10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2004

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 1-9810

Owens & Minor, Inc.

(Exact name of Registrant as specified in its charter)

Virginia	54-1701843
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4800 Cox Road, Glen Allen, Virginia	23060
(Address of principal executive offices)	(Zip Code)

Post Office Box 27626, Richmond, Virginia	23261-7626
(Mailing address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (804) 747-9794

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨

The number of shares of Owens & Minor, Inc.’s common stock outstanding as of October 31, 2004, was 39,425,348 shares.

Owens & Minor, Inc. and Subsidiaries

Index

			Page
Part I.	Financial Information
	Item 1.	Financial Statements Consolidated Statements of Income – Three Months and Nine Months Ended September 30, 2004 and 2003	3
		Consolidated Balance Sheets – September 30, 2004 and December 31, 2003	4
		Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2004 and 2003	5
		Notes to Consolidated Financial Statements	6
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20
	Item 4.	Controls and Procedures	20
Part II.	Other Information
.	Item 1.	Legal Proceedings	20
	Item 6.	Exhibits	20

2

Part I. Financial Information

Item 1. Financial Statements

Owens & Minor, Inc. and Subsidiaries

Consolidated Statements of Income

(unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2004			2003			2004			2003
Revenue	$	1,134,387		$	1,063,509		$	3,359,836		$	3,135,980
Cost of revenue		1,019,537			954,289			3,016,095			2,811,067
Gross margin		114,850			109,220			343,741			324,913
Selling, general and administrative expenses		84,480			80,868			253,030			237,113
Depreciation and amortization		3,676			3,868			11,197			11,801
Other operating income and expense, net		(903	)		(969	)		(3,175	)		(3,449	)
Operating earnings		27,597			25,453			82,689			79,448
Interest expense, net		3,086			4,142			9,375			11,153
Discount on accounts receivable securitization		—			199			261			581
Distributions on mandatorily redeemable preferred securities		—			—			—			2,898
Other expense		—			—			—			154
Income before income taxes		24,511			21,112			73,053			64,662
Income tax provision		9,314			8,277			27,906			25,348
Net income	$	15,197		$	12,835		$	45,147		$	39,314
Net income per common share-basic	$	0.39		$	0.37		$	1.16		$	1.16
Net income per common share-diluted	$	0.38		$	0.34		$	1.14		$	1.06
Cash dividends per common share	$	0.11		$	0.09		$	0.33		$	0.26

See accompanying notes to consolidated financial statements.

3

Owens & Minor, Inc. and Subsidiaries

Consolidated Balance Sheets

(unaudited)

(in thousands, except per share data)	September 30, 2004			December 31, 2003
Assets
Current assets
Cash and cash equivalents	$	102,342		$	16,335
Accounts and notes receivable, net of allowance of $7,570 and $8,350		327,433			353,431
Merchandise inventories		428,551			384,266
Other current assets		28,617			27,343
Total current assets		886,943			781,375
Property and equipment, net of accumulated depreciation of $70,990 and $74,056		22,196			21,088
Goodwill		198,960			198,063
Other assets, net		42,643			45,222
Total assets	$	1,150,742		$	1,045,748
Liabilities and shareholders’ equity
Current liabilities
Accounts payable	$	377,044		$	314,723
Accrued payroll and related liabilities		13,460			13,279
Other accrued liabilities		71,070			67,630
Total current liabilities		461,574			395,632
Long-term debt		208,307			209,499
Other liabilities		31,704			30,262
Total liabilities		701,585			635,393
Shareholders’ equity
Preferred stock, par value $100 per share; authorized - 10,000 shares Series A; Participating Cumulative Preferred Stock; none issued		—			—
Common stock, par value $2 per share; authorized - 200,000 shares; issued and outstanding – 39,416 shares and 38,979 shares		78,832			77,958
Paid-in capital		124,600			118,843
Retained earnings		252,639			220,468
Accumulated other comprehensive loss		(6,914	)		(6,914	)
Total shareholders’ equity		449,157			410,355
Total liabilities and shareholders’ equity	$	1,150,742		$	1,045,748

See accompanying notes to consolidated financial statements.

4

Owens & Minor, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(unaudited)

	Nine Months Ended September 30,
(in thousands)	2004			2003
Operating activities
Net income	$	45,147		$	39,314
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		11,197			11,801
Provision for LIFO reserve		3,150			3,280
Provision for losses on accounts and notes receivable		1,176			1,938
Changes in operating assets and liabilities:
Accounts and notes receivable		24,844			29,815
Merchandise inventories		(47,435	)		(38,801	)
Accounts payable		82,294			84,681
Net change in other current assets and liabilities		2,294			(8,111	)
Other, net		5,812			4,457
Cash provided by operating activities		128,479			128,374
Investing activities
Additions to property and equipment		(8,105	)		(4,273	)
Additions to computer software		(3,713	)		(8,008	)
Net cash paid for acquisition of business		(2,512	)		—
Proceeds from sale of land		1,820			—
Other, net		215			274
Cash used for investing activities		(12,295	)		(12,007	)
Financing activities
Repurchase of mandatorily redeemable preferred securities		—			(20,439	)
Repurchase of common stock		—			(10,884	)
Net payments on revolving credit facility		—			(27,900	)
Cash dividends paid		(12,976	)		(9,220	)
Proceeds from exercise of stock options		4,004			4,303
Decrease in drafts payable		(20,000	)		(26,150	)
Other, net		(1,205	)		—
Cash used for financing activities		(30,177	)		(90,290	)
Net increase in cash and cash equivalents		86,007			26,077
Cash and cash equivalents at beginning of period		16,335			3,361
Cash and cash equivalents at end of period	$	102,342		$	29,438

See accompanying notes to consolidated financial statements.

5

Owens & Minor, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(unaudited)

1. Accounting Policies

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (which are comprised only of normal recurring accruals and the use of estimates) necessary to present fairly the consolidated financial position of Owens & Minor, Inc. and its wholly-owned subsidiaries (O&M or the company) as of September 30, 2004 and the consolidated results of operations for the three and nine month periods and cash flows for the nine month periods ended September 30, 2004 and 2003, in conformity with U.S. generally accepted accounting principles.

2. Interim Results of Operations

The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year.

3. Reclassifications

Certain prior period amounts have been reclassified in order to conform to the current period presentation. The reclassifications have no effect on total revenue or net income as previously reported. The most significant reclassifications are as follows:

• Certain direct costs related to consulting and other service revenue are now included in cost of revenue. These costs were previously included in selling, general and administrative expense.

• Customer finance charge income is now included in other operating income and expense, net. This income was previously included in interest expense, net.

4. Acquisition

In March 2004, the company acquired certain net assets of 5nQ, a small, clinical inventory management solutions company. 5nQ developed an innovative software service, QSight^™, for clinical healthcare inventory management solutions. This strategic acquisition enables O&M to enhance the OMSolutions^SM technology and service offerings to hospitals and suppliers.

The acquisition has been accounted for as a purchase of a business and, accordingly, the operating results of 5nQ have been included in the company’s consolidated financial statements since the date of acquisition. The company paid $2.5 million in cash for the purchase, and will also make additional payments to the previous owners, who are now employed by O&M, based on the amount of QSight^™ subscription revenues through March 2007. The allocation of the purchase price included $1.5 million of computer software and $0.2 million of intangible assets, both included in “other assets, net” on the consolidated balance sheet, and $0.9 million of goodwill. Had the acquisition taken place on January 1, 2003, the consolidated revenue and net income of the company would not have materially differed from the amounts reported for the three months ended September 30, 2003 or the nine months ended September 30, 2004 and 2003.

5. Stock-based Compensation

The company uses the intrinsic value method as defined by Accounting Principles Board Opinion No. 25 to account for stock-based compensation. This method requires compensation expense to be recognized for the excess of the quoted market price of the stock at the grant date or the measurement date over the amount an employee must pay to acquire the stock. The following table presents the effect on net income and earnings per share had the company used the fair value

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method, as defined in Statement of Financial Accounting Standards No. (SFAS) 123, Accounting for Stock-Based Compensation, to account for stock-based compensation:

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2004			2003			2004			2003
Net income	$	15,197		$	12,835		$	45,147		$	39,314
Add: stock-based employee compensation expense included in reported net income, net of tax		197			150			609			476
Deduct: total stock-based employee compensation expense determined under fair value based method for all awards, net of tax		(486	)		(413	)		(1,515	)		(1,322	)
Pro forma net income	$	14,908		$	12,572		$	44,241		$	38,468
Per common share - basic:
Net income, as reported	$	0.39		$	0.37		$	1.16		$	1.16
Pro forma net income	$	0.38		$	0.36		$	1.13		$	1.13
Per common share - diluted:
Net income, as reported	$	0.38		$	0.34		$	1.14		$	1.06
Pro forma net income	$	0.38		$	0.33		$	1.11		$	1.04

6. Retirement Plans

In December 2003, the Financial Accounting Standards Board (FASB) revised Statement of Financial Accounting Standards No. (SFAS) 132, Employers’ Disclosures about Pensions and Other Postretirement Benefits. The revised statement requires disclosures in addition to those in the original SFAS 132 about the assets, obligations, cash flows, and net periodic benefit cost of defined benefit pension plans and other defined benefit postretirement plans. Most of the additional disclosure requirements were effective for the company as of December 31, 2003, with the remaining requirements effective in 2004. The adoption of the revised statement did not affect the company’s financial condition or results of operations. The revised statement requires interim disclosures to be made about the components of net periodic pension cost of the company’s retirement plans. The components of net periodic pension cost of the company’s retirement plans for the three and nine months ended September 30, 2004 and 2003 are as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2004			2003			2004			2003
Service cost	$	256		$	282		$	766		$	635
Interest cost		723			719			2,249			2,162
Expected return on plan assets		(435	)		(394	)		(1,301	)		(1,094	)
Amortization of prior service cost		8			71			149			212
Recognized net actuarial loss		227			196			661			544
Net periodic pension cost	$	779		$	874		$	2,524		$	2,459

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7. Comprehensive Income

The company’s comprehensive income for the three and nine months ended September 30, 2004 and 2003 is shown in the table below:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2004		2003		2004		2003
Net income	$	15,197	$	12,835	$	45,147	$	39,314
Other comprehensive income – change in unrealized gain on investment, net of tax		—		42		—		29
Comprehensive income	$	15,197	$	12,877	$	45,147	$	39,343

8. Net Income per Common Share

The following sets forth the computation of basic and diluted net income per common share:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share data)	2004		2003		2004		2003
Numerator:
Numerator for basic net income per common share – net income	$	15,197	$	12,835	$	45,147	$	39,314
Distributions on convertible mandatorily redeemable preferred securities, net of income taxes		—		595		—		2,362
Numerator for diluted net income per common share – net income attributable to common stock after assumed conversions	$	15,197	$	13,430	$	45,147	$	41,676
Denominator:
Denominator for basic net income per common share – weighted average shares		39,083		35,128		38,986		34,021
Effect of dilutive securities:
Conversion of mandatorily redeemable preferred securities		—		3,498		—		4,703
Stock options and restricted stock		599		725		622		597
Denominator for diluted net income per common share – adjusted weighted average shares and assumed conversions		39,682		39,351		39,608		39,321
Net income per common share – basic	$	0.39	$	0.37	$	1.16	$	1.16
Net income per common share – diluted	$	0.38	$	0.34	$	1.14	$	1.06

9. Contingency

In September 2004, the company received a notice from the Internal Revenue Service (IRS) proposing to disallow, effective for the 2001 tax year, the reduction in the company’s last-in first-out (LIFO) inventory for certain manufacturer discounts earned by the company and instead require the inclusion of the discounts in income. Since the proposed disallowance involves the timing of deductions, it primarily affects the company’s liability for interest. Management believes that its treatment of the discounts is consistent with a ruling received by the company on this matter from the IRS and is appropriate under the tax law. Accordingly, the company plans to contest the proposed disallowance pursuant to all applicable administrative and legal procedures. If the company were unsuccessful, the deductions would be disallowed effective for the 2001 tax year, and the company would have to pay a deficiency of $32.3 million in taxes on which deferred taxes have been provided, as well as interest calculated at statutory rates, for which no reserve has been established. The payment of the deficiency and interest would adversely affect operating cash flow for the full amount of the payment, while the company’s net income and earnings per share would be reduced by the

8

amount of any liability for interest, net of tax. The ultimate resolution of this matter may take several years and a determination adverse to the company could have a material effect on the company’s results of operations.

