Exhibit 10(j)
LUBY'S CAFETERIAS, INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
PREAMBLE
The principal objective of this supplemental Executive Retirement Plan (SERP)
is to ensure the payment of a competitive level of retirement income in order
to attract, retain and motivate selected executives. The plan is designed to
provide benefits in excess of the limitations under Section 415 and certain
other provisions of the Internal Revenue Code (the "Code"). The effective
date of this plan is December 31, 1995.
SECTION I
DEFINITIONS
1.1 "Accrued Benefit" means a monthly benefit payable as a Life Annuity
equal to 50% of Final Average Compensation offset by (1) Primary Social
Security, (2) the Annuitized Value of the Profit Sharing Plan and (3) the
Annuitized Value of any Deferred Compensation Agreement divided by twelve.
The net benefit is prorated by Service less than 25 years.
1.2 "Actuarial Equivalent" means a benefit of equivalent value based on
the 1983 Group Annuity Mortality Table (50% Male - 50% Female) and 8.5% annual
rate of interest.
1.3 "Affiliate" means any corporation, partnership, joint venture, trust,
association or other business enterprise which is a member of a controlled
group of corporations or a member of an affiliated service group (as defined
in Section 414 of the Code) which includes the Employer.
1.4 "Annuitized Value of Deferred Compensation Agreement" means the
Participant's deferred compensation value multiplied by a 10-year installment
factor divided by an Actuarial Equivalent life annuity factor.
1.5 "Annuitized Value of Profit Sharing Plan" means the Participant's
account balance in the Profit Sharing Plan including cash surrender value at
date of termination or Retirement, increased at 8.5% interest to Retirement,
divided by an Actuarial Equivalent life annuity factor.
1.6 "Beneficiary" means the person(s) designated by the Participant who is
entitled to receive benefits upon the death of the Participant.
1.7 "Board of Directors" means the board of directors, the executive
committee or other body given management responsibility for the Employer.
1.8 "Committee" means the Compensation Committee appointed by the Board of
Directors of the Employer, which has been given authority by the Board of
Directors to administer this Plan.
1.9 "Compensation" means compensation (whether or not payment is deferred)
earned by a Participant and shall include the Participant's wages, salaries,
fees for professional service and other amounts for personal services actually
rendered in the course of employment with an Employer maintaining the Plan
(including, but not limited to, commissions paid salespersons, compensation for
service on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses). Compensation for this purpose does not include
reimbursement for expenses.
1.10 "Contingent Annuitant" means the Participant's spouse designated to
receive any payments due after the death of the Participant under the Joint
and Survivor Annuity forms of payment.
1.11 "Effective Date" means the effective date of the Plan, December 31,
1995.
1.12 "Employer" means Luby's Cafeterias, Inc.
1.13 "Final Average Compensation" means the average of the last five
calendar years of Compensation immediately prior to termination of employment.
1.14 "Joint and Survivor Annuity" means either the Joint and 50% Survivor
Annuity or the Joint and 100% Survivor Annuity described in Section III of
this Plan.
1.15 "Life Annuity" means an annuity payable for the life of the
Participant, with no monthly payments made thereafter.
1.16 "Participant" means an employee of the Employer who is an Officer or
Area Vice President who has been named by the Committee as eligible to
participate in this Plan.
1.17 "Plan" means Luby's Cafeterias, Inc. Supplemental Executive Retirement
Plan.
1.18 "Plan Year" means any twelve month period beginning on September 1st
and ending on the last day of August.
1.19 "Primary Social Security" means the actual Social Security Benefit
paid to the Participant at initial retirement.
1.20 "Profit Sharing Plan" means the Luby's Cafeterias, Inc. Profit Sharing
and Retirement Trust.
1.21 "Rabbi Trust" means the Trust under the Luby's Cafeterias, Inc.
Supplemental Executive Retirement Plan which may be established by the
Employer to provide itself with a source of funds to assist in the meeting of
its liabilities under the Plan.
1.22 "Retirement" means a Participant's actual retirement from the Employer
following his or her Normal, Early or Delayed Retirement Date.
1.23 "Service" means a Participant's total completed years and months of
employment whether or not continuous.
1.24 "Vesting" means ownership. A Participant's Accrued Benefit becomes
100% vested upon attainment of age 65. There is no vesting prior to age 65
unless approved by the Board of Directors.
SECTION II
ELIGIBILITY FOR BENEFITS
In accordance with the distribution provision contained in Section III of the
Plan, each Participant is eligible to receive an Accrued Benefit under this
Plan upon attainment of Normal Retirement Date, Delayed Retirement Date or
Early Retirement Date (as each is defined in this Section II).
2.2 "Normal Retirement Date" means the December 31 following the date the
Participant attains age 65 and completes five years of Service.
2.3 "Early Retirement Date" means, at the discretion of the Board, the
first day of the month on or after the Participant attains age 55, or any
subsequent month thereafter.
2.4 "Delayed Retirement Date" means the first day of the month on or after
the Participant's Normal Retirement Date and retirement from the Employer.
SECTION III
FORM OF RETIREMENT BENEFIT
3.1 By a Participant's 64th birthday, a Participant shall elect to have
his or her Accrued Benefit payable in the normal form of payment, a Life
Annuity as defined in Section 1.15, or under one of the optional forms of
payment as defined in Sections 3.6 or 3.7. The optional forms of payment
defined in Sections 3.4 and 3.5 will not automatically be available to
Participants but will be offered at the discretion of the Board of Directors.
