SPLIT-DOLLAR COLLATERAL ASSIGNMENT
Owner: NORMAN AXELROD shall refer to the Employee, Third Party, or Trust,
and his/her/its successors and assigns;
Assignee: LINENS 'N THINGS shall refer to Employer, and its successors and
assigns;
Insurer: NATIONWIDE LIFE AND ANNUITY COMPANY;
Policy No.: N056077170;
Insured: NORMAN AXELROD;
Split Dollar Agreement: shall refer to the Agreement entered into between the
Owner and the Assignee dated December 20, 1999, which is the subject of this
Collateral Assignment.
In consideration of the Split-Dollar Agreement (the "Agreement") entered into
between the above named Assignee and Owner, Assignee and Owner agree as follows:
a) The above numbered Policy is assigned by Owner to Assignee as
collateral security of Owner's liability to Assignee as defined in the
Agreement (the "Assignee's Interest"), subject to all terms and
conditions of the Policy and to all superior liens, if any, which the
Insurer may have against the Policy.
b) The rights of the Owner and Assignee are specified in the Agreement.
This Collateral Assignment is intended to provide direction to the
Insurer as to the required signatures when either or both parties
exercise certain policy rights.
In accordance with the Split Dollar Agreement, the parties agree to the
following limitations of the ability to exercise the rights provided under the
Policy:
Death Benefits
The Assignee shall have the right to receive from the Policy Proceeds, an amount
equal to the Assignee's Interest in the Policy, as defined and modified in the
Split Dollar Agreement. The Owner shall have the right to receive the balance,
if any, of the Policy Proceeds, but in no event, less than twenty-five thousand
dollars ($ 25,000). Each Party shall have the right to designate and change the
beneficiary or beneficiaries to receive its portion of the Policy Proceeds
payable in accordance with the Split Dollar Agreement.
Cash Values
1. Investment Choices: Prior to a Change in Control as defined in the
Split Dollar Agreement, the Assignee shall have the right to exercise
any investment choices permitted by the Policy with respect to the cash
value of the Policy, and Owner shall agree to waive this right in
accordance with the established procedures of the Insurer. After a
Change in Control, the Owner shall have the right to exercise any
investment choices permitted by the Policy with respect to the cash
value of the Policy, and Assignee shall agree to waive this right in
accordance with the established procedures of the Insurer. The Insurer
may rely on the statement of the Assignee as to whether a Change of
Control has occurred.
2. Policy Loans and Partial Withdrawals: Neither party shall have the
right to request and receive a loan secured by Policy Cash Values
without the express, written consent of the other party. Neither party
shall have the right to receive a distribution from the cash value of
the Policy (in the form of a Cash Withdrawal, Partial Surrender or
otherwise) prior to the termination of service by the Insured with the
Assignee without the express, written consent of the other party. After
the termination of service of the Insured with the Assignee, the Owner
shall have the right to receive distributions from the Policy Cash
Values, but only at the time and in the amount set forth in the Split
Dollar Agreement. Insurer may rely on the Assignee's representation as
to the amount so set forth in the Split Dollar Agreement and the manner
in which the distribution is to be accomplished.
3. Termination of the Split Dollar Agreement: In the event of the
termination of the Split Dollar Agreement in accordance with the
provisions thereof, the Assignee shall have the right to receive an
amount equal to its Interest in the Policy payable from the cash values
of the Policy. Pursuant to the Split Dollar Agreement, the Owner may
exercise the right to satisfy the Assignee's Interest in the Policy by
direct payment to the Assignee.
Miscellaneous Rights
1. Any other rights not provided for in this Collateral Assignment,
including the right to surrender the Policy or exercise any
non-forfeiture options under the Policy, shall require the written
consent of both Owner and Assignee unless otherwise provided.
2. Insurer may rely on the Assignee's representation as to the amount of
the Assignee's Interest in the Policy in accordance with the Split
Dollar Agreement
3. Insurer may act on any request to exercise any right based on the
required signatures as set forth in this Collateral Assignment, and
Insurer has no duty to investigate the reason for any such exercise.
Upon payment of any amounts from the Policy based on this request,
during Insured's lifetime or at death, Insurer shall be fully
discharged and released as to its actions.
4. Owner represents that there are no other collateral assignments of the
Policy and no proceedings in bankruptcy are pending.
5. This Split-Dollar Collateral Assignment shall be binding upon the
parties and their successors, assigns, devisees, personal
representatives and other legal representatives.
6. Insurer will not be liable for any action it takes before this Split-
Dollar Collateral Assignment is received and acknowledged at the
Insurer's Home Office.
7. In the event of any conflict between the terms specifying the required
signatures in this Split-Dollar Collateral Assignment and the
signatures required in the Agreement, the terms of this Split-Dollar
Collateral Assignment shall prevail as to signatures.
The Owner hereby assigns, transfers, and sets over the Policy to the Assignee,
as collateral, to secure the rights of the Assignee as set out in this
Collateral Assignment, and for no other purpose. The Policy shall remain subject
to this assignment notwithstanding any assignment, transfer or conveyance of the
Policy or any interest therein by the Owner. Nothing in this assignment shall
change the rights and obligations of the Owner and the Company as set out
herein, or in the Split Dollar Agreement as described in the preamble language
of this Assignment.
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Agreed to this 17 day of January, 2000.
If signing for an entity, the undersigned represents that she/he has authority
to bind the entity.
NORMAN AXELROD LINENS 'N THINGS
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OWNER (Print name) ASSIGNEE (Print name of entity or
individual)
NORMAN AXELROD BRIAN SILVA
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SIGNATURE OF OWNER SIGNATURE OF ASSIGNEE
(and if an entity print title of
authorized signor)
6 Sunflower Drive 6 Brighton Road
Upper Saddle River, NJ 07458 Clifton, NJ 07015
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ADDRESS ADDRESS
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Filed at the Home Office of the Insurer this ______ day of _______, 20___. Aon
Consulting assumes no responsibility for the validity of the contents of this
document.
By ___________________________________
Authorized Officer