) If Trustee undertakes or defends any litigation arising
in connection with this Trust, Company agrees to indemnify Trustee
against Trustee's costs, expenses and liabilities (including,
without limitation, attorneys' fees and expenses) relating thereto
and to be primarily liable for such distributions. If Company does
not pay such costs, expenses and liabilities in a reasonably timely
manner, Trustee may obtain payment from the Trust, including
without limitation by disposing of any Shares in the Trust not
awarded to Participants.
(c) Trustee may consult with legal counsel (who may also be
counsel for Company generally) with respect to any of its duties or
obligations hereunder.
(d) Trustee may hire agents, accountants, actuaries,
investment advisors, financial consultants or other professionals
to assist it in performing any of its duties or obligations
hereunder.
(e) Trustee shall have, without exclusion, all powers
conferred on Trustees by applicable law, unless expressly provided
otherwise herein.
(f) Notwithstanding any powers granted to Trustee pursuant to
this Trust Agreement or to applicable law, Trustee shall not have
any power that could give this Trust the objective of carrying on
a business and dividing the gains therefrom, within the meaning of
section 301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.
Section 10. Compensation of Trustee
Company shall pay all administrative and Trustee's fees and
expenses. If not so paid, the fees and expenses shall be paid from
the Trust.
Section 11. Resignation and Removal of Trustee
(a) Trustee may resign at any time by written notice to
Company, which shall be effective 30 days after receipt of such
notice unless Company and Trustee agree otherwise.
(b) Trustee may be removed by the affirmative vote of
majority of the Board of Directors on 30 days notice or upon,
shorter notice accepted by Trustee.
(c) Upon a Change of Control, Trustee may not be removed by
Company for eighteen months.
(d) Upon resignation or removal of Trustee and appointment of
a successor Trustee, all assets shall subsequently be transferred
to the successor Trustee. The transfer shall be completed within
30 days after receipt of notice of resignation, removal or transfer
unless Company extends the time limit.
(e) If Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 12 hereof, by the effective
date of resignation or removal under paragraph(s) (a) or (b) of
this section. If no such appointment has been made, Trustee may
apply to a court of competent jurisdiction for appointment of a
successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative
expenses of the Trust.
Section 12.
Appointment of Successor
(a) If Trustee resigns [or is removed] in accordance with
Section 11(a) or (b) hereof, the Board of Directors may appoint any
third party, such as a bank trust department or other party that
may be granted corporate trustee powers under state law, or an
individual permitted to serve as trustee under state law, as a
successor to replace Trustee upon resignation or removal. The
appointment shall be effective when accepted in writing by the new
Trustee, who shall have all of the rights and powers of the former
Trustee, including ownership rights in the Trust Assets. The
former Trustee shall execute any instrument necessary or reasonably
requested by Company or the successor Trustee to evidence the
transfer.
(b) The successor Trustee need not examine the records and
acts of any prior Trustee and may retain or dispose of existing
Trust assets, subject to Sections 7 and 8 hereof. The successor
Trustee shall not be responsible for and Company shall indemnify
and defend the successor Trustee from any claim or liability
resulting from any action or inaction of any prior Trustee or from
any other past event, or any condition existing at the time it
becomes successor Trustee.
Section 13. Amendment
or Termination
(a) This Trust Agreement may be amended by a written
instrument executed by Trustee and Company, provided that no such
amendment shall conflict with the terms of the Plan or make the
Trust revocable.
(b) The Trust shall not terminate until the date on which
Plan Participants are not longer entitled to benefits pursuant to
the terms of the Plan. Upon termination of the Trust any assets
remaining in the Trust shall be returned to Company.
(c) Upon written approval of Participants entitled to
distribution of benefits pursuant to the terms of the Plan, Company
may terminate this Trust prior to the time all benefit
distributions under the Plan have been made. All assets in the
Trust at termination shall be returned to Company.
Section 14. Miscellaneous
(a) Any provision of this Trust Agreement prohibited by law
shall be ineffective to the extent of any such prohibition, without
invalidating the remaining provisions hereof.
(b) Benefits payable to Plan Participants under this Trust
Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment,
garnishment, levy, execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed
in accordance with the laws of Delaware.
Section 15. Effective Date
The effective date of this Trust Agreement shall be March 4,
1997.
IN WITNESS WHEREOF, the Company has by its authorized officer
signed this agreement and affixed its seal and the Trustee has by
its appropriate officer signed this Agreement and fixed its seal on
and as of the day and year written below.
WITNESS NETLIVE COMMUNICATIONS, INC.
/s/ Xxxx Xxxxxxxx 3/5/97 By: /s/ Xxxxxxxx Xxxxx
Title: Chief Executive Officer
WITNESS
/s/ Xxxxx Xxxxxxx /s/ R. Xxxxxx Xxx
Trustee