All optional forms of payment are the Actuarial Equivalent of the Accrued
Benefit payable as a Life Annuity. All benefit payments will commence on the
first day of the month on or after the date the Participant is eligible to
receive payment. If an election is not made at least one year prior to
commencement of benefit, a married Participant shall be deemed to have elected
a Joint and 50% Survivor Annuity and a Participant who is not married shall be
deemed to have elected a Life Annuity. However, Participants who are already
at age 64 or older as of the effective date of the Plan will be allowed to
make an election as soon as administratively feasible after Plan
implementation, but no later than August 1, 1996.
3.2 The monthly benefit payable at an Early Retirement Date will equal the
Actuarial Equivalent of the Accrued Benefit determined under Section 1.1 with
the Primary Social Security offset delayed until age 62.
3.3 The monthly benefit payable at a Delayed Retirement Date will be equal
to the Accrued Benefit determined under Section 1.1 based on the Participant's
Delayed Retirement Date.
3.4 "Five Years Certain Annuity" means a modified monthly income payable
for a five year period. In the event of the Participant's death within the
five year period following the date payments start, the same income will be
payable to the Participant's Beneficiary for the remainder of the five year
period.
3.5 "Ten Years Certain Annuity" means a modified monthly income payable
for a ten year period. In the event of the Participant's death within the ten
year period following the date payments start, the same income will be payable
to the Participant's Beneficiary for the remainder of the ten year period.
3.6 "Joint and 50% Survivor Annuity" means a modified monthly income
payable for the Participant's lifetime. At the Participant's death, 50% of
such amount is continue to the Participant's Contingent Annuitant for his or
her lifetime.
3.7 "Joint and 100% Survivor Annuity" means a modified monthly income
payable for the Participant's lifetime. At the Participant's death, 100% of
such amount is continued to the Participant's Contingent Annuitant for his or
her lifetime.
3.8 "Small Lump Sum Payment" means a single lump sum payment in lieu of
annuity payments. This option will be payable at the discretion of the Board
of Directors in cases where the amount of the monthly benefit otherwise
payable is less than $100.
SECTION IV
DEATH BENEFITS
4.1 If a Participant dies before attaining age 55, no death benefit shall
be payable under the Plan.
4.2 If a Participant dies after attaining age 55 but prior to his or her
Normal Retirement Date, at the discretion of the Board, the Participant's
surviving spouse may be paid the 50% survivor benefit that would have been
payable if the Participant had retired, elected a Joint and 50% Survivor
Annuity, and commenced payments on the first of the month immediately prior to
the date of death. If the Participant dies after his or her Normal Retirement
Date but before commencement of benefits, the Particpant's surviving spouse
will be paid the 50% survivor benefit under the Joint and 50% Survivor
Annuity commencing on the first day of the month following the date of the
Participant's death. There is no death benefit if the Participant is not
married and had not commenced benefit payments at the time of death.
4.3 If a Participant dies after commencement of benefits, the death
benefit, if any, is dependent on the form of payment elected.
SECTION V
ADMINISTRATION
5.1 The Committee will be appointed by the Board of Directors of the
Employer. Each Committee member will serve until his or her resignation or
removal. The Board of Directors of the Employer will have the sole discretion
to remove any one or more Committee members and appoint one or more replacement
or additional Committee members from time to time.
5.2 The Committee will select from among its members a chairman who will
preside at all of its meetings and will elect a secretary without regard to
whether that person is a member of the Committee. The secretary will keep all
records, documents and data pertaining to the Committee's supervision and
administration of the Plan. A majority of the members of the Committee will
constitute a quorum for the transaction of business and the vote of a majority
of the members present at any meeting will decide any questions brought before
the meeting. In addition, the Committee may decide any question by vote,
taken without a meeting, of a majority of its members. A member of the
Committee who is also a Participant will not vote or act on any matter
relating solely to himself.
5.3 The Committee will have the exclusive responsibility for the general
administration of the Plan according to the terms and provisions of the Plan
and will have all poers necessary to accomplish those purposes, including but
not by way of limitation the right, power and authority:
A. to make rules and regulations for the administration of the Plan
which are not inconsistent with its terms and provisions;
B. to construe all terms, provisions, conditions and limitations of the
Plan and its construction of the Plan made in good faith and without
discrimination in favor of or against any Participant will be final as to all
parties;
C. to determine whether a Change In Control has occurred;
D. to correct any defect, supply any omission or reconcile any
inconsistency that may appear in the Plan in the manner and to the extent it
deems expedient to carry the Plan into effect for the greatest benefit of all
parties at interest and its judgment in those matters will be final as to all
parties;
E. to determine all controversies relating to the administration of the
Plan, including but limited to:
(1) differences of opinion arising between the Employer and a
Participant except when the difference of opinion relates to the
entitlement to, the amount of, or the method or timing of a
benefit affected by a Change in Control, in which event, it
shall be decided by judicial action; and
(2) any question it deems advisable to determine in order to promote
the uniform administration of the Plan for the benefits of all
parties at interest; and
F. to delegate by written notice those clerical and recordation duties
of the Committee, as it deems necessary or advisable for the proper and
efficient administration of the Plan.
5.4 The Committee will be reimbursed by the Employer for all expenses
properly and actually incurred in the performance of their duties under
the Plan.
5.5 The Committee, in exercising any power or authority granted under
this Plan or in making any determination under this Plan shall perform or
refrain from performing those actions using its sole discretion and judgment.
Any decision made by the Committee or any refraining to act or any act taken
by the Committee in good faith shall be final and binding on all parties.
The Committee's decision shall never be subject to de novo review.
Notwithstanding the foregoing, the Committee's decisions, refraining
to act, or acting is to be subject to judicial review for those incidents
occurring during the Plan Year in which a Change In Control occurs and during
the Plan Year following a Change in Control.