10. Recently Adopted Accounting Pronouncements

In December 2003, the FASB issued FASB Interpretation No. (FIN) 46R (revised December 2003), Consolidation of Variable Interest Entities, which addresses how a business enterprise should evaluate whether it has a controlling financial interest in an entity through means other than voting rights and accordingly should consolidate the entity. FIN 46R replaces FASB Interpretation No. 46, Consolidation of Variable Interest Entities, which was issued in January 2003. The company was required to apply FIN 46R to interests in variable interest entities as of March 31, 2004. Application of this Interpretation did not affect the company’s financial condition or results of operations.

11. Condensed Consolidating Financial Information

The following tables present condensed consolidating financial information for: Owens & Minor, Inc.; on a combined basis, the guarantors of Owens & Minor, Inc.’s 8.5% Senior Subordinated 10-year Notes (the Notes); and the non-guarantor subsidiaries of the Notes. Separate financial statements of the guarantor subsidiaries are not presented because the guarantors are jointly, severally and unconditionally liable under the guarantees and the company believes the condensed consolidating financial information is more meaningful in understanding the financial position, results of operations and cash flows of the guarantor subsidiaries.

9

Condensed Consolidating Financial Information

(in thousands)

For the three months ended September 30, 2004	Owens & Minor, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries		Eliminations		Consolidated
Statements of Operations
Revenue	$	—		$	1,134,387		$	—	$	—	$	1,134,387
Cost of revenue		—			1,019,537			—		—		1,019,537
Gross margin		—			114,850			—		—		114,850
Selling, general and administrative expenses		43			84,437			—		—		84,480
Depreciation and amortization		—			3,676			—		—		3,676
Other operating income and expense, net		—			(903	)		—		—		(903	)
Operating earnings (loss)		(43	)		27,640			—		—		27,597
Interest (income) expense, net		(196	)		3,282			—		—		3,086
Income before income taxes		153			24,358			—		—		24,511
Income tax provision		57			9,257			—		—		9,314
Net income	$	96		$	15,101		$	—	$	—	$	15,197

For the three months ended September 30, 2003	Owens & Minor, Inc.			Guarantor Subsidiaries		Non-guarantor Subsidiaries			Eliminations		Consolidated
Statements of Operations
Revenue	$	—		$	1,063,509	$	—		$	—	$	1,063,509
Cost of revenue		—			954,289		—			—		954,289
Gross margin		—			109,220		—			—		109,220
Selling, general and administrative expenses		5			80,601		262			—		80,868
Depreciation and amortization		—			3,868		—			—		3,868
Other operating income and expense, net		—			8		(977	)		—		(969	)
Operating earnings (loss)		(5	)		24,743		715			—		25,453
Interest (income) expense, net		(853	)		4,153		842			—		4,142
Discount on accounts receivable securitization		—			5		194			—		199
Income (loss) before income taxes		848			20,585		(321	)		—		21,112
Income tax provision (benefit)		360			8,058		(141	)		—		8,277
Net income (loss)	$	488		$	12,527	$	(180	)	$	—	$	12,835

10

Condensed Consolidating Financial Information

(in thousands)

For the nine months ended September 30, 2004	Owens & Minor, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
Statements of Operations
Revenue	$	—		$	3,359,836		$	—		$	—		$	3,359,836
Cost of revenue		—			3,016,095			—			—			3,016,095
Gross margin		—			343,741			—			—			343,741
Selling, general and administrative expenses		500			252,407			123			—			253,030
Depreciation and amortization		—			11,197			—			—			11,197
Other operating income and expense, net		—			(1,473	)		(1,702	)		—			(3,175	)
Operating earnings (loss)		(500	)		81,610			1,579			—			82,689
Interest (income) expense, net		(1,320	)		9,859			836			—			9,375
Intercompany dividend income		—			(20,342	)		—			20,342			—
Discount on accounts receivable securitization		—			8			253			—			261
Income before income taxes		820			92,085			490			(20,342	)		73,053
Income tax provision		313			27,401			192			—			27,906
Net income	$	507		$	64,684		$	298		$	(20,342	)	$	45,147

For the nine months ended September 30, 2003	Owens & Minor, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations		Consolidated
Statements of Operations
Revenue	$	—		$	3,135,980		$	—		$	—	$	3,135,980
Cost of revenue		—			2,811,067			—			—		2,811,067
Gross margin		—			324,913			—			—		324,913
Selling, general and administrative expenses		5			236,113			995			—		237,113
Depreciation and amortization		—			11,801			—			—		11,801
Other operating income and expense, net		—			(75	)		(3,374	)		—		(3,449	)
Operating earnings (loss)		(5	)		77,074			2,379			—		79,448
Interest (income) expense, net		(7,094	)		20,063			(1,816	)		—		11,153
Discount on accounts receivable securitization		—			15			566			—		581
Distributions on mandatorily redeemable preferred securities		—			—			2,898			—		2,898
Other expense		154			—			—			—		154
Income before income taxes		6,935			56,996			731			—		64,662
Income tax provision		2,784			22,285			279			—		25,348
Net income	$	4,151		$	34,711		$	452		$	—	$	39,314

11

Condensed Consolidating Financial Information

(in thousands)

September 30, 2004	Owens & Minor, Inc.		Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
Balance Sheets
Assets
Current assets
Cash and cash equivalents	$	99,980	$	2,361		$	1		$	—		$	102,342
Accounts and notes receivable, net		—		327,433			—			—			327,433
Merchandise inventories		—		428,551			—			—			428,551
Intercompany advances, net		32,825		(32,681	)		(144	)		—			—
Other current assets		—		28,617			—			—			28,617
Total current assets		132,805		754,281			(143	)		—			886,943
Property and equipment, net		—		22,196			—			—			22,196
Goodwill		—		198,960			—			—			198,960
Intercompany investments		383,415		7,773			—			(391,188	)		—
Other assets, net		11,480		31,163			—			—			42,643
Total assets	$	527,700	$	1,014,373		$	(143	)	$	(391,188	)	$	1,150,742
Liabilities and shareholders’ equity
Current liabilities
Accounts payable	$	—	$	377,044		$	—		$	—		$	377,044
Accrued payroll and related liabilities		—		13,460			—			—			13,460
Other accrued liabilities		3,397		67,673			—			—			71,070
Total current liabilities		3,397		458,177			—			—			461,574
Long-term debt		208,140		167			—			—			208,307
Intercompany long-term debt		—		138,890			—			(138,890	)		—
Other liabilities		—		31,704			—			—			31,704
Total liabilities		211,537		628,938			—			(138,890	)		701,585
Shareholders’ equity
Common stock		78,832		—			1,500			(1,500	)		78,832
Paid-in capital		124,600		249,797			1,001			(250,798	)		124,600
Retained earnings (deficit)		112,731		142,552			(2,644	)		—			252,639
Accumulated other comprehensive loss		—		(6,914	)		—			—			(6,914	)
Total shareholders’ equity		316,163		385,435			(143	)		(252,298	)		449,157
Total liabilities and shareholders’ equity	$	527,700	$	1,014,373		$	(143	)	$	(391,188	)	$	1,150,742

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Condensed Consolidating Financial Information

(in thousands)

December 31, 2003	Owens & Minor, Inc.		Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
Balance Sheets
Assets
Current assets
Cash and cash equivalents	$	14,156	$	2,178		$	1		$	—		$	16,335
Accounts and notes receivable, net		—		5,985			347,446			—			353,431
Merchandise inventories		—		384,266			—			—			384,266
Intercompany advances, net		126,182		186,302			(312,484	)		—			—
Other current assets		18		27,325			—			—			27,343
Total current assets		140,356		606,056			34,963			—			781,375
Property and equipment, net		—		21,088			—			—			21,088
Goodwill		—		198,063			—			—			198,063
Intercompany investments		383,415		22,773			—			(406,188	)		—
Other assets, net		13,624		31,598			—			—			45,222
Total assets	$	537,395	$	879,578		$	34,963		$	(406,188	)	$	1,045,748
Liabilities and shareholders’ equity
Current liabilities
Accounts payable	$	—	$	314,723		$	—		$	—		$	314,723
Accrued payroll and related liabilities		—		13,279			—			—			13,279
Other accrued liabilities		6,030		61,538			62			—			67,630
Total current liabilities		6,030		389,540			62			—			395,632
Long-term debt		209,364		135			—			—			209,499
Intercompany long-term debt		—		138,890			—			(138,890	)		—
Other liabilities		—		30,262			—			—			30,262
Total liabilities		215,394		558,827			62			(138,890	)		635,393
Shareholders’ equity
Common stock		77,958		—			1,500			(1,500	)		77,958
Paid-in capital		118,843		249,797			16,001			(265,798	)		118,843
Retained earnings		125,200		77,868			17,400			—			220,468
Accumulated other comprehensive loss		—		(6,914	)		—			—			(6,914	)
Total shareholders’ equity		322,001		320,751			34,901			(267,298	)		410,355
Total liabilities and shareholders’ equity	$	537,395	$	879,578		$	34,963		$	(406,188	)	$	1,045,748

13

Condensed Consolidating Financial Information

(in thousands)

For the nine months ended September 30, 2004	Owens & Minor, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
Statements of Cash Flows
Operating activities
Net income	$	507		$	64,684		$	298		$	(20,342	)	$	45,147
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		—			11,197			—			—			11,197
Provision for LIFO reserve		—			3,150			—			—			3,150
Provision for losses on accounts and notes receivable		—			1,063			113			—			1,176
Noncash intercompany dividend income		—			(20,342	)		—			20,342			—
Changes in operating assets and liabilities:
Accounts and notes receivable		—			10,786			14,058			—			24,844
Merchandise inventories		—			(47,435	)		—			—			(47,435	)
Accounts payable		—			82,294			—			—			82,294
Net change in other current assets and liabilities		(2,615	)		4,971			(62	)		—			2,294
Other, net		3,136			2,676			—			—			5,812
Cash provided by operating activities		1,028			113,044			14,407			—			128,479
Investing activities
Additions to property and equipment		—			(8,105	)		—			—			(8,105	)
Additions to computer software		—			(3,713	)		—			—			(3,713	)
Net cash paid for acquisition of business		—			(2,512	)		—			—			(2,512	)
Proceeds from sale of land		—			1,820			—			—			1,820
Other, net		—			215			—			—			215
Cash used for investing activities		—			(12,295	)		—			—			(12,295	)
Financing activities
Change in intercompany advances		93,768			(79,361	)		(14,407	)		—			—
Cash dividends paid		(12,976	)		—			—			—			(12,976	)
Proceeds from exercise of stock options		4,004			—			—			—			4,004
Decrease in drafts payable		—			(20,000	)		—			—			(20,000	)
Other, net		—			(1,205	)		—			—			(1,205	)
Cash provided by (used for) financing activities		84,796			(100,566	)		(14,407	)		—			(30,177	)
Net increase in cash and cash equivalents		85,824			183			—			—			86,007
Cash and cash equivalents at beginning of period		14,156			2,178			1			—			16,335
Cash and cash equivalents at end of period	$	99,980		$	2,361		$	1		$	—		$	102,342

14

Condensed Consolidating Financial Information

(in thousands)

