1034-00004 · Group Strathmore Corp · ILIT Documents

ilit-schedule-a.docx DOCUMENT M&A / Corporate

40 / 75 ← → ✕

Contract analysis Extract to table

SCHEDULE A

Trust Property

Attached to and forming a part of the Caldwell Family Insurance Trust Agreement dated March 15, 2023

Grantor: Jonathan R. Caldwell

Trustee: Northgate Trust Company of Delaware, 1201 North Market Street, Suite 1600, Wilmington, DE 19801

1. Identification of Trust Property

The following described property constitutes the trust property of the Caldwell Family Insurance Trust (the "Trust") established pursuant to the Trust Agreement dated March 15, 2023 (the "Trust Agreement"), by Jonathan R. Caldwell, as Grantor, and Northgate Trust Company of Delaware, a Delaware-chartered trust company, as Trustee. All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Trust Agreement.

The trust property described in this Schedule A is held by the Trustee in its fiduciary capacity, subject to the terms, conditions, and provisions of the Trust Agreement. This Schedule A is incorporated by reference into the Trust Agreement and shall be construed as an integral part thereof.

2. Life Insurance Policy Description

2.1 Policy Details

The principal asset of the Trust consists of the following life insurance policy (the "Policy"):

The Policy is a permanent life insurance contract issued by Beacon Life Assurance Company in the ordinary course of its business and is subject to the terms, conditions, riders, endorsements, and exclusions set forth in the Policy contract. A complete copy of the Policy, including all riders and endorsements, is maintained in the records of the Trustee and is available for inspection by the Grantor and the Trust beneficiaries in accordance with the provisions of the Trust Agreement.

2.2 Insured Lives

The Policy insures the following two individuals on a survivorship (second-to-die) basis:

First Insured Life:

Jonathan Robert Caldwell Date of Birth: March 14, 1956 Residence: 418 East 72nd Street, Apt. 14A, New York, NY 10021 Social Security Number: XXX-XX-4781

Second Insured Life:

Eleanor Victoria Caldwell Date of Birth: September 22, 1958 Residence: 418 East 72nd Street, Apt. 14A, New York, NY 10021 Social Security Number: XXX-XX-6203

The death benefit under the Policy is payable upon the death of the survivor of the two insured lives described above. No death benefit is payable under the Policy upon the death of the first to die of the insured lives, except as may otherwise be provided by any rider or endorsement attached to the Policy. The survivorship structure of the Policy is designed to provide estate liquidity upon the occurrence of the second death, at which time federal estate tax obligations of the insured lives' estates are anticipated to arise.

2.3 Death Benefit

The death benefit in the amount of Fifteen Million Dollars ($15,000,000) is payable to the Trustee of the Caldwell Family Insurance Trust as both the owner and the designated beneficiary of the Policy upon the death of the survivor of the two insured lives. The death benefit amount stated herein reflects the initial face amount of the Policy as of the date of issuance and may be subject to adjustment in accordance with the terms of the Policy contract, including without limitation any increases or decreases elected by the Trustee (with the consent of the Grantor, if applicable, as provided in the Trust Agreement), any policy loans outstanding at the time of the insured event, or any applicable surrender charges or cost of insurance deductions.

2.4 Premium Information

The annual premium of One Hundred Eighty-Seven Thousand Five Hundred Dollars ($187,500) is funded through contributions made by the Grantor to the Trust. Each such contribution is intended to qualify for the federal gift tax annual exclusion pursuant to Section 2503(b) of the Internal Revenue Code of 1986, as amended (the "Code"), by reason of the Crummey withdrawal rights granted to the Trust beneficiaries under Article IV of the Trust Agreement.

Upon receipt of each premium contribution from the Grantor, the Trustee shall issue written Crummey withdrawal notices to each of the following Trust beneficiaries, as more fully described in the Trust Agreement:

(a) Thomas R. Caldwell;

(b) Katherine C. Hartfield; and

Each such beneficiary shall have the right to withdraw his or her proportionate share of each contribution for a period of not less than thirty (30) days following receipt of the Crummey withdrawal notice, as set forth in the Trust Agreement. To the extent that any withdrawal right lapses unexercised, the lapsed amount shall be retained by the Trustee and applied toward the payment of the annual premium on the Policy or otherwise administered in accordance with the Trust Agreement.