SECTION VI
MISCELLANEOUS
6.1 The Board of Directors may, in its sole discretion, terminate, suspend
or amend this Plan at any time or from time to time, in whole or in part.
However, no amendment or suspension of the Plan will affect a Participant's
right or the right of a Beneficiary to the Accrued Benefit calculated as of
the date of termination or amendment unless with the written consent of the
Participant or the Beneficiary. Further, no amendment will affect a
Participant's rights under any provision relating to a Change In Control
after a Change In Control has previously occurred without his or her consent.
6.2 Nothing contained herein will confer upon any Participant the right
to be retained in the service of the Employer, nor will it interfere with the
right of the Employer to discharge or otherwise deal with Participants
without regard to the existence of this Plan, nor shall it give a Participant
or any person claiming through him any interest or right under this Plan
other than that of any unsecured general creditor of the Employer.
6.3 This Plan is unfunded, and the Employer will make Plan benefit
payments solely on a current disbursement basis. However, the Employer
may establish a Rabbi Trust to invest assets to be held by an independent
trustee. It is also specifically recognized by both the Employer and the
Participants that this Plan is only a general corporate commitment and
that each Participant must rely upon the general credit of the Employer
for the fulfillment of its obligations hereunder.
6.4 To the maximum extent permitted by law, no benefit under this Plan
shall be assignable or subject to any manner to alienation, sale, transfer,
claims of creditors, pledge, attachment, or encumbrances of any kind. If
any Participant, spouse, or Beneficiary becomes bankrupt or attempts to
alienate, anticipate, sell, assign, pledge, or encumber any right or benefit
under this Plan, that right or benefit will, in the discretion of the
Committee, cease.
6.5 The Committee may adopt rules and regulations to assist in the
administration of the Plan.
6.6 The Committee will furnish information to the Employer concerning
the amount and form of distribution to any Participant entitled to a
distribution so that the Employer may make or cause the Rabbi Trust
to make the distribution required. It will also calculate the deductions
from the amount of the benefit paid under the Plan for any taxes required
to be withheld by federal, state, or local government and will cause them
to be withheld.
6.7 Should a Participant become incompetent or should a Participant
designate a Beneficiary who is a minor or incompetent, the Committee is
authorized to pay the funds due to the parent of the minor or to the guardian
of the minor or incompetent or directly to the minor or to apply those
funds for the benefit of the minor or incompetent in any manner the
Committee determines in its sole discretion.
6.8 The Committee will not be liable for any decision or action taken in
good faith in connection with the administration of this Plan. Without
limiting the generality of the foregoing, any decision or action taken by
the Committee when it relies upon information supplied it by any officer
of the Employer, the Employer's legal counsel, the Employer's actuary, the
Employer's independent accountants or other advisors in connection with the
administration of this Plan will be deemed to have been taken in good faith.
6.9 If any term, provision, covenant, or condition of the Plan is held
to be invalid, void, or otherwise unenforceable, the rest of the Plan
will remain in full force and effect and will in no way be affected,
impaired, or invalidated.
6.10 Any notice or filing required or permitted to be given to the
Committee or a Participant will be sufficient if in writing and hand delivered
or sent by U.S. mail to the principal office of the Employer or to the
residential mailing address of the Participant. Notice will be deemed to
be given as of the date of hand delivery or if delivery is by mail,
as of the date shown on the postmark.
6.11 This Plan is established under and will be construed according to
the laws of the State of Texas.
6.12 Vesting in Accrued Benefits In Event of Change In Control or
Termination of the Plan.
A. Notwithstanding any other provisions of the Plan, in the event
of Change in Control (as hereinafter defined) or termination of the
Plan, the Accrued Benefit of all actively employed Participants
shall become fully vested.
B. For purposes of this Section 6.12, a Change In Control shall
occur if any one of the four following events occur:
(1) any "person," including a "syndication" or "group"
as those terms are used in Section 13(d)(3) of the Securities
Exchange Act of 1934, is or becomes the beneficial owner,
directly or indirectly, or securities of the Employer
representing 40% or more of the combined voting power of
the Employer's then outstanding voting securities;
(2) the Employer is merged or consolidated with another
corporation and immediately after giving effect to the merger
or consolidation less than 80% of the outstanding voting
securities of the surviving or resulting entity are then
beneficially owned in the aggregate by (i) the stockholders of
the Employer immediately prior to such merger or consolidation,
or (ii) if a record date has been set to determine the
stockholders of the Employer entitled to vote on such merger
or consolidation, the stockholders of the Employer as of such
record date;
(3) if at any time during a calendar year a majority of the
directors of the Employer are not persons who were directors at
the beginning of the calendar year (unless the lack of majority
is the result of the death of one or more directors);
(4) the Employer transfers substantially all of its assets to
another corporation which is a less than 80% owned subsidiary of
the Employer.
C. The provisions of this Section 6.12 may not be amended after the
date a Change In Control occurs without the written consent of a
majority in number of Participants and Beneficiaries. The Board of
Directors reserves the right to amend or eliminate this Section 6.12
prior to the date a Change In Control occurs.
D. In the event of a Change In Control, a contribution shall be made
to the Rabbi Trust to fully fund the Actuarial Equivalent value of
all Accrued Benefits.
EXECUTED this 30th day of May, 1996.
ATTEST: LUBY'S CAFETERIAS, INC.
DEBRA L. WAINSCOTT By: JOHN E. CURTIS, JR.
________________________________ _____________________________
Title: President
Exhibit 10(k)
LUBY'S CAFETERIAS, INC.
