GE EXECUTIVE LIFE INSURANCE AGREEMENT (Rev. Nov 2003)
Exhibit
10(r)
(Rev.
Nov
2003)
THIS
AGREEMENT made and entered into effective the 1st
day of December,
2003, by and between General Electric Company ("Employer"), and
______________________________________ ("Owner");
WHEREAS,
---------------------«INSUREDS_NAME»
("Employee") is a valued employee of Employer and Employer wishes to retain him
in its employ; and
WHEREAS,
as an inducement to Employee's continued employment, Employer wishes to assist
Employee with his personal life insurance program by entering into this Life
Insurance Agreement with the Owner.
NOW,
THEREFORE, the Employer and Owner agree as follows:
1. Identification
of Policy.
This Agreement relates to the life insurance policy (“Policy”) issued by
Metropolitan Life Insurance Company (“Insurer”) which is described on Exhibit A
of this Agreement. Exhibit A shall be updated annually as determined by the
Employer effective each December 1st during the term of this
Agreement.
2. Ownership
of Policy.
Owner or Owner’s transferee (hereinafter collectively “Owner”) shall be the
owner of the Policy, and may exercise all ownership rights granted to the Owner
by the terms of the Policy. Notwithstanding any other provisions of this
Agreement or any form of policy assignment executed by Owner in connection with
this Agreement, it is the express intention of the parties to reserve to the
Owner all rights in and to the Policy granted to the Owner by its terms,
including, but not limited to, the right to assign the Owner's interest in the
Policy, the right to change the beneficiary of the Policy, the right to exercise
settlement options, the right to borrow against the cash value of the Policy,
and the right to surrender or cancel the Policy, in whole or in part. Employer
shall neither have nor exercise any right in or to the Policy which could, in
any way, endanger, defeat or impair any of the rights of the Owner in the
Policy, including the right to collect the proceeds of the Policy in excess of
the amount due the Employer, as provided in this Agreement. The only rights in
and to the Policy granted to the Employer shall be limited to its security
interest in the "surrender value" of the Policy, which for all purposes of this
Agreement shall be as defined in the Policy, and a portion of the death benefit
of the Policy, as hereinafter provided. The Employer shall not assign any of its
rights in the Policy to anyone other than the Owner.
3. Premium.
The Employer shall pay the total premium on the Policy. The total annual premium
due on such Policy, effective December 1st of each year during the term of this
Agreement, shall be set forth in item 6 of Exhibit A of this Agreement, as
determined by the Employer.
4. Collateral
Assignment.
Contemporaneously with this Agreement, the Owner has made a collateral
assignment of the Policy to the Employer under the form of Assignment attached
as Exhibit B, as it may be amended from time to time to reflect any
modifications to Exhibit A with respect to the Insurer or policy number, which
Assignment gives the Employer the right to recover the cumulative premiums it
has paid on the Policy (the “cumulative premium outlay”) from the surrender
value of the Policy and to recover a portion of the death benefit of the Policy.
The interest of the Employer in and to the Policy shall be specifically limited
to the following rights:
| a. |
The
right to recover the lesser of its cumulative premium outlay or the
surrender value of the Policy in the event the Policy is totally
surrendered or cancelled by the Owner, or the right to receive the
surrender proceeds to the extent of its cumulative premium outlay in the
event the Policy is partially surrendered by the Owner as provided in
paragraph 5; |
| b. |
The
right to recover the death benefit proceeds remaining after the Owner's
death benefit set forth in item 5 of Exhibit A has been paid to the
Owner's designated beneficiary upon the death of Employee, as provided in
paragraph 7 below; |
| c. |
The
right to recover the lesser of its cumulative premium outlay or the
surrender value of the Policy, or to receive ownership of the Policy, in
the event of termination of this Agreement, as provided in paragraphs
6(b), 6(c) and 6(d) below; and |
| d. |
The
right to recover its cumulative premium outlay to the extent that any
aggregate outstanding Policy loans made by the Owner exceed the amount by
which the surrender value of the Policy exceeds the cumulative premium
outlay paid by the Employer. |
5. Surrender
or Cancellation.
The Owner shall have the sole right to surrender or cancel the Policy, in whole
or in part, and to receive the surrender value, subject to the provisions of
this paragraph 5. In the event of any partial or complete surrender or
cancellation, the Employer shall be provided with written notice of such
surrender or cancellation at least fifteen (15) days prior to a distribution
from the Insurer. Subject to paragraph 6, in the event of any partial surrender,
the Employer shall be entitled to recover the lesser of its cumulative premium
outlay or the surrender proceeds. In the event of a complete surrender or
cancellation, the Employer shall be entitled to recover the lesser of its
cumulative premium outlay or the surrender value of the Policy.
6. Termination
of Agreement.
| a. |
This
Agreement shall terminate upon the earlier to occur
of: |
(1) The
date on which either party to the Agreement provides notice in writing to the
other party of the desire to terminate; or
(2) The
Employee's termination of employment (other than retirement, disability or other
Company approved separation) with the Employer; or
(3) The
latter of:
(a) The
fifteenth anniversary of the effective date of this Agreement;
or
(b) The
date on which the Employee attains age 60.
b.