For the nine months ended September 30, 2003	Owens & Minor, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Eliminations			Consolidated
Statements of Cash Flows
Operating activities
Net income	$	4,151		$	34,711		$	452		$	—		$	39,314
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		—			11,801			—			—			11,801
Provision for LIFO reserve		—			3,280			—			—			3,280
Provision for losses on accounts and notes receivable		—			958			980			—			1,938
Changes in operating assets and liabilities:
Accounts and notes receivable		—			(537	)		30,352			—			29,815
Merchandise inventories		—			(38,801	)		—			—			(38,801	)
Accounts payable		—			84,681			—			—			84,681
Net change in other current assets and liabilities		(3,367	)		(4,128	)		(616	)		—			(8,111	)
Other, net		2,920			1,537			—			—			4,457
Cash provided by operating activities		3,704			93,502			31,168			—			128,374
Investing activities
Additions to property and equipment		—			(4,273	)		—			—			(4,273	)
Additions to computer software		—			(8,008	)		—			—			(8,008	)
Decrease in intercompany investment		4,083			—			—			(4,083	)		—
Proceeds from investment in intercompany debt		—			—			4,083			(4,083	)		—
Other, net		—			274			—			—			274
Cash provided by (used for) investing activities		4,083			(12,007	)		4,083			(8,166	)		(12,007	)
Financing activities
Repurchase of mandatorily redeemable preferred securities		(20,439	)		—			—			—			(20,439	)
Repurchase of common stock		(10,884	)		—			—			—			(10,884	)
Net payments on revolving credit facility		(27,900	)		—			—			—			(27,900	)
Change in intercompany advances		86,435			(55,267	)		(31,168	)		—			—
Payments on intercompany debt		(4,083	)		—			—			4,083			—
Decrease in intercompany investment		—			—			(4,083	)		4,083			—
Cash dividends paid		(9,220	)		—			—			—			(9,220	)
Proceeds from exercise of stock options		4,303			—			—			—			4,303
Decrease in drafts payable		—			(26,150	)		—			—			(26,150	)
Cash provided by (used for) financing activities		18,212			(81,417	)		(35,251	)		8,166			(90,290	)
Net increase in cash and cash equivalents		25,999			78			—			—			26,077
Cash and cash equivalents at beginning of period		1,244			2,116			1			—			3,361
Cash and cash equivalents at end of period	$	27,243		$	2,194		$	1		$	—		$	29,438

15

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis describes material changes in the financial condition of Owens & Minor, Inc. and its wholly-owned subsidiaries (O&M or the company) since December 31, 2003. Trends of a material nature are discussed to the extent known and considered relevant. This discussion should be read in conjunction with the consolidated financial statements, related notes thereto and management’s discussion and analysis of financial condition and results of operations included in the company’s 2003 Annual Report on Form 10-K for the year ended December 31, 2003.

Reclassifications

As a result of the growth of the OMSolutions^SM business and the increasing effect of customer finance charge income on interest expense in recent periods, the company made certain changes to the presentation of its income statement effective January 1, 2004, to provide more useful information to investors. These reclassifications have no effect on total revenue or net income as previously reported. The most significant reclassifications are as follows:

• Certain direct costs related to consulting and other service revenue are now included in cost of revenue. These costs were previously included in selling, general and administrative expense.

• Customer finance charge income is now included in other operating income and expense, net. This income was previously included in interest expense, net.

Financial information for all prior periods included in this report has been reclassified to conform to the current presentation.

Results of Operations

Third quarter and first nine months of 2004 compared with 2003

Overview. For the third quarter and first nine months of 2004, net income increased by 18% and 15% from the comparable periods of 2003. The increase in net income was driven by increased operating earnings, lower financing costs as a result of the repurchase and conversion of mandatorily redeemable preferred securities in 2003 and improved collections of accounts receivable, as well as a lower effective tax rate. Operating earnings increased by 8% from the third quarter of 2003 to the third quarter of 2004, while for the first nine months of the year, operating earnings increased by 4% over the prior year period. Operating earnings increased as a result of revenue growth as well as lower employee benefit costs, partially offset by lower gross margins and increased spending on strategic initiatives.

Revenue. For the third quarter and first nine months of 2004, revenue increased 7% over the comparable prior year periods. This revenue increase resulted from new core distribution business, including HealthTrust Purchasing Group, and increased sales to existing customers.

16

Operating earnings. As a percentage of revenue, operating earnings were consistent with the prior year periods, at 2.4% for the third quarters of 2004 and 2003, and 2.5% for the first nine months of 2004 and 2003. The following table presents the components of operating earnings as a percent of revenue for the third quarter and first nine months of 2004 and 2003:

	Three months ended September 30,				Nine months ended September 30,
	2004		2003		2004		2003
Gross margin	10.1	%	10.3	%	10.2	%	10.4	%
SG&A expense	7.4	%	7.6	%	7.5	%	7.6	%
Depreciation and amortization	0.3	%	0.4	%	0.3	%	0.4	%
Other operating income and expense, net	(0.1	)%	(0.1	)%	(0.1	)%	(0.1	)%
Operating earnings	2.4	%	2.4	%	2.5	%	2.5	%

Percentages may not foot due to rounding

The decrease in gross margin from 2003 to 2004 resulted primarily from reduced alternate sourcing of products and ongoing competitive pricing pressure.

Competitive pricing pressure has been a significant factor in recent years, and management expects this trend to continue. In addition, as suppliers continue to seek more restrictive agreements with distributors, the company has access to fewer special inventory buying opportunities than in the past. The company is working to counteract the effects of these trends by continuing to offer customers a wide range of value-added services, such as OMSolutions^SM, PANDAC^® and other programs, as well as expanding the MediChoice^® private label product line. The company also continues to work with suppliers on programs to enhance gross margin.

SG&A expenses were 7.4% of revenue for the third quarter and 7.5% for the first nine months of 2004, down from 7.6% in the comparable periods of 2003. The company benefited from decreases in employee benefit costs, particularly healthcare coverage, as the company experienced an unusual number of large claims under its self-insured plan in the first nine months of 2003. In addition, depreciation and amortization decreased from 2003 to 2004 by $0.2 million for the third quarter and $0.6 million for the first nine months as the company has migrated some of its information technology (IT) applications from its own hardware to equipment provided under the IT outsourcing agreement that the company entered into in 2002.

The company continued to invest in its strategic initiatives, such as OMSolutions^SM and Owens & Minor University, at a higher rate than in the prior year. The company expects to continue to invest in its strategic initiatives while also focusing on operational standardization in order to further improve productivity. Additionally, OMSolutions^SM expenses exceeded revenue for the third quarter and first nine months of 2004, and management no longer expects it to become accretive by the end of the year. However, the company remains focused on growing the OMSolutions^SM business both internally and through acquisitions, and in October 2004, acquired the assets of HealthCare Logistics Services, a small, California-based, healthcare consulting firm. The company expects this acquisition to add strength to its OMSolutions^SM consulting and outsourcing efforts across the nation.

17

Financing costs. Financing costs, which include interest expense, discount on accounts receivable securitization and distributions on mandatorily redeemable preferred securities, totaled $3.1 million and $9.6 million for the third quarter and first nine months of 2004, compared with $4.3 million and $14.6 million for the same periods of 2003. The decrease in financing costs from 2003 resulted primarily from reductions in outstanding financing, most significantly the repurchase of $20.8 million and conversion of $104.4 million of mandatorily redeemable preferred securities in 2003. Financing costs were also favorably affected by interest income from increased cash and cash equivalents resulting principally from improved collections of accounts receivable and timing of payments for inventory purchases.

The company expects to continue to manage its financing costs by managing working capital levels. Future financing costs will be affected primarily by changes in short-term interest rates, as well as working capital and capital expenditure requirements.

Income taxes. The provision for income taxes was $9.3 million and $27.9 million in the third quarter and first nine months of 2004 compared with $8.3 million and $25.3 million in the same periods of 2003. The effective tax rate was 38.0% and 38.2% for the third quarter and first nine months of 2004, compared to 38.9% for the full year of 2003. The tax provision for the third quarter and first nine months of 2004 includes an adjustment of the company’s reserve for tax liabilities for years subject to audit as the company was better able to estimate its ultimate liability for those years.

Financial Condition, Liquidity and Capital Resources

Liquidity. The company’s liquidity remained strong in the first nine months of 2004, as its cash and cash equivalents increased $86.0 million to $102.3 million at September 30, and long-term debt remained consistent at $208.3 million, down $1.2 million from December 31, 2003. In the first nine months of 2004, the company generated $128.5 million of cash flow from operations, compared with $128.4 million in the first nine months of 2003. Cash flows in both periods were positively affected by improved collections of accounts receivable and timing of payments for inventory purchases. Accounts receivable days sales outstanding at September 30, 2004 were 25.8 days, improved from 27.8 days at December 31, 2003 and 27.5 days at September 30, 2003. Inventory turnover decreased slightly to 9.6 in the third quarter of 2004 from 9.7 in the third quarter of 2003.

Effective May 4, 2004, the company amended its revolving credit facility, extending its expiration to May 2009. The credit limit of the amended facility increased from $150.0 million to $250.0 million, and the interest rate is based on, at the company’s discretion, LIBOR, the Federal Funds Rate or the Prime Rate, plus an adjustment based on the company’s leverage ratio. Under the new terms of the facility, the company is charged a commitment fee of between 0.15% and 0.35% on the unused portion of the facility. The terms of the agreement limit the amount of indebtedness that the company may incur, require the company to maintain certain levels of net worth, leverage ratio and fixed charge coverage ratio, and restrict the ability of the company to materially alter the character of the business through consolidation, merger, or purchase or sale of assets. As a result of the increased borrowing capacity under the amended revolving credit facility, the company terminated its off balance sheet accounts receivable financing facility.

The company expects that its available financing will be sufficient to fund its working capital needs and long-term strategic growth, although this cannot be assured. At September 30, 2004, the company had $243.5 million of unused credit under its revolving credit facility.

18

Capital Expenditures. Capital expenditures were $11.8 million in the first nine months of 2004 compared with $12.3 million in the same period of 2003. The mix of expenditures changed from 2003 to 2004, with increased spending on design and construction of a new corporate headquarters and equipment and improvements related to the relocation of two of the company’s distribution centers, offset by reduced capital spending on information systems. The company expects capital expenditures for the remainder of 2004 to include continued spending on the construction of the corporate headquarters building. Capital expenditures for information systems are expected to continue to run at a lower rate than in 2003.

Risks

The company is subject to risks associated with changes in the healthcare industry, including competition and continued efforts to control costs, which place pressure on operating earnings, changes in the way medical and surgical services are delivered, and changes in manufacturer preferences between the sale of product directly to hospital customers and the use of wholesale distribution. The loss of one of the company’s larger customers could have a significant effect on its business.

Forward-looking Statements

Certain statements in this discussion constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Although O&M believes its expectations with respect to the forward-looking statements are based upon reasonable assumptions within the bounds of its knowledge of its business and operations, all forward-looking statements involve risks and uncertainties and, as a result, actual results could differ materially from those projected, anticipated or implied by these statements. Such forward-looking statements involve known and unknown risks, including, but not limited to:

• general economic and business conditions

• the ability of the company to implement its strategic initiatives

• dependence on sales to certain customers

• dependence on suppliers

• changes in manufacturer preferences between direct sales and wholesale distribution

• competition

• changing trends in customer profiles

• the ability of the company to meet customer demand for additional value added services

• the ability to convert customers to CostTrack^SM

• the availability of supplier incentives

• access to special inventory buying opportunities

• the ability of business partners to perform their contractual responsibilities

• the ability to manage operating expenses

• the ability of the company to manage financing costs and interest rate risk

• the risk that a decline in business volume or profitability could result in an impairment of goodwill

• the ability to timely or adequately respond to technological advances in the medical supply industry

• the ability to successfully identify, manage or integrate possible future acquisitions

• the costs associated with and outcome of outstanding and any future litigation, including product and professional liability claims

• the outcome of outstanding tax contingencies

• changes in government regulations.

19

As a result of these and other factors, no assurance can be given as to the company’s future results. The company is under no obligation to update or revise any forward-looking statements, whether as a result of new information, future results, or otherwise.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The company believes there has been no material change in its exposure to market risk from that discussed in Item 7A in the company’s Annual Report on Form 10-K for the year ended December 31, 2003.

Item 4. Controls and Procedures

The company carried out an evaluation, with the participation of the company’s management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the company’s disclosure controls and procedures (pursuant to Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. In September 2004, as the result of human error, the company made a late Form 8-K filing under Item 5.04 relating to a notice sent to Section 16 insiders informing them of a prohibition on trading in company securities during an upcoming 401(k) blackout period. This special blackout period overlapped with the company’s standard trading blackout period between earnings releases, of which the Section 16 officers had already been notified and were in compliance. Based upon the company’s evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the company required to be included in the company’s periodic SEC filings. There has been no change in the company’s internal controls over financial reporting during the quarter ended September 30, 2004, that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

Certain legal proceedings pending against the company are described in the company’s Annual Report on Form 10-K for the year ended December 31, 2003. Through September 30, 2004, there have been no material developments in any legal proceedings reported in such Annual Report.