WELFARE BENEFIT PLAN TRUST
This Agreement made and entered into by and between Luby's Cafeterias,
Inc., a corporation, and John E. Curtis, Jr., an individual, as trustee.
W I T N E S S E T H:
WHEREAS, Luby's Cafeterias, Inc. (hereinafter sometimes referred to as
the "Company") has previously adopted an employee welfare benefit plan known
as the Luby's Cafeterias, Inc. Welfare Benefit Plan which provides group
medical benefits for the exclusive benefit of its eligible employees and the
eligible dependents thereof (hereinafter referred to as the "Plan"); and
WHEREAS, the Company desires to establish the trust embodied herein and
to designate it as a part of the Luby's Cafeterias, Inc. Welfare Benefit
Plan, so as to comply with applicable provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA");
NOW, THEREFORE, in consideration of the mutual undertakings of each of
the parties hereto, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used herein the words and phrases next below set out shall have the
meaning next below attributed to them unless the context in which such word
or phrase appears reasonably requires a broader, narrower or different
meaning.
1.1. "Company" shall mean Luby's Cafeterias, Inc. Welfare Benefit
Plan or any successor thereof which shall adopt and continue the Plan and
Trust.
1.2. "Contract" or "Contracts" shall mean all insurance contracts in
place under the Plan from time to time.
1.3. "Effective Date" shall mean the effective date of this Trust,
which date shall be July 18, 1996.
1.4. "Employer" shall mean the Company and any other entity which is
a member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) or which is a trade or business (whether or not
incorporated) which is under common control (within the meaning of
Section 414(c) of the Code).
1.5. "ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended from time to time.
1.6. "Member" shall mean any individual who meets the eligibility
requirements set forth in the Plan, as it may be amended from time to time.
1.7. "Plan" shall mean Luby's Cafeterias, Inc. Welfare Benefit Plan,
as amended from time to time, which shall be set forth in a separate Plan
document, but is incorporated herein for all purposes.
1.8. "Plan Administrator" shall mean the Company, unless another
entity or person is appointed by the Company to administer the Plan pursuant
to the terms of the Plan.
1.9. "Trust" or "Trust Fund" shall mean all cash, fixed income
investments, money market instruments and other properties actually held by
the Trustee pursuant to the provisions of this agreement.
1.10. "Trustee" shall mean the qualified and acting Trustee under this
agreement whether it be one or several individuals or a corporate institution
or any successor Trustee appointed by the Board of Directors of the Company
in accordance with applicable provisions of this Trust agreement.
1.11. "Trust Year" shall mean initially the year beginning on the
Effective Date and ending August 31, 1996. Thereafter, the Trust Year shall
commence on September 1 and end on the following August 31 of the following
calendar year. Unless otherwise provided in the Plan, the Plan year shall
correspond with the Trust Year.
ARTICLE II
ESTABLISHMENT OF TRUST
2.1. A Trust is hereby established by the Company and the Trustee for
the sole purpose of creating a fund to provide for the payment of medical,
and other related benefits to Members (and their dependents who are eligible
to receive benefits under the Plan).
ARTICLE III
ADOPTION BY EMPLOYERS
3.1. Any business organization which is a member of the Company's
controlled group of corporations or is under common control (as defined in
Section 1.4 hereof) and which obtains the consent and approval of the Board
of Directors of the Company and which by a resolution of its Board of
Directors (or equivalent governing authority) elects to participate herein
and make contributions hereto shall be deemed to have adopted the Plan and
this Trust agreement and agreed to be bound by all the terms, provisions,
conditions and limitations of the Plan and this Trust agreement, a copy of
which resolution shall be certified and deposited with the Trustee.
3.2. Neither the adoption of this Trust agreement by any such
Employer nor any act performed by it in relation to this Trust shall ever
create a joint venture or partnership relationship between it and any other
Employer.
ARTICLE IV
CONTRIBUTIONS
4.1. At such time or times and in such manner as shall be determined
by the Plan Administrator, each Employer shall contribute in cash to the
Trust such sums as it receives from time to time as refunds from any premium
stabilization reserves under any Contracts.
ARTICLE V
DIVISION OF RESPONSIBILITY
5.1. The Trustee shall be a fiduciary with respect to the Trust and
except as otherwise provided herein shall have the exclusive responsibility
for the Trust Fund and all the powers necessary to receive, hold, preserve,
manage, invest and reinvest the Trust Fund as provided generally in this
Trust agreement and to pay all costs and expenses incident thereto. The
Trustee shall be responsible only for such sums actually received by it as
Trustee and shall not be responsible for collecting any contributions from
any Employer.
5.2. The Plan Administrator shall be charged with the administration
of the Plan and shall decide, subject to the terms of the Plan, all questions
pertaining to its administration, interpretation and application. In this
regard it is contemplated that the Plan Administrator may delegate portions
of its ministerial functions to a third-party administrator provided that any
such arrangement shall comply with the applicable provisions of Part 4 of
Subtitle B of Title I of ERISA and further provided that the Plan
Administrator shall always retain the ultimate control of and the
responsibility for the administration of the Plan. The Trustee shall not be
responsible for or in any way concerned with the administration of the Plan.
5.3. Any investment manager employed by the Plan Administrator is
hereby expressly given the power to direct the Trustee with respect to the
management, investment and reinvestment of the Trust Fund. If at any time
and from time to time, any such investment manager, as a co-fiduciary,
exercises its power (given under the Plan and this Trust) by written notice
to the Trustee, to direct the Trustee in the management, investment and
reinvestment of the Trust Fund, the Trustee shall be subject to all proper
written directions of such investment manager provided that such direction(s)
are made in accordance with the terms of this agreement and ERISA.