Within thirty (30) days following the termination of this Agreement, the Owner
shall pay to the Employer the Employer's cumulative premium outlay. Upon receipt
by the Employer of such amount, the Employer shall execute an appropriate
instrument of release of the Assignment of the Policy.
c.
If the Owner fails to pay such amount within such thirty (30) day period, the
Owner shall execute any and all instruments that may be required to vest
ownership of the Policy in the Employer. Thereafter, the Owner shall have no
further interest in the Policy.
d.
If the Owner fails to surrender the policy and execute the instruments required
by paragraph 6(b) within such thirty (30) day period, the Employer may notify
the Insurer that the Employer intends to exercise its rights under the
Assignment. In such event, the Insurer shall pay to the Employer the cumulative
premium outlay specified in paragraph 6(b).
7. Death.
Upon the death of Employee, the Employer shall receive its cumulative premium
outlay. The balance of the death benefit provided under the Policy, if any,
shall be paid directly to the beneficiary.
8. Loans.
The Owner shall have the sole right to borrow against the Policy up to a maximum
amount equal to the amount by which the surrender value of the policy exceeds
the cumulative premium outlay paid by the Employer. The Employer shall have no
right to obtain loans against the Policy, directly or indirectly, from the
Insurer or from any other person, or to pledge or assign the Policy as security
for any loan.
9. Transferee.
In the event Owner shall transfer all of its interest in the Policy, then all of
Owner's interest in the Policy and in this Agreement shall be vested in its
transferee, who shall be substituted as a party under this Agreement, and the
transferring Owner shall have no further interest in the Policy or in this
Agreement.
10. Successors
and Assigns.
This Agreement shall bind Employer, its successors and assigns, and Owner and
their heirs, executors, administrators and transferees, and any Policy
beneficiary. The Employer agrees that it will not merge or consolidate with
another employer, corporation, or organization, or permit its business and
activities to be taken over by any other organization unless or until the
succeeding or continuing employer, corporation or other organization shall
expressly assume the rights and obligations of the Employer set forth in this
Agreement.
11. Effect
on Employment.
This Agreement shall not be deemed to constitute a contract of employment
between the parties, nor shall any provision restrict the right of Employee to
terminate his employment, at any time not in contravention of any applicable
employment agreement.
12. Insurer.
The Insurer shall be bound only by the provisions of and endorsements on the
Policy, and any payments made or action taken by it in accordance with the
Policy shall fully discharge it from all claims, suits and demands of all
persons whatsoever. Except as specifically provided by endorsement on the Policy
and as provided in the Assignment, the Insurer shall in no way be bound by the
provisions of this Agreement.
13. Payment.
It is agreed that benefits may be paid under the Policy by the Insurer either by
separate checks to the parties entitled thereto, or by joint check. In the
latter instance, the Owner and the Employer agree that benefits shall be divided
as provided herein.
14. Amendment.
Except as provided in paragraph 6 and in paragraphs 1 and 3 pertaining to
Exhibit A, this Agreement may not be cancelled, amended, altered or modified,
except by a written instrument signed by all of the parties.
15. Notices.
Any notice, consent or demand required or permitted to be given under the
provisions of this Agreement by one party to another shall be in writing, shall
be signed by the party giving or making the same, and may be given either by
delivering the same to such other party personally, or by mailing the same, by
United States certified mail, postage prepaid, to such party, addressed to his,
her or its last known address as shown on the records of the Employer. The date
of such mailing shall be deemed the date of such mailed notice, consent or
demand.
16. Gender
and Number.
Whenever any words are used herein in the masculine gender, they shall be
construed as though they were also used in the feminine or neuter gender in all
cases where they would so apply, and whenever any words are used herein in the
singular or plural form, they shall be construed as though they were also used
in the other form in all cases where they would so apply.
17. Controlling
Law.
This Agreement, and the rights of the parties hereunder, shall be governed by
and construed pursuant to the laws of the State of New York except to the extent
preempted by federal law.
IN
WITNESS WHEREOF, the parties have executed this Agreement effective the day and
year first above written.
| Owner’s Signature: | General Electric Company | |
| /s/ Xxxxxxx X. Xxxxxx | ||
| By: Xxxxxxx X. Xxxxxx | ||
|
|
Senior Vice President - | |
| Print Name | Corporate Human Resources |
EXHIBIT
A
LIFE
INSURANCE PLAN
INSURANCE
POLICY SCHEDULE
|
1. Insured’s
Name: |
«INSUREDS_NAME» |
|
2. Effective
Date: |
«EFFECTIVE_DATE» |
|
3. Insurer: |
Metropolitan
Life Insurance Company |
|
4. Policy
Number: |
«POLICY_NUMBER» |
|
5. Owner’s
Portion of Death Benefit:
(End
of Year 1) |
«OWNERS_PORTION_OF_THE_DEATH_BENEFIT» |
|
6. Total
Annual Premium: |
«M_2003_ANNUAL_PREMIUM» |
|
7. Owner’s
Portion of Cash Value:
(End
of Year 1) |
|
|
8. Policyowner: |
|
|
9. Beneficiary: |
EXHIBIT
B
COLLATERAL
ASSIGNMENT
THIS
ASSIGNMENT, made and entered into effective the 1st day
of December,
2003, by the undersigned ________________________________ as owner ("Owner") of
that certain Life Insurance Policy No.