The Trustee shall be responsible for the timely remittance of premium payments to Beacon Life Assurance Company in order to maintain the Policy in full force and effect. The Grantor acknowledges that the Grantor is under no legal obligation to make contributions to the Trust for the payment of premiums, and that any failure to make such contributions may result in the lapse or termination of the Policy.

2.5 Policy Ownership

The Policy was assigned to the Trustee pursuant to an Assignment of Life Insurance Policy (the "Assignment") executed on March 15, 2023, by and between the Grantor (as assignor) and Northgate Trust Company of Delaware, as Trustee (as assignee). A copy of the fully executed Assignment has been delivered to Beacon Life Assurance Company and is maintained in the records of the Trustee.

All incidents of ownership in the Policy, as that term is defined in Section 2042 of the Code and the Treasury Regulations promulgated thereunder, are held exclusively by the Trustee in its fiduciary capacity. Without limiting the generality of the foregoing, the Trustee holds the sole and exclusive right to:

(a) change the beneficiary designation of the Policy;

(b) surrender or cancel the Policy;

(d) pledge the Policy as collateral for any loan;

(e) borrow against the cash surrender value of the Policy;

(f) elect settlement options under the Policy;

(g) exercise any conversion privileges or nonforfeiture options available under the Policy; and

(h) exercise any and all other rights, privileges, options, and elections available to the owner of the Policy under its terms.

The Grantor has retained no incidents of ownership in the Policy, directly or indirectly, and the Grantor shall not exercise or attempt to exercise any of the rights described above. The Grantor acknowledges and agrees that the irrevocable transfer of all incidents of ownership to the Trustee is intended to exclude the proceeds of the Policy from the Grantor's gross estate for federal estate tax purposes under Sections 2035 and 2042 of the Code.

2.6 Beneficiary Designation

The Trustee has designated itself, in its capacity as Trustee of the Caldwell Family Insurance Trust, as the primary beneficiary of all death benefit proceeds payable under the Policy. No contingent beneficiary has been designated, as the Trust Agreement provides for the disposition of trust assets, including Policy proceeds, upon the occurrence of various contingencies.

Upon the death of the survivor of the insured lives, the death benefit proceeds payable under the Policy shall be collected by the Trustee and thereafter held, administered, invested, and distributed by the Trustee in accordance with the terms and provisions of the Trust Agreement, including without limitation the provisions of Article V (Distribution of Trust Property) and Article VI (Trustee Powers and Duties) thereof.

The Trustee shall not change the beneficiary designation of the Policy without the prior written consent of the Trust Protector, if one has been appointed, or as otherwise permitted under the terms of the Trust Agreement.

3. Insurance Broker

The Policy described in Section 2 above was procured through the following insurance brokerage firm:

Glenmore Insurance Brokerage LLC 44 Wall Street, Suite 1200 New York, NY 10005

Contact: Nathan C. Freed, Senior Vice President, Private Client Division

Glenmore Insurance Brokerage LLC acted as the broker of record in connection with the application for and placement of the Policy. All communications with Beacon Life Assurance Company regarding the Policy, including but not limited to premium notices, policy changes, claims, and correspondence, may be directed through Glenmore Insurance Brokerage LLC or directly to the issuing company at the address set forth in Section 2.1 above. The Trustee shall maintain appropriate records of all such communications.

4. Additional Trust Property

This Schedule A may be amended, supplemented, or restated from time to time by the Grantor and the Trustee to reflect additional property transferred to the Trust, whether by gift, bequest, devise, or other means, in accordance with the provisions of the Trust Agreement. Any such amendment shall be attached to and incorporated into the Trust Agreement and this Schedule A.

As of the date of execution of the Trust Agreement, the Policy described in Section 2 above constitutes the sole trust property of the Trust, together with any cash contributions made by the Grantor to the Trust from time to time for the purpose of funding premium payments on the Policy or for any other purpose consistent with the terms of the Trust Agreement. The Trustee may hold such cash contributions in a non-interest-bearing trust account or in such other short-term investment vehicle as the Trustee deems appropriate in the exercise of its fiduciary discretion, pending application of such funds to premium payments or other trust purposes.

The Trustee shall maintain a current inventory of all trust property and shall update this Schedule A as necessary to reflect additions to or dispositions of trust property occurring after the date hereof.