ARTICLE VI
THE POWERS, DUTIES AND RESPONSIBILITIES
OF THE TRUSTEE
6.1. The Trustee is authorized and empowered to invest or reinvest
only in fixed income investments in the form of marketable debt issues with
remaining maturities of not more than five years. These would include but
not be limited to U.S. government and agency obligations, overnight and term
repurchase agreements, bankers acceptances, tax exempt instruments issued by
states, municipalities or similar agencies, or Euro dollar certificates of
deposit. Specifically precluded are investments in letter stock, short sale
contracts, investments in foreign companies not traded on principal
exchanges, commodities, foreign currencies and/or equity securities. When
investing in money market instruments, those instruments should be rated "A-
1" (as rated by Standard & Poor's) or "P-1" (as rated by Moody's) as defined
by recognized rating services or the equivalent for negotiable certificates
of deposit of the thirty largest banks in the United States, as measured by
assets. Money market fund investments should be invested in one of the
following categories: (i) primarily invested in government securities, (ii)
P-1 commercial paper or (iii) negotiable certificates of deposits of the
thirty largest banks in the United States.
Whenever the Trustee receives funds to be invested or determines that
assets in the Trust Fund should be sold and the proceeds held for a period of
time pending reinvestment or other purpose, such funds may be held uninvested
in cash or invested in short term investments such as certificates of deposit
with the Trustee, U. S. Treasury bills, savings accounts with the Trustee
commercial paper or other similar assets which may be offered by the Trustee
and as may be determined by the Trustee in its sole discretion, which assets
shall remain a part of the Trust Fund.
6.2. The Trustee shall have the following powers relating to the
receipt, preservation, management, investment and reinvestment of both
principal and income of this Trust, as it may be composed from time to time
in addition to all of the powers granted the Trustee under common law and the
laws of the state of the situs of the Trust and all other applicable
statutes:
(a) To handle, deal with and dispose of the property and
estate of the Trust Fund as if it were the simple fee owner of such
property and estate;
(b) To keep any and all property in the name of some other
person, partnership or corporation with a power of attorney for
transfer attached, or in its name without disclosing its fiduciary
capacity;
(c) To collect the principal and income of the Trust Fund as
the same may become due and payable and to give binding receipt
therefor;
(d) To take any action, whether by legal proceeding,
compromise, or otherwise, as the Trustee in its sole discretion deems
to be in the best interest of the Trust if there is a default in the
payment of any principal or income of the Trust at any time; and
(e) To invest, sell and reinvest the Trust assets in such
assets as it shall select within the permitted limits described in
Section 6.1.
The Trustee shall not be required to take any legal action to collect,
preserve or maintain any Trust property unless it has been indemnified either
by the Trust itself, with the approval of the Plan Administrator, or by the
Employer with respect to any expenses or losses to which it may be subjected
by taking such action. Any property acquired by the Trustee through the
enforcement or compromise of any claim or claims it has as Trustee of this
Trust will become a part of the Trust Fund.
6.3. The Trustee in discharging its duties with respect to the
management, investment and reinvestment of the Trust Fund shall do so solely
in the interest of the Members (and their eligible dependents), using the
care, skill, prudence and diligence under the circumstances then prevailing
that a prudent man acting in a like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character; shall
diversify the investments of the Trust so as to minimize the risk of large
losses unless under the circumstances it is clearly prudent not to do so; and
shall otherwise act in accordance with the provisions of this Trust agreement
and ERISA.
6.4. The Trustee shall have the following powers relating to payments
and distributions to be made from the Trust Fund:
(a) Upon direction of the Plan Administrator, to convey,
assign and deliver, upon full termination of the Plan and Trust, to
such persons as then shall be entitled thereto under the Plan and
Trust, the Trust Fund, or the net cash proceeds of the Trust Fund after
conversion of non cash assets into cash;
(b) To pay out of the Trust Fund the following: amounts due
and payable on any advance made by the Trustee or on any loan made by
anyone to the Trust Fund, and all taxes of any nature levied, assessed
or imposed upon the Trust Fund, reasonable expenses of the Trustee,
including counsel fees, and the Trustee's compensation as provided
herein;
(c) To make distributions out of the Trust Fund only to the
person or persons as directed by the Plan Administrator or any agent
appointed by the Plan Administrator. If such person or persons cannot
be found or the correct distributee cannot be ascertained, to hold such
payment or deposit same in a bank, including the Trustee, for the
credit of said person or persons without liability for interest
thereon. If any check or draft in payment of the benefit hereunder,
which has been mailed by regular U.S. mail to the last address of the
payee furnished the Trustee by the Plan Administrator is returned
unclaimed, the Trustee shall notify the Plan Administrator and shall
discontinue further payment efforts until it receives instructions from
the Plan Administrator. The Trustee shall not be required to make any
investigation to determine the whereabouts or mailing address of any
such person or persons. The Trustee may make payment of any benefit
hereunder by mailing its check or draft for the amount thereof to the
person certified to the Trustee by the Plan Administrator as the person
to whom such payment is to be made; and
6.5. All persons dealing with the Trustee are entitled to rely upon
the representations of the Trustee as to its authority and are released from
any duty to inquire into its authority for taking or omitting any action or
to verify that any money paid or other property delivered to the Trustee is
used by the Trustee for Trust purposes. Any action of the Trustee under this
Trust shall be conclusive evidence of the facts recited in it. All persons
shall be fully protected when acting or relying upon any notice, resolution,
instruction, direction, order, certificate, opinion, letter, telegram or
other document believed by such persons to be genuine, to have been signed by
the Trustee, and to be the act of the Trustee.