Item 6. Exhibits

10.1	Owens & Minor, Inc. Supplemental Executive Retirement Plan, as amended and restated effective April 1, 2004
10.2	Owens & Minor, Inc. Executive Deferred Compensation Plan Trust, effective July 1, 2004
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

20

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	Owens & Minor, Inc.
	(Registrant)
Date November 5, 2004	/s/ G. GILMER MINOR, III
	G. Gilmer Minor, III
	Chairman and Chief Executive Officer
Date November 5, 2004	/s/ JEFFREY KACZKA
	Jeffrey Kaczka
	Senior Vice President
	Chief Financial Officer
Date November 5, 2004	/s/ OLWEN B. CAPE
	Olwen B. Cape
	Vice President & Controller
	Chief Accounting Officer

Exhibits Filed with SEC

Exhibit #
10.1	Owens & Minor, Inc. Supplemental Executive Retirement Plan, as amended and restated effective April 1, 2004
10.2	Owens & Minor, Inc. Executive Deferred Compensation Plan Trust, effective July 1, 2004
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

EX-10.1

Exhibit 10.1

OWENS & MINOR, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

INTRODUCTION

The Board of Directors of Owens & Minor, Inc. determined that the adoption of the Owens & Minor, Inc. Supplemental Executive Retirement Plan (the Plan) should assist it in attracting and retaining those employees whose judgment, abilities and experience will contribute to its continued progress and success. The Board of Directors also determined that the Plan should further those objectives by providing retirement and related benefits that supplement the amounts payable under the tax-qualified plans maintained by Owens & Minor, Inc.

The Plan is effective July 1, 1991. Prior to that date Owens & Minor, Inc. agreed to pay certain supplemental retirement and related benefits to selected executive and management employees in accordance with the terms of individual Executive Salary Continuation Agreements. The Plan supersedes each of the Executive Salary Continuation Agreements in effect on July 1, 1991, except in the case of such agreements for which benefit payments became due before July 1, 1991. The Plan, was amended and restated, effective July 1, 2000. The Plan was again amended and restated, effective April 1, 2004. Individuals who were eligible to participate in the Plan prior to July 1, 2000, but who are not eligible to participate in the Plan, as amended and restated effective July 1, 2000 and April 1, 2004, are listed on Exhibit I and are subject to the Plan in the form attached as Exhibit II.

The Plan is intended to provide an unfunded supplemental retirement benefit to a select group of management and highly compensated employees as such terms are used in Sections 201, 301, and 501 of the Employee Retirement Income Security Act of 1974. The Plan must be interpreted and administered in a manner that is consistent with that intent.

ARTICLE I

DEFINITIONS

1.01.  401(k) Plan Benefit

401(k) Plan Benefit means the monthly benefit that would be payable to the Participant if the portion of the Participant’s account balance in the Savings & Protection Plan for Teammates of Owens & Minor, Inc. attributable to nondiscretionary employer contributions were converted to an annuity (i) payable for the lifetime of the Participant, with no survivor benefits, (ii) using as factors to effect the conversion the “applicable mortality table” and “applicable interest rate” as defined in Section 417(e)(3)(A)(ii) of the Code, and (iii) commencing as of the Participant’s Early Retirement Date (in the case of the payment of an Early Retirement Allowance) or as of the Participant’s Normal Retirement Date (in the case of the payment of a Normal Retirement Allowance) or as of the date of the Participant’s termination of employment under Section 3.04 (in the case of a payment of a Change in Control Allowance). The 401(k) Plan Benefit shall be taken into account in determining the amount payable to the Participant under this Plan

1 Revised April 1, 2004

regardless of the benefit the Participant actually receives under the Savings & Protection Plan for Teammates of Owens & Minor, Inc.

1.02.  Affiliate

Affiliate means any “subsidiary corporation” or “parent corporation” (within the meaning of Section 425 of the Code) of the Company.

1.03.  Applicable Percentage

Applicable Percentage means the percentage set forth in clause (a), (b) or (c) as applicable:

(a) for a Participant who reached his Normal Retirement Date, his Early Retirement Date or otherwise became entitled to receive a benefit under Article III of the Plan prior to April 1, 2004: 65% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of a Senior Officer; 55% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of a Holding Company Vice President; and 45% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of a Regional Vice President;

(b) for a Participant who reached his Normal Retirement Date, his Early Retirement Date or otherwise became entitled to receive a benefit under Article III of the Plan on or after April 1, 2004; 60% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of a Senior Officer; 50% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of a Holding Company Vice President; and 35% with respect to the Early Retirement Allowance and Normal Retirement Allowance and Change in Control Allowance of an individual holding any other titled position at the Company or an Affiliate; provided, however, that notwithstanding the foregoing provisions in this clause (b), the Applicable Percentage shall remain at 65% for determining benefits payable under Article III to Gil Minor, Craig Smith and Henry Berling and at 60% for determining benefits payable under Article III to Dick Bozard and Hugh Gouldthorpe; and

(c) for any benefit that becomes payable on behalf of a Participant under Section 4.01 of the Plan, 25% with respect to payments on behalf of a Senior Officer and 15% with respect to payments on behalf of a Holding Company Vice President, a Regional Vice President or any individual holding any other titled position at the Company or any Affiliate.

1.04.  Beneficiary

Beneficiary means a Participant’s Spouse or one or more Lineal Descendants designated on a Beneficiary Designation Form by a Participant in accordance with procedures established by the Committee. If the Participant makes a valid designation of more than one Beneficiary then the Beneficiaries who survive the Participant shall receive a percentage interest in the benefit payable under the Plan in accordance with the Participant’s instruction or, absent such instruction, shall receive equal interests. If there is no valid Beneficiary designation by the Participant, or the designated Beneficiary does not survive the Participant, the Participant’s

2 Revised April 1, 2004

Beneficiary is the first of the following: the Participant’s surviving Spouse and the Participant’s Lineal Descendants per stirpes who survive the Participant.

1.05.  Beneficiary Designation Form

Beneficiary Designation Form means a form acceptable to the Committee used by a Participant according to this Plan to name the Beneficiary or Beneficiaries who will receive all benefits under this Plan if he or she dies.

1.06.  Board

Board means the Board of Directors of the Company.

1.07.  Cause

Cause means a Participant’s conviction of a felony involving dishonestly directed against the Company or an Affiliate or a Participant’s conviction of a crime of moral turpitude that is injurious to the business reputation of the Company or an Affiliate.

1.08.  Change in Control

Change in Control means that

(i) any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, or any Company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the Company’s then outstanding securities; provided, however, that Company securities acquired directly from the Company shall be disregarded for this purpose;

(ii) during any period of two consecutive years (not including any period prior to July 1, 2000), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clause (i), (ii) or (iv) of this Section) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of a majority of the directors then still in office who either (x) were directors at the beginning of such period or (y) were so elected or nominated with such approval, cease for any reason to constitute at least a majority of the Board;

(iii) the stockholders of the Company approve a merger or consolidation of the Company with any other Company, other than (x) a merger or consolidation which would result in the voting securities of the Company outstanding

3 Revised April 1, 2004

immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (y) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no “person” (as hereinabove defined) acquires more than 20% of the combined voting power of the Company’s then outstanding securities; or

(iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

1.09.  Change in Control Allowance

Change in Control Allowance means the benefit described in Section 3.04.

1.10.  Code

Code means the Internal Revenue Code of 1986, as amended.

1.11.  Committee

Committee means the Compensation and Benefits Committee of the Board.

1.12.  Company

Company means Owens & Minor, Inc.

1.13.  Early Retirement Allowance

Early Retirement Allowance means the benefit described in Section 3.02.

1.14.  Early Retirement Date

Early Retirement Date means the first day of a month coincident with or following a Participant’s Retirement at or after attaining age 55 and after completing a number of Years of Service that, when added to the Participant’s age at the time of the Participant’s Retirement, equals at least 70.

1.15.  Final Average Pay

Final Average Pay means the amount determined under clause (a) or (b), as applicable:

(a) for a Participant who reached his Normal Retirement Date or Early Retirement Date or otherwise became entitled to receive benefits under the Plan prior to April 1, 2004, the total of (i) plus (ii), divided by 60, where: (i) is the base monthly salary of a Participant, whether paid in cash or shares of the Company’s stock, during the 60 months preceding the applicable date of reference; and (ii) is the Participant’s annual bonus, whether paid in cash or shares of the

4 Revised April 1, 2004

Company’s stock, earned for the year in which Participant Retires [or otherwise becomes entitled to receive benefits under the Plan] and the four immediately preceding years; and

(b) for a Participant who reached his Normal Retirement Date or Early Retirement Date or otherwise became entitled to receive benefits under the Plan on or after April 1, 2004, the highest 60-consecutive month average of (i) plus (ii), for the last 120 months preceding the applicable date of reference, where: (i) is the base monthly salary of a Participant, whether paid in cash or shares of the Company’s stock; and (ii) is the Participant’s annual bonus, paid over the same 60-consecutive month period, whether paid in cash or shares of the Company’s stock; provided that no more than 5 annual bonuses shall be included in the calculation of Final Average Pay under this clause (b) and provided further, that if a higher average results from calculating a Participant’s Final Average Pay using the total of (i) plus (ii) under this clause (b), divided by 60, where: (i) is the base monthly salary of the Participant, paid in cash or shares of the Company’s stock, during the 60 consecutive months preceding the applicable date of reference and (ii) is the Participant’s annual bonus, paid in cash or shares of the Company’s stock, earned for the year in which the Participant Retires [or otherwise becomes entitled to receive benefits under the Plan] and the four immediately preceding years, then such higher average shall be the Participant’s Final Average Pay.

The following rules shall apply for purposes of determining a Participant’s Final Average Pay under clause (a) or (b) above: (i) if any portion of a Participant’s base salary or annual bonus is paid pursuant to the issuance of shares of the Company’s stock, such shares shall be valued on the date of issuance, whether or not the stock is then vested; (ii) a Participant’s Final Average Pay shall be determined without regard to any compensation reductions or deferrals under Section 125 or 401(k) of the Code; (iii) a Participant’s Final Average Pay shall not include amounts paid as an automobile allowance or other amounts that are in addition to his or her regular base monthly salary and (iv) any period in which a Participant suffers a Total and Permanent Disability shall be disregarded in determining his or her Final Average Pay.

1.16.  Good Reason

Good Reason means that after a Change in Control, (a) the Participant does not receive salary increases comparable to the salary increases that the Participant received in prior years or, if greater, that other employees in comparable positions receive in the current year; or (b) the Participant’s compensation or employment related benefits are reduced; or (c) the Participant’s status, title(s), office(s), working conditions, or management responsibilities are diminished (other than changes in reporting or management responsibilities required by applicable federal or state law); or (d) the Participant’s place of employment is relocated more than fifty (50) miles from his or her place of employment immediately before the Change in Control, without the Participant’s consent. A Participant’s resignation will not be considered for Good Reason unless it occurs within six months after an event described in subsection (a), (b), (c), or (d) of the preceding sentence, or within six months after the last in a series of such events.

1.17.  Holding Company Vice President

Holding Company Vice President means an individual who holds the title of Vice President of the Company.

5 Revised April 1, 2004

1.18.  Lineal Descendant

Lineal Descendant means a Participant’s child, grandchild, or great-grandchild, or child of any of the foregoing persons. References in this Plan to a Participant’s Lineal Descendants or to a child, grandchild, or great-grandchild or child of any of the Participant or any Lineal Descendant shall include adopted persons.

1.19.  Normal Retirement Allowance

Normal Retirement Allowance means the benefit described in Section 3.01.

1.20.  Normal Retirement Date

Normal Retirement Date means the first day of a month coincident with or following a Participant’s Retirement after Participant has attained age 65.

1.21.  Participant

Participant means an individual who has been selected to participate in the Plan in accordance with Article II.

1.22.  Plan

Plan means the Owens & Minor, Inc. Supplemental Executive Retirement Plan.

1.23.  Qualified Defined Benefit Plan

Qualified Defined Benefit Plan means a defined benefit pension plan that is maintained by the Company or an Affiliate and which satisfies the requirements of Section 401(a) and related sections of the Code.

