THIS DEED is made the 16th day of July 1997
BY A.L.O.T. TRUSTEE LIMITED, a limited liability company incorporated in Jersey
whose registered office is situated at Pirouet House, Union Street, St. Helier,
Jersey, Channel Islands (the "Trustee").
SUPPLEMENTAL to a settlement made between BG Services Limited and the Trustee
(therein called "Agent Loyalty Opportunity Trust") dated 23 May 1997 (the
"Settlement").
WHEREAS:
(1) The Trustee is the present trustee of the Settlement.
(2) By clause 22.2 of the Settlement the Trustee has power from time to time
by instrument in writing to revoke, alter or amend all or any of the
provisions of the Rules.
(3) The Trustee is desirous of exercising the power referred to above in such
manner as hereinafter appears.
(4) The Trustees have consented to the exercise of the Settlor's power as set
out above and has evidenced such consent by signing as a party hereto.
(5) Where the context permits words and phrases used herein shall bear the
same meaning as in the Settlement.
NOW THIS DEED WITNESSETH that in exercise of the power conferred upon them by
Clause 22.2 of the Settlement the Trustee HEREBY DECLARES that the Rules and the
Appendix thereto shall be deleted in their entirety and replaced with the Rules
and Appendix contained in the Schedule hereto.
IN WITNESS WHEREOF this deed has been executed by the parties the day and year
first above written.
THE SCHEDULE TO THE DEED OF AMENDMENT DATED 16 JULY 1997
SCHEDULE TWO
AGENT LOYALTY OPPORTUNITY TRUST
RULES
These rules have been established pursuant to the Agent Loyalty Opportunity
Trust established by Settlement dated 23 May 1997.
1. Definitions
1.1. In this instrument wherever the context permits the following expressions
shall have the meanings set against them:-
"Account Value" shall mean the accumulated value as determined by the Life
Company of all in force fixed and variable deferred annuity and life
insurance policies issued by the Life Company and sold by an Award Holder.
"Award" shall mean an award of Units made to a Sales Agent pursuant to an
Award Agreement.
"Award Agreement" shall mean the written agreement described in Rule 5.2
evidencing the making of an Award to a Sales Agent and containing the
terms, conditions and restrictions pertaining to such Award.
"Award Date" shall mean the date of the Award Agreement.
"Award Holder" shall mean a Sales Agent to whom an Award has been made.
"Award Price" shall meam the price of a Unit specified in the Award
Agreement being a sum equivalent to the mid-market price of a Share on the
Award Date or such other price as the Trustee shall determine.
"Award Units" shall mean Units the subject of an Award.
"Bonus" shall mean a cash bonus calculated and payable as provided in Rule
8.
"Company" shall mean London Pacific Group Limited, a company incorporated
with limited liability in Jersey, Channel Islands.
"Exercise Notice" shall mean the written notice given by an Award Holder
to exercise an Award as referred to in Rule 7.1 and described in Rule 7.2.
"The Group" shall mean the Company and its subsidiaries.
"The Life Company" shall mean London Pacific Life & Annuity Company, a
North Carolina life assurance company.
"Rules" unless the context clearly indicates otherwise shall mean a rule
of the Trust as adopted by the Trustee and amended from time to time.
"Sales Agent" shall mean any independent sales agent in the United States
who is party to an Agency Agreement with the Life Company which remains in
full force and effect for the sale of the Life Company's life and annuity
products.
"Settlement" shall mean the Settlement dated 23 May 1997 known as the
Agent Loyalty Opportunity Trust.
"Share" shall mean an Ordinary Share of 5c each in the Company, as traded
on the London Stock Exchange.
"Specified Percentage" shall mean the percentage set out in an Award
Agreement required to determine whether an Award Holder's Award shall vest
in accordance with Rule 6.2.
"$" or "dollar" or "c" or "cent" refers to the legal tender of the United
States of America.
"Trust" shall mean the Agent Loyalty Opportunity Trust as it may be
amended from time to time.
"Trustee" shall mean the Trustee or Trustees for the time being of the
Trust.
"Unit" shall mean a unit representing the right granted to an Award Holder
pursuant to an Award requiring that the Trustee pays that Award Holder a
Bonus sum calculated in accordance with Rule 8 by reference to the value
of a Share on the basis that one Unit shall be representative of the value
of one Share;
"Vesting Conditions" shall mean the conditions set out in the provisions
of Rule 6; and
"Year" shall mean calendar year
1.2 The single includes the plural and vice versa.
1.3 The masculine includes the feminine and vice versa and each includes
neuter.