6.6. The Trustee may engage and consult with legal counsel of its
choice, who may be counsel for any Employer or Trustee's own general counsel,
with respect to the meaning or construction of the Plan, this Trust agreement
or the Trustee's obligations or duties hereunder.
6.7. The Trustee shall not be required to give bond or other security
for the faithful performance of its duties unless required by law which
cannot be waived; and the Trustee shall not be required to make any
inventory, return, or report of any kind to any court unless required by law
which cannot be waived.
ARTICLE VII
NOTICES AND DIRECTIONS
7.1. The Trustee shall not be bound by any certificate, notice,
resolution, consent, order, information or other communication unless and
until it shall have been received in writing at a location which is mutually
agreeable to the parties hereto.
7.2. The Trustee may accept as evidence of the authority of (i) any
persons acting as members of the Plan Administrator or (ii) the proper
representative(s) of the investment manager, if one is appointed, a copy of
a resolution of the Board of Directors of the Company as certified by the
Secretary or an Assistant Secretary together with a specimen signature of the
Plan Administrator members and/or the proper representative(s) of the
investment manager, if one is appointed, and shall be entitled to recognize
them as such and act upon the instructions, directions, consents, and
requests of the members of the Plan Administrator and/or the proper
representative(s) of any appointed investment manager last certified to it.
The Trustee may continue to act in accordance with any such notice until the
receipt by it of notice rescinding or superseding such action or resolution.
7.3. Instructions, directions or notices of the Plan Administrator
to the Trustee, certified to by any one or more members thereof shall be
accepted as conclusive evidence of the proper issuance and contents thereof.
7.4. The Trustee, in all matters pertaining to its management,
investment and distribution of this Trust, when it acts in good faith, may
rely upon any such notice, resolution, instruction, direction, order,
certificate, opinion, letter, telegram or other document believed by the
Trustee to be genuine, to have been signed by a proper representative of the
Plan Administrator (or the investment manager, if one is appointed) and to be
the act of the Plan Administrator or the investment manager, as the case may
be. It shall accept any certificate or other instrument duly signed by a
proper representative of the Plan Administrator or any duly appointed
investment manager which purports to evidence an instruction, direction, or
order of the Plan Administrator, or the investment manager, as the case may
be, as conclusive evidence thereof.
7.5. Notices or communications from the Trustee to the Plan
Administrator and/or any duly appointed investment manager shall be addressed
to such person or persons as shall have been certified to the Trustee by the
Plan Administrator and shall be sent to such person or persons at the
principal office of the Company unless the Trustee shall have been instructed
in writing to send such communications to another address.
ARTICLE VIII
TRUSTEE'S FEE AND EXPENSE
8.1. Any corporate Trustee hereunder shall receive fair and
reasonable compensation for services rendered in any amount not exceeding the
customary and prevailing charges for services of a similar character at the
time and at the place such services are performed. No individual Trustee
hereunder shall receive compensation for services rendered but, like any
corporate Trustee hereunder, shall be reimbursed for expenses properly and
actually incurred in the performance of its duties under the Plan and Trust.
The Trustee's compensation and the expenses of this Trust shall be paid by
the Employer unless an Employer elects to have the Trustee's compensation and
the expenses of the Trust paid out of its contribution to the Trust Fund.
Each Trust Year each Employer shall bear that portion of such compensation
and expense as the amount contributed to the Trust for such year on behalf of
Members employed by such Employer bears to the total amount contributed for
such year to the Trust on behalf of all Members employed by all participating
Employers.
ARTICLE IX
LIABILITY OF THE TRUSTEE
9.1. The Trustee shall not be liable to the Trust or to any person
having a beneficial interest in the Trust for any losses or decline in value
which may be incurred upon any investment of the Trust Fund, or for failure
of such Fund to produce any or greater earnings, interest, or profits, so
long as the Trustee acts in good faith and in accordance with the
responsibilities, obligations and duties placed on it under ERISA.
9.2. The Trustee shall not be liable for any act or omission by it
because of a direction of an investment manager appointed by the Plan
Administrator nor for any act or omission of the Plan Administrator, or an
investment manager appointed by the Plan Administrator or any other agent
appointed by the Plan Administrator except to the extent required by ERISA,
and any other applicable state or federal law, which liability cannot be
waived. When the Trustee has made any payment out of the Trust Fund in
accordance with the directions of the Plan Administrator or any agent
appointed by the Plan Administrator, it shall not be responsible for the
correctness of the amount of the payment to the recipient, or the method by
which it is paid. The Trustee shall also be protected in relying upon any
certificate, notice, resolution, consent, order, or other communication
purporting to have been signed on behalf of the Plan Administrator or an
investment manager appointed by the Plan Administrator which it believes to
be genuine, without any obligation on the part of the Trustee to ascertain
whether or not the provisions of the Plan are thereby being complied with.
9.3. The Trustee shall not be liable for any act or omission on its
own part except to the extent required by the terms of ERISA, and any other
state or federal law applicable, which liability cannot be waived.
9.4. The Trustee may, in its sole discretion withhold from
distribution all or any part of the Fund which the Trustee considers
necessary and proper for the payment of taxes under present or future laws,
which the Trustee is obligated to pay or withhold.
9.5. The Trustee shall not be liable for its failure or inability to
file any tax return or other report which it is unable to file because of the
failure of the Employer, after written demand by the Trustee, to furnish the
information necessary for the preparation thereof.
9.6. If at any time the Trustee is in doubt concerning the course
which it should follow in connection with any matter relating to the
administration of the Trust, it may request the Plan Administrator to advise
it with respect thereto and shall be protected in relying upon any written
advice or direction which may be given by the Plan Administrator in response
to such request.