1.24.  Qualified Defined Benefit Plan Benefit

Qualified Defined Benefit Plan Benefit means the monthly benefit that would be payable to the Participant from all Qualified Defined Benefit Plans in the form of an annuity payable for the lifetime of the Participant with no survivor’s benefits. The amount of the Qualified Defined Benefit Plan Benefit shall be determined as an annuity commencing as of the Participant’s Early Retirement Date (in the case of the payment of an Early Retirement Allowance) or as of the Participant’s Normal Retirement Date (in the case of the payment of a Normal Retirement Allowance) or as of the date of the Participant’s termination of employment under Section 3.04 (in the case of a payment of a Change in Control Allowance). The Qualified Defined Benefit Plan Benefit shall be taken into account in determining the amount payable to the Participant under this Plan regardless of the benefit the Participant actually receives under any Qualified Defined Benefit Plan.

6 Revised April 1, 2004

1.25.  Regional Vice President

Regional Vice President means an individual who holds the title of Regional Vice President of the Company.

1.26.  Retire and Retirement

Retire and Retirement mean severance from the employment of the Company and its Affiliates (i) at or after the attainment of age 55 and after completing a number of Years of Service that, when added to Participant’s age at the time of severance from employment, equals at least 70 or (ii) at or after the attainment of age 65.

1.27.  Senior Officer

Senior Officer means an individual who holds the title of Senior Vice President of the Company or an Affiliate or who holds a position with the Company or an Affiliate that is more senior than Senior Vice President.

1.28.  Social Security Benefit

Social Security Benefit means the monthly benefit that the Participant is entitled to receive under Section 215 of the Social Security Act, without regard to any reduction in such benefit on account of excess earnings and without regard to whether the Participant elects to receive such benefit. The amount of the Social Security Benefit shall be determined as of the Participant’s Early Retirement Date (in the case of the payment of an Early Retirement Allowance) or as of the Participant’s Normal Retirement Date (in the case of the payment of a Normal Retirement Allowance) or as of the date of the Participant’s termination of employment under Section 3.04 (in the case of a payment of a Change in Control Allowance), and shall be reduced by .333% for each month by which the month in which the Participant’s Retirement or other termination of employment occurs precedes the month in which the Participant will attain age 62.

1.29.  Spouse

Spouse means the person to whom the Participant is legally married on the date of reference.

1.30.  Total and Permanent Disability

Total and Permanent Disability means a disability which (i) resulted from bodily or mental injury or disease, (ii) has existed continuously for at least six months and (iii) in the opinion of the Committee prevents the Participant from performing his or her regularly assigned duties with the Company and its Affiliates. The Committee may require the Participant to prove his or her continued Total and Permanent Disability once during each calendar year and absent such proof the Total and Permanent Disability shall be deemed to have ceased.

7 Revised April 1, 2004

1.31.  Years of Service

Years of Service means the total years of service credited to a Participant for purposes of determining his or her vested or nonforfeitable interest in a Qualified Defined Benefit Plan. Notwithstanding the foregoing, a Participant shall be credited with Years of Service during a period of Total and Permanent Disability as if he or she was employed by the Company during such period.

ARTICLE II

PARTICIPATION

Consistent with the purposes of the Plan and the Company’s intent in adopting the Plan, the Committee shall designate employees of the Company and its Affiliates who are eligible to participate in the Plan. An individual shall remain a Participant only so long as the Committee continues such designation; provided, however, that a designation may not be changed or revoked after that Participant has reached his Early Retirement Date or Normal Retirement Date, or that Participant or his or her Beneficiary has become entitled to a benefit under the Plan, or during a period in which the Participant suffers a Total and Permanent Disability. Further, a designation may not be changed or revoked after a Change in Control.

Membership on the Board or a committee of the Board (other than the Committee) shall not by itself render an individual ineligible to participate in the Plan. An individual who is a member of the Committee may not participate in the Plan during his or her service on the Committee.

ARTICLE III

RETIREMENT AND CHANGE IN CONTROL ALLOWANCES

3.01.  Normal Retirement Allowance

Subject to the requirements of Article V and Section 8.01, a Normal Retirement Allowance shall be payable to a Participant who Retires on or after his or her Normal Retirement Date. The monthly Normal Retirement Allowance shall be the difference between (i) and (ii) below where

(i) = the Applicable Percentage of the Participant’s Final Average Pay (determined as of his or her Normal Retirement Date) and

(ii) = the sum of the Qualified Defined Benefit Plan Benefit and the 401(k) Plan Benefit and the Social Security Benefit and the defined benefit pension plan(s) benefits(s) of any other prior employer or employers.

3.02.  Early Retirement Allowance

Subject to the requirements of Article V and Section 8.01, an Early Retirement Allowance shall be payable to a Participant who Retires on or after his or her Early Retirement Date and before his or her Normal Retirement Date. The monthly Early Retirement Allowance shall be equal to the benefit calculated in Section 3.01, but determined as of the Participant’s

8 Revised April 1, 2004

Early Retirement Date, reduced by .333% for each month by which the month in which Participant’s Early Retirement Date occurs precedes the month in which he or she would first have become eligible for a Normal Retirement Allowance. Notwithstanding the foregoing, the .333% reduction referenced in the preceding sentence shall not apply to a Participant who Retires at or after attainment of age 62 and after completing 20 Years of Service and before his or her Normal Retirement Date, so that the monthly Early Retirement Allowance for such a Participant shall be equal to the benefit calculated in Section 3.01, but determined as of the Participant’s Early Retirement Date.

3.03.  Payment of Retirement Allowances

The payment of the retirement allowance payable under Section 3.01 or Section 3.02 shall begin on the 15th day of the month following the month in which the Participant Retires. The payment of the retirement allowance shall continue to be paid as of the 15th day of each month thereafter until the month in which the Participant dies. No further retirement allowance payments will be made under Section 3.01 or Section 3.02 following the month in which the Participant dies.

3.04.  Change in Control Allowance

(a) Subject to the requirements of Article V and Section 8.01, a Change in Control Allowance shall be payable to a Participant who is terminated by the Company or an Affiliate (other than for Cause) or who resigns his or her employment with the Company or an Affiliate with Good Reason following a Change in Control, but prior to his or her Early Retirement Date or Normal Retirement Date. The monthly Change in Control Allowance shall be equal to (i) the benefit calculated in Section 3.01, but determined as of the date of Participant’s termination in accordance with this Section 3.04, multiplied by (ii) a fraction, the numerator of which is the number of Years of Service that the Participant has accrued on the date of his or her termination under this Section 3.04, and the denominator of which is the number of Years of Service that the Participant would have accrued if he or she had remained in the continuous employ of the Company and its Affiliates through the earlier of the date that he or she would first have become eligible for an Early Retirement Allowance and the date that he or she would first have become eligible for a Normal Retirement Allowance; reduced by (iii) .333% for each month by which the month in which Participant terminates employment under this Section 3.04 precedes the month in which he or she would first have become eligible for a Normal Retirement Allowance.

3.05.  Payment of Change in Control Allowance

The payment of the Change in Control Allowance payable under Section 3.04 shall begin on the 15th day of the month following the month in which the Participant terminates employment following a Change in Control, or, if later, on the 30th day after the Change in Control. The payment of the Change in Control Allowance shall be paid as of the 15th day of each month thereafter until the month in which the Participant dies. No further Change in Control Allowance payments will be made under Section 3.04 following the month in which the Participant dies.

9 Revised April 1, 2004

ARTICLE IV

PAYMENTS IN THE EVENT OF DEATH

4.01.  Death On or Before Retirement

(a) Subject to the requirements of Article V and Section 8.01, a benefit shall be payable under this Section 4.01(a) if the Participant dies prior to a date on which his or her severance from employment would constitute his or her Retirement. The monthly benefit payable under this Section 4.01(a) shall be equal to the Applicable Percentage of the Participant’s Final Average Pay (determined as of the last day of the month preceding the month in which the Participant died).

(b) Subject to the requirements of Article V and Section 8.01, a benefit shall be payable under this Section 4.01(b) if the Participant’s severance from employment due to his or her death constitutes his or her Retirement. The monthly benefit payable under this Section shall be the greater of (i) the benefit that would have been payable under Section 4.01(a) if the date of the Participant’s death had not been a date on which the Participant could Retire and (ii) the monthly benefit that would have been payable under Article III if the Participant’s employment had terminated on the date of his or her death for reasons other than his or her death.

(c) The payment of the benefit described in the preceding Subsection (a) or (b), as applicable, shall be paid to the Participant’s Beneficiary beginning on the 15th day of the month following the month in which the Participant died. The payment of that benefit to the Participant’s Beneficiary will continue as of the 15th day of each month thereafter until the earlier of (i) the death of the Participant’s Beneficiary and (ii) a total of 180 months’ benefits have been paid to the Participant’s Beneficiary. In the event of the death of the Participant’s Beneficiary before a total of 180 payments have been made, the present value of the remainder of such 180 payments shall be paid in a lump sum to the estate of the Beneficiary, using the “applicable interest rate” as defined in Section 417(e)(3)(A)(ii) of the Code to calculate the present value.

(d) No benefit will be payable under this Section if the Participant is not survived by any Beneficiary.

4.02.  Death After Retirement or Change in Control Termination

(a) Subject to the requirements of Article V and Section 8.01, a benefit shall be payable under this Section if the Participant dies after Retirement or after termination or employment under circumstances that entitle him or her to a Change in Control Allowance under Article III and before his or her receipt of 180 payments of that benefit. The monthly benefit payable under this Section 4.02 shall be equal to the monthly allowance to which the Participant was entitled under Article III immediately prior to the Participant’s death.

(b) The payment of the benefit described in the preceding Subsection (a) shall be paid to the Participant’s Beneficiary beginning on the 15th day of the month following the month in which the Participant died. The payment of that benefit to the Participant’s Beneficiary will continue as of the 15th day of each month thereafter until the earlier of (i) a total of 180 payments have been made under the Plan to the Participant and his or her Beneficiary, and (ii)

10 Revised April 1, 2004

the death of the Participant’s Beneficiary. In the event of the death of Participant’s Beneficiary before a total of 180 payments have been made, the present value of the remainder of such 180 payments shall be paid in a lump sum to the estate of the Beneficiary, using the “applicable interest rate” as defined in Section 417(e)(3)(A)(ii) of the code to calculate the present value.

(c) No benefit will be payable under this Section if the Participant is not survived by any Beneficiary.

ARTICLE V

VESTING AND CONTINUOUS EMPLOYMENT

5.01.  Vesting

No benefit will be payable under the Plan unless the Participant remains in the continuous employ of the Company and its Affiliates from his or her most recent designation as a Participant by the Committee until:

(i) his or her Early Retirement Date;

(ii) his or her Normal Retirement Date;

(iii) his or her death; or

(iv) his or her termination of employment under circumstances that entitle the Participant to a Change in Control Allowance in the case of the payment of a Change in Control Allowance.

Notwithstanding the foregoing, no benefit shall be payable under this Plan if the Participant’s employment with the Company and its Affiliates terminates or is terminated for Cause.

5.02.  Total and Permanent Disability

(a) A Participant who remains in the continuous employ of the Company and its Affiliates from his or her most recent designation as a Participant by the Committee until his or her separation from service on account of a Total and Permanent Disability shall be deemed to remain in the continuous employ of the Company and its Affiliates for purposes of the Plan.

(b) A Participant described in the preceding Subsection may elect to receive an Early Retirement Allowance on or after what would have been his or her Early Retirement Date. A Participant described in the preceding Subsection may elect to receive a Normal Retirement Allowance on or after what would have been his or her Normal Retirement Date. The benefit described in Section 4.01(a) or (b), as applicable, shall be payable on behalf of a Participant described in the preceding Subsection who dies without having made an election to receive an Early Retirement Allowance or a Normal Retirement Allowance pursuant to the first sentence of this Section 5.01(b). The benefit described in Section 4.02 shall be payable on behalf of a Participant described in the preceding Subsection who dies after having made an election to receive an Early Retirement Allowance or a Normal Retirement Allowance pursuant to the first sentence of this Section 5.01(b).

