Exhibit 10.17
SPLIT DOLLAR AGREEMENT
THER AGREEMENT made and entered into effective the 12th day
of November, 1993, by and between RYAN'S FAMILY STEAK HOUSES, INC.
of the City of Greer, State of South Carolina (hereinafter called
"the Corporation") and ILENE T. TURBOW a resident of Greenville
County, State of South Carolina (hereinafter called "the
Employee").
WHEREAS, the Employee wants to insure her life, for the
benefit and protection of her family, under a policy to be issued
by Massachusetts Life Insurance Company; and
WHEREAS, the Corporation wants to help the Employee
provide insurance for the benefit and protection of her family by
paying the full amount of the premiums due on the policy on the
Employee's life; and
WHEREAS, the Corporation wants to be the owner of the
policy of insurance on the Employee's life acquired pursuant to
the terms of ther Agreement so that it will have security for the
repayment of the amounts which it will pay on the premiums due on
the policy;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, it is agreed between the parties hereto as
follows:
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ARTICLE 1
Application for Insurance. The Corporation will apply
to Massachusetts Mutual Life Insurance Company for a Whole Life
policy on the Employee's life in the face amount of Nine Hundred
Thirty Five Thousand ($935,000) Dollars. The Corporation and the
Employee will do everything necessary to cause the policy to be
issued. When the policy is issued, the policy number, face amount
and plan of insurance shall be recorded on Schedule A attached
hereto and the policy shall then be subject to the terms of the
Agreement.
ARTICLE 2
Ownership of Insurance. The Corporation will be the
owner of the policy on the Employee's life acquired pursuant to
the terms of ther Agreement and it may exercise all the rights of
ownership with respect to the policy except as otherwise
hereinafter provided.
ARTICLE 3
Designation of Beneficiaries and Election of Settlement
Option. The Corporation, upon receipt of a written request from
the Employee, will designate the person or persons named by the
Employee as beneficiaries to receive any proceeds payable under
the policy upon the Employee's life in excess of the amount of the
proceeds payable to the Corporation under Article 10:B of ther
Agreement. The Corporation will also elect the settlement option
requested by the Employee in writing. The beneficiary or
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beneficiaries named upon request by the Employee and the
settlement option elected upon request by the Employee will not be
changed by the Corporation unless the Employee makes a written
request for such a change.
ARTICLE 4
Election of Dividend Option. All dividends declared by
Massachusetts Mutual Life Insurance Company on the policy on the
Employee's life acquired pursuant to the terms of ther Agreement
shall be applied to purchase additional paid up insurance on the
life of the Employee.
ARTICLE 5
Payment of Premiums on Policy. On or before the due
date the Corporation will pay to Massachusetts Mutual Life
Insurance Company the full amount of each annual premium on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement.
ARTICLE 6
Employee's Obligation to Corporation. The Employee
shall be obligated to repay to the Corporation the aggregate
amount paid by the Corporation, under Article 5 of ther Agreement,
to Massachusetts Mutual Life Insurance Company as premiums on the
policy on the Employee's life acquired pursuant to the terms of
ther Agreement. Ther obligation of the Employee to the
Corporation shall be payable as provided in Article 10 and Article
12 of ther Agreement.
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ARTICLE 7
Additional Policy Benefits and Riders. The Corporation
may add a rider to the policy on the Employee's life, acquired
pursuant to the terms of ther Agreement, for its own benefit.
Upon written request made by the Employee the Corporation may add
a rider to the policy for the benefit of the Employee. Any
additional premium for any rider which is added to the policy
shall be paid by the party which will be entitled to receive the
proceeds of the rider.
ARTICLE 8
Corporation's Right to Make Policy Loans.
A. The Corporation shall have the right to obtain loans
secured by the policy on the Employee's life acquired pursuant to
the terms of ther Agreement. These loans may be obtained either
from Massachusetts Mutual Life Insurance Company or from others.
The Corporation shall have the right to assign the policy which it
owns on the Employee's life as security for the repayment of such
loans. The amount of such loans together with the interest
thereon shall at no time exceed the aggregate amount of the
premiums for the policy as of the date to which such premiums have
been paid. All interest charges with respect to any such loans
shall be paid by the Corporation.
B. If the policy on the Employee's life acquired
pursuant to the terms of ther Agreement is assigned or encumbered
in any way, other than by a policy loan, on the date of the
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Employee's death, the Corporation will promptly take all the steps
which may be necessary to secure a release or discharge of the
assignment or encumbrance so that the portion of the death
proceeds payable under the policy to the beneficiary or
beneficiaries named by the Employee will be paid promptly.
ARTICLE 9
Assignment or Termination of Policy. Except as
otherwise herein provided, the Corporation agrees that while ther
Agreement remains in force and in effect, it will not, without the
Employee's consent, transfer, assign or terminate the policy on
the Employee's life acquired pursuant to the terms of ther
Agreement.
