Exhibit 10-14.6
AMENDED AND RESTATED COLLATERAL ASSIGNMENT
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THIS AMENDED AND RESTATED COLLATERAL ASSIGNMENT, made and entered into
this 31st day of July, 1998, by and between XXXX X. XXXXXXX and XXXXXX XXXXXX,
Trustees under the Rounick Irrevocable Insurance Trust dated October 27, 1986
(the "Owner") and XXX SHOPS, INC. (the "Assignee").
WITNESSETH:
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WHEREAS, the parties hereto entered into a Collateral Assignment
Agreement dated July 31, 1987 (the "Old Agreement") with respect to a policy of
life insurance in the face amount of Twenty Million Dollars ($20,000,000.00),
issued by Manufacturer's Life Insurance Company (the "Insurer"); and
WHEREAS, the Owner owns Life Insurance Policy No. 3,779,930-1 issued by
the Insurer and any supplemental contracts issued in connection therewith (such
policy and contracts herein called "Policy"); and
WHEREAS, the Policy insures the lives of the last to die of Xxxxxx
Xxxxxxx and Xxxx Xxxxxxx ("Insured"); and
WHEREAS, the Assignee has contributed the annual premium due on the
Policy, as more specifically provided in the Split Dollar Insurance Agreement
dated July 31, 1987 and the Amended and Restated Split Dollar Agreement of even
date herewith, between the Insured and the Assignee; and
WHEREAS, in consideration of the Assignee having paid the premiums, the
Owner granted to the Assignee a security interest in the Policy as collateral
security for the payment to the Assignee of all amounts due to Assignee pursuant
to the Agreement; and
WHEREAS, a dispute has arisen between the Insurer, the Owner, and the
Assignee regarding the payment of additional premiums to the Insurer, and
WHEREAS, the Insurer has reduced the face value of the Policy from,
Twenty Million Dollars ($20,000,000.00) to Fifteen Million Dollars
(15,000,000.00); and
WHEREAS, the Insurer has adjusted the illustrated policy values and
eliminated any remaining indebtedness on the Policy effective February 1, 1996;
and
WHEREAS, the Assignee in consideration for the Insurer's eliminating
any indebtedness on the Policy and reducing the premium obligation to maintain
the policy in force, will agree to pay additional premiums on the Policy; and
WHEREAS, the Owner has agreed to the reduction of the face value of the
Policy from Twenty Million Dollars ($20,000,000.00) to Fifteen Million Dollars
(15,000,000.00); and
WHEREAS, this Amended and Restated Collateral Assignment ("Agreement")
is intended to replace and supersede the Old Agreement.
NOW, THEREFORE, for value received, the undersigned hereby assigns,
transfers and sets over to the Assignee, its successors and assigns, the Policy,
subject to the following terms and conditions:
1. This Assignment is made, and the Policy is to be held, as collateral
security for the payments required to be received by Assignee, pursuant to the
terms of the Agreement.
2. The Assignee shall have the right to pledge or assign its interest
in the Policy, subject to the terms of the Agreement and to this Assignment.
(2)
3. The Assignee's interest in the Policy shall further be limited to
the right to recover its net premium outlay (i.e., gross premiums paid less
payments made by Owner and less any policy loan of the Assignee encumbering the
Policy), but if the Policy is canceled and the cash surrender value is less than
the net premium outlay, the Assignee's interest shall be limited to the cash
surrender value.
4. Except as specifically herein granted to the Assignee, the Owner
shall retain all incidents of ownership in the Policy, including, but not
limited to, the right to assign its interest in the Policy, the right to change
the beneficiary of the Policy, and the right to exercise all settlement options
permitted by the terms of the Policy; provided, however, that all rights
retained by the Owner, transferee and beneficiary shall be subject to the terms
and conditions of the Agreement and this Assignment and the Owner and Assignee
agree that no loan may be made against the Policy except for the payment of
premiums on the Policy.
5. Assignee shall, upon request, forward the Policy to the Insurer,
without unreasonable delay, for endorsement of any designation or change of
beneficiary, any election of optional mode of settlement, or the exercise of any
other right reserved by the Owner hereunder.
6. The Insurer is hereby authorized to recognize the Assignee's claims
to rights hereunder without investigating the reason for any action taken by the
Assignee, the amount of its net premium outlay, the termination of the
Agreement, the giving of any notice required herein, or the application to be
made by the Assignee of any amounts to be paid to the Assignee. The signature of
the Assignee shall be sufficient for the exercise of any rights under the Policy
assigned hereby to the Assignee and the receipt of the Assignee for any sums
received by him shall be a full discharge and release therefor to the Insurer.
(3)
7. If the Insurer is made or elects to become a party to any litigation
concerning the proper apportionment of the death proceeds, cash surrender value,
loan value or ownership rights under this Agreement, the Owner and Assignee and
their transferees agree to be jointly and severally liable for the Insurer's
litigation expenses, including reasonable attorney fees.
8. Upon the full payment to the Assignee of the amount to which it is
entitled under paragraph 3 hereof, the Assignee shall reassign the Policy to the
Owner and all specific rights included in this Collateral Assignment; provided,
however, the Insurer shall only be required to release this Assignment pursuant
to written instructions received from the Assignee.
9. All matters respecting the validity, effect and interpretation of
this Assignment shall be determined in accord with the laws of the Commonwealth
of Pennsylvania.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement the date and year first above written.
Assignee:
ATTEST: XXX SHOPS, INC.
/s/ Xxxxxx Xxxxxx By: /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxx, Secretary Xxxxxx Xxxxxxx, President
Owner:
WITNESS: ROUNICK FAMILY IRREVOCABLE
INSURANCE TRUST
/s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, Trustee
/s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx, Trustee
(4)
