Exhibit 10.77
TERMINATION
OF
COLLATERAL ASSIGNMENT SPLIT-DOLLAR AGREEMENT
WHEREAS, by Agreement made the 6th day of October, 2000 (the
"Split-Dollar Agreement"), by and between Select Medical Corporation
("Corporation") and Xxxxxxx X. Xxxxxxx, Trustee of the Irrevocable Trust under
Deed date October 20, 1987 of Xxxxx X. Xxxxxxxx, Settlor ("Owner") and Xxxxx X.
Xxxxxxxx ("Employee") (Corporation, Owner and Employee collectively referred to
herein as the "Parties") Corporation agreed to pay premiums on certain life
insurance policies (the "Policies"), as an additional employment benefit to
Employee, with Owner, as the owner of the Policies, to possess all incidents of
ownership in and to the Policies, which were, however, in each case to be
subject to a collateral assignment in favor of Corporation (collectively, the
"Collateral Assignments") to secure the payment of the Corporation's "Secured
Premium Amount" (as that term is defined in the Split-Dollar Agreement); and
WHEREAS, the Policies currently subject to the Split-Dollar
Agreement are listed on the schedule attached hereto; and
WHEREAS, by reason of certain federal legislation commonly
known as the Xxxxxxxx-Xxxxx Act, it is uncertain whether Corporation can
continue to make premium payments with respect to the Policies as contemplated
in the Split-Dollar Agreement; and
WHEREAS, all of the Parties are willing to terminate the
Split-Dollar Agreement at this time upon payment by Owner to Corporation of the
Secured Premium Amount, as specifically contemplated in paragraph 11(d) of the
Split-Dollar Agreement; and
WHEREAS, the Parties are in agreement that the Secured Premium
Amount is Three Million Seven Hundred Forty-Four Thousand Dollars ($3,744,000);
and
WHEREAS, Owner will, contemporaneously with execution of this
instrument, pay to Corporation the full Secured Premium Amount of Three Million
Seven Hundred Forty-Four Thousand Dollars ($3,744,000); and
NOW THEREFORE, the parties hereto agree that, effective upon
payment to the Corporation by Owner of the Secured Premium Amount and execution
of this Termination Agreement the Split-Dollar Agreement shall be terminated;
and
Corporation further agrees that, in accordance with paragraph
12(a) of the Split-Dollar Agreement, Corporation shall release the Collateral
Assignments with respect to the Policies by the execution and delivery of
appropriate instruments of release.
IN WITNESS WHEREOF, the parties have executed this Termination
Agreement, in duplicate, as of this ----- day of December, 2003.
Attest: SELECT MEDICAL CORPORATION
/s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxxxxx
--------------------------- ----------------------------------------
Xxxxxxx X. Xxxxxx, Secretary Xxxxx X. Xxxxxxxxx,
Vice President and Controller
IRREVOCABLE TRUST OF XXXXX X.
XXXXXXXX DATED OCTOBER 20, 1987
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------- ----------------------------------------
Witness Xxxxxxx X. Xxxxxxx, Trustee
/s/ Xxxxx X. Xxxxxxxx
---------------------------- ---------------------------------------
Witness XXXXX X. XXXXXXXX, Employee
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Schedule of Insurance Policies
Subject to the Split-Dollar Agreement
Referred to in the Foregoing Termination Agreement
Sun Life Policy #020018770
Great West Policy #4995814
Metropolitan Policy #951050265A
Metropolitan Policy #960150090PR
Metropolitan Policy #951150267A
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