Exhibit 10-14.4
AGREEMENT OF SETTLEMENT AND GENERAL RELEASE
WHEREAS, The Manufacturers Life Insurance Company, ("Manulife")
issued a life insurance policy to Xxxx X. Xxxxxxx and Xxxxxx Xxxxxx as Trustees
of the Rounick Family Irrevocable Insurance Trust dated October 27, 1986,
("Owners/Trustees") on the joint lives of Xxxxxx X. Xxxxxxx and Xxxxxx X.
Xxxxxxx, (the "Insureds"), policy number 3,779,930-1, (the "policy"); and
WHEREAS, a dispute has arisen between Manulife on the one hand
and the Owners/Trustees and Insureds on the other with respect to the nature and
extent of premiums and coverages under said policy; and,
WHEREAS, the parties desire to settle and compromise their
differences amicably;
This agreement shall be effective on the last date written below;
NOW, THEREFORE, IT IS AGREED that in consideration of the mutual
covenants contained herein, the sufficiency and adequacy of which are mutually
acknowledged;
1. Manulife shall adjust the illustrated policy values to match
the attached Appendix "A" (illustration dated February 1, 1996) which is
incorporated herein by reference, such that policy loans outstanding on February
1, 1996 are reduced by $229,348.00. The surrender of the policy prior to the
death of the Insureds will result in an adjustment of the cash surrender value
not to exceed $229,348.00.
2. Manulife shall adjust the illustrated policy values to
implement a reduction in the face amount of the policy from $20,000,000.00 to
$15,000,000.00 effective February 1, 1997 as reflected in the attached Appendix
"A". Any then available policy guaranteed cash value will be used to purchase
paid up additions.
3. The Owners/Trustees will pay $397,286.00 into the policy
within 30 days of the date of this agreement and this money will be used to
eliminate any remaining indebtedness on the policy as though the payment had
been made on February 1, 1996 such that the current policy debt will incur no
further loan interest charges as of that date as depicted in the attached
Appendix "A".
4. The payment made by Manulife referred to above is not nor
shall it be construed as an admission of fault or liability and is made solely
in the interest of resolving a disputed matter. This Agreement and General
Release, including the consideration provided, shall be kept strictly
confidential and shall not be hereafter disclosed to any third parties by the
Insureds or Owners/Trustees except by permission of Manulife, or as may be
necessary for tax and estate planning purposes, an order of the court, or other
legal process. Breach of this provision is likely to lead to serious
consequential damages to Manulife and its agent by virtue of
the existence of unresolved and disputed fact matters and damages arising there
would be from difficult to resolve in the event of such breach. Consequently,
the parties hereto stipulate that damages arising from a breach shall cause the
loan and premium payments to be readjusted such that the changes described in
paragraph one (1) would be reversed. This shall be done upon proof of a
substantial breach of this provision subsequent to the date of this agreement,
by either the Insureds or the Owners/Trustees in its capacity as Trustee, in a
Federal or State court in Pennsylvania.
5. The undersigneds, jointly and severally, on their own behalf,
and that of their heirs, successors and assigns hereby release, acquit and
discharge Manulife and any of their agents, officers, employees, directors,
successors and assigns of and from any and all claims and causes of action, of
any name and nature arising from the sale, solicitation, purchase or issuance of
the policy described herein including any act omission, transaction, dealing,
conduct or negotiation of any kind whatsoever arising from the solicitation,
purchase or issuance of any contract with Manulife. Insureds do not waive any
rights under the contract itself.
DATED this 5th day of May 1998.