11 Revised April 1, 2004

(c) This Section shall not apply if the Participant recovers from his or her Total and Permanent Disability and does not return to the active employ of the Company and its Affiliates at that time. In that event, the Participant will be deemed to have separated from the service of the Company and its Affiliates as of the date that his or her employment terminated on account of his or her Total and Permanent Disability.

5.03. Continuous Employment

The Committee, in its discretion, shall determine the extent, if any, to which leaves or absence for military service, governmental service and other reasons shall be deemed not to have caused an interruption in a Participant’s continuous employment with the Company and its Affiliates.

5.04. Non-Competition

(a) As a condition for participating in the Plan, Participant acknowledges that during his or her employment by the Company and its Affiliates, he or she will have access to and obtain confidential documents and information relating to the business of the Company and its Affiliates. Participant acknowledges and agrees that because the Company is granting him or her such access and permitting him or her to obtain such confidential documents and information, any competition by him or her with the Company unfairly would result in material damage to the Company and its Affiliates and cause Company and its Affiliates to suffer irreparable damage.

(b) Participant thus agrees that, once he or she has become entitled to a benefit under this Plan in accordance with Section 5.01, then during his or her employment and for a period of five years immediately following termination of his or her employment (for any reason), Participant shall not directly or indirectly own, manage, operate, join, control, be employed by or consult with any firm or business entity which is in the same business as, or similar to, the Company or any of its Affiliates and which competes with the Company or any of its Affiliates. Recognizing the broad geographic scope and unique nature of the business of the Company and its Affiliates, and expressly acknowledging the Company’s legitimate interest in this restriction, Participant agrees that this restriction shall apply within a radius of 500 miles from Participant’s principal assignment with the Company and its Affiliates.

(c) Participant further agrees that, once he or she has become entitled to a benefit under this Plan in accordance with Section 5.01, then during his or her employment and for a period of five years immediately following termination of his or her employment (for any reason), Participant will not hire, solicit for hire or encourage to leave the Company’s or an Affiliate’s employment any person who is then an employee of the Company or an Affiliate.

(d) Participant agrees that in the event of any breach or threatened breach of his or her promises in this Section, the Company will not have an adequate remedy at law and will suffer substantial and irreparable damage. Participant accordingly agrees that the Company shall be entitled to obtain specific enforcement of his or her promises, including but not limited to temporary and permanent injunctions restraining Participant from breaching such promises. In addition to any remedy that may be afforded the Company, upon a breach or threatened breach of the promise in this Section, Participant shall forfeit all rights under this Plan and no benefit or

12 Revised April 1, 2004

further benefit shall be payable to Participant, or any Beneficiary. This provision shall not bar the Company from any other remedies available to it for such breach or threatened breach, including the recovery of damages and attorneys’ fees.

(e) The prohibitions of this Section are severable, and a finding by any court that any one prohibition is unenforceable shall not affect the validity of any other prohibition. Additionally, should any court find that any provision of this Section is unenforceable, Participant and the Company specifically authorize the court to modify that provision and to enforce that provision as modified.

ARTICLE VI

ADMINISTRATION OF THE PLAN

6.01. Generally

The Plan shall be administered by the Committee. Subject to the provisions of the Plan, the Committee may adopt such rules and regulations as may be necessary to carry out the purposes hereof. The Committee’s interpretation and construction of any provision of the Plan shall be final and conclusive.

6.02. Indemnification

The Company shall indemnify and save harmless each member of the Committee against any and all expenses and liabilities arising out of his or her membership on the Committee, excepting only expenses and liabilities arising out of his or her own willful misconduct. Expenses against which a member of the Committee shall be indemnified hereunder shall include without limitation, the amount of any settlement or judgment, costs, counsel fees, and related charges reasonably incurred in connection with a claim asserted, or a proceeding brought or settlement thereof. The foregoing right of indemnification shall be in addition to any other rights to which any such member may be entitled.

6.03. Determining Benefits

In addition to the powers hereinabove specified, the Committee shall have the power to compute and certify the amount and kind of benefits from time to time payable to or on behalf of Participants under the Plan, to authorize all disbursements for such purposes, and to determine whether a Participant or a Beneficiary is entitled to a benefit under the Plan.

6.04. Cooperation

To enable the Committee to perform its functions, the Company shall supply full and timely information to the Committee on all matters relating to the compensation of all Participants, their Retirement, death or other cause for termination of employment, and such other pertinent facts as the Committee may require.

6.05. Claims

(a) It is not necessary to file a claim in order to receive Plan benefits.

13 Revised April 1, 2004

(b) On receipt of a claim for Plan benefits, the Committee must respond in writing within ninety days. If necessary, the Committee’s first notice must indicate any special circumstances requiring an extension of time for the Committee’s decision. The extension notice must indicate the date by which the Committee expects to render a decision; an extension of time for processing may not exceed ninety days after the end of the initial period.

(c) If a claim is wholly or partially denied, the Committee must give written notice within the time provided in subsection (b). An adverse notice must specify each reason for denial. There must be specific reference to provisions of the Plan or related documents on which the denial is based. If additional material or information is necessary for the claimant to perfect the claim, it must be described and there must be an explanation of why that material or information is necessary. Adverse notice must disclose appropriate information about the steps that the claimant must take if he or she wishes to submit the claim for review. If notice that a claim has been denied is not furnished within the time required in subsection (b), the claim is deemed denied.

(d) The full value of a payment made according to the provisions of the Plan satisfies that much of the claim and all related claims under the Plan against the Committee and the Company and its Affiliates, each of whom, as a condition to a payment from it or directed by it, may require the Participant, Beneficiary, or legal representative to execute a receipt and release of the claim in a form determined by the person requesting the receipt and release.

6.06. Review of Claims

(a) On proper written request for review from a claimant to the Committee, there must be a review by the Board. The Committee must receive the written request before sixty-one days after the claimant’s receipt of notice that a claim has been denied according to the preceding Plan Section. The claimant and an authorized representative are entitled to be present and heard if any hearing is used as part of the review.

(b) The Board must determine whether there will be a hearing. Before any hearing, the claimant or a duly authorized representative may review all Plan documents and other papers that affect the claim and may submit issues and comments in writing. The Board must schedule any hearing to give sufficient time for this review and submission, giving notice of the schedule and deadlines for submissions.

(c) The Board must advise the claimant in writing of the final determination after review. The decision on review must be written in a manner calculated to be understood by the claimant, and it must include specific reasons for the decision and specific references to the pertinent provisions of the Plan or related documents on which the decision is based. The written advice must be rendered within sixty days after the request for review is received, unless special circumstances require an extension of time for processing. If an extension is necessary, the decision must be rendered as soon as possible but no later than 120 days after receipt of the request for review. If the Board has regularly scheduled meetings at least quarterly, the following rules govern the time for the decision after review. If the claimant’s written request for review is received more than thirty days before a Board meeting, the decision of the Board must be rendered at the next meeting after the request for review is received. If the claimant’s

14 Revised April 1, 2004

written request for review is received thirty days or less before a Board meeting, the decision of the Board must be rendered at the Board’s second meeting after the request for review has been received. If special circumstances (such as the need to hold a hearing) require an extension of time for processing, the decision of the Board must be rendered not later than the Board’s third meeting after the request for review has been received. If an extension of time for review is required, written notice of the extension must be furnished to the claimant before the extension begins. If notice that a claim has been denied on review is not received by the claimant within the time required in this paragraph, the claim is deemed denied on review.

ARTICLE VII

TERMINATION, AMENDMENT OR MODIFICATION OF PLAN

7.01. Reservation of Rights

Except as otherwise specifically provided, the Company reserves the right to terminate, amend or modify this Plan wholly or partially at any time and from time to time. Such right to terminate, amend or modify the Plan shall be exercised by the Board. Notwithstanding the preceding, with respect to an affected Participant, the Plan may not be amended, modified or terminated after a Change in Control unless the affected Participant agrees to such amendment, modification or termination in writing.

7.02. Limitation of Actions

The rights of the Company set forth in the preceding Section are subject to the condition that its Board shall take no action to terminate the Plan or decrease the benefit that would become payable or is payable, as the case may be, with respect to a Participant or a Beneficiary after the Participant has reached his or her Early Retirement Date or Normal Retirement Date or the Participant, or his or her Beneficiary has become entitled to a benefit under the Plan.

7.03. Effect of Termination

Except as provided in Sections 7.01 and 7.02, upon the termination of this Plan by the Board, the Plan shall be of no further force or effect, and neither the Company nor the Participant or his or her Beneficiary shall have any further obligation or right under this Plan.

ARTICLE VIII

MISCELLANEOUS

8.01. Limitation on Benefits

(a) For purposes of this Plan, the following terms shall have the meanings indicated below:

(i) “Accounting Firm” means the public accounting firm retained as the Company’s independent auditor as of the date immediately prior to the Change in Control, or, for any Participant subject to an Executive Severance Agreement, such other independent accounting firm as may be appointed in accordance with that Agreement.

15 Revised April 1, 2004

(ii) “Capped Parachute Payments” means the largest amount of Parachute Payments that may be paid to a Participant without liability for any excise tax under Code Section 4999.

(iii) “Net After Tax Amount” means the amount of any Parachute Payments or Capped Parachute Payments, as applicable, net of taxes imposed under Code Sections 1, 3101(b) and 4999 and any state or local income taxes applicable to a Participant as in effect on the date of the payment under this Section 8.01. The determination of the Net After Tax Amount shall be made using the highest combined effective rate imposed by the foregoing taxes on income of the same character as the Parachute Payments or Capped Parachute Payments, as applicable, in effect for the year for which the determination is made.

(iv) “Parachute Payment” means a payment that is described in Code Section 280G(b)(2) (without regard to whether the aggregate present value of such payments exceeds the limit prescribed by Code Section 280G(b)(2)(A)(ii)). The amount of any Parachute Payment shall be determined in accordance with Code Section 280G and the regulations promulgated thereunder, or, in the absence of final regulations, the proposed regulations promulgated under Code Section 280G.

(b) The benefit payable to a Participant under this Plan and under other plans, programs, and agreements may constitute Parachute Payments that are subject to the “golden parachute” rules of Code Section 280G and the excise tax of Code Section 4999. It is the Company’s intention to reduce any Parachute Payments (but not any payment, distribution or other benefit that is not a Parachute Payment) if, and only to the extent that, a reduction will allow the affected Participant to receive a greater Net After Tax Amount than he or she would receive absent a reduction. The remaining provisions of this subsection describe how that intent will be effectuated.

(c) The Accounting Firm will first determine the amount of any Parachute Payments that are payable to a Participant. The Accounting Firm will also determine the Net After Tax Amount attributable to that Participant’s total Parachute Payments.

(d) The Accounting Firm will next determine the amount of that Participant’s Capped Parachute Payments. Thereafter, the Accounting Firm will determine the Net After Tax Amount attributable to that Participant’s Capped Parachute Payments.

(e) That Participant will receive the total Parachute Payments unless the Accounting Firm determines that the Capped Parachute Payments will yield a higher Net After Tax Amount, in which case that Participant will receive the Capped Parachute Payments. If that Participant will receive the Capped Parachute Payments, his or her benefit under this Plan will be adjusted, if at all, in the manner determined by the Committee, taking into account the provisions of any Executive Severance Agreement or other agreement to which the Participant may be subject that specifies the manner in which Parachute Payments must be reduced. The Accounting Firm will notify the Participant and the Company if it determines that the Parachute Payments must be reduced to the Capped Parachute Payments and will send the Participant and the Company a copy of its detailed calculations supporting that determination.

16 Revised April 1, 2004

(f) If, pursuant to Subsection (e), a Participant will receive the total Parachute Payments, the Company shall indemnify the Participant and hold him harmless against all claims, losses, damages, penalties, expenses, and excise taxes. To effect this indemnification, the Company must pay the Participant an additional amount (the “Gross-Up Payment”) that after payment by the Participant of all taxes, including, without limitation, any income, employment and excise taxes (and any interest and penalties imposed with respect thereto), imposed upon the Gross-Up Payment leaves the Participant a net amount from the Gross-Up Payment equal to the excise tax under Code Section 4999 imposed on the Parachute Payments. The determination of any additional amount that must be paid under this paragraph must be made by the Company in good faith.