5. Confirmation and Acknowledgment

The undersigned Grantor hereby confirms that the property described in this Schedule A constitutes the initial trust property of the Caldwell Family Insurance Trust and that the foregoing description of the Policy and related information is true, correct, and complete in all material respects as of the date set forth below. The Grantor further confirms that the Policy has been irrevocably assigned to the Trustee and that the Grantor has retained no incidents of ownership in the Policy.

The undersigned Trustee hereby acknowledges receipt of the trust property described in this Schedule A and confirms that such property is held by the Trustee in its fiduciary capacity, subject to and in accordance with the terms and provisions of the Trust Agreement.

IN WITNESS WHEREOF, the Grantor and the Trustee have executed this Schedule A as of the date set forth below.

GRANTOR:

________________________________________

Jonathan R. Caldwell, as Grantor

Date: March 15, 2023

TRUSTEE:

NORTHGATE TRUST COMPANY OF DELAWARE

By: ________

Name: Philip A. Rossiter

Title: Senior Vice President, Trust Administration

Date: March 15, 2023

This Schedule A is attached to and forms a part of the Caldwell Family Insurance Trust Agreement dated March 15, 2023. This document is confidential and is intended solely for the use of the parties to the Trust Agreement and their authorized advisors.

Item	Description
Issuing Company	Beacon Life Assurance Company, a Connecticut domiciled insurance company, with principal offices located at 100 Constitution Plaza, Hartford, CT 06103
Policy Number	BLA-2023-77419
Policy Type	Second-to-die universal life insurance policy
Date of Issue	2023 (application submitted March 15, 2023; policy issued upon completion of underwriting and delivery of the initial premium payment)
Item	Description
Face Amount / Death Benefit	$15,000,000 (Fifteen Million Dollars)
Beneficiary	Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust
Item	Description
Annual Premium	$187,500 (One Hundred Eighty-Seven Thousand Five Hundred Dollars)
Premium Payment Schedule	Annual
Premium Due Date	On or before each anniversary of the Policy date of issue
Item	Description
Owner	Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust
Item	Description
Primary Beneficiary of Policy Proceeds	Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust

