1
EXHIBIT 10.32
SPLIT DOLLAR AGREEMENT
This Agreement, made on August 4, 1999, by and between Chemed
Corporation ("the Corporation"), a Delaware corporation with offices at 2600
Chemed Center, 000 X. Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000 and Xxxxxx X. Xxxxxx,
III ("the Trustee"), as Trustee of an Irrevocable Trust Agreement with Xxxx X.
Mount and Xxxxxxxx X. Mount dated June 22, 1998 ("the Trust").
1. PREMISES
1.1 Xxxx X. Mount is an employee of the Corporation and has
created the Trust. The Trustee wishes to insure the lives of
Mr. Mount and his wife, Xxxxxxxx X. Mount, for the benefit and
protection of their family. The Corporation will help the
Trustee provide this insurance coverage by payment of part of
the premiums under a split dollar arrangement, whereby the
Trustee will be the owner of a life insurance policy which
will be collaterally assigned to the Corporation as security
for amounts the Corporation will contribute for the premium
payments.
2. APPLICATION FOR INSURANCE
2.1 The Trustee has applied to Phoenix Home Life Mutual
Insurance Company for a Survivor
2
Legacy Policy on the lives of Xxxx X. Mount and Xxxxxxxx X.
Mount for $ $2,000,000 ("Policy").
3. POLICY OWNERSHIP
3.1 The Trustee shall own the Policy and may exercise all
rights of ownership with respect to it, subject only to the
security interest of the Corporation as expressed in this
Agreement and the collateral assignment of the Policy to the
Corporation.
4. PAYMENT OF PREMIUMS
4.1 On or before the due date of each annual premium on the
Policy, the Corporation will pay to Phoenix Home Life Mutual
Insurance Company an amount equal to the greater of 80 percent
of the annual premium or the annual premium less the economic
benefit cost (as measured by the Phoenix Home Life term
insurance rates) of the portion of the insurance which the
beneficiary or beneficiaries named by the Trustee would be
entitled to receive if Mr. Mount and Mrs. Mount died during
the policy year for which the annual premium is paid.
4.2 On or before the due date of each annual premium on the
Policy, the Corporation will pay
2
3
to Phoenix Home Life Mutual Insurance Company, on behalf of
the Trustee, the remainder of the annual premium. This payment
will constitute compensation to Mr. Mount in the form of a
bonus during his lifetime and in the form of deferred
compensation if he dies before Mrs. Mount and will be
considered paid by the Trustee for purposes of the Assignment
(as defined in Article 5).
4.3 These premium advances by the Corporation shall apply
specifically to annual premiums due under the Policy up to Mr.
Mount's age of 65. However, additional premium advances may be
made by mutual agreement of the parties.
5. ASSIGNMENT OF POLICY
5.1 The Trustee shall collaterally assign the Policy to the
Corporation so as to reflect the respective interests of the
parties under this Agreement, said collateral assignment
("Assignment") having been executed by the parties on the date
of this Split Dollar Agreement, and thus made a part of such
Policy and this Agreement.
3
4
6. USE OF DIVIDENDS
6.1 The dividends declared by Phoenix Home Life Mutual
Insurance Company on the Policy will be used to purchase
paid-up insurance.
6.2 The dividend option which is specified in paragraph 6.1 of
this Article will not be terminated or changed without a
conforming amendment to this Agreement and unless such change
is done in accordance with the provisions of Part D "Joint
Rights" section of the Assignment.
7. SURRENDER OF POLICY
7.1 The Trustee shall have the sole and exclusive right to
surrender the Policy.
7.2 If the Policy is surrendered, the Trustee shall direct the
insurance company in writing to draw a check payable to the
Corporation in an amount equal to the "Assignee's Cash Value
Rights", as defined within the provisions of Part A
"Definitions" section of the Assignment.
7.3 If there is a delay in the surrender of the Policy by
either party to this Agreement, and if such delay results in
diminished policy values being available to either party,
neither party
4
5
to this Agreement shall hold the insurance company liable for
such diminution in Policy values.
8. DEATH CLAIMS
8.1 Upon the death of the last to die of Mr. and Mrs. Mount,
the Corporation shall have an interest in the proceeds of the
Policy equal to the "Assignee's Death Benefit Share", as
defined within the provisions of Part A "Definitions" section
of the Assignment. The balance of proceeds remaining shall be
paid directly by the insurance company to the beneficiary or
beneficiaries designated in the Policy.
9. TERMINATION OF AGREEMENT
9.1 This Agreement shall terminate upon surrender of the
Policy by the Trustee or upon thirty (30) days' written notice
of termination given by either party to the other by
registered mail at the party's last known address.
9.2 Prior to termination of this Agreement, the Trustee shall
direct the insurance company in writing to draw a check
payable to the Corporation for an amount equal to the
"Assignee's Cash Value Interest", as defined
5
6
within the provisions of Part A "Definitions" section of the
Assignment. Upon receipt of this amount, the Corporation shall
release the security interest of the Corporation expressed in
this Agreement and the Assignment.
10. SPECIAL PROVISIONS
The following provisions are part of this Plan and are
intended to meet the requirements of the Employee Retirement
Income Security Act of 1974:
10.01 - The named fiduciary: The Secretary of the Company
10.02 - The funding policy under this Plan is that all
premiums on the Policy be remitted to the Insurer
when due.
10.03 - Direct payment by the Insurer is the basis of payment
of benefits under this Plan, with those benefits in
turn being based on the payment of premiums as
provided in the Plan.
10.04 - For claims procedure purposes, the "Claims Manager"
shall be the Secretary of the Company.
6
7
(a) If for any reason a claim for benefits under
this Plan is denied by the Company, the
Claims Manager shall deliver to the claimant
a written explanation setting forth the
specific reasons for the denial, pertinent
references to the Plan section on which the
denial is based, such other data as may be
pertinent and information on the procedures
to be followed by the claimant in obtaining
a review of his claim, all written in a
manner calculated to be understood by the
claimant. For this purpose:
(1) The claimant's claim shall be
deemed filed when presented orally
or in writing to the Claims
Manager.
7
8
(2) The Claims Manager's explanation
shall be in writing delivered to
the claimant within 90 days of the
date the claim is filed.
(b) The claimant shall have 60 days following
his/her receipt of the denial of the claim
to file with the Claims Manager a written
request for review of the denial. For such
review, the claimant or his/her
representative may submit pertinent
documents and written issues and comments.
(c) The Claims Manager shall decide the issue on
review and furnish the claimant with a copy
within 60 days of receipt of the claimant's
request for review of his/her claim. The
decision on review shall be in writing and
shall include
8
9
specific reasons for the decision written in
a manner calculated to be understood by the
claimant, as well as specific references to
the pertinent Plan provisions on which the
decision is based. If a copy of the decision
is not so furnished to the claimant within
such 60 days, the claims shall be deemed
denied on review.
11. AMENDMENT AND BINDING EFFECT
11.1 This embodies all agreements by the parties made with
respect to the Policy. The Agreement shall not be modified or
amended except by a writing signed by the parties. The
Agreement shall be binding upon the parties, their heirs,
legal representatives, successors and assigns.
12. GOVERNING LAW
12.1 This Agreement shall be subject to and shall be construed
under the laws of the State of Ohio.
9
10
Executed by the parties at Cincinnati, Ohio, as of August 4, 1999.
CHEMED CORPORATION
------------------------ By: /s/ Xxxxx X. Xxxxxx, Vice President
------------------------------------
Witness Signature, Corporate Title
------------------------ By: /s/ Xxxxxx X. Xxxxxx, III
------------------------------------
Witness Trustee
10