---- -----
MANULIFE The Manufacturers Life Insurance Company
BY: /s/ Xxxx X. Xxxxxxxxx
------------------------------------------
Xxxx X. Xxxxxxxxx
ITS: Assistant Vice President & Senior Counsel
--------------------------------------------
/s/ Xxxxxx X. Xxxxxxx
INSUREDS --------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxxx
--------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ Xxxx X. Xxxxxxx
OWNERS/TRUSTEES --------------------------------------------
Xxxx X. Xxxxxxx
/s/ Xxxxxx Xxxxxx
--------------------------------------------
Xxxxxx Xxxxxx
APPENDIX "A"
ADVANCED SURVIRORSHIP LEDGER
PREPARED FOR INFORCE POLICY #3779930
M & J ROUNICK M & J ROUNICK
FEMALE, AGE 42 MALE NONSMOKER, AGE 47
$20000000 MANULIFE PRINCIPAL'S SURVIVORSHIP LIFE AT 95 - B84 $157020.00
SINGLE CEO II RIDER $362905.00
--------------------------------------------------------------------------------
$20000000 TOTAL INITIAL INSURANCE INITIAL ANNUAL PREMIUM $519925.00
DIVIDENDS BUY PUA'S FOR 10 YEARS, THEREAFTER DIVIDENDS REDUCE PREMIUMS
WITH EXCESS APPLIED TO PURCHASE PUA'S
******* THIS PROPOSAL ASSUMES A DECREASE IN THE INSURANCE AMOUNT *******
** PLEASE REFER TO THE FACE DECREASE SECTION OF THE FOOTNOTES FOR DETAILS **
*** THIS ILLUSTRATION ASSUMES THAT THE LOAN OUTSTANDING AT THE BEGINNING OF YEAR 10 OF ***
*** $626,634.47 HAS BEEN REPAID AT THE BEGINNING OF THE YEAR 10 I.E. FEBRUARY 1, 1996 ***
CASH TOTAL TIO PUA TOTAL
GROSS CASH ANNUAL DIVIDEND TOTAL VALUE CASH DEATH DEATH DEATH
ANNUAL PREMIUM DIVIDEND ON PUA'S DIVIDEND OF PUA'S VALUE BENEFIT BENEFIT BENEFIT
YEAR PREMIUM DUE BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR
---- ------- ------- --------- --------- ----------- ----------- ----------- ----------- ----------- -----------
10 157020 0 0 0 98000 0 1092600 0 0 20000O00
11 117770 0 96400 0 96400 251780 1212530 0 803428 15803428
12 117770 0 72300 8468 80768 223561 1332811 0 689336 15689336
13 117770 0 77550 7517 85067 198597 1463547 0 591872 15551872
14 117770 0 80850 6676 87526 175174 1603474 0 504730 15504730
------- ------ -------- -------
628100 0 327100 447762
15 117770 0 84000 5887 89887 153261 1752861 0 427039 15427039
16 117770 0 87450 5149 92599 133273 1912573 0 359199 15359199
17 117770 0 90300 4477 94777 114754 2082454 0 299240 15299240
18 117770 0 93300 3864 97154 97962 2263062 0 247214 15247214
19 117770 0 96450 3289 99739 83171 2454371 0 203168 15203168
------- ------ -------- -------
1216950 0 778600 921918
20 117770 0 99900 2792 102692 70821 2653471 0 167505 15167505
21 117770 0 103350 2376 105726 61078 2873728 0 139916 15139916
22 117770 0 106950 2049 108599 54269 3100619 0 120448 15120448
23 117770 0 110700 1820 112520 50737 3339337 0 109153 15109153
24 117770 0 114600 1700 116300 50851 3590102 0 106087 15106087
------- ------ -------- -------
1805800 0 1314100 1468155
25 117770 0 117770 1703 119473 54116 3852416 0 109535 15109535
26 117770 0 117770 1812 119582 57563 4123613 0 113095 15113095
27 117770 0 117770 1926 119696 61200 4403700 0 116772 15116772
28 117770 0 117770 2047 119827 65037 4692837 0 120566 15120566
29 117770 0 117710 2174 119944 69082 4990432 0 124484 15124484
------- ------ -------- -------
2394650 0 1902950 2066668
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
ADVANCED SURVIRORSHIP LEDGER
PREPARED FOR INFORCE POLICY #3779930
M & J ROUNICK M & J ROUNICK
FEMALE, AGE 42 MALE NONSMOKER, AGE 47
