FORM OF INSURANCE AGREEMENT
EXHIBIT
10.3
FORM
OF INSURANCE AGREEMENT
This
is
an Agreement, entered into as of the date set forth on the Summary Schedule
which is attached hereto and made a part hereof, by and between GREEN MOUNTAIN
POWER CORPORATION (hereinafter "Company") and the Executive named in the Summary
Schedule (hereinafter "Executive").
WHEREAS,
the Executive has provided valuable services to the Company and the Company
desires to retain the Executive's valuable services and to provide the Executive
and his beneficiaries with death benefits;
WHEREAS,
the Executive is a highly compensated managerial employee;
WHEREAS,
the benefits provided herein constitute an important and integral portion of
the
Executive's financial planning; and
WHEREAS,
in reliance on the availability of the benefits provided Executive herein,
Executive has chosen to forego obtaining benefits from other
sources.
NOW
THEREFORE, the Company and the Executive in consideration of the terms and
conditions set forth herein hereby mutually covenant and agree as
follows:
1. Insurance.
The
Company agrees to purchase a life insurance policy on the life of the Executive.
The Company shall be the owner of the policy and shall be entitled to exercise
all of the rights and privileges available under the terms of the policy, except
as hereinafter provided. The Executive's beneficiaries shall be entitled to
a
death benefit as set forth on the Summary Schedule attached hereto and hereby
made a part hereof. The Executive shall designate on the Summary Schedule the
beneficiaries of the death benefit. The Executive may change the designated
beneficiaries at any time by giving written notice to the Company.
2. Conditions.
Upon the
Executive's termination of employment with the Company, this Agreement shall
automatically terminate and the Executive shall have no further rights hereunder
except as provided in Section 7 below. If the Executive is no longer classified
as an executive, the Company may terminate this Agreement in its sole
discretion. If the Executive shall become disabled within the meaning of the
long term disability plan of the Company and prior to termination of employment
with the Company, the Executive shall be considered to be continuing in
employment as an executive for as long as such disability exists, but not after
age sixty-five, and the Executive's salary as referred to on the Summary
Schedule shall be deemed to be the Executive's annual base compensation on
the
date of onset of the disability.
The
Executive agrees that he already has, or will, answer truthfully any questions
or requests for information by an insurance company in connection with the
issuance of a policy upon his life with the Company as the owner thereof. If
the
Executive fails to do so, or dies by suicide, and the liability of the insurer
under said policy or policies, if any, is restricted to any degree as a result
of such failure or suicide, then the Company shall be released from all of
its
obligations under this Agreement.
3. Premiums.
The
premiums for the insurance policy shall be paid by the Company.
4. Dividends.
Any
dividends payable with respect to the policy shall either (1) be applied by
the
Company to reduce its premiums hereunder, or (2) used to purchase additional
paid-up insurance, at the Company's option.
5. Interests
of the Parties.
Upon
surrender of the aforementioned life insurance policy or upon termination of
this Agreement prior to the death of the Executive, the Company shall be
entitled to an amount equal to the cash value of the policy as of the next
succeeding policy anniversary, plus any final and terminal dividend and refund
of premium payable by the insurer, decreased by any indebtedness incurred by
the
Company against the policy.
Upon
the
death of the Executive prior to a surrender of the policy or a termination
of
this Agreement, the Executive's beneficiaries shall be entitled to a death
benefit payable in the amount set forth on the Summary Schedule attached hereto
and hereby made a part hereof, which benefit shall be paid by the insurer
directly to Executive's Beneficiaries. The Company shall be entitled to all
other proceeds.
6. Executives
of Subsidiaries.
For
purposes of this Agreement, employment by the Company shall include employment
by a wholly-owned subsidiary of the Company. The transfer of an Executive from
the Company to any wholly-owned subsidiary of the Company, or from any
wholly-owned subsidiary to the Company, or from one wholly-owned subsidiary
to
another shall not constitute a termination of such executive's employment by
the
Company under this Agreement.
