EXHIBIT 10.21
SPLIT-DOLLAR AGREEMENT
This Agreement, entered into this 21st day of September, 1992, by and between
The Xxxxxxx Xxxxxx Company, Inc., (the "Corporation") organized and existing
under the laws of Commonwealth of Connecticut, and Xxxxxxxxx X. Xxxxx XX, (the
"Employee").
Witnesseth:
WHEREAS, the "Employee" has rendered competent and faithful services on behalf
of the Corporation and the Corporation highly values the services, abilities and
accomplishments of the Employee; and
WHEREAS, the Corporation desires to encourage the Employee to continue to render
faithful and high quality services to the Corporation; and
WHEREAS, the Corporation is desirous of providing protection for the
beneficiaries of Employee in the event of his untimely death; and
WHEREAS, The Employee has applied for, and is the owner of Life Insurance Policy
Number 66891602 (the "Policy") in the specified face amount of $1,000,000 from
the Xxxx Xxxxxxx Mutual Life Insurance Company; and
WHEREAS, the Employee has assigned the Policy to the Corporation as collateral
for amounts to be advanced by the Corporation under this Agreement by an
instrument of assignment (the "Collateral Assignment") executed on September 21,
1992, and
WHEREAS, it is understood and agreed that this Agreement is to be considered
effective as of the date on which the Policy was issued by the Insurance Company
or the date of execution of this Agreement whichever is earlier.
NOW THEREFORE, for value received and in consideration of the mutual covenants
and agreements contained herein, the Corporation, for itself, its successors and
assigns, and the Employee for himself, his executors, administrators and
assigns, agree as follows:
1
Article I
Ownership Rights In The Policy
A. The Employee shall have all of the ownership rights, options and privileges
permitted by the Policy except those expressly granted to the Corporation
by the terms of this Agreement.
B. The Corporation has the right to borrow or to pledge the surrender value of
the Policy to the extent of its interest specified in Paragraph C of this
Article, and as permitted by the terms of the Policy.
C. The Corporation's interest in the Policy shall be limited to:
... the total of the net premiums paid by the Corporation or the surrender
value of the Policy, whichever is the lesser provided such amount is
reduced by an indebtedness (on or secured by the Policy) which is
attributable to borrowing by or on behalf of the Corporation.
Article II
Premium Payment Options
A. The Corporation shall contribute the entire premium payable under the
policy.
B. The Employee shall be charged with taxable income by reason of the
economic benefit of the insurance protection received, as determined
under Revenue Rulings 64-328, 1964-2 C.B. 11 and 66-100, 1966-1 C.B.
12. The Corporation shall furnish the Employee a statement on Form W-2
of his or her taxable income, including income, received under this
plan.
Article III
Division of Death Proceeds of Policy
In the event that the Employee shall die while this Agreement is in force, the
Corporation shall be entitled to receive from the Policy proceeds an amount
equal to the Corporation's interest in the Policy, as determined under Article
I.C. of this Agreement. The portion of the Policy proceeds which is in excess of
the amount paid to the Corporation shall be paid to the beneficiary named by the
Employee in accordance with the terms of the Policy as reflected in the records
of the insurance company.
2
Article IV
Policy Dividends
All dividends attributable to the Policy shall be applied to the purchase of
paid-up additional insurance from the Insurance Company. This additional
insurance will have a cash value of at least the amount of dividends used to
purchase it. Upon the death of the Insured, the additional insurance shall be
part of the Policy proceeds for purposes of this Agreement.
Article V
Termination of Agreement
A. This Agreement may be cancelled by either party at any time while the
Employee is living, upon written notice thereof to the other party and
shall automatically be cancelled upon termination of the Employee's
employment during his/her lifetime with the Corporation. Upon such
termination, the Employee shall have a 60-day option to pay the Corporation
an amount equal to the Corporation's interest in the Policy under Article
I.C. in return for the Corporation's release of any claim to the policy.
If, within the 60-day period following the cancellation of this Agreement
by the Employee or the Corporation, the Employee fails to exercise said
option, then the Employee shall be deemed to have relinquished all rights
in the Policy and the Corporation will be free to surrender or take any
other action with respect to the Policy as it may desire. If the Employee
fails to pay the Corporation within the 60-day option period, the Employee
agrees upon request of the Corporation to execute any and all instruments
that may be required to transfer all right, title, and interest in the
Policy to the Corporation.