SCHEDULE A
Trust Property
Attached to and forming a part of the Caldwell Family Insurance Trust Agreement dated March 15, 2023
Grantor: Jonathan R. Caldwell
Trustee: Northgate Trust Company of Delaware, 1201 North Market Street, Suite 1600, Wilmington, DE 19801
1. Identification of Trust Property
The following described property constitutes the trust property of the Caldwell Family Insurance Trust (the "Trust") established pursuant to the Trust Agreement dated March 15, 2023 (the "Trust Agreement"), by Jonathan R. Caldwell, as Grantor, and Northgate Trust Company of Delaware, a Delaware-chartered trust company, as Trustee. All capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Trust Agreement.
The trust property described in this Schedule A is held by the Trustee in its fiduciary capacity, subject to the terms, conditions, and provisions of the Trust Agreement. This Schedule A is incorporated by reference into the Trust Agreement and shall be construed as an integral part thereof.
2. Life Insurance Policy Description
2.1 Policy Details
The principal asset of the Trust consists of the following life insurance policy (the "Policy"):
The Policy is a permanent life insurance contract issued by Beacon Life Assurance Company in the ordinary course of its business and is subject to the terms, conditions, riders, endorsements, and exclusions set forth in the Policy contract. A complete copy of the Policy, including all riders and endorsements, is maintained in the records of the Trustee and is available for inspection by the Grantor and the Trust beneficiaries in accordance with the provisions of the Trust Agreement.
2.2 Insured Lives
The Policy insures the following two individuals on a survivorship (second-to-die) basis:
First Insured Life:
Jonathan Robert Caldwell Date of Birth: March 14, 1956 Residence: 418 East 72nd Street, Apt. 14A, New York, NY 10021 Social Security Number: XXX-XX-4781
Second Insured Life:
Eleanor Victoria Caldwell Date of Birth: September 22, 1958 Residence: 418 East 72nd Street, Apt. 14A, New York, NY 10021 Social Security Number: XXX-XX-6203
The death benefit under the Policy is payable upon the death of the survivor of the two insured lives described above. No death benefit is payable under the Policy upon the death of the first to die of the insured lives, except as may otherwise be provided by any rider or endorsement attached to the Policy. The survivorship structure of the Policy is designed to provide estate liquidity upon the occurrence of the second death, at which time federal estate tax obligations of the insured lives' estates are anticipated to arise.
2.3 Death Benefit
The death benefit in the amount of Fifteen Million Dollars ($15,000,000) is payable to the Trustee of the Caldwell Family Insurance Trust as both the owner and the designated beneficiary of the Policy upon the death of the survivor of the two insured lives. The death benefit amount stated herein reflects the initial face amount of the Policy as of the date of issuance and may be subject to adjustment in accordance with the terms of the Policy contract, including without limitation any increases or decreases elected by the Trustee (with the consent of the Grantor, if applicable, as provided in the Trust Agreement), any policy loans outstanding at the time of the insured event, or any applicable surrender charges or cost of insurance deductions.
2.4 Premium Information
The annual premium of One Hundred Eighty-Seven Thousand Five Hundred Dollars ($187,500) is funded through contributions made by the Grantor to the Trust. Each such contribution is intended to qualify for the federal gift tax annual exclusion pursuant to Section 2503(b) of the Internal Revenue Code of 1986, as amended (the "Code"), by reason of the Crummey withdrawal rights granted to the Trust beneficiaries under Article IV of the Trust Agreement.
Upon receipt of each premium contribution from the Grantor, the Trustee shall issue written Crummey withdrawal notices to each of the following Trust beneficiaries, as more fully described in the Trust Agreement:
(a) Thomas R. Caldwell;
(b) Katherine C. Hartfield; and
(c) Olivia G. Caldwell.
Each such beneficiary shall have the right to withdraw his or her proportionate share of each contribution for a period of not less than thirty (30) days following receipt of the Crummey withdrawal notice, as set forth in the Trust Agreement. To the extent that any withdrawal right lapses unexercised, the lapsed amount shall be retained by the Trustee and applied toward the payment of the annual premium on the Policy or otherwise administered in accordance with the Trust Agreement.
The Trustee shall be responsible for the timely remittance of premium payments to Beacon Life Assurance Company in order to maintain the Policy in full force and effect. The Grantor acknowledges that the Grantor is under no legal obligation to make contributions to the Trust for the payment of premiums, and that any failure to make such contributions may result in the lapse or termination of the Policy.
2.5 Policy Ownership
The Policy was assigned to the Trustee pursuant to an Assignment of Life Insurance Policy (the "Assignment") executed on March 15, 2023, by and between the Grantor (as assignor) and Northgate Trust Company of Delaware, as Trustee (as assignee). A copy of the fully executed Assignment has been delivered to Beacon Life Assurance Company and is maintained in the records of the Trustee.
All incidents of ownership in the Policy, as that term is defined in Section 2042 of the Code and the Treasury Regulations promulgated thereunder, are held exclusively by the Trustee in its fiduciary capacity. Without limiting the generality of the foregoing, the Trustee holds the sole and exclusive right to:
(a) change the beneficiary designation of the Policy;
(b) surrender or cancel the Policy;
(c) assign or transfer the Policy;
(d) pledge the Policy as collateral for any loan;
(e) borrow against the cash surrender value of the Policy;
(f) elect settlement options under the Policy;
(g) exercise any conversion privileges or nonforfeiture options available under the Policy; and