2. Administration
2.1 The Trustee shall have full power and discretion, subject to the express
provisions of these Rules:
2.1.1 To determine from time to time to which Sales Agents Awards shall be
made, the term of each Award, the Award Price, the time or times at
which all or portions of an Award may be exercised and the number of
Units the subject of an Award;
2.1.2 To construe and interpret these Rules and Awards granted thereunder,
and to amend and revoke the Rules. In the exercise of this power,
the Trustee shall generally determine all questions of policy and
interpretation that may arise, and may correct any defect, omission
or inconsistency in these Rules or in any Award Agreement in a
manner and to the extent it shall deem necessary or expedient to
make these Rules fully effective;
2.1.3 To prescribe the terms and conditions of each Award, including
without limitation the bonus provisions;
2.1.4 Subject to applicable legal restrictions and the consent of the
Award Holder affected, to amend any outstanding Award Agreement,
including but without limitation the acceleration in whole or in
part.
2.1.5 Generally, to exercise such powers and to perform such acts as are
deemed necessary or expedient to promote the best interests of the
Company.
2.2 All decisions, interpretations and other actions of the Trustee shall be
final and binding on all Award Holders. The Trustee shall not be liable
for any action that it has taken or failed to take in good faith with
respect to these Rules or any Award.
2.3 In the exercise of any power or discretion under these Rules the Trustee
shall first have regard to any written recommendations which it shall
receive from the Company or any committee of the Company.
3. Eligibility
Awards may be granted to any Sales Agents.
4. Awards subject to Rules
4.1 Restrictions
No Award granted under the terms of these Rules shall be capable of being
sold, transferred, pledged, encumbered or otherwise alienated or dealt
with by an Award Holder.
4.2 No Rights as a Shareholder
An Award Holder shall have no rights as a shareholder with respect to any
Units the subject of an Award or in respect of Shares held by the Trustee
at any time and without limitation of the generality of the foregoing. The
Award Holder shall not be entitled to dividends (ordinary or
extraordinary, whether in cash, securities or other property),
distributions, or other rights with respect to any Units or Shares and the
making of an Award shall not entitle the Award Holder to any rights in
respect of any Units or Shares.
5. Grant of Awards
5.1 General
The Trustee may make Awards at any time and from time to time during the
Trust Period of the Settlement. The Trustee shall specify the Award date
(the "Award Date") or, if it fails to do so, the Award Date shall be the
date of the action taken by the Trustee to make an Award.
5.2 Award Agreement
As soon as practicable after making an Award, the Award Holder and the
Trustee shall enter into a written Award Agreement substantially in the
form of the Appendix hereto which specifies the Award Date, the Award
Price, the number of Award Units, the Vesting Conditions, the Vesting
Schedule and the other terms and conditions of the Award.
5.3 Award Term
An Award which has not been exercised seven years after the Award Date
shall be forfeited on the seventh anniversary of the Award Date and shall
have no further effect.
6. Vesting Conditions
6.1 No Award Holder shall be entitled to exercise his rights under an Award
Agreement unless and until the Vesting Conditions applicable to an Award
have been satisfied. In order to determine whether the Vesting Conditions
have been satisfied in respect of any year as soon as practicable after 1
January of each year the Life Company shall notify the Trustee in writing
of:-
(a) the Account Value for each Award Holder which shall be calculated as
at 31 December (the "Calculation Date") of the immediately preceding
year (the "Ending Value")
(b) the Account Value for each Award Holder calculated as at 31 December
of the year prior to the immediately preceding year (the "Beginning
Value").
6.2 Vesting Hurdle
Subject to the provision of this Rule 6 that proportion of an Award
Holder's Award as determined by reference to the Vesting Schedule as
defined in Rule 6.3 hereof shall vest and his right under the Award become
exercisable from the next following Vesting Date otherwise on and subject
to the terms of the Award Agreement if his Ending Value exceeds the
Specified Percentage of his Beginning Value in respect of the same year.
6.3 Vesting Schedule
Each Award Agreement shall specify in a "Vesting Schedule " a date or
dates on which, subject to satisfaction of the Vesting Conditions relevant
for that year, all or a proportion of that Award Holder's Award Units
shall become capable of being exercised.