B. Upon the division of death proceeds of the Policy pursuant to Article III
above, this Agreement shall terminate.
Article VI
Conflict Between Collateral Assignment and Agreement
In the event that there shall be any conflict between this Agreement and the
Collateral Assignment, the Collateral Assignment shall take precedence over this
Agreement.
Article VII
Amendment
This agreement may be amended at any time and from time to time, by a written
instrument signed by the Corporation and the Employee.
3
Article VIII
Agreement Binding Upon Parties
This Agreement shall bind both the Corporation and the Employee, as well as
their heirs, successors, personal representatives and assigns.
Article IX
Insurer Not a Party to Agreement
The Insurance Company shall not be deemed a party to this Agreement. Payment or
other performance of its contractual obligations in accordance with the Policy
provisions shall fully discharge the Insurance Company from any and all
liability.
Article X
Governing Law
This Agreement sets forth the entire agreement between the parties hereto, and
any and all prior agreements are hereby superseded. The law of the State of
Connecticut shall govern this Agreement.
IN WITNESS WHEREOF, the Parties hereto have set their hands on the day and year
first hereinabove written.
Employee /s/ Xxxxxxxxx X. Xxxxx Witness /s/ [ILLEGIBLE]
----------------------- --------------------
Corporation The Xxxxxxx Xxxxxx Co. Witness /s/ [ILLEGIBLE]
------------------------ --------------------
By: /s/ [ILLEGIBLE]
-----------------------
Authorized Officer
4
Collateral Assignment
For value received the undersigned Xxxxxxxxx X. Xxxxx XX, hereafter called the
Assignor, hereby collaterally assigns and transfers to Xxxxxxx Xxxxxx Company,
hereafter called the Assignee, or its legal representative policy numbered
66891602 issued by the Xxxx Xxxxxxx Mutual Life Insurance Company, hereafter
called the Company, upon the life of Xxxxxxxxx X. Xxxxx XX. This assignment of
the policy is made as collateral security for premiums now or hereafter advanced
on behalf of the Assignee by the Assignor under a Split Dollar Agreement between
Assignor and the Assignee dated .
This assignment shall be subject, however, to all the terms and conditions of
the said policy, and to any prior pledge or assignment thereof to the Company or
to any prior pledge or assignment which is binding on the Company.
The said assignee is authorized to borrow from the Policy surrender value to the
extent of it's interest as specified in the Split Dollar Agreement. All other
rights under the Policy shall be possessed by the Assignor.
Repayment as is stipulated in the Split Dollar Agreement shall constitute a
discharge of this assignment upon completion of a valid release of collateral
assignment by the Assignee.
The company is authorized upon surrender of the Policy by the Assignor, upon
death of the insured, or upon termination of the Split Dollar Agreement and
completion by the Assignor of a loan form or surrender form to pay the Assignee
its respective collateral interest as set forth in a written statement by the
Assignee filed with the Company. This statement shall be conclusive proof to the
Company of the Assignee's interest in the Policy.
The Company will pay the balance, if any, due under the Policy to the person or
persons entitled thereto under said Policy as shown on the Company's records.
The Assignor hereby warrants the validity of this assignment and that there are
no prior assignments of this Policy except as noted herein.
1
It is hereby certified that no proceedings in bankruptcy or insolvency,
voluntary or involuntary have ever been instituted by or against the Assignor,
and that he is not under guardianship or any legal disability, except as
follows: None.
Date: September 21, 1992 Assignor : /s/ Xxxxxxxxx X. Xxxxx
-------------------- --------------------------
The Xxxx Xxxxxxx Mutual Life Insurance Company, without assuming any
responsibility for the validity or the sufficiency of the foregoing assignment,
has, on this date, filed a duplicate thereof at its Home Office.
XXXX XXXXXXX MUTUAL LIFE INSURANCE COMPANY
Date: September 21, 1992 By: OCT 9 1992
-------------------- ------------------------
Secretary
/s/ [ILLEGIBLE]
2
