SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 1-1430
REYNOLDS METALS COMPANY
A Delaware Corporation
(I.R.S. Employer Identification No. 54-0355135)
6601 West Broad Street, P. O. Box 27003, Richmond, Virginia 23261-7003
Telephone Number (804) 281-2000
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No ___
As of July 31, 1995, the Registrant had 63,446,718 shares of Common Stock,
no par value, outstanding and entitled to vote.
<PAGE>
<TABLE>
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
_________________________________________________________________________________________
Reynolds Metals Company
<CAPTION>
Quarter ended Six months ended
June 30 June 30
_________________________________________________________________________________________
(In millions, except per share amounts) 1995 1994 1995 1994
_________________________________________________________________________________________
<S> <C> <C> <C> <C>
REVENUES
Net sales $1,864 $1,455 $3,515 $2,709
Equity, interest and other income 10 5 20 12
_________________________________________________________________________________________
1,874 1,460 3,535 2,721
_________________________________________________________________________________________
COSTS AND EXPENSES
Cost of products sold 1,560 1,311 2,952 2,477
Selling, administrative and general expenses 113 93 220 185
Interest - principally on long-term obligations 44 38 87 74
_________________________________________________________________________________________
1,717 1,442 3,259 2,736
_________________________________________________________________________________________
Income (loss) before income taxes 157 18 276 ( 15)
Taxes on income (credit) 46 6 83 ( 6)
_________________________________________________________________________________________
NET INCOME (LOSS) 111 12 193 ( 9)
Preferred stock dividends 9 9 18 16
_________________________________________________________________________________________
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS $ 102 $ 3 $ 175 ($ 25)
=========================================================================================
INCOME (LOSS) PER SHARE (Note B)
Average shares outstanding 73 62 73 61
Net income (loss) $1.51 $0.05 $2.64 ($0.41)
CASH DIVIDENDS PER COMMON SHARE $0.30 $0.25 $0.55 $0.50
_________________________________________________________________________________________
</TABLE>
<PAGE>
<TABLE>
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
_________________________________________________________________________________________
Reynolds Metals Company
<CAPTION>
June 30 December 31
_________________________________________________________________________________________
(In millions) 1995 1994
_________________________________________________________________________________________
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $41 $308
Short-term investments 71 126
Receivables, less allowances of $21 (1994 - $19) 1,157 962
Inventories 1,042 873
Prepaid expenses 70 53
_________________________________________________________________________________________
Total current assets 2,381 2,322
Unincorporated joint ventures and associated companies 884 856
Property, plant and equipment 6,471 6,308
Less allowances for depreciation and amortization 3,326 3,200
_________________________________________________________________________________________
3,145 3,108
Deferred taxes and other assets 1,207 1,175
_________________________________________________________________________________________
Total assets $7,617 $7,461
=========================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable, accrued and other liabilities $1,198 $1,286
Short-term obligations 211 120
Long-term debt 19 18
_________________________________________________________________________________________
Total current liabilities 1,428 1,424
Long-term debt 1,868 1,848
Postretirement benefits 1,113 1,145
Environmental, deferred taxes and other liabilities 722 772
Stockholders' equity
Preferred stock 505 505
Common stock 918 870
Retained earnings 1,119 980
Cumulative currency translation adjustments (16) (43)
Pension liability adjustment (40) (40)
_________________________________________________________________________________________
Total stockholders' equity 2,486 2,272
_________________________________________________________________________________________
Total liabilities and stockholders' equity $7,617 $7,461
=========================================================================================
</TABLE>
<PAGE>
<TABLE>
CONDENSED STATEMENT OF CASH FLOWS (UNAUDITED)
_________________________________________________________________________________________
Reynolds Metals Company
<CAPTION>
Six months ended
June 30
_________________________________________________________________________________________
(In millions) 1995 1994
_________________________________________________________________________________________
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $193 ($9)
Adjustments to reconcile to net cash used in operating activities:
Depreciation and amortization 153 143
Deferred taxes and other 24 21
Changes in operating assets and liabilities net of effects
from acquisitions and dispositions:
Accounts payable, accrued and other liabilities (116) 112
Receivables (187) (106)
Inventories (161) (93)
Other (87) (7)
_________________________________________________________________________________________
Net cash provided by (used in) operating activities ( 181) 61
INVESTING ACTIVITIES
Capital investments (210) (175)
Proceeds from sales of assets 28 14
Investments in debt securities - (139)
Maturities of investments in debt securities 54 -
Other investing activities - net (4) (66)
_________________________________________________________________________________________
Net cash used in investing activities (132) (366)
FINANCING ACTIVITIES
Proceeds from preferred stock issue - 505
Increase (decrease) in short-term borrowings 80 (57)
Cash dividends paid (49) (22)
Other financing activities - net 15 (52)
_________________________________________________________________________________________
Net cash provided by financing activities 46 374
CASH AND CASH EQUIVALENTS
Net increase (decrease) (267) 69
At beginning of period 308 19
_________________________________________________________________________________________
AT END OF PERIOD $ 41 $ 88
=========================================================================================
</TABLE>
<PAGE>
REYNOLDS METALS COMPANY AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Quarters and Six Months Ended June 30, 1995 and 1994
Note A - Basis of presentation
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for
the interim periods of 1995 are not necessarily indicative of the results
that may be expected for the year ending December 31, 1995. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report on Form 10-K for the year
ended December 31, 1994.
