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Exhibit 10c(23)
EXECUTIVE PERMANENT LIFE INSURANCE AGREEMENT
THIS
AGREEMENT is made this ____________
between
CAROLINA POWER & LIGHT COMPANY
("Company") and ____________________________________
("Employee").
WITNESSETH:
WHEREAS,
the Company has instituted an Executive Permanent Life
Insurance Program in order to assist selected key employees in
providing death benefits for their beneficiaries;
and
WHEREAS,
the Company desires to provide such benefits in the Executive
Permanent Life Insurance
Program to the extent provided herein;
NOW,
THEREFORE, it is mutually agreed that:
1.
Insurance Policy .
In furtherance of the purpose of the Executive Permanent Life
Insurance Program, the Company and Employee have jointly applied
for and purchased life insurance from
Northwestern Mutual Life Insurance Company ("Insured") insuring the
life of _________ _________,
an employee of the Company. The policy number is _________
_________
and
the original face amount is ________________
("Policy").
2.
Policy Ownership .
The Company and the Employee agree that the Policy shall be divided
into two separate and distinct policy interests as provided in
Paragraph 4. During the term of this Agreement, the parties shall
have the following ownership rights with respect to such policy
interests.
a)
Company .
i)
The
contingent limited right to obtain one or more loans or
advances on the Policy which shall be limited to the extent of
the Company's Policy Interest, as defined in Paragraph 4
below, and to pledge or assign the Policy for such loans or
advances. Any such loan, advance, pledge or assignment by the
Company shall be subject to the written consent of the
Employee. If such loans are for the purpose of paying premiums
or otherwise to purchase or carry the Policy, the Company
agrees to adhere to the requirement of Section 264 of the
Internal Revenue code of 1986, as amended from time to time,
so that the interest paid on such loans, or some portion
thereof, may be deductible for federal income tax
purposes;
ii)
Ownership
of Policy cash value equal to the sum of all "Company
premiums" as defined in Paragraph 3(a) hereof;
and
iii)
The
limited right to receive death proceeds of the Policy to the
extent of the Company’s
Policy Interest in the event of the Employee’s death
during the term of this
Agreement.
b)
Employee .
Except as provided in Paragraph 2(a) above and otherwise in this
Agreement, the Employee shall have all remaining ownership rights
in the Policy, including but not limited to, the
following:
i)
The
contingent limited right to obtain one or more loans or
advances on the Policy which shall be limited to the extent of
the Employee's Policy Interest, as defined in Paragraph 4
below, and to pledge or assign the Policy for such loans or
advances. Any
such loan, advance, pledge or assignment by the Employee shall
be subject to the written
consent of the Company;
ii)
The
right to designate beneficiaries of the Employee's Policy
Interest including selection of settlement
options;
iii)
The right to assign any part or all of the Employee's
ownership rights in the Policy to any person, entity or trust
by execution of appropriate documents;
iv)
The
right to surrender the Policy subject to the Company’s
Policy Interest; and
v)
Ownership
of all Policy cash value not owned by the
Company.
3.
Payment of Premiums .
a)
i) Subject
to Paragraph 3(b) below, payment of the Policy’s annual
premium shall be split between the Company and the Employee.
The Employee shall pay that portion of
the annual premium equal to the
“economic benefit” as defined in Revenue Rulings
64-325 and 66-110. The value of the economic benefit shall be
calculated by using
the lower of the P.S. 58 rates or
the Insurer’s term rates. The Company shall pay the
remainder of the premium (hereafter referred to as
“Company premium(s)”).
ii)
Notwithstanding
the foregoing, during the term of this Agreement, the Company
shall pay its portion of the annual premium for ten (10) years
commencing with the premium for the initial policy year
beginning July 1, 1998, and including the premium due on the
July 1, 2007 policy anniversary; provided, however, that the
Company may agree to pay such additional premiums as it and
the Employee may agree. In the event the Company is not
obligated to pay a portion of the premium on the policy for
any policy year during the term of this Agreement, the
Employee shall pay such premium either in cash or by the
application of policy dividends and/or values.
iii)
By mutual consent of the parties hereto and for administrative
convenience, the Company
may pay the entire premium as it becomes due, whereupon the
Employee shall
reimburse the Company for the Employee's share of the premium
in such manner as the Company and the Employee may mutually
agree.
b)
If
either a standard disability waiver of premium benefit or
accidental death benefit is added
as a rider to the Policy, the Employee agrees to pay the
annual cost of such riders.
4.
Policy Interests .
a)
Subject
to Paragraph 4(b) below, during the term of this Agreement and
prior to or upon
the death of the Employee, the Company, by reason of payment
of
premiums pursuant
to Paragraph 3 above, shall have an interest in the Policy
equal to the sum of
Company premiums paid reduced by any Policy
indebtedness
which is incurred by the
Company and unpaid interest on such Policy indebtedness
("Company's Policy Interest").
The Employee, by reason of payment
of premiums pursuant to Paragraph 3
above, shall have all the remaining interest in the Policy in
excess of the Company's
Policy
Interest ("Employee's Policy Interest").
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b)
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In
the event of the death of the Employee during the term of this
Agreement, the proceeds of the Policy shall be payable as
follows:
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i)
The
Company shall be entitled to receive an amount of the Policy
death proceeds equal to the proceeds of the Policy reduced by
the death benefit payable to the Employee’s beneficiary
pursuant to Paragraph 4(b)(ii) below, less any Policy
indebtedness
which is incurred by the Company and unpaid interest on such
Policy indebtedness.
ii)
The
Employee's beneficiary shall be entitled to receive an amount
of the Policy death proceeds as follows plus death proceeds,
if any, from an accidental death benefit rider:
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Year
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Amount
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1
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705,000
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2
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747,300
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3
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792,138
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4
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839,666
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5
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890,046
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6
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943,449
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7
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1,000,056
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8
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1,060,059
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9
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1,123,663
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10
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1,191,083
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11
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1,262,548
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12
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1,338,300
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5.
Dividends .
During the term of the Agreement, the Company and Employee agree
that any dividends
attributable to the Policy shall be used to purchase paid-up
additional life insurance on
the Employee's life unless mutually agreed otherwise.
Notwithstanding the foregoing, in the event a premium on the Policy
becomes due during the term of this Agreement and the Company is
not obligated to pay any portion of such premium, the Employee may
elect to have Policy dividends first offset such premium due with
any remaining dividends used to purchase paid-up additional life
insurance.
6.
Beneficiary Designation .
The Company and Employee agree that the beneficiary designation for
the payment of death proceeds in the Policy Application shall be
completed so that the Company
will be entitled to receive proceeds equal to the
Company's
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