9.7. Further, it is specifically provided that upon direction by the
Plan Administrator the Trustee may purchase out of the Trust Funds hereof
insurance for the Trustee and for the Trust Fund itself to cover liability
and losses occurring by reason of the act or omission of the Trustee provided
such insurance permits recourse by the insurer against the Trustee in the
case of a breach of fiduciary obligation by it.
ARTICLE X
SETTLEMENT OF THE ACCOUNTS
OF THE TRUSTEE
10.1. The Trustee shall keep such records as may be necessary in the
conduct of this Trust. The Trustee's books and records of the Trust Fund
shall be open to inspection by the Employer and the Plan Administrator at all
reasonable times during business hours of the Trustee.
10.2. All income, profits, recoveries, contributions, refunds, and any
and all monies, securities and properties of any kind at any time received or
held by the Trustee hereunder shall be held for investment purposes as a
commingled Trust Fund except as otherwise provided herein. Although separate
accounts or records may be maintained for operational and accounting
purposes, no such account or record shall be considered as segregating or
earmarking any specific assets of the Trust Fund from any other assets of the
commingled Trust Fund.
10.3. Within sixty (60) days after the close of each Trust Year and
such other times as requested in writing by the Plan Administrator and as of
the date of the removal or resignation of the Trustee, the Trustee shall
render to the Employer and the Plan Administrator an account and report of
the Trust Fund during such Trust Year or covering the period since the
previous account and report, whichever is applicable. The report shall
reflect the transactions for the period covered and shall reflect the cost of
assets and investments, and the fair market value thereof held in the Trust
as of the end of the Trust Year or such other date as is applicable. Said
report shall be open for inspection for ninety (90) days from date of receipt
by the Plan Administrator and Employer and if objections are not filed within
that period of time it shall be deemed to have been approved and shall
constitute a full and complete discharge and release to the Trustee from the
Employer and the Plan Administrator and all persons having or claiming any
interest in the Trust Fund.
ARTICLE XI
ACTION RESIGNATION, REMOVAL AND SUBSTITUTION
OF TRUSTEE
11.1. There shall be one (or more) individual(s) who serve(s) as
Trustee or one corporate Trustee, as determined from time to time by the
Board of Directors of the Company. When more than one individual serves as
Trustee, action by the individual trustees shall be determined by the
majority of the individual trustees. Such action shall be binding upon all
parties at interest. The individuals who collectively act as Trustee may act
by vote at a meeting or by writing without a meeting. Any act of the
individual or individuals serving as Trustee shall be sufficiently evidenced
if certified to by an individual Trustee, and, if there is more than one
individual serving as Trustee, one of the individual trustees may be given
authority to perform all administrative and ministerial duties. Any
individual who serves as Trustee hereunder shall be an employee of an
Employer. Each individual Trustee shall serve until a successor Trustee
shall be named by the Board of Directors of the Company or until his
resignation, death, incapacity or removal, in which event such Board of
Directors shall name a successor individual Trustee. An individual Trustee
otherwise eligible to participate in the Plan and Trust shall not be excluded
on the ground that he is an individual Trustee.
11.2. The Trustee or any successor Trustee may resign as Trustee
hereunder at any time by filing with the Company its written resignation. No
such resignation shall take effect until sixty (60) days from the date
thereof unless prior thereto a successor Trustee shall have been appointed
and accepted.
11.3. The Trustee or any successor Trustee may be removed by the
Company at any time. No such removal shall take effect until sixty (60) days
from the date that the notice in writing was delivered to the Trustee unless
prior thereto a successor Trustee shall have been appointed and accepted and
the Trustee consents to such earlier date.
11.4. Any vacancy in the office of Trustee created by the resignation
or removal of the Trustee shall not terminate the Trust. Upon removal or
resignation of the Trustee, the Board of Directors of the Company shall
appoint a successor Trustee.
11.5. The appointment of a successor Trustee hereunder shall be
accomplished by the delivery to the resigning or removed Trustee, as the case
may be, of an instrument in writing by the Company appointing such successor
Trustee, and its acceptance in writing of the appointment as successor
Trustee hereunder. Any successor Trustee hereunder shall be one or more
individuals who are employees of an Employer or a corporation authorized and
empowered to conduct a trust business in the state of the sinus of the Trust.
All of the provisions set forth herein with respect to the Trustee shall
relate to each successor Trustee.
11.6. Any successor Trustee, after acknowledging acceptance of this
Trust and accepting the Trust assets and the accounting of the retiring
Trustee, shall be vested with all the estates, titles, rights, powers,
duties, and discretions granted to the retiring Trustee. The retiring
Trustee shall execute and deliver all assignments or other instruments as may
be necessary or advisable in the discretion of the successor Trustee.
11.7. Any corporation into which any corporate Trustee or any
successor corporate Trustee may be merged or consolidated, or any corporation
resulting from any merger or consolidation to which any corporate Trustee or
any successor corporate Trustee may be a party, or any corporation to which
all or substantially all of the Trust business of any corporate Trustee or
any successor corporate Trustee may be transferred, shall be a successor of
such Trustee hereunder without the filing of any instrument or the
performance of any other act.
ARTICLE XII
AMENDMENT AND TERMINATION
12.1. Subject to the provisions of Article II, the Board of Directors
of the Company shall have the sole right (i) to amend the Plan and (ii) to
amend this Trust with the consent of the Trustee. Any amendment shall be
made by a certified copy of a resolution of the Board of Directors of the
Company setting forth the nature of the amendment and its effective date and,
in the event of an amendment of the Trust, a written consent of the Trustee.