Note B - Earnings per share
In the second quarter and six months of 1995, earnings per share equals net
income divided by the weighted-average number of common shares and common
share equivalents outstanding during the period. The number of common share
equivalents outstanding was based on the assumed conversion of the Company's
7% PRIDES(SM), Convertible Preferred Stock ("PRIDES"). In the second
quarter and six months of 1994, earnings per share equals net
income, minus PRIDES dividends, divided by the weighted-average number of
common shares outstanding during the period. Common share equivalents
relating to the PRIDES were not included in the second quarter and six
months of 1994 since their effect would have been anti-dilutive.
Note C - Financing Arrangements
In the first quarter of 1995, the Company amended its $500 million revolving
credit facility to extend the term and lower the cost. The expiration date
of the facility was extended from 1999 to 2000. The annual commitment fee
on the unused portion of the facility was lowered from .20% to .125%. No
amounts were outstanding under the facility at June 30, 1995.
Note D - Contingent liabilities
As previously disclosed in the Company's annual report on Form 10-K for the
year ended December 31, 1994, the Company is involved in various worldwide
environmental improvement activities resulting from past operations,
including designation as a potentially responsible party, with others, at
various EPA designated Superfund sites. The Company has recorded amounts
which, in management's best estimate, will be sufficient to satisfy
anticipated costs of known remediation requirements. As a result of factors
such as the continuing evolution of environmental laws and regulatory
requirements, the availability and application of technology, the
identification of presently unknown remediation sites and the allocation of
costs among potentially responsible parties, estimated costs for future
environmental compliance and remediation are necessarily imprecise. Based
upon information presently available, such future costs are not expected to
have a material adverse effect on the Company's competitive or financial
position or its ongoing results of operations. However, such costs could be
material to future quarterly or annual results of operations.
<PAGE>
Various suits and claims are pending against the Company. In the opinion of
management, after consultation with counsel, disposition of these suits and
claims, either individually or in the aggregate, will not have a material
adverse effect on the Company's competitive or financial position or its
ongoing results of operations. No assurance can be given, however, that the
disposition of one or more of such suits or claims in a particular reporting
period will not be material in relation to the reported results for such
period.
Note E - Canadian Reynolds Metals Company, Limited
Summarized financial information for Canadian Reynolds Metals Company,
Limited is as follows:
<TABLE>
<CAPTION>
Quarter ended June 30 Six Months ended June 30
______________________ ________________________
1995 1994 1995 1994
______________________ ________________________
<S> <C> <C> <C> <C>
Net Sales:
Customers $136 $93 $249 $166
Parent company 140 114 319 230
______________________ ________________________
276 207 568 396
Cost of products sold 178 188 393 368
Net income (loss) $59 $1 $109 $6
</TABLE>
<TABLE>
<CAPTION>
June 30 December 31
1995 1994
____________ ______________
<S> <C> <C>
Current assets $424 $238
Noncurrent assets 996 1,015
Current liabilities (106) (83)
Noncurrent liabilities (595) (564)
</TABLE>
Note F - Other Information
The Financial Accounting Standards Board issued in March, 1995, FAS No. 121
- - Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of. The Company is in the process of evaluating the
provisions of this pronouncement and has not made a determination as to the
impact, if any, on the Company's financial position and/or results of
operations.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
INTRODUCTION
The following discussion and analysis should be read in conjunction
with the consolidated financial statements and notes thereto included in or
referred to in this report.
RESULTS OF OPERATIONS
The Company had net income of $111 million ($1.51 per share) and $193
million ($2.64 per share) in the second quarter and six months of 1995,
respectively, compared to net income of $12 million ($0.05 per share) in the
second quarter of 1994 and a net loss of $9 million ($0.41 per share) in the
six months of 1994.
The Company's results for the second quarter and six months of 1995
reflect higher demand for the Company's products and stronger aluminum
prices worldwide as well as the ongoing benefits of performance improvement
programs, which include cost reduction, restructurings in prior years, and
strategic acquisitions and divestitures.