$20000000 MANULIFE PRINCIPAL'S SURVIVORSHIP LIFE AT 95 - B84 $157020.00
SINGLE CEO II RIDER $362905.00
--------------------------------------------------------------------------------
$20000000 TOTAL INITIAL INSURANCE INITIAL ANNUAL PREMIUM $519925.00
DIVIDENDS BUY PUA'S FOR 10 YEARS, THEREAFTER DIVIDENDS REDUCE PREMIUMS
WITH EXCESS APPLIED TO PURCHASE PUA'S
******* THIS PROPOSAL ASSUMES A DECREASE IN THE INSURANCE AMOUNT *******
** PLEASE REFER TO THE FACE DECREASE SECTION OF THE FOOTNOTES FOR DETAILS **
*** THIS ILLUSTRATION ASSUMES THAT THE LOAN OUTSTANDING AT THE BEGINNING OF YEAR 10 OF ***
*** $626,634.47 HAS BEEN REPAID AT THE BEGINNING OF THE YEAR 10 I.E. FEBRUARY 1, 1996 ***
CASH TOTAL TIO PUA TOTAL
GROSS CASH ANNUAL DIVIDEND TOTAL VALUE CASH DEATH DEATH DEATH
ANNUAL PREMIUM DIVIDEND ON PUA'S DIVIDEND OF PUA'S VALUE BENEFIT BENEFIT BENEFIT
YEAR PREMIUM DUE BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR
---- ------- ------- --------- --------- ----------- ----------- ----------- ----------- ----------- -----------
30 117770 0 117770 2309 120079 73341 5295592 0 128530 15128530
31 117770 0 117770 2450 120220 77819 5407269 0 132707 15132707
32 117770 0 117770 2597 120367 82517 5924117 0 137020 15137020
33 117170 0 117170 2752 120522 87435 6245086 0 141473 15141473
34 111110 0 111110 2914 120684 92576 6568826 0 146071 15146071
------- ----- ------- -------
2983500 0 2492800 2668540
35 117770 0 117770 3083 120853 97939 6894740 0 150818 15160818
36 111770 0 111770 3259 121029 103530 7222230 0 155720 15155702
17 117770 0 117770 3442 121212 109351 7550552 0 160781 15160781
38 117770 0 117770 3633 121403 115407 7879258 0 166006 15166006
39 117770 0 117770 3831 121601 121704 8207454 0 171401 15171401
------- ----- ------- -------
3572350 0 3080650 3274937
40 117770 0 117770 4037 121807 128241 8534241 0 176972 15176972
41 111770 0 111770 4250 122020 135021 8858871 0 182723 15182723
42 117770 0 117770 4471 122241 142043 9180893 0 189662 15188662
43 117770 0 117770 4700 122470 149310 9501060 0 194793 15194793
44 117770 0 117770 4937 122707 156836 9821336 0 201124 15201124
------- ----- ------- -------
4161200 0 3669500 3885881
45 117770 0 117770 5182 122952 164642 10144592 0 207661 15207661
46 117770 0 117770 5438 123208 172761 10473861 0 214410 15214410
47 117770 0 117770 5705 123475 181236 10810386 0 221378 15221378
48 117770 0 117770 5984 123754 190116 11148516 0 228573 15228573
49 117770 0 117770 6278 124048 199442 11501792 0 236002 15236002
------- ----- ------- -------
4750050 0 4258350 4503315
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
ADVANCED SURVIRORSHIP LEDGER
PREPARED FOR INFORCE POLICY #3779930
M & J ROUNICK M & J ROUNICK
FEMALE, AGE 42 MALE NONSMOKER, AGE 47
$20000000 MANULIFE PRINCIPAL'S SURVIVORSHIP LIFE AT 95 - B84 $157020.00
SINGLE CEO II RIDER $362905.00
--------------------------------------------------------------------------------
$20000000 TOTAL INITIAL INSURANCE INITIAL ANNUAL PREMIUM $519925.00
DIVIDENDS BUY PUA'S FOR 10 YEARS, THEREAFTER DIVIDENDS REDUCE PREMIUMS
WITH EXCESS APPLIED TO PURCHASE PUA'S
******* THIS PROPOSAL ASSUMES A DECREASE IN THE INSURANCE AMOUNT *******
** PLEASE REFER TO THE FACE DECREASE SECTION OF THE FOOTNOTES FOR DETAILS **
*** THIS ILLUSTRATION ASSUMES THAT THE LOAN OUTSTANDING AT THE BEGINNING OF YEAR 10 OF ***
*** $626,634.47 HAS BEEN REPAID AT THE BEGINNING OF THE YEAR 10 I.E. FEBRUARY 1, 1996 ***
CASH TOTAL TIO PUA TOTAL
