Exhibit 10.1.10
SPLIT-DOLLAR LIFE INSURANCE AGREEMENT
DECEMBER 21, 1999
XXXX & XXXXXX, INC.
A DELAWARE CORPORATION
0000 X.X. XXXXX XXXXXX, XXXXX 000
XXXXXXXX, XXXXXX 00000 COMPANY
XXXXX X. XXXX
TRUSTEE OF THE XXXX GRANDCHILDREN'S TRUST
0000 X.X. XXXXX XXXXXX, XXXXX 000
XXXXXXXX, XXXXXX 00000 TRUSTEE
The Company and the Trustee enter into this Agreement to govern an
arrangement whereby the Company and the Trustee will join in the purchase of
Policy No. 020043774, on a policy form entitled Variable Estate Protection
Policy 1999, (Policy), issued by Xxxx Xxxxxxx Mutual Life Insurance Company
(Insurer), insuring the lives of Xxxxx X. Xxxx (Xxxx) and his wife, Xxxxxxxxx X.
Xxxx. This Agreement is entered into in connection with the employment by the
Company of Xxxx as the Company's Chairman and Chief Executive Officer and is
intended to be a split-dollar life insurance agreement described in Rev. Rul.
64-328.
ARTICLE 1
LIFE INSURANCE POLICY AND COLLATERAL ASSIGNMENT
1.01 POLICY
1.01-1 In connection with this Agreement, the Trustee will
apply for and purchase the Policy.
1.01-2 The Trustee will be owner of the Policy. The Trustee
may freely exercise all rights and incidents of ownership, subject to the rights
of the Company under this Agreement and the collateral assignment of the Policy
to secure the Company's rights as described below.
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1.01-3 The Trustee may pledge or assign the Policy to secure
a loan, including a policy loan from the Insurer, but only to the extent that
the Policy death benefit and net cash surrender value will not thereby be
reduced below the amount the Company would then be entitled to receive under
2.01 in the event of a death benefit being payable under the Policy or under
3.01 in the event of surrender of the Policy. The Trustee is responsible for
payment of interest on any such loan.
1.01-4 The Trustee will promptly provide copies of all
Policy documents, including the Policy, the Policy application, the Collateral
Assignment, any loan documents and any other documents relating to the Policy,
to the Company.
1.02 PREMIUM PAYMENTS
The Company will pay the entire premium under the policy.
1.03 COLLATERAL ASSIGNMENT
1.03-1 To secure the Company's rights under this Agreement,
the Trustee will collaterally assign the Policy to the Company using a
collateral assignment form attached as Attachment A (Collateral Assignment). The
Collateral Assignment will merely secure the Company's rights under this
Agreement and will not transfer any incidents of ownership of the Policy to the
Company.
1.03-2 The Trustee shall own and retain all rights under the
Policy, subject to the Company's rights under the Collateral Assignment,
including the right to designate beneficiaries, the right to settlement and
dividend options, the right to make a policy loan on the cash value as security,
the right to surrender or partially surrender the Policy and receive the cash
value and any other incidents of ownership.
1.03-3 The Trustee and the Company will take any additional
actions necessary to cause the Collateral Assignment to conform to this
Agreement.
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ARTICLE 2
DEATH BENEFIT UNDER POLICY
2.01 PAYMENT TO COMPANY
If a death benefit becomes payable under the Policy, a sum
equal to the accumulated premiums paid by the Company under 1.02, less any
amount previously reimbursed, shall be paid to the Company.
2.02 BALANCE OF PROCEEDS
Any balance of the proceeds over the amount payable under 2.01
shall be paid to the Trustee or other beneficiaries designated by the Trustee in
the manner and in the amounts provided in the Policy's provisions for
designation of beneficiary.
ARTICLE 3
SURRENDER OF POLICY
3.01 PAYMENT TO COMPANY ON SURRENDER
If the Trustee surrenders or partially surrenders the Policy,
the Company shall have the unqualified right to receive the lesser of (a) the
net proceeds from the complete or partial surrender of the policy or (b) the
accumulated premiums paid by the Company under 1.02, less any amount previously
reimbursed.
3.02 BALANCE OF NET CASH SURRENDER VALUE
Any balance of the Policy's net cash surrender value over the
amount payable to the Company under 3.01 shall be payable to the Trustee.
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ARTICLE 4
TERMINATION OF AGREEMENT
4.01 TERMINATION OF AGREEMENT
This Agreement shall terminate on the earlier of (a) such date
as the Company and the Trustee may agree in writing or (b) the last day of the
sixteenth Policy year.
4.02 RELEASE OF COLLATERAL ASSIGNMENT
4.02-1 For sixty days after the date of termination of the
Agreement under 4.01, the Trustee shall have the option of obtaining the release
of the Collateral Assignment as follows.
4.02-2 The Trustee may exercise this option by paying to the
Company the amount of the net cash surrender value of the Policy that the
Company would then be entitled to receive under 3.01 if the Policy were then
surrendered.
4.02-3 Upon receipt of payment under 4.02-2 the Company will
release the Collateral Assignment by executing and delivering to the Trustee and
the Insurer an appropriate instrument of release.
4.03 COMPANY'S RIGHTS
If the Trustee does not exercise the option under 4.02, the
Company may enforce its rights to claim and receive payment from the net cash
surrender value of the Policy of the amount under 3.01. The Trustee will, at the
Company's request, execute any documents required by the Insurer to make payment
to the Company, including surrender or partial surrender of the Policy if
required under the terms of the Policy.
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ARTICLE 5
MISCELLANEOUS
5.01 BINDING AGREEMENT
This Agreement is binding on and enforceable by and against
the parties, their successors, legal representatives and assigns.
5.02 AMENDMENTS
This Agreement may be amended only in a written document
signed by both parties.
5.03 GOVERNING LAW
This Agreement is governed by and construed according to the
laws of the state of Oregon with the exception of its rules with respect to
choice of laws.
5.04 SEVERABILITY
No part of this Agreement will be affected if any other part
of it is held invalid or unenforceable.
5.05 NOTICES
All notices required or permitted to be given under this
Agreement must be given in writing and will be deemed given when personally
delivered or, if earlier, when received after mailing by registered or certified
mail, postage prepaid, with return receipt requested.
5.06 ADAYS@
Any reference in this Agreement to Adays@ means all calendar
days, whether or not legal holidays.
5.07 WAIVERS
A party's failure to insist on compliance or enforcement of
any provision of this Agreement shall neither affect the validity of the
provision or its enforceability, nor constitute a waiver of future enforcement
of that or any other provision.
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5.08 DUPLICATE ORIGINALS
This Agreement may be executed in duplicate originals, any of
which shall have the same significance.
TRUSTEE: TRUSTEE OF THE XXXX GRANDCHILDREN'S TRUST
By: /s/ Xxxxx X. Xxxx
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COMPANY: XXXX & TALBOT, INC.
By: /s/ Xxxxxxx Xxxxxxxx
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