Shipments and Revenues
Shipments, net sales and revenues per pound for the second quarter and
six months of 1995 and 1994 were as follows (metric tons in thousands and
dollars in millions, except per pound amounts):
<TABLE>
<CAPTION>
Second Quarter Six Months
1995 1994 1995 1994
____________________ ____________________
<S> <C> <C> <C> <C>
Aluminum product shipments 426 406 818 751
Net sales:
Aluminum $1,508 $1,127 $2,842 $2,053
Nonaluminum 356 328 673 656
____________________ ____________________
Total $1,864 $1,455 $3,515 $2,709
==================== ====================
Revenues per pound:
Fabricated aluminum products $1.87 $1.45 $1.80 $1.42
Primary aluminum $0.92 $0.66 $0.95 $0.64
</TABLE>
Shipments of aluminum products set an all time Company record in the second
quarter of 1995 and contributed to increased shipments in the six
months of 1995. Higher shipments were realized in both periods for most
products, particularly primary aluminum, recycled aluminum, cans and ends,
can sheet and distributor sheet. Demand was strong in most of the
Company's principal markets. Higher shipments of cans and ends and
distributor sheet were also attributable to the acquisitions of a can
manufacturing facility in the second quarter of 1994 and a metals
distribution business in the third quarter of 1994.
The increases in net sales for aluminum products in both periods were
due to the higher shipping volume and higher prices for most aluminum
products.
The increase in nonaluminum sales was due to strong demand and
improved prices for alumina and stainless steel. Due to the strength in
the alumina market, the Company has restarted a portion of its idle
capacity at its alumina plant near Corpus Christi, Texas. The increase in
sales of stainless steel was also attributable to the acquisition of the
metals distribution business mentioned above.
<PAGE>
RESULTS OF OPERATIONS - continued
Shipments and Revenues - continued
For further information concerning shipments and revenues, see the
discussion under "Operating Area Analysis".
<TABLE>
Markets
Revenues by principal markets were:
<CAPTION>
Second Quarter Six Months
1995 1994 1995 1994
_______________ ______________
<S> <C> <C> <C> <C>
Packaging and Containers 45% 47% 43% 46%
Distributors and Fabricators 13 12 14 12
Automotive and Transportation 13 11 14 11
Building and Construction 13 13 13 12
Electrical 3 3 3 3
Other 13 14 13 16
_______________ _______________
Total 100% 100% 100% 100%
======= ======== ======= =======
</TABLE>
Sales to the packaging and containers market improved 22% and 20%,
respectively, in the second quarter and six months of 1995, but provided a
lower percentage of total revenues due to more substantial gains in sales to
other markets. The Company is benefiting in this market from acquisitions,
mix of customers who are performing well in the market, and positive growth
in specialty cans. Industry volumes relating to cans and can sheet have
shown some weakness due to accelerated purchases in late 1994 in
anticipation of higher prices in 1995, unseasonably cool and wet weather
throughout the U.S. in the first half of 1995, and competition from other
materials.
Sales to the distributors and fabricators market improved 41% and 49%,
respectively, in the second quarter and six months of 1995. The
improvements were due to strong demand and the 1994 acquisition of a metals
distribution business.
Sales to the automotive and transportation market improved 54% and
62%, respectively, in the second quarter and six months of 1995. This
improvement reflects the increased use of aluminum in cars. Lower car
production in the second quarter of 1995 had only a slight impact on the
Company's sales of wheels, extrusions and sheet. Higher car production is
expected later in the year after the model change over, and any short-term
decline in car production should be offset by new applications and new
business.
Sales to the building and construction market improved 28% and 38%,
respectively, in the second quarter and six months of 1995. The
improvements were due to strong commercial construction which is expected to
continue for the balance of the year. This strength is offset somewhat by
residential construction, which remains soft, particularly in new
construction, while remodeling remains steady.
Costs and Expenses
The increases in cost of products sold were due to the higher shipping
volume and higher costs for purchased materials. Costs were favorably
impacted by performance improvement programs and higher capacity utilization
at aluminum fabricating facilities.
Selling, administrative and general expenses increased in both 1995
periods due to the higher level of business activity, but declined slightly
as a percent of sales. Interest expense increased in both 1995 periods due
to higher rates.
<PAGE>
RESULTS OF OPERATIONS - continued
Costs and Expenses - continued
On a quarterly basis, the Company evaluates the status of all
significant existing or potential environmental issues, develops or revises
estimates of costs to satisfy known remediation requirements and adjusts its
accruals accordingly. Based upon information presently available, such
future costs are not expected to have a material adverse effect on the
Company's competitive or financial position or its ongoing results of
operations. However, it is not possible to predict the amount or timing of
future costs of environmental remediation requirements which may
subsequently be determined. Such costs could be material to future
quarterly or annual results of operations.
On August 29, 1994 and March 30, 1995, the Company received civil
investigative demands from the U.S. Department of Justice relating to
production of primary aluminum and the pricing of aluminum can stock,
respectively. The Company is cooperating with both inquiries and is
confident that its conduct has been in compliance with U.S. antitrust laws.
Various suits and claims are pending against the Company. In the
opinion of management, after consultation with counsel, disposition of these
suits and claims, either individually or in the aggregate, will not have a
material adverse effect on the Company's competitive or financial position
or its ongoing results of operations. No assurance can be given, however,
that the disposition of one or more of such suits or claims in a particular
reporting period will not be material in relation to the reported results
for such period.