(g) As a result of any uncertainty in the application of Code Sections 280G and 4999 at the time that the Accounting Firm makes its determinations under this Section 8.01, it is possible that amounts will have been paid or distributed to a Participant that should not have been paid or distributed under this Section 8.01 (“Overpayments”), or that additional amounts should be paid or distributed to a Participant under this Section 8.01 (“Underpayments”). If the Accounting Firm determines, based on either controlling precedent, substantial authority or the assertion of a deficiency by the Internal Revenue Service against a Participant or the Company, which assertion the Accounting Firm believes has a high probability of success, that an Overpayment has been made, then the Participant shall have an obligation to pay the Company upon demand an amount equal to the sum of the Overpayment plus interest on such Overpayment at the prime rate provided in Code Section 7872(f)(2) from the date of the Participant’s receipt of such Overpayment until the date of such repayment; provided, however, that the Participant shall be obligated to make such repayment if, and only to the extent, that the repayment would either reduce the amount on which the Participant is subject to tax under Code Section 4999 or generate a refund of tax imposed under Code Section 4999. If the Accounting Firm determines, based upon controlling precedent or substantial authority, that an Underpayment has occurred, the Accounting Firm will notify the Participant and the Company of that determination and the Company will pay the amount of that Underpayment to the Participant promptly in a lump sum, with interest calculated on such Underpayment at the prime rate provided in Code Section 7872(f)(2) from the date such Underpayment should have been paid until actual payment.

(h) All determinations made by the Accounting Firm under this Section 8.01 are binding on the Participant and the Company and must be made as soon as practicable but no later than thirty days after a Participant’s termination of employment following a Change in Control. Within thirty days after the termination, the Company will commence payment of the Participant’s Change in Control Allowance, or a reduced Change in Control Allowance as calculated by the Accounting Firm pursuant to this Section 8.01.

(i) All references in this Section 8.01 to a Participant and to an amount payable to the Participant shall be interpreted to include the Participant’s Beneficiary and amounts payable to the Participant’s Beneficiary, if applicable.

17 Revised April 1, 2004

8.02. Unfunded Plan

The Company has only a contractual obligation to make payments of the benefits described in the Plan. All benefits are to be satisfied solely out of the general corporate assets of the Company which shall remain subject to the claims of its creditors. No assets of the Company will be segregated or committed to the satisfaction of its obligations to any Participant or Beneficiary under this Plan. If the Company, in its sole discretion, elects to purchase life insurance on the life of a Participant in connection with the Plan, the Participant must submit to a physical examination, if required by the insurer, and otherwise cooperate in the issuance of such policy or his or her rights under the Plan will be forfeited.

8.03. Other Benefits and Agreements

The benefits, if any, provided for a Participant or his or her Beneficiary under the Plan are in addition to any other benefits available to such Participant under any other plan or program of the Company for its employees (other than an Executive Salary Continuation Agreement), and, except as may otherwise be expressly provided for, the Plan shall supplement and shall not supersede, modify or amend any other plan or program of the Company in which a Participant is participating.

8.04. Withholding Taxes

The benefit, if any payable to a Participant or his or her Beneficiary under the Plan shall be reduced by the amounts which the Company, in its discretion, determines shall be withheld under applicable federal, state and local income taxes and for any applicable employment-related taxes.

8.05. Restrictions on Transfer of Benefits

No right or benefit under the Plan shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance or charge, and any attempt to do so shall be void. No right or benefit hereunder shall in any manner be liable for or subject to the debts, contracts, liabilities, or torts of the person entitled to such benefit. If any Participant or Beneficiary under the Plan should become bankrupt or attempt to anticipate, alienate, sell, assign, pledge, encumber or charge any right to a benefit hereunder, then such right or benefit, in the discretion of the Committee, shall cease and terminate, and, in such event, the Committee may hold or apply the same or any part thereof for the benefit of such Participant or his or her Beneficiary or other dependents, or any of them, in such manner and in such portion as the Committee may deem proper.

8.06. No Guarantee of Employment

The Plan does not in any way limit the right of the Company or an Affiliate at any time and for any reason to terminate the Participant’s employment or such Participant’s status as an officer of the Company or an affiliate. In no event shall the Plan by its terms or implications constitute an employment contract of any nature whatsoever between the Company or an Affiliate and a Participant.

18 Revised April 1, 2004

8.07. Successors

The Plan shall be binding upon the Company and its successors and assigns; subject to the powers set forth in Article VII, and upon a Participant and his or her Beneficiary and either of their assigns, heirs, executors and administrators.

8.08. Construction

Headings are given for ease of reference and must be disregarded in interpreting the Plan. Masculine pronouns wherever used shall include feminine pronouns and the use of the singular shall include the plural.

19 Revised April 1, 2004

EX-10.2

Exhibit 10.2

OWENS & MINOR, INC.

EXECUTIVE DEFERRED COMPENSATION PLAN TRUST

Effective July 1, 2004

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

TABLE OF CONTENTS

Section		Page
ARTICLE I	ESTABLISHMENT OF TRUST	2
ARTICLE II	PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES	3
ARTICLE III	TRUSTEE RESPONSIBILITY REGARDING PAYMENTS	4
ARTICLE IV	PAYMENTS TO THE COMPANY	6
ARTICLE V	INVESTMENT AUTHORITY	7
ARTICLE VI	DISPOSITION OF INCOME	9
ARTICLE VII	ACCOUNTING BY TRUSTEES	10
ARTICLE VIII	RESPONSIBILITY OF TRUSTEES	11
ARTICLE IX	COMPENSATION AND EXPENSES OF TRUSTEES	12
ARTICLE X	RESIGNATION AND REMOVAL OF TRUSTEES	13
ARTICLE XI	APPOINTMENT OF SUCCESSOR	14
ARTICLE XII	AMENDMENT OR TERMINATION	15
ARTICLE XIII	MISCELLANEOUS	16
ARTICLE XIV	EFFECTIVE DATE	17
ARTICLE XV	SIGNATURE PAGE	18

(i)

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

This Agreement made effective as of the 1^st day of July, 2004, by and between Owens & Minor, Inc. (the “Company”) and Erika T. Davis and Grace den Hartog (the “Trustees”).

RECITALS:

WHEREAS, the Company has adopted the Owens & Minor, Inc. Executive Deferred Compensation Plan (the “Plan”);

WHEREAS, the Company has incurred or expects to incur liability under the terms of the Plan with respect to the individuals participating therein;

WHEREAS, the Company wishes to establish a trust (hereinafter called the “Trust”) and to contribute to the Trust assets that shall be held hereunder, subject to the claims of the creditors of the Company and any affiliate of the Company whose employees participate in the Plan (an “Affiliated Employer”) in the event of the Company’s or an Affiliated Employer’s Insolvency, as herein defined, until paid to the Plan’s participants, and their beneficiaries 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, as amended (“ERISA”); and

WHEREAS, it is the intention of the Company to make contributions to the Trust from time to time to provide itself a source of funds to assist it in meeting its obligations under the Plan;

1

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

NOW, THEREFORE, the parties do hereby establish the Trust and agree that the Trust shall be comprised, held and disposed as of follows:

ARTICLE I

ESTABLISHMENT OF TRUST

1.01 The Trust hereby established is revocable by the Company; it shall become irrevocable upon a Change of Control, as defined in the Plan.

1.02 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 (the “Code”), and shall be construed accordingly.

1.03 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 the Plan’s 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 asset 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 the Company. Any assets held by the Trust will be subject to the claims of the Company’s and any Affiliated Employer’s general creditors under federal and state law in the event of Insolvency, as defined in Trust Section 3.01.

1.04 Prior to a Control Change Date (as defined in the Plan), the Company, in its sole discretion, at any time, and from time to time, may make deposits of cash or other property in trust with the Trustees to be held, administered and disposed of by the Trustees as provided in this Trust Agreement. Neither the Trustees nor any of the Plan’s participants or beneficiaries shall have any right to compel such deposits.

1.05 Upon a Control Change Date (as defined in the Plan), the Company shall, as soon as possible, but in no event longer than ten (10) days following the Control Change Date, make an irrevocable contribution to the Trust in an amount that is sufficient to pay each of the Plan’s participants or beneficiaries the benefits to which the Plan’s participants or their beneficiaries would be entitled pursuant to the terms of the Plan as of the Control Change Date. The amount of such irrevocable contribution shall be determined by the Company’s independent accountant engaged by the Company prior to the Control Change Date. Nothing in this Section 1.05 or Section 1.04 shall be construed as preventing the Company or the trustee of a trust established by the Company from making additional contributions to the Trust following a Control Change Date.

2

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE II

PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES

2.01 The Company shall deliver to Trustees a schedule (the “Payment Schedule”) that indicates the amounts payable in respect of each of the Plan’s participants (and his or her beneficiaries), that provides a formula or other instructions acceptable to the Trustees 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, the Trustees shall make payments to each of the Plan’s participants and their beneficiaries in accordance with such Payment Schedule. The Trustees 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 and shall pay amounts withheld to the appropriate taxing authorities or determine that such amounts have been reported, withheld and paid by the Company.

2.02 The entitlement of a Plan participant or his or her beneficiaries to benefits under the Plan shall be determined by the 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.

2.03 The Company may make payment of benefits directly to the Plan’s participants or their beneficiaries as they become due under the terms of the Plan. The Company shall notify the Trustees 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, and any earnings thereon, are not sufficient to make payments of benefits (payable in cash under the Plan) in accordance with the terms of the Plan, the Company shall make the balance of each such payment as it falls due. The Trustees shall notify the Company where principal and earnings are not sufficient.

3

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE III

TRUSTEE RESPONSIBILITY REGARDING PAYMENTS

3.01 The Trustees shall cease payment of benefits to the Plan’s participants and their beneficiaries if the Company or an Affiliated Employer is Insolvent. The Company or an Affiliated Employer shall be considered “Insolvent” for purposes of this Trust Agreement if (i) the Company or an Affiliated Employer is unable to pay its debts as they become due or (ii) the Company or an Affiliated Employer is subject to a pending proceeding as a debtor under the United States Bankruptcy Code.

3.02 At all times during the continuance of this Trust, as provided in Trust Section 1.03, the principal and income of the Trust shall be subject to claims of general creditors of the Company and all Affiliated Employers under federal and state law as set forth below.

(a) The Board of Directors and the Chief Executive Officer of the Company or an Affiliated Employer shall have the duty to inform the Trustees in writing of the Company’s or the Affiliated Employer’s Insolvency. If a person claiming to be a creditor of the Company or an Affiliated Employer alleges in writing to the Trustees that the Company or an Affiliated Employer has become Insolvent, the Trustees shall determine whether the Company or such Affiliated Employer is Insolvent and, pending such determination, the Trustees shall discontinue payment of benefits to the Plan’s participants and their beneficiaries.

(b) Unless the Trustees have actual knowledge of the Company’s or an Affiliated Employer’s Insolvency, or have received notice from the Company or an Affiliated Employer or a person claiming to be a creditor alleging that the Company or an Affiliated Employer is Insolvent, the Trustees shall have no duty to inquire whether the Company or an Affiliated Employer is Insolvent. The Trustees may in all events rely on such evidence concerning the Company’s or any Affiliated Employer’s solvency as may be furnished to the Trustees and that provides the Trustees with a reasonable basis for making a determination concerning the Company’s or such Affiliated Employer’s solvency.

(c) If at any time the Trustees have determined that the Company or an Affiliated Employer is Insolvent, the Trustees shall discontinue payments to the Plan’s participants or their beneficiaries and shall hold the assets of the Trust for the benefit of the Company’s and the Affiliated Employer’s general creditors. Nothing in this Trust Agreement shall in any way diminish any rights of the Plan’s participants or their beneficiaries to pursue their rights as general creditors of the Company or an Affiliated Employer with respect to benefits due under the Plan or otherwise.

(d) The Trustees shall resume the payment of benefits to the Plan’s participants or their beneficiaries in accordance with Article II of this Trust Agreement only after the Trustees have determined that the Company or the Affiliated Employer is not Insolvent (or is no longer Insolvent).

4

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

3.03 Provided that there are sufficient assets, if the Trustees discontinue the payment of benefits from the Trust pursuant to Trust Section 3.02 hereof and subsequently resumes such payments, the first payment following such discontinuance shall include the aggregate amount of all payments due to the Plan’s participants or their beneficiaries under the terms of the Plan (and payable as cash under the Plan) for the period of such discontinuance, less the aggregate amount of any payments made to the Plan’s participants or their beneficiaries by the Company in lieu of the payments provided for hereunder during any such period of discontinuance.