(h) exercise any and all other rights, privileges, options, and elections available to the owner of the Policy under its terms.
The Grantor has retained no incidents of ownership in the Policy, directly or indirectly, and the Grantor shall not exercise or attempt to exercise any of the rights described above. The Grantor acknowledges and agrees that the irrevocable transfer of all incidents of ownership to the Trustee is intended to exclude the proceeds of the Policy from the Grantor's gross estate for federal estate tax purposes under Sections 2035 and 2042 of the Code.
2.6 Beneficiary Designation
The Trustee has designated itself, in its capacity as Trustee of the Caldwell Family Insurance Trust, as the primary beneficiary of all death benefit proceeds payable under the Policy. No contingent beneficiary has been designated, as the Trust Agreement provides for the disposition of trust assets, including Policy proceeds, upon the occurrence of various contingencies.
Upon the death of the survivor of the insured lives, the death benefit proceeds payable under the Policy shall be collected by the Trustee and thereafter held, administered, invested, and distributed by the Trustee in accordance with the terms and provisions of the Trust Agreement, including without limitation the provisions of Article V (Distribution of Trust Property) and Article VI (Trustee Powers and Duties) thereof.
The Trustee shall not change the beneficiary designation of the Policy without the prior written consent of the Trust Protector, if one has been appointed, or as otherwise permitted under the terms of the Trust Agreement.
3. Insurance Broker
The Policy described in Section 2 above was procured through the following insurance brokerage firm:
Glenmore Insurance Brokerage LLC 44 Wall Street, Suite 1200 New York, NY 10005
Contact: Nathan C. Freed, Senior Vice President, Private Client Division
Glenmore Insurance Brokerage LLC acted as the broker of record in connection with the application for and placement of the Policy. All communications with Beacon Life Assurance Company regarding the Policy, including but not limited to premium notices, policy changes, claims, and correspondence, may be directed through Glenmore Insurance Brokerage LLC or directly to the issuing company at the address set forth in Section 2.1 above. The Trustee shall maintain appropriate records of all such communications.
4. Additional Trust Property
This Schedule A may be amended, supplemented, or restated from time to time by the Grantor and the Trustee to reflect additional property transferred to the Trust, whether by gift, bequest, devise, or other means, in accordance with the provisions of the Trust Agreement. Any such amendment shall be attached to and incorporated into the Trust Agreement and this Schedule A.
As of the date of execution of the Trust Agreement, the Policy described in Section 2 above constitutes the sole trust property of the Trust, together with any cash contributions made by the Grantor to the Trust from time to time for the purpose of funding premium payments on the Policy or for any other purpose consistent with the terms of the Trust Agreement. The Trustee may hold such cash contributions in a non-interest-bearing trust account or in such other short-term investment vehicle as the Trustee deems appropriate in the exercise of its fiduciary discretion, pending application of such funds to premium payments or other trust purposes.
The Trustee shall maintain a current inventory of all trust property and shall update this Schedule A as necessary to reflect additions to or dispositions of trust property occurring after the date hereof.
5. Confirmation and Acknowledgment
The undersigned Grantor hereby confirms that the property described in this Schedule A constitutes the initial trust property of the Caldwell Family Insurance Trust and that the foregoing description of the Policy and related information is true, correct, and complete in all material respects as of the date set forth below. The Grantor further confirms that the Policy has been irrevocably assigned to the Trustee and that the Grantor has retained no incidents of ownership in the Policy.
The undersigned Trustee hereby acknowledges receipt of the trust property described in this Schedule A and confirms that such property is held by the Trustee in its fiduciary capacity, subject to and in accordance with the terms and provisions of the Trust Agreement.
IN WITNESS WHEREOF, the Grantor and the Trustee have executed this Schedule A as of the date set forth below.
GRANTOR:
________________________________________
Jonathan R. Caldwell, as Grantor
Date: March 15, 2023
TRUSTEE:
NORTHGATE TRUST COMPANY OF DELAWARE
By: ________
Name: Philip A. Rossiter
Title: Senior Vice President, Trust Administration
Date: March 15, 2023
This Schedule A is attached to and forms a part of the Caldwell Family Insurance Trust Agreement dated March 15, 2023. This document is confidential and is intended solely for the use of the parties to the Trust Agreement and their authorized advisors.
Item | Description
Issuing Company | Beacon Life Assurance Company, a Connecticut domiciled insurance company, with principal offices located at 100 Constitution Plaza, Hartford, CT 06103
Policy Number | BLA-2023-77419
Policy Type | Second-to-die universal life insurance policy
Date of Issue | 2023 (application submitted March 15, 2023; policy issued upon completion of underwriting and delivery of the initial premium payment)
Item | Description
Face Amount / Death Benefit | $15,000,000 (Fifteen Million Dollars)
Beneficiary | Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust
Item | Description
Annual Premium | $187,500 (One Hundred Eighty-Seven Thousand Five Hundred Dollars)
Premium Payment Schedule | Annual
Premium Due Date | On or before each anniversary of the Policy date of issue
Item | Description
Owner | Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust
Item | Description
Primary Beneficiary of Policy Proceeds | Northgate Trust Company of Delaware, as Trustee of the Caldwell Family Insurance Trust

SCHEDULE A

GRANTOR:

TRUSTEE:

NORTHGATE TRUST COMPANY OF DELAWARE

Record

Parties

Dates

Amounts