7. Termination.
Except
as provided in Section 2 above, this Agreement may not be terminated. Upon
the
Executive's pre-retirement termination of employment with the Company, the
Executive may, within thirty days after termination, purchase the Company's
interest in the policy by paying to the Company the aggregate amount of its
interest in the policy as specified in Section 5 of this Agreement. On receipt
of such amount, or its equivalent in other property reasonably acceptable to
the
Company, the Company shall execute an absolute assignment of the policy to
the
Executive, free and clear of all encumbrances. In all other circumstances,
it is
understood and agreed that the policy shall become the sole property of the
Company, which may designate itself as beneficiary of the entire proceeds,
surrender the policy for cash (which it shall be entitled to retain), or deal
with it in any other manner that it sees fit.
8. Definitions.
The
following terms as used in this Agreement mean:
|
A.
|
Premiums:
The premiums provided for by the
policy.
|
|
B.
|
Cash
Value: The cash value, including guaranteed cash value and value
of
insurance additions purchased with dividends as defined in the
policy.
|
9. Successors
and Assigns.
All of
the Company's rights under this Agreement will pass to and this Agreement will
be binding upon its successors and assigns. All of the Executive's rights under
this Agreement will pass to and this Agreement will be binding upon the
Executive's heirs, beneficiaries, executors and administrators.
10. Arbitration.
In
the
event of any dispute arising between the parties to this Agreement, the parties
agree that such controversy shall be settled exclusively by arbitration in
Burlington, Vermont, in accordance with the rules of the American Arbitration
Association. Judgment may be entered on the arbitrator's award in any court
having jurisdiction. In the event that the Executive or his beneficiaries
prevail and are awarded benefits or money damages by the arbitrator, such
benefits or damages shall be equal to one hundred twenty-five percent (125%)
of
the amount otherwise due under this Agreement; however, if the arbitrator finds
that the Company acted in good faith, such benefits or damages shall only be
equal to one hundred percent (100%) of the amount due under this
Agreement.
11. Attorney's
Fees. The
Company shall pay the Executive or his beneficiaries all costs and expenses,
including reasonable attorney's fees and arbitration costs, incurred by them
in
reasonably exercising any of their rights hereunder, or enforcing any terms,
conditions, or provisions hereof.
12. State
Law. This
Agreement shall be construed under the laws applicable to agreements made
entirely within the State of Vermont.
13. Whole
Agreement.
This
writing contains the whole Agreement, with no other understandings or provisions
other than what is contained herein.
ACKNOWLEDGEMENT
OF ARBITRATION
The
parties hereto understand that this Agreement contains an Agreement to
arbitrate. After signing this document, the parties understand that they will
not be able to bring a lawsuit concerning any dispute that may arise which
is
covered by the arbitration agreement, unless it involves a question of
constitutional or civil rights. Instead, the parties agree to submit any such
dispute to an impartial arbitrator.
EXECUTED
as of this ___ day of
IN
THE
PRESENCE OF:
(as
to
both) Executive
GREEN
MOUNTAIN POWER
(as
to
both) CORPORATION
By:
Duly
Authorized Agent
SUMMARY
SCHEDULE
1. Name
of Executive:
2. Address:
3. Date:
4. Name
of Insurance Company:
5. Policy
Number:
6. Death
Benefits:
7. Beneficiaries:
In
the
event there are no surviving beneficiaries, then the benefit shall be paid
to
the Executive's estate.
Dated
at
Colchester, Vermont, this ___ day of .
WITNESS:
(as
to
both) Executive
GREEN
MOUNTAIN POWER
(as
to
both) CORPORATION
By:
Duly
Authorized Agent
GROUP
LIFE AGREEMENT
In
consideration for Green Mountain Power Corporation's execution of an Insurance
Agreement with me, I hereby agree not to participate in any other Green Mountain
Power Corporation group-life insurance programs and consent to the termination
of any such participation as of the date insurance is obtained under the
Insurance Agreement, except that I may participate in the Corporation's
group-life insurance programs if I pay all premiums charged on account of such
participation.
Dated
.
Executive
Form
Approved:
General
Counsel