GROSS CASH ANNUAL DIVIDEND TOTAL VALUE CASH DEATH DEATH DEATH
ANNUAL PREMIUM DIVIDEND ON PUA'S DIVIDEND OF PUA'S VALUE BENEFIT BENEFIT BENEFIT
YEAR PREMIUM DUE BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR BEG OF YR
---- ------- ------- --------- --------- ----------- ----------- ----------- ----------- ----------- -----------
50 117770 0 117770 6586 124356 209240 11870990 0 243672 15243672
51 111770 0 111770 6910 124680 219610 12266210 0 252591 15251591
52 117770 0 117770 7247 125017 230223 12666823 0 259768 15255768
53 117770 0 117770 7597 125367 241344 13031844 0 268210 15266210
54 0 0 117770 7941 125711 370038 13444939 0 406209 15406209
------- ----- ------- -------
5221130 0 4847200 5128449
55 0 0 19350 12184 31534 406441 13798842 0 440376 15440376
56 0 0 19800 13392 33192 445250 14148351 0 475849 15475849
57 0 0 20250 14673 34923 466414 14505114 0 512657 15512657
------- ----- ------- -------
5221130 0 4906600 5228099
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
INFORCE POLICY REVIEW
PROPOSAL DATE: FEBRUARY 1, 1996
LIFE INSUREDS: M & J ROUNICK PLAN: SURVIVORSHIP LIFE AT 95 -B84
POLICY NUMBER: 3779930 RIDERS: SINGLE CEO
DATE POLICY ISSUED: FEBRUARY 1, 1987
ISSUE AGE: 42 NON-SMOKER: YES
CURRENT POLICY YEAR: 10 LOAN INTEREST RATE: VARIABLE
CURRENT ANNUALIZED PREMIUM: $157020.00
POLICY BENEFITS
---------------
CURRENT DEATH BENEFIT (DIVIDEND INCLUDED): $20000000 LESS TOTAL LOAN.
CASH VALUE AT THE END OF THE CURRENT YEAR: $1092600 LESS TOTAL LOAN.
POLICY LOANS
------------
THIS PROPOSAL ASSUMES THAT NO LOANS WERE OUTSTANDING ON THIS POLICY
AS OP AUGUST 1, 1996.
DIVIDENDS
---------
ANNUAL DIVIDEND AT LAST ANNIVERSARY: $98000.00
VANISH
------
THIS PROPOSAL ASSUMES THAT $98000.00 WAS SURRENDERED TO PAY THE PREMIUM AT THE
BEGINNING OF THE YEAR.
POLICY VALUES
-------------
THE SINGLE CEO RIDER PREMIUM SHOWN IN THE HEADING OF THIS PROPOSAL REPRESENTS
THE SINGLE PREMIUM APPLIED FOR AT THE TIME OF ISSUE. HOWEVER, THE ACTUAL SINGLE
CEO PREMIUM PAID MAY BE EQUAL TO OR LESS THAN THE STATED CEO SINGLE
PREMIUM. THE VALUES ILLUSTRATED ABOVE ARE BASED ON THE ACTUAL CEO SINGLE
PREMIUM PAID.
A POLICY FROM MANULIFE FINANCIAL IS BACKED BY 0VER 100 YEARS OF EXPERIENCE
AND EXPERTISE.
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
IMPORTANT INFORMATION ABOUT THIS PROPOSAL
Manulife Financial has a reputation for its financial integrity and for
providing solid, long term value to our policyholders. In keeping with that
tradition, we encourage our clients to fully examine and understand the
assumptions used in a life insurance proposal.
This proposal is not a contract; we recommend that you refer to your policy for
a complete explanation of your policy benefits.
GUARANTEES
ONLY THOSE PREMIUMS AND VALUES LABELLED AS 'GUARANTEED' IN THIS PROPOSAL WILL BE
CONTRACTUALLY GUARANTEED IN YOUR POLICY.
DIVIDENDS
ILLUSTRATED DIVIDENDS, AND ALL VALUES DEPENDING ON ILLUSTRATED DIVIDENDS, ARE
BASED ON THE JULY 1995 DIVIDEND SCALE. THEY ARE NEITHER GUARANTEES NOR ESTIMATES
OF FUTURE DIVIDENDS.
PREMIUM
Premiums cease at the earlier of second death or the youngest surviving life
reaching age 95.
This proposal assumes all previous premiums have been paid in full.
Premiums due, when reduced by dividends, may vary substantially from the
illustrated premiums due, depending on the actual dividends paid in future
years.