Taxes on Income
The effective tax rates reflected in the income statement differ from
the U.S. federal statutory rate because of state and foreign taxes and the
effects of percentage depletion allowances.
<TABLE>
OPERATING AREA ANALYSIS
(Dollars in millions, metric tons in thousands)
<CAPTION>
SECOND QUARTER SIX MONTHS
___________________________ __________________________
Net Sales Shipments Net Sales Shipments
1995 1994 1995 1994 1995 1994 1995 1994
___________________________ ___________________________
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Finished products and other
sales
Packaging and containers:
Aluminum $510 $426 101 97 $912 $763 183 173
Nonaluminum 134 128 257 249
Other aluminum 147 106 41 36 298 198 85 69
Other nonaluminum 129 101 257 211
__________________________ ___________________________
920 761 142 133 1,724 1,421 268 242
__________________________ ___________________________
Production and processing
Primary aluminum 159 103 78 71 292 177 139 126
Flat rolled 359 240 106 105 689 457 212 203
Extruded and drawn 205 154 52 56 400 285 108 107
Other aluminum 128 98 48 41 251 173 91 73
Other nonaluminum 93 61 159 124
Gold 38 72
__________________________ ___________________________
944 694 284 273 1,791 1,288 550 509
___________________________ ___________________________
Net sales $1,864 $1,455 426 406 $3,515 $2,709 818 751
=========================== ===========================
</TABLE>
<PAGE>
OPERATING AREA ANALYSIS - continued
Finished Products and Other Sales
Higher shipments were realized for most products in both 1995 periods,
particularly cans and ends and distributor sheet. The increases in aluminum
sales were due to the higher shipping volume and improved prices for most
aluminum products. The increases in nonaluminum sales were principally
attributable to strong demand and improved prices for stainless steel.
Higher shipments of cans and ends, distributor sheet and stainless steel
were due to 1994 acquisitions.
Production and Processing
Higher shipments were realized for most products in both 1995 periods,
particularly primary and recycled aluminum and can sheet. The increases in
aluminum sales were due to the higher shipping volume and improved prices
for most aluminum products. The increase in nonaluminum sales was due to
improved prices for alumina, as well as higher demand which was met by the
restart of idle capacity at an alumina facility. There were no gold
revenues due to the divestiture of gold operations in 1994 and early 1995.
LIQUIDITY AND CAPITAL RESOURCES
Working Capital
Working capital totalled $953 million at June 30, 1995, compared to
$898 million at December 31, 1994. The ratio of current assets to current
liabilities was 1.7/1 at June 30, 1995, compared to 1.6/1 at December 31,
1994. The increase in working capital reflects the higher level of business
activity.
Operating Activities
In the first six months of 1995, cash provided by operations was
supplemented with cash on hand and cash provided by financing activities to
fund investing activities and increases in inventories and receivables and
to reduce accounts payable, accrued and other liabilities.
Investing Activities
Capital investments of $210 million in the first six months of 1995
included $81 million for operating requirements (i.e., replacement
equipment, capital maintenance, environmental control projects, etc.). The
remainder was for continuing performance improvement and strategic
investment projects including the modernization of a primary aluminum
production plant in New York; the modernization and expansion of can
manufacturing facilities (including participation in the construction of can
plants in South America); expansions at foil and plastic film facilities;
modification and equipping of a new wheel facility; and equipment upgrades
at a number of other facilities. In addition, strategic investments were
made in two major projects and for two acquisitions as discussed below.
The Company's fabricated aluminum automotive components plant in
Indiana is undergoing a $12 million expansion that will more than double
annual production capacity. The start-up of the additional capacity is set
for early 1996. The expansion will allow the facility to keep up with a
growing customer base.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES - continued
Investing Activities - continued
At its can sheet facility in Alabama, a three-year, $75 million
modernization is underway. The expenditure is in addition to the nearly
$500 million invested on continuous improvement projects in the facility
since 1988. The project will include two new furnaces, as well as
improvements to existing equipment. The modernization will allow for
enhanced overall product quality and will reduce costs.
In the second quarter of 1995, the Company acquired a laminated foil
plant located in Louisville, Ky. The facility laminates aluminum foil onto
paper and primarily serves the flexible packaging needs of the tobacco and
pharmaceutical industries. The facility complements the Company's current
product and customer mix, and further strengthens the Company's ability to
serve customers in this market.
Also in the second quarter of 1995, the Company acquired an engraving
company that serves the flexographic and lithographic printers that supply
the packaging and publication industries in the U.S., Canada and Mexico. The
acquired company operates facilities in Texas, Louisiana and Washington
which prepare film and manufacture printing plates. The acquisition will
strengthen the Company's operation that manufactures printing cylinders and
engravings for the rotogravure, flexographic and lithographic printing
industries.