In the event of an amendment, each other Employer will be deemed to have
consented to and adopted the amendment unless an Employer notifies the Plan
Administrator and the Trustee to the contrary in writing within thirty (30)
days after receipt of a copy of the amendment, in which case the rejection
will constitute a withdrawal from the Plan and this Trust by that Employer.
12.2. The Company shall make such amendments to this Trust as may be
necessary to maintain compliance with the various federal and state laws and
all such amendments may be made retroactively.
12.3. An Employer may withdraw from this Trust either by rejecting an
amendment to the Plan or this Trust or by giving written notice of its intent
to withdraw to the Company, the Plan Administrator and the Trustee. The Plan
Administrator will then determine, within sixty (60) days following the
receipt of the rejection or notice, the portion of the Trust Fund that is
attributable to the Members employed by the withdrawing Employer and shall
forward a copy of the determination to the Trustee. Upon receipt of the
determination, the Trustee will immediately segregate those assets
attributable to the Members employed by the withdrawing Employer and will
transfer those assets to the successor Trustee or Trustees when it receives
a designation of such successor from the withdrawing Employer.
The determination of the Plan Administrator, in its sole discretion, of
the portion of the Trust Fund that is attributable to the Members employed by
the withdrawing Employer will be final and binding upon all parties at
interest; and, the Trustee's transfer of those assets to the designated
successor Trustee shall relieve the Trustee of any further obligation,
liability or duty to the withdrawing Employer, the Members employed by that
Employer and the successor Trustee or Trustees.
12.4. Any Employer may terminate this Trust with respect to itself by
executing and delivering to the Trustee a notice of termination which
specifies the date on which the Plan and Trust shall terminate. Likewise,
this Trust will automatically terminate with respect to any Employer upon the
adjudication of that Employer as a bankrupt, the general assignment by that
Employer to or for the benefit of its creditors, or the dissolution of that
Employer without a successor. Upon the termination of this Trust by any
Employer, the Trustee shall thereupon use and apply the Trust Fund for the
payment of all obligations of the Trust which are incurred on behalf of the
terminating Employer. Except as otherwise provided herein, remaining funds
shall be used and applied by the Trustee, as directed by the Plan
Administrator, to provide additional benefits of the kind and type described
in Article II hereof to the Members then participating hereunder or for such
other similar or related purposes.
The termination of this Trust as to any one or more Employers will not
constitute a termination of this Trust with respect to the other remaining
Employers.
12.5. This Trust will not automatically terminate with respect to an
Employer in the event it consolidates, merges, and is not the surviving
corporation, sells substantially all of its assets, is a party to a
reorganization and its Employees and substantially all of its assets are
transferred to another entity, liquidates or dissolves if there is a
successor corporation which is a member of the Company's controlled group of
corporations, or under common control (as set forth in Section 1.4 herein).
Instead, such resulting successor corporation may continue this Trust by
adopting a resolution providing for the continuance of the Trust simultaneous
with or within one year after such consolidation, merger, sale,
reorganization, liquidation or dissolution. If, after the one year period
such successor corporation has not adopted this Trust, this Trust will then
automatically terminate with respect to such successor corporation on the
first day next following the one year period and the Trust will be handled as
provided above in Section 12.4.
ARTICLE XIII
MISCELLANEOUS
13.1. The adoption and maintenance of this Trust shall not be deemed
to be a contract between any Employer and its employees which gives any
employee the right to be retained in the employment of any Employer; to
interfere with the rights of any Employer to discharge any employee at any
time; or to interfere with the employee's right to terminate his employment
at any time.
13.2. No benefit payable or to become payable from this Trust will be
subject: to anticipation or assignment by any Member or other person
entitled to receive benefits under the Plan and Trust; to attachment by,
interference with, or control of any creditor of a Member or other person
entitled to receive benefits under the Plan and Trust; or to being taken or
reached by any legal or equitable process in satisfaction of any debt or
liability of a Member prior to its actual receipt by such Member. Any
attempted conveyance, transfer, assignment, mortgage, pledge, or encumbrance
is intended to take place or become effective before or after any
distribution of trust assets or the termination of this Trust Fund, itself.
And, the Trustee will never under any circumstances be required to recognize
any conveyance, transfer, assignment, mortgage, pledge or encumbrance by a
Member or other person entitled to receive benefits under the Plan and Trust
of the Trust Fund, any part of it, or any interest in it, or to pay any money
or thing of value to any creditor or assignee of a Member or other person
entitled to receive benefits under the Plan and Trust for any cause
whatsoever.
13.3. Whenever the context requires such, words of the masculine
gender used herein shall include the feminine and the neuter; and words used
in the singular shall include the plural.
13.4. The provisions of this Trust shall be construed, according to
the laws of the State of Texas. The Trustee or any Employer may at any time
initiate a legal action or proceeding for the settlement of the account of
the Trustee, or for the determination of any question or for instructions.
The only necessary parties to any such action or proceeding are the Trustee
and the Employer concerned; however, any other person or persons may be
included as parties defendant at the election of the Trustee and the
Employer.
13.5. Each provision of this Trust is severable and if any provision
is found to be void or against public policy, it shall not affect the
validity of any other provision hereof.
IN WITNESS WHEREOF, the Company and the Trustee have caused this Trust
agreement to be executed this 18th day of July, 1996.
Luby's Cafeterias, Inc.
By: JOHN E. CURTIS, JR.
________________________________________
Title: President
______________________________________
ATTEST:
SUSAN L. BEGGS
_____________________________________________________
Title: Assistant Secretary
______________________________________________
JOHN E. CURTIS, JR.
_______________________________________________
John E. Curtis, Jr.
TRUSTEE