VANISHING PREMIUMS
THE POLICY ILLUSTRATED REQUIRES THAT PREMIUMS BE PAID EACH YEAR WITHOUT
LIMITATION. HOWEVER, IT IS POSSIBLE THAT AT SOME FUTURE DATE, DIVIDENDS, AND IF
NECESSARY, THE SURRENDER OF PAID UP ADDITIONS MAY BECOME SUFFICIENT TO PAY
CURRENT AND FUTURE PREMIUMS DUE. THE PROPOSAL SHOWS THIS BY INDICATING A TIME
WHEN PREMIUMS 'VANISH'.
IF ACTUAL DIVIDENDS ARE LOWER THAN ILLUSTRATED, YOU WOULD HAVE TO PAY PREMIUMS
BEYOND THE DATE AT WHICH THIS PROPOSAL SHOWS THAT PREMIUMS MIGHT 'VANISH'. FOR
POLICIES WHERE PREMIUMS HAVE ALREADY 'VANISHED', FUTURE PREMIUMS COULD BE
REQUIRED.
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
IMPORTANT INFORMATION ABOUT THIS PROPOSAL
LOANS AND SURRENDER
The dividends shown in this proposal reflect the loans and 1oan interest rates
as illustrated. Actual policy dividends will vary according to actual loan
interest rates and loan activity.
THE LOAN INTEREST RATE ILLUSTRATED IS 7.25% AND MAY DIFFER FROM THE CURRENT
RATE.
MANULIFE FINANCIAL RESERVES THE RIGHT TO INCREASE OR DECREASE THE POLICY LOAN
INTEREST RATE AT EACH POLICY ANNIVERSARY - SUCH RATE WILL NEVER EXCEED THE
MAXIMUM PERMITTED BY STATE LAW.
TAXATION
The Individual's illustrated tax bracket is 28%.
This proposal may not fully reflect your actual tax or accounting situation. We
suggest that you consult your professional advisors regarding the interpretation
of current and proposed tax laws and accounting principles.
PROPOSAL DESIGN
This proposal assumes older life dies in year 99. This proposal assumes younger
life dies in year 99.
ALTERNATE PROPOSALS
CURRENT INTEREST RATE TRENDS INDICATE THAT DIVIDEND SCALES AT MANULIFE FINANCIAL
AND THROUGHOUT THE LIFE INSURANCE INDUSTRY WILL BE REDUCED IN THE FUTURE. AS
VALUES ILLUSTRATED ON THIS OR ANY OTHER POLICY ARE SENSITIVE TO CHANGES IN THE
DIVIDEND SCALE, AND IN KEEPING WITH OUR POLICY OF FULL DISCLOSURE TO OUR
POLICYHOLDERS, MANULIFE FINANCIAL RECOMMENDS THAT YOU REVIEW AN ADDITIONAL
ILLUSTRATION(S) THAT WILL DEMONSTRATE THE SENSITIVITY OF PRODUCT VALUES TO
LOWER DIVIDEND SCALES THAN CURRENTLY CREDITED.
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
IMPORTANT INFORMATION ABOUT THIS PROPOSAL
FACE DECREASE
THIS PROPOSAL IS ILLUSTRATED WITH A FACE AMOUNT REDUCTION FROM $20000000 TO
$15000000 IN YEAR 11.
ONCE THE FACE AMOUNT REDUCTION HAS BEEN PROCESSED, IF ADDITIONAL COVERAGE IS
NEEDED IN THE FUTURE, THE INSURED WOULD NEED TO SUBMIT A NEW APPLICATION FOR
INSURANCE WHICH WILL REQUIRE MEDICAL EVIDENCE. THE NEW INSURANCE WILL BE BASED
ON THE INSURED'S AGE AT THAT TIME.
THIS PROPOSAL DOES NOT REFLECT ANY TAX CONSEQUENCES OR POLICY CHANGE FEES
RESULTING FROM THE PARTIAL SURRENDER TO REDUCE THE FACE AMOUNT.
This proposal assumes that the cash value allowance of $273,150.00 resulting
from the partial surrender to reduce the face amount is used to purchase paid up
additions.
YOU SHOULD CAREFULLY REVIEW THE FULL PROPOSAL INCLUDING THE SECTION ENTITLED
'IMPORTANT INFORMATION ABOUT THIS PROPOSAL'.
THIS PROPOSAL IS ONLY VALID IF ALL PAGES ARE INCLUDED