5

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE IV

PAYMENTS TO THE COMPANY

Except as provided in Article III hereof, after the Trust has become irrevocable, the Company shall have no right or power to direct the Trustees to return to the Company or to divert to others any of the Trust assets before all payment of benefits have been made to the Plan’s participants and their beneficiaries pursuant to the terms of the Plan.

6

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE V

INVESTMENT AUTHORITY

5.01 In no event may the Trustees invest in securities (including stock or rights to acquire stock) or obligations issued by Company. All rights associated with assets of the Trust shall be exercised by the Trustees or the person designated by the Trustees, and shall in no event be exercisable by or rest with Plan participants.

5.02 The authority of the Trustees described in Trust Sections 5.01 and 5.03 shall be exercised in accordance with the guidelines and directions issued to the Trustees by such individuals as are appointed by the Board of Directors for this purpose.

5.03 The Trustees shall have the following powers:

(a) to invest and reinvest the Trust in such investments as they may deem proper and suitable for the purposes of the Trust including, by way of example and not limitation: notes, bonds, obligations, stock either common or preferred, warrants, rights, securities convertible into common stock, participations in a common trust fund or funds (including a common trust sponsored or operated by a corporate trustee, where applicable), mutual funds either open or closed end, partnerships, obligations of the United States, any state of the United States or any municipality or agency thereof, mortgages and real estate whether developed or undeveloped, sales and leasebacks, interests in real estate investment trusts, leaseholds of any duration, savings accounts, certificates of deposit and other types of time deposits with any financial institution (including a corporate trustee, where applicable), individual and group insurance policies or contracts, annuity contracts and investment policies and contracts;

(b) to keep, retain and safeguard any and all investments properly constituting the Trust and to dispose of such property by sale, exchange or otherwise;

(c) to sell, assign, exchange, transfer, convey or otherwise dispose of any or all of the investments or property constituting the Trust at either public or private sale of cash or other consideration or for deferred payments, and for the purpose of selling, assigning, transferring or conveying the same, to make, execute, acknowledge and deliver any and all instruments of conveyance or assignments in such form and with such warranties and covenants as the Trustees may deem proper; and in the event of any sale, conveyance, exchange or other disposition of any asset of the Trust, the purchaser shall not be required in any way to see to the application of the purchase money or other consideration passing in connection therewith;

(d) to vote any stocks, bonds or other securities held in the Trust at any meeting of stockholders, bondholders, or other security holders, and to delegate the power so to vote to attorneys-in-fact or by proxies under power of attorney, restricted or unrestricted, and to join in or dissent from or oppose the reorganization, recapitalization, consolidation, sale or

7

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

merger of a corporation or properties in which the Trustees may hold stocks, bonds, or other securities, or in which it may be interested;

(e) to take up or subscribe for any rights or exercise any subscription or conversion privilege in any stocks, bonds, notes or other securities constituting the Trust;

(f) to compromise, adjust, arbitrate, sue or defend, abandon or otherwise deal with and settle claims in favor of or against the Trust or relating to any of the assets of the Trust;

(g) to hold property in the name of the Trustees or the name of nominees, or to retain such investments unregistered or in a form permitting transfer by delivery; provided that the books and records of the Trustees shall at all times show that such investments are a part of the Trust and the Trustees shall be liable for the acts of its nominees;

(h) to borrow money and mortgage, pledge or hypothecate assets of the Trust as security for any money so borrowed;

(i) to make repairs, alterations, additions or improvements to or to demolish improvements on any property contained in the Trust;

(j) to make or join in any lease or contract, or renew or extend any note, even though such lease or contract, or such renewal or extension may extend beyond the term of this Trust;

(k) to make and execute all instruments necessary or proper to carry out the powers conferred herein;

(l) to write covered call options and utilize similar investment techniques to the extent it deems such techniques prudent under the circumstances; and

(m) to do all other things which shall be necessary to carry out the powers specified herein and perform its duties under this Trust.

8

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE VI

DISPOSITION OF INCOME

Except as provided in Section 2.01, during the term of this Trust, all income received by the Trust, net of expenses and taxes, shall be accumulated and reinvested.

9

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE VII

ACCOUNTING BY TRUSTEES

The Trustees 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 the Company and the Trustees. Within sixty (60) days following the close of each calendar year and within thirty (30) days after the removal or resignation of the Trustees, the Trustees shall deliver to the Company a written account of their 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.

10

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE VIII

RESPONSIBILITY OF TRUSTEES

8.01 The Trustees 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 the Trustees shall incur no liability to any person for any action taken pursuant to a direction, request or approval given by the Company which is contemplated by, and in conformity with, the terms of the Plan or this Trust and is given in writing by an authorized employee of the Company. In the event of a dispute between the Company and a party, the Trustees may apply to a court of competent jurisdiction to resolve the dispute.

8.02 If the Trustees undertake or defend any litigation arising in connection with this Trust, the Company agrees to indemnify the Trustees against the Trustees’ costs, expenses and liabilities (including, without limitation, attorneys’ fees and expenses) relating thereto and to be primarily liable for such payments. If the Company does not pay such costs, expenses and liabilities in a reasonably timely manner, the Trustees may obtain payment from the Trust.

8.03 The Trustees may consult with legal counsel (who may also be counsel for the Company generally) with respect to any of its duties or obligations hereunder.

8.04 The Trustees may hire agents, accountants, actuaries, investment advisors, financial consultants or other professionals to assist it in performing any of their duties or obligations hereunder.

8.05 The Trustees shall have, without exclusion, all powers conferred on trustees by applicable law, unless expressly provided otherwise herein, provided, however, that if an insurance policy is held as an asset of the Trust, the Trustees shall have no power to name a beneficiary of the policy other than the Trust, to assign the policy (as distinct from conversion of the policy to a different form) other than to a successor trustee, or to loan to any person (other than the Company) the proceeds of any borrowing against such policy.

8.06 Notwithstanding the provisions of Trust Section 8.05, the Trustees may loan to the Company the proceeds of any borrowing against an insurance policy held as an asset of the Trust.

8.07 Notwithstanding any powers granted to the Trustees pursuant to this Trust Agreement or to applicable law, the Trustees 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 Code.

11

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE IX

COMPENSATION AND EXPENSES OF TRUSTEES

The Company shall pay all administrative and expenses and, as agreed to by the Company, and any Trustee’s fees. If not so paid, the fees and expenses shall be paid from the Trust.

12

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE X

RESIGNATION AND REMOVAL OF TRUSTEES

10.01 The Trustees may resign at any time by written notice to the Company, which shall be effective thirty (30) days after receipt of such notice unless the Company and the Trustees agree otherwise.

10.02 The Trustees may be removed by the Company on thirty (30) days notice or upon shorter notice accepted by Trustees; provided, however, that upon a Change of Control, as defined herein, the successor Trustee appointed in accordance with Section 11.04 may not be removed by the Company for three (3) years.

10.03 If the successor Trustee appointed in accordance with Section 11.04 resigns within three (3) years of a Change of Control, as defined herein, such Trustee shall select a successor trustee in accordance with the provisions of Trust section 11.02 prior to the effective date of the Trustee’s resignation or removal.

10.04 Upon resignation or removal of the Trustees and appointment of a successor trustee, all assets shall subsequently be transferred to the successor trustee. The transfer shall be completed within sixty (60) days after receipt of notice of resignation, removal or transfer, unless the Company extends the time limit.

10.05 If the Trustees resign or are removed, a successor shall be appointed, in accordance with Article XI hereof, by the effective date of resignation or removal under Trust section 10.01 or 10.02. If no such appointment has been made, the Trustees may apply to a court of competent jurisdiction for appointment of a successor or for instructions. All expenses of the Trustees in connection with the proceeding shall be allowed as administrative expenses of the Trust.

13

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE XI

APPOINTMENT OF SUCCESSOR

11.01 If the Trustees resign or are removed in accordance with Trust section 10.01 or 10.02, the Company may appoint any third party, such as a bank trust department with trust powers under state law or other party that may validly exercise trustee powers under state law, as a successor to replace the Trustees 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 Trustees shall execute any instrument necessary or reasonably requested by the Company or the successor trustee to evidence the transfer.

11.02 If the Trustees resign or are removed pursuant to the provisions of Trust section 10.03 and select a successor Trustee, the Trustees may appoint any third party such as a bank trust department or other party that may validly exercise trustee powers under state law. The appointment of a successor trustee shall be effective when accepted in writing by the new trustee. The new trustee shall have all the rights and powers of the former Trustees, including ownership rights in Trust assets. The former Trustees shall execute any instrument necessary or reasonably requested by the successor trustee to evidence the transfer.

11.03 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 Articles VII and VIII hereof. A successor trustee shall not be responsible for and the Company shall indemnify and defend a 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.

11.04 A successor Trustee that is a bank trust department with trust powers under state law shall be appointed to serve effective as of a Control Change Date. Such successor Trustee shall become the Trustee in accordance with the provisions of Section 11.01 and 11.03.

14

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE XII

AMENDMENT OR TERMINATION

12.01 The Trust Agreement may be amended by a written instrument executed by the Trustees and the Company. Notwithstanding the foregoing, no such amendment shall conflict with the terms of the Plan or shall make the Trust revocable after it has become irrevocable in accordance with Trust section 1.02.

12.02 The Trust shall not terminate until the date on which Plan participants and their beneficiaries are no longer entitled to benefits from the Investment Accounts pursuant to the terms of the Plan, unless sooner revoked in accordance with Trust section 1.02. Upon termination of the trust any assets remaining in the Trust shall be returned to the Company.

12.03 Upon written approval of all participants or beneficiaries entitled to payment of benefits pursuant to the terms of the Plan, the Company may terminate this Trust prior to the time all benefit payments under the Plan have been made. All assets in the Trust at termination shall be returned to the Company unless the Trust has become irrevocable prior to such termination.

12.04 Any other provision of this Trust to the contrary notwithstanding, the Trust may not be amended by the Company for three (3) years following a Change of Control.

15

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE XIII

MISCELLANEOUS

13.01 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.

13.02 Benefits payable to Plan participants and their beneficiaries 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.

13.03 This Trust Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia other than its choice of law provisions to the extent that they would require the application of the laws of another state.

16

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE XIV

EFFECTIVE DATE

The effective date of this Trust Agreement shall be July 1, 2004.

17

Owens & Minor, Inc.

Executive Deferred Compensation Plan Trust

Effective July 1, 2004

ARTICLE XV

SIGNATURE PAGE

As evidence of its adoption of this amendment and restatement of the Trust, the Company and Trustees have caused this document to be executed by their duly authorized officers effective the 1^st day of July, 2004.

		OWENS & MINOR, INC.
Date:	November 5, 2004	By:	/s/ JEFFREY KACZKA

		ERIKA T. DAVIS
Date:	August 24, 2004		/s/ ERIKA T. DAVIS

		GRACE DEN HARTOG
Date:	August 20, 2004		/s/ GRACE DEN HARTOG

18

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, G. Gilmer Minor, III, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2004 of Owens & Minor, Inc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) [omitted in reliance on SEC Release No. 33-8238; 34-47986 Section III.E.]

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2004

/s/ G. GILMER MINOR, III

G. Gilmer Minor, III

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULE 13a-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jeffrey Kaczka, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2004 of Owens & Minor, Inc;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) [omitted in reliance on SEC Release No. 33-8238; 34-47986 Section III.E.]

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2004

/s/ JEFFREY KACZKA

Jeffrey Kaczka

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Owens & Minor, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, G. Gilmer Minor, III, Chief Executive Officer and Chairman of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fully presents, in all material respects, the financial condition and results of operations of the Company.

/s/ G. GILMER MINOR, III

G. Gilmer Minor, III

Chief Executive Officer

Owens & Minor, Inc.

November 5, 2004

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Owens & Minor, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jeffrey Kaczka, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fully presents, in all material respects, the financial condition and results of operations of the Company.

/s/ JEFFREY KACZKA

Jeffrey Kaczka

Chief Financial Officer

Owens & Minor, Inc.

November 5, 2004