In the first quarter of 1995, the Company sold its remaining gold
mining assets in Australia for $28 million. The proceeds from the sale,
which approximated book value, will be redeployed into value-added
businesses. The sale is not expected to have a material effect on the
Company's ongoing results of operations.
Financing Activities
In the first quarter of 1995, the Company amended its $500 million
revolving credit facility to extend the term and lower the cost. The
expiration date of the facility was extended from 1999 to 2000. The annual
commitment fee on the unused portion of the facility was lowered from .20%
to .125%. No amounts were outstanding under the facility at June 30, 1995.
Borrowings in the second quarter of 1995 included $22 million of tax
exempt bonds which were issued to finance a portion of the costs of
acquiring, constructing and installing sewage and solid waste disposal
facilities at the Company's primary aluminum production plant in Massena,
N.Y. The bonds, which require a single repayment in 2025, bear interest at
a variable rate (4.0% at June 30, 1995).
In the second quarter of 1995, the Company increased the quarterly
dividend on its common stock by 5 cents to 30 cents a share. The dividend
was increased in view of the Company's improved performance and
profitability.
In the first half of 1995, the Company contributed 906,000 shares of
common stock, valued at approximately $45 million, to its pension plans.
This completes the contribution of three million shares of common stock to
the Company's pension plans which were the subject of a registration
statement filed in 1993.
Financial Outlook
Capital investments in 1995 are expected to total $475 million and
include amounts for operating requirements and continuing expenditures for
those performance improvement and strategic investment projects that are
underway. These investments will be funded primarily with cash generated
from operations, proceeds from the sale of non-core assets and a portion of
the remaining proceeds from the Company's preferred stock issued
in early 1994.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES - continued
Financial Outlook - continued
The Company believes its available financial resources (including cash
and investments of over $100 million), together with internally generated
funds, are sufficient to meet its business needs at the present time and for
the foreseeable future. The Company continues to exceed the financial ratio
requirements contained in its financing arrangements and expects to do so
for the foreseeable future. At June 30, 1995, $222 million of the Company's
$1.65 billion shelf registration remained available for the issuance of debt
securities.
Rates for electricity charged by the Bonneville Power Administration
("BPA"), which serves the Company's Troutdale, Oregon and Longview,
Washington primary aluminum production plants, have been settled through
October, 1996, with a four percent increase over the prior rate. However,
the longer-term outlook for BPA's rates remains uncertain, due in part to
ongoing political, regulatory and judicial developments relating to
endangered species listings of Snake River salmon and the effect of such
developments on BPA's hydroelectric operations. Further increases in power
rates which are already relatively high by worldwide standards could
jeopardize the long-term competitiveness of the Company's Troutdale and
Longview plants. The Company would have to consider whether paying
increased power rates for its smelter operations in the Pacific Northwest
would be prudent under prevailing economic conditions. The Company is
exploring competitive alternatives to BPA power and BPA is attempting to
meet the competition by lowering its operating costs and rates.
OTHER INFORMATION
The Financial Accounting Standards Board issued in March, 1995, FAS No.
121 - Accounting for the Impairment of Long-Lived Assets and for LongLived
Assets to be Disposed Of. The Company is in the process of evaluating the
provisions of this pronouncement and has not made a determination as to the
impact, if any, on the Company's financial position and/or results of
operations.
<PAGE>
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
See Index to Exhibits.
(b) Reports on Form 8-K
The Registrant filed no reports on Form 8-K during the second quarter
of 1995.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
REYNOLDS METALS COMPANY
By Allen M. Earehart
Allen M. Earehart
Vice President, Controller
(Principal Accounting Officer)
DATE: August 11, 1995
<PAGE>
INDEX TO EXHIBITS
EXHIBIT 2 - None
* EXHIBIT 3.1 - Restated Certificate
of Incorporation, as amended to
the date hereof. (File No. 1-1430, 1994
Form 10-K Report, EXHIBIT 3.1)
EXHIBIT 3.2 - By-Laws, as amended to the
date hereof
EXHIBIT 4.1 - Restated Certificate
of Incorporation. See EXHIBIT
3.1.
EXHIBIT 4.2 - By-Laws. See EXHIBIT 3.2.