issued by Metropolitan Life Insurance Company ("Insurer") and any supplementary
contracts issued in connection with such policy (said policy and contracts
herein called "Policy"), upon the life of «INSUREDS_NAME»
("Insured"), to General Electric Company, a New York corporation,
("Assignee").
WITNESSETH:
WHEREAS,
the Insured is a valued employee of the Assignee, and the Assignee wishes to
retain him in its employ;
WHEREAS,
as an inducement to the Insured's continued employment, the Assignee desires to
assist the Insured with his personal life insurance program by contributing the
annual premium due on the Policy, as more specifically provided for in that
certain Life Insurance Agreement entered into between the Insured and the
Assignee ("Agreement"); and
WHEREAS,
in consideration of the Assignee's agreeing to pay the premiums pursuant to the
Agreement, the Owner agrees to assign to the Assignee certain rights in the
Policy as set forth in this Assignment.
NOW,
THEREFORE, for value received, the undersigned Owner hereby assigns, transfers
and sets over to the Assignee, its successors and assigns, the following
specific rights in the Policy subject to the following terms and
conditions:
1.
Assigned
Rights.
The Assignee's interest in the Policy shall be limited to:
|
a. |
The
right to recover the lesser of the total premiums it has paid on the
Policy less amounts received under the Agreement from the Owner
("cumulative premium outlay") or the "surrender value" of the Policy (as
defined in the Policy for all purposes hereinafter) in the event the
Policy is totally surrendered or cancelled by the Owner, or the right to
receive the surrender proceeds to the extent of its cumulative premium
outlay in the event the Policy is partially surrendered or cancelled by
the Owner, as provided in paragraph 5 of the
Agreement. |
|
b. |
The
right to recover the death benefit proceeds as provided in paragraph 7 of
the Agreement. |
|
c. |
The
right to recover the lesser of its cumulative premium outlay or the
surrender value of the Policy or to receive ownership of the Policy, in
the event of termination of the Agreement, as provided in paragraphs 6(a),
6(b) and 6(c) of the Agreement. |
|
d. |
The
right to recover its cumulative premium outlay to the extent a Policy loan
made by the Owner in any year exceeds the lesser of the Owner's portion of
the premium for that year or the increase for that year in the surrender
value of the Policy, as provided in paragraph 8 of the
Agreement. |
Incidents
of Ownership.
The Owner shall retain all incidents of ownership in the Policy, including, but
not limited to, the sole and exclusive rights to: borrow against the Policy;
assign the Owner's interest in the Policy; change the beneficiary of the Policy;
exercise settlement options; and, subject to paragraphs 5 and 6 of the
Agreement, surrender or cancel the Policy (in whole or in part)·
Endorsement
of Policy.
If the Assignee shall have possession of the Policy at any time while this
Assignment is in force, then upon request and without unreasonable delay, the
Assignee shall forward the Policy to the Insurer for endorsement of any
designation or change of beneficiary, any election of optional mode of
settlement, or the exercise of any other right reserved by the Owner
hereunder.
Insurer.
| a. |
The
Insurer is hereby authorized to recognize the Assignee's claims to rights
under this Agreement without investigating the reason for any action taken
by the Assignee, the amount of its cumulative premium outlay, the
existence of any default, the giving of any required notice or the
application to be made by the Assignee of any amounts to be paid to the
Assignee. The signature of the Assignee shall be sufficient for the
exercise of any of its rights under the Assignment for the Assignee's
receipt for any sums received by it shall be a full discharge and release
of such sums to the Insurer. |
| b. |
The
Insurer shall be fully protected in recognizing a request made by the
Owner for surrender or cancellation of the Policy, in whole or in part, or
in recognizing a request made by the Owner for any loans against the
Policy permitted by the terms of the Policy, with or without the consent
of the Assignee. In the event of any such request, the Insurer may pay the
proceeds of such surrender, cancellation, or loans to the sole order of
the Owner, or as the Owner shall direct, provided that the Insurer has
provided the requisite fifteen (15) days' notice to the Assignee required
by paragraph 5 of the Agreement. |
Release.
Upon the full payment of the liabilities of the Owner to the Assignee pursuant
to the Agreement, the Assignee shall execute an appropriate instrument of
release of this Collateral Assignment.
IN
WITNESS WHEREOF, the undersigned Owner has executed this Assignment effective
the day and year first above written.
Owner's
Signature:
__________________________________ ___________________
Witness
