Split Dollar Insurance ArrangementSplit Dollar Insurance Arrangement • November 1st, 2002 • McRae Industries Inc • Computer peripheral equipment, nec • North Carolina
As part of the compensation paid to the Company’s former President, Branson J. McRae, the Company entered into a split dollar insurance arrangement with Mr. McRae pursuant to which the Company agreed to pay the annual premiums on several life insurance policies, with a total face amount of $5 million, covering the lives of Mr. McRae and his wife, Mrs. Lorraine H. McRae. Under the terms of this arrangement, Mr. McRae was entitled to name the owners of the policies and upon the death of both of Mr. and Mrs. McRae the Company is entitled to a portion of the death benefits payable under the policies not to exceed the greater of (i) the cash surrender value of the policies and (2) the cumulative premiums paid by the Company on the policies. Mr. McRae died in February 1997. Mrs. McRae is currently 80 years old. Mr. and Mrs. McRae’s four children, including D. Gary McRae and James W. McRae, each of whom is a director and executive officer of the Company, were named the initial owners and bene