* EXHIBIT 4.3 - Indenture dated as of
April 1, 1989 (the "Indenture") between
Reynolds Metals Company and The Bank of New
York, as Trustee, relating to Debt
Securities. (File No. 1-1430, Form 10-Q
Report for the Quarter Ended March 31, 1989,
EXHIBIT 4(c))
* EXHIBIT 4.4 - Amendment No. 1 dated
as of November 1, 1991 to the
Indenture. (File No. 1-1430, 1991 Form 10K
Report, EXHIBIT 4.4)
* EXHIBIT 4.5 - Rights Agreement
dated as of November 23, 1987 (the "Rights
Agreement") between Reynolds Metals Company
and The Chase Manhattan Bank, N.A. (File
No. 1-1430, Registration Statement on Form 8-
A dated November 23, 1987, pertaining to
Preferred Stock Purchase Rights, EXHIBIT 1)
* EXHIBIT 4.6 - Amendment No. 1
dated as of December 19, 1991 to the Rights
Agreement. (File No. 1-1430, 1991 Form 10K
Report, EXHIBIT 4.11)
* EXHIBIT 4.7 - Form of 9-3/8%
Debenture due June 15, 1999. (File No. 1
1430, Form 8-K Report dated June 6, 1989,
EXHIBIT 4)
* EXHIBIT 4.8 - Form of Fixed Rate
Medium-Term Note. (Registration Statement
No. 33-30882 on Form S-3, dated August 31,
1989, EXHIBIT 4.3)
* EXHIBIT 4.9 - Form of Floating
Rate Medium-Term Note. (Registration
Statement No. 33-30882 on Form S-3, dated
August 31, 1989, EXHIBIT 4.4)
* EXHIBIT 4.10 - Form of Book-Entry
Fixed Rate Medium-Term Note. (File No. 1
1430, 1991 Form 10-K Report, EXHIBIT 4.15)
* EXHIBIT 4.11 - Form of Book-Entry
Floating Rate Medium-Term Note. (File No. 1-
1430, 1991 Form 10-K Report, EXHIBIT 4.16)
* EXHIBIT 4.12 - Form of 9%
Debenture due August 15, 2003. (File No. 1
1430, Form 8-K Report dated August 16, 1991,
Exhibit 4(a))
____________________________
* Incorporated by reference.
<PAGE>
* EXHIBIT 4.13 - Articles of
Continuance of Canadian Reynolds Metals
Company, Limited -- Societe Canadienne de
Metaux Reynolds, Limitee ("CRM"), as amended
to the date hereof. (Registration Statement
No. 33-59168 on Form S-3, dated March 5,
1993, EXHIBIT 4.1)
* EXHIBIT 4.14 - By-Laws of CRM, as
amended to the date hereof. (File No. 11430,
Form 10-Q Report for the Quarter Ended
September 30, 1993, EXHIBIT 4.19)
* EXHIBIT 4.15 - Indenture dated as
of April 1, 1993 among CRM, Reynolds Metals
Company and The Bank of New York, as Trustee.
(File No. 1-1430, Form 8-K Report dated July
14, 1993, EXHIBIT 4(a))
* EXHIBIT 4.16 - Form of 6-5/8%
Guaranteed Amortizing Note due July 15, 2002.
(File No. 1-1430, Form 8-K Report dated July
14, 1993, EXHIBIT 4(d))
* EXHIBIT 10.1 - Reynolds Metals
Company 1982 Nonqualified Stock Option Plan,
as amended through May 17, 1985.
(File No. 1-1430, 1985 Form 10-K Report,
EXHIBIT 10.2)
* EXHIBIT 10.2 - Reynolds Metals
Company 1987 Nonqualified Stock Option Plan.
(Registration Statement No. 33-13822 on Form
S-8, dated April 28, 1987, EXHIBIT 28.1)
* EXHIBIT 10.3 - Reynolds Metals
Company 1992 Nonqualified Stock Option Plan.
(Registration Statement No. 33-44400 on Form
S-8, dated December 9, 1991, EXHIBIT 28.1)
* EXHIBIT 10.4 - Reynolds Metals
Company Performance Incentive Plan, as
amended and restated effective January 1,
1996. (File No. 1-1430, Form 10-Q Report
for the Quarter Ended March 31, 1995,
EXHIBIT 10.4)
* EXHIBIT 10.5 - Agreement dated
December 9, 1987 between Reynolds Metals
Company and Jeremiah J. Sheehan. (File No.
1-1430, 1987 Form 10-K Report, EXHIBIT 10.9)
* EXHIBIT 10.6 - Supplemental Death
Benefit Plan for Officers. (File No. 1-1430,
1986 Form 10-K Report, EXHIBIT 10.8)
* EXHIBIT 10.7 - Financial
Counseling Assistance Plan for Officers.
(File No. 1-1430, 1987 Form 10-K Report,
EXHIBIT 10.11)
* EXHIBIT 10.8 - Management
Incentive Deferral Plan. (File No. 1-1430,
1987 Form 10-K Report, EXHIBIT 10.12)
* EXHIBIT 10.9 - Deferred
Compensation Plan for Outside Directors as
Amended and Restated Effective December 1,
1993. (File No. 1-1430, 1993 Form 10-K
Report, EXHIBIT 10.12)
* EXHIBIT 10.10 - Retirement Plan
for Outside Directors. (File No. 1-1430,
1986 Form 10-K Report, EXHIBIT 10.10)
____________________________
* Incorporated by reference.