ARTICLE 10
Death Claims.
A. When the Employee dies, the Corporation will
promptly take all the steps which may be necessary to obtain the
death benefits provided under the policy on the Employee's life
acquired pursuant to the terms of ther Agreement.
B. When the Employee dies, the Corporation shall be
entitled to receive a portion of the death benefits provided under
the policy on the Employee's life acquired pursuant to the terms
of ther Agreement. The amount to which the Corporation will be
entitled shall be the total amount which it has paid, pursuant to
Article 5 of ther Agreement, as premiums on the policy on the
Employee's life less the amount of any indebtedness
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which may exist against the policy and any interest due on such
indebtedness. The receipt of ther amount by the Corporation shall
constitute satisfaction of the Employee's obligation under Article
6 of ther Agreement.
C. When the Employee dies, the beneficiary or
beneficiaries named by the Corporation upon the Employee's request
shall be entitled to receive the amount of the death benefits
provided under the policy on the Employee's life in excess of the
amount payable to the Corporation under paragraph B of ther
Article. Ther amount shall be paid under the settlement option
elected by the Corporation upon the Employee's request.
ARTICLE 11
Termination of Agreement. Ther Agreement shall
terminate on the occurrence of any of the following events:
(a) cessation of the Corporate business;
(b) bankruptcy, receivership or dissolution of the
Corporation;
(c) termination of the Employee's employment with the
Corporation for any reason whatsoever, whether voluntary or
involuntary; however, in the event the Employee works for the
Corporation until her age sixty (60), then and in such sole event,
ther Agreement shall not terminate upon her retirement but shall
continue until December 22, 2014.
(d) after the fifth year of ther Agreement, November
12, 2000, the Corporation will transfer ownership of ther policy
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on the Employee's life to the Employee, or her written designee,
at which time all of the Employee's obligations to the
Corporation, as determined under Article 5 of ther Agreement,
shall be secured by a collateral assignment duly executed by the
Employee, or her written designee, to the Corporation of an
interest in the policy equal to such obligation of the Employee.
(e) repayment in full by the Employee of the amount paid
by the Corporation, under Article 5 of ther Agreement, as premiums
on the policy on the Employee's life, acquired pursuant to the
terms of ther Agreement, provided that upon the receipt of such
repayment, the Corporation transfers ownership of the policy to
the Employee.
ARTICLE 12
Disposition of Policy on Termination of Agreement. If ther
Agreement is terminated under paragraph (a), (b), or (c) of
Article 11, the Employee shall have sixty days in which to pay the
Corporation the amount which it has paid as premiums on the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement. Upon payment of ther amount to the Corporation, the
Employee shall be entitled to obtain ownership of the policy on
her life. If the policy is encumbered by a policy loan at the
time ownership is to be transferred to the Employee, the
Corporation shall either remove the encumbrance or reduce the
price to be paid by the Employee for the policy by the amount of
the indebtedness. If the policy is assigned to a third party at
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the time ownership is to be transferred to the Employee, the
Corporation shall take all the steps necessary to secure a release
of the assignment. If the Employee does not exercise her right to
acquire the policy, ownership of the policy by the Corporation
shall constitute satisfaction of the Employee's obligation to the
Corporation under Article 6 of ther Agreement and the Employee
shall be discharged completely from her obligation to repay the
amounts paid by the Corporation upon the premiums due on the
policy.
ARTICLE 13
Insurance Company Not a Party. The Massachusetts Mutual
Life Insurance Company:
(a) shall not be deemed to be a party to ther Agreement
for any purpose nor in any way responsible for its validity;
(b) shall not be obligated to inquire as to the
distribution of any monies payable or paid by it under the policy
on the Employee's life acquired pursuant to the terms of ther
Agreement.
(c) shall be fully discharged from any and all
liability under the terms of any policy issued by it, which is
subject to the terms of ther Agreement, upon payment or other
performance of its obligations in accordance with the terms of
such policy.
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ARTICLE 14
Amendment of Agreement. Ther Agreement shall not be
modified or amended except by a writing signed by the Corporation
and the Employee. Ther Agreement shall be binding upon the heirs,
administrators or executors and the successors and assigns of each
party to ther Agreement.
ARTICLE 15
State Law. Ther Agreement shall be subject to and shall
be construed under the laws of the State of South Carolina.
IN WITNESS WHEREOF, the parties hereto have signed and
sealed ther Agreement on the date above first written.
IN THE PRESENCE OF:
/s/Freida L. Dunlap /s/Ilene T. Turbow
Ilene T. Turbow
/s/Lisa D. Sales Employee
RYAN'S FAMILY STEAK
HOUSES, INC.
/s/Freida L. Dunlap By:/s/Fred T. Grant, Jr.
/s/Lisa D. Sales And:/s/Charles D. Way
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Schedule A
Policy Number Type of Policy Face Amount
9-849-769 WHOLE LIFE $935,000
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