6.4 Vesting Date
The proportion of the Award Holders' Award for any year determined by
reference to the Vesting Schedule shall vest and be capable of being
exercised subject to fulfilment of the provisions of this Rule 6 on 1
March in the year following the Calculation Date, and such date shall be
known as the Vesting Date.
6.5 Failure to Vest
In the event that an Award Holder does not meet the Vesting Conditions
contained in this Rule in respect of any year then the proportion of that
Award Holders' Award determined by reference to the Vesting Schedule for
that year shall not vest and become exercisable in that year and shall be
forfeited and of no further effect.
6.6 Notification of Vesting
The Trustee shall be under no obligation to notify an Award Holder whose
Award has vested in accordance with this Rule but an Award Holder may
enquire as to whether or not his Award has vested by application to Chief
Marketing Officer, London Pacific Life & Annuity Company, 0000 Xxxxxxxxx
Xxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxx 00000.
7. Exercise of an Award following Vesting
7.1 Subject to the provisions of these Rules an Award Holder may exercise his
Award at any time in whole or in part by giving an Exercise Notice signed
by the Award Holder in accordance with the provisions of Rule 7.2.
7.2 The Exercise Notice shall be addressed to Chief Marketing Officer, London
Pacific Life & Annuity Company, 0000 Xxxxxxxxx Xxxx Xxxxx, Xxxxxxxxxx,
Xxxxxxxxxx 00000 and notice of exercise shall only be effective upon
receipt of the Exercise Notice. The Award Holder shall specify the number
of Award Units the subject of the exercise and details of how payment of
Bonus should be made including where relevant, payment details for wire
transfers to an Award Holder's bank account.
7.3 Notwithstanding any other provision of these Rules no Award shall be
capable of being exercised during any period or periods when the Company
or its Directors or either of them are unable to deal in Shares as a
result of the provisions of the Listing Rules of the London Stock
Exchange. Any such period or periods shall be known as a "Closed Period".
The Trustee, the Life Company and the Company shall be under no obligation
to inform Award Holders of the time or existence of a Closed Period, but
it shall be the responsibility of the Award Holder to establish whether or
not a Closed Period is operating before exercising any rights under an
Award.
8. Payment of Bonus following Exercise
8.1 In respect of an Award which has vested, the Trustee shall upon receipt of
a duly completed Exercise Notice by the Life Company calculate the Bonus
payable to the Award Holder by reference to the following formula:-
B = (EP-AP) x U
Where B = the Bonus payable;
EP = a sum equal to the average closing middle market price of a
Share on the London Stock Exchange for the five business days
following receipt of the Exercise translated into dollars by
reference to an appropriate dollar / pound sterling exchange
rate which shall be determined by the Life Company and
notified to the Trustee less 1% of such price representing
dealing costs involved in the Trustee selling Shares to
realise an amount equal to the Bonus;
AP = the Award Price; and
U = the total number of Units in respect of which the Award is
being exercised
The Bonus shall be paid by cheque or wire transfer to the Award Holder within 30
days of the receipt by the Life Company of the Exercise Notice.
8.2 Any payment of any Bonus to an Award Holder shall be made net of any tax,
duty or other amounts which the Trustee, the Life Company or the Company
shall be obliged or entitled to deduct therefrom. The Trustee shall have
power to withhold all or any part of an Award Holder's Bonus to meet any
obligations of the Award Holder due to the Trustee, the Life Company, the
Company or
otherwise.
9. Termination of an Award Holder's Agency Agreement
9.1 If the Trustee receives written notification (the "Notice of Termination")
from the Life Company that, for any reason including death or permanent
and total disability, an Award Holder's Agency Agreement has terminated,
the Award Units held at the date of termination for that Award Holder but
not vested in accordance with Rule 6 shall be forfeited and the Award
Agreement shall have no further effect.
9.2 The Trustee shall be entitled to rely on the Notice of Termination and
shall not be obliged to make any further investigations or enquiries in
order to verify the authenticity of the Notice of Termination.
9.3 The Trustee shall not be liable for any action it may take or fails to
take following receipt of Notice of Termination from the Company or
otherwise.
10 Modification, Extension and Renewal of Awards
Within the limitations of these Rules, the Trustee may modify, extend or renew
outstanding Awards or may accept the cancellation thereof (to the extent not
previously exercised) for the making of new Awards in substitution therefore.
Notwithstanding the foregoing, no modification shall, without the consent of the
Award Holder, alter or impair his rights or obligations under an Award.