<PAGE>
* EXHIBIT 10.11 - Death Benefit Plan
for Outside Directors. (File No. 1-1430,
1986 Form 10-K Report, EXHIBIT 10.11)
* EXHIBIT 10.12 - Form of
Indemnification Agreement for Directors and
Officers. (File No. 1-1430, Form 8-K Report
dated April 29, 1987, EXHIBIT 28.3)
* EXHIBIT 10.13 - Form of Executive
Severance Agreement between Reynolds Metals
Company and key executive personnel,
including each of the individuals listed
in Item 4A of the Reynolds Metals
Company 1994 Form 10-K Report, Paul S.
Hayden and John F. Rudin. (File No.
1-1430, 1987 Form 10-K Report, EXHIBIT 10.18)
* EXHIBIT 10.14 - Amendment to
Reynolds Metals Company 1987 Nonqualified
Stock Option Plan effective May 20, 1988.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1988, EXHIBIT 19(a))
* EXHIBIT 10.15 - Amendment to
Reynolds Metals Company 1987 Nonqualified
Stock Option Plan effective October 21,
1988. (File No. 1-1430, Form 10-Q Report
for the Quarter Ended September 30,
1988, EXHIBIT 19(a))
* EXHIBIT 10.16 - Amendment to
Reynolds Metals Company 1987 Nonqualified
Stock Option Plan effective January 1,
1987. (File No. 1-1430, 1988 Form 10-K
Report, EXHIBIT 10.22)
* EXHIBIT 10.17 - Form of Stock
Option and Stock Appreciation Right
Agreement, as approved February 16,
1990 by the Compensation Committee of
the Company's Board of Directors.
(File No. 1-1430, 1989 Form 10-K
Report, EXHIBIT 10.24)
* EXHIBIT 10.18 - Amendment to Reynolds Metals Company
1982 Nonqualified Stock Option Plan
effective January 18, 1991. (File
No. 1-1430, 1990 Form 10-K Report,
EXHIBIT 10.25)
* EXHIBIT 10.19 - Amendment to Reynolds
Metals Company 1987 Nonqualified Stock
Option Plan effective January 18,
1991. (File No. 1-1430, 1990 Form 10-K
Report, EXHIBIT 10.26)
* EXHIBIT 10.20 - Letter Agreement
dated January 18, 1991 between Reynolds
Metals Company and William O. Bourke.
(File No. 1-1430, 1990 Form 10-K Report,
EXHIBIT 10.29)
* EXHIBIT 10.21 - Form of Stock Option Agreement,
as approved April 22, 1992 by the
Compensation Committee of the
Company's Board of Directors.
(File No. 11430, Form 10-Q Report for
the Quarter Ended March 31, 1992,
EXHIBIT 28(a))
* EXHIBIT 10.22 - Consulting Agreement dated
May 1, 1992 between Reynolds Metals
Company and William O. Bourke. (File
No. 1-1430, Form 10-Q Report for the
Quarter Ended March 31, 1992,
EXHIBIT 28(b))
____________________________
* Incorporated by reference.
<PAGE>
* EXHIBIT 10.23 - Renewal dated
February 18, 1994 of Consulting Agreement
dated May 1, 1992 between Reynolds Metals
Company and William O. Bourke. (File No. 1
1430, 1993 Form 10-K Report, EXHIBIT 10.28)
* EXHIBIT 10.24 - Reynolds Metals
Company Restricted Stock Plan for Outside
Directors. (Registration Statement No. 33
53851 on Form S-8, dated May 27, 1994,
EXHIBIT 4.6)
* EXHIBIT 10.25 - Reynolds Metals
Company New Management Incentive Deferral
Plan. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended June 30, 1994, EXHIBIT
10.30)
* EXHIBIT 10.26 - Reynolds Metals
Company Salary Deferral Plan for Executives.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1994, EXHIBIT 10.31)
* EXHIBIT 10.27 - Reynolds Metals
Company Supplemental Long Term Disability
Plan for Executives. (File No. 1-1430, Form
10-Q Report for the Quarter Ended June 30,
1994, EXHIBIT 10.32)
* EXHIBIT 10.28 - Amendment to
Reynolds Metals Company 1982 Nonqualified
Stock Option Plan effective August 19, 1994.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT
10.33)
* EXHIBIT 10.29 - Amendment to
Reynolds Metals Company 1987 Nonqualified
Stock Option Plan effective August 19, 1994.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT
10.34)
* EXHIBIT 10.30 - Amendment to
Reynolds Metals Company 1992 Nonqualified
Stock Option Plan effective August 19, 1994.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT
10.35)
* EXHIBIT 10.31 - Amendment to
Reynolds Metals Company New Management
Incentive Deferral Plan effective January 1,
1995. (File No. 1-1430, 1994 Form 10-K
Report, EXHIBIT 10.36)
* EXHIBIT 10.32 - Amendment to
Reynolds Metals Company New Management
Incentive Deferral Plan effective January 1,
1995 through December 31, 1996. (File No. 1-
1430, 1994 Form 10-K Report, EXHIBIT 10.37)
* EXHIBIT 10.33 - Amendment to
Reynolds Metals Company Salary Deferral Plan
for Executives effective January 1, 1995
through December 31, 1996. (File No. 1-
1430, 1994 Form 10-K Report, EXHIBIT 10.38)
EXHIBIT 10.34 - Form of Split
Dollar Life Insurance Agreement (Trustee
Owner, Trustee Pays Premiums)
EXHIBIT 10.35 - Form of Split
Dollar Life Insurance Agreement (Trustee
Owner, Employee Pays Premium)
____________________________
* Incorporated by reference.