11. No Rights in respect of Agency Agreement
Neither these Rules nor any Award made hereunder shall confer upon any Award
Holder any right as against the Life Company other than the rights determined by
the terms of the Agency Agreement nor shall the existence of an Award interfere
in any way with the Life Company's rights to terminate the Agency Agreement of
any Award Holder in
accordance with its terms.
12. Duration and Amendments
12.1 Duration
These Rules shall become effective on the date of execution of the
Settlement and terminate automatically on expiration of the Trust Period
under the Settlement.
12.2 Amendment; Termination
The Trustee may amend, suspend or terminate these Rules at any time and
for any reason.
12.3 Effect of Amendment or Termination
No Award shall be made to an Award Holder under these Rules after the
termination hereof, except pursuant to an Award made before termination.
Termination or amendment of these Rules shall not affect any Award
previously made or any Award previously made under these Rules.
13. Proper Law
These Rules and all Award Agreements entered into pursuant to it shall be
governed by and construed in accordance with the laws of the Island of Jersey.
AGENT LOYALTY OPPORTUNITY TRUST
AWARD AGREEMENT
THIS AGREEMENT is made on the day set out in the First Schedule hereto.
BETWEEN
(1) A.L.O.T. Trustee Limited as Trustee (the "Trustees") of the Agent Loyalty
Opportunity Trust (the "Trust"); and
(2) The Sales Agent whose name appears below.
WHEREAS
The Trustee has resolved to award to the Sales Agent the number of Award Units
specified in the First Schedule to this agreement and the Sales Agent accepts
the said Award Units upon and subject to the terms of this agreement.
NOW IT IS HEREBY AGREED as follows:-
(1) Words and expressions used in this Award Agreement shall where context
permits bear the same meaning as in the Agent Loyalty Opportunity Trust
Rules (the "Rules") a copy of which are set out in the Second Schedule
hereto.
(2) The Rules are hereby incorporated into this agreement and the Sales Agent
agrees to be bound thereby.
(3) In consideration of the Sales Agent continuing to be a Sales Agent the
Trustees
hereby awards to the Sales Agent the Award Units specified in the First
Schedule hereto.
(4) Provided that in any year the Vesting Conditions described in the Rules
are satisfied that proportion of the Sales Agent's Award Units for that
year as determined by reference to the Vesting Schedule contained in the
First Schedule hereto shall vest on the Vesting Date and be exercisable.
(5) None of the Sales Agent's Award Units shall be capable of vesting before
the Earliest Vesting Date as defined in the First Schedule hereto.
(6) If in any year the Vesting Conditions are not satisfied by the Sales Agent
then the relevant proportion of the Sales Agent's Award Units which would
otherwise have vested for that year will be forfeited and no further
effect.
(7) Provided the Vesting Conditions as described in the Rules and where
relevant more particularly defined in the First Schedule hereto have been
satisfied in relation to this Award the Trustee agrees that at such time
as they shall receive an Exercise Notice from the Sales Agent in respect
of vested Award Units they shall pay to the Sales Agent a Bonus in such
amount and on such terms and at such time as shall be determined in
accordance with the provisions of the Rules.
(8) All vested Award Units which are not exercised by the Sales Agent by the
Termination Date as defined in the First Schedule hereto shall be
forfeited and of no further effect.
(9) This agreement shall be governed by and construed in accordance with the
laws of the Island of Jersey and the Sales Agent hereto irrevocably
submits to the non-exclusive jurisdiction of the said Island of Jersey.
IN WITNESS WHEREOF
The parties hereto have caused this agreement to be executed as of the date set
out below.
The common seal of
A.L.O.T. TRUSTEE LIMITED
was hereby affixed in the presence of:-
.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
DIRECTOR DIRECTOR/SECRETARY
.. . . . . . . . . . . . . . . . . . . .
SALES AGENT SIGNATURE
.. . . . . . . . . . . . . . . . . . . .
SALES AGENT NAME
.. . . . . . . . . . . . . . . . . . .
WITNESS NAME
AGENT LOYALTY OPPORTUNITY TRUST
AWARD AGREEMENT FIRST SCHEDULE
Award Date ........................................................
Award Price US$.....................................................
Number of Units Awarded ........................................................
Earliest Vesting Date ........................................................
Termination Date ........................................................
Vesting Schedule
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THE COMMON SEAL of
A.L.O.T. TRUSTEE LIMITED
was hereunto affixed
in the presence of:-
/s/ X X XXXXXXX
Director
/s/ X X XXXXX
Director