<PAGE>
EXHIBIT 10.36 - Form of Split
Dollar Life Insurance Agreement (Employee
Owner, Employee Pays Premium)
EXHIBIT 10.37 - Form of Split
Dollar Life Insurance Agreement (Third Party
Owner, Third Party Pays Premiums)
EXHIBIT 10.38 - Form of Split
Dollar Life Insurance Agreement (Third Party
Owner, Employee Pays Premiums)
EXHIBIT 11 - Computation of
Earnings Per Share
EXHIBIT 15 - None
EXHIBIT 18 - None
EXHIBIT 19 - None
EXHIBIT 22 - None
EXHIBIT 23 - None
EXHIBIT 24 - None
EXHIBIT 27 - Financial Data
Schedule
Pursuant to Item 601 of Regulation S-K, certain instruments with
respect to long-term debt of Reynolds Metals Company (the "Registrant") and
its consolidated subsidiaries are omitted because such debt does not exceed
10 percent of the total assets of the Registrant and its subsidiaries on a
consolidated basis. The Registrant agrees to furnish a copy of any such
instrument to the Commission upon request.
EXHIBIT 3.2
By-Laws
of
REYNOLDS METALS COMPANY
Table of Contents
Page
ARTICLE I - Stock
Section 1. Certificates for Stock . . . . . . . . . l
Section 2. Transfers of Stock . . . . . . . . . . . 1
Section 3. Holders of Record . . . . . . . . . . . 1
Section 4. Lost or Destroyed Certificates . . . . . 2
ARTICLE II - Stockholders' Meetings
Section 1. Place of Meetings . . . . . . . . . . . 2
Section 2. Annual Meetings . . . . . . . . . . . . 2
Section 3. Special Meetings . . . . . . . . . . . . 2
Section 4. Matters to be Brought Before
Stockholders Meetings . . . . . . . . . 2
Section 5. Notice of Meetings . . . . . . . . . . . 3
Section 6. Quorum . . . . . . . . . . . . . . . . . 4
Section 7. Adjourned Meetings . . . . . . . . . . . 4
Section 8. Inspectors of Election . . . . . . . . . 4
Section 9. List of Stockholders . . . . . . . . . . 5
Section 10. Voting . . . . . . . . . . . . . . . . . 5
Section 11. Consents in Writing . . . . . . . . . . 5
ARTICLE III - Board of Directors
Section 1. Number; Term of Office; Powers . . . . . 6
Section 2. Resignations . . . . . . . . . . . . . . 6
Section 3. Vacancies . . . . . . . . . . . . . . . 6
Section 4. Annual Meeting . . . . . . . . . . . . . 6
Section 5. Regular Meetings . . . . . . . . . . . . 6
Section 6. Special Meetings . . . . . . . . . . . . 6
Section 7. Notice of Meetings . . . . . . . . . . . 7
Section 8. Quorum; Adjourned Meetings;
Required Vote . . . . . . . . . . . . . 7
Section 9. Committees . . . . . . . . . . . . . . . 7
Section 10. Compensation . . . . . . . . . . . . . . 8
Section 11. Consents in Writing . . . . . . . . . . 8
Section 12. Participation by Conference Telephone . 8
Table of Contents, Continued
ARTICLE IV - Officers
Section 1. Officers . . . . . . . . . . . . . . . . 8
Section 2. Chairman of the Board . . . . . . . . . 9
Section 3. Vice Chairmen of the Board . . . . . . . 9
Section 4. President . . . . . . . . . . . . . . . 9
Section 5. Vice Presidents . . . . . . . . . . . . 9
Section 6. General Counsel . . . . . . . . . . . . 9
Section 7. Secretary . . . . . . . . . . . . . . . 9
Section 8. Treasurer . . . . . . . . . . . . . . . 9
Section 9. Controller . . . . . . . . . . . . . . . 10
Section 10. Other Officers and Assistant Officers . 10
Section 11. Term of Office; Vacancies . . . . . . . 10
Section 12. Removal . . . . . . . . . . . . . . . . 10
ARTICLE V - Dividends and Finance
Section 1. Dividends . . . . . . . . . . . . . . . 10
Section 2. Deposits; Withdrawals; Notes and Other
Instruments . . . . . . . . . . . . . . 10
Section 3. Fiscal Year . . . . . . . . . . . . . . 10
ARTICLE VI - Books and Records; Record Date
Section 1. Books and Records . . . . . . . . . . . 11
Section 2. Record Date . . . . . . . . . . . . . . 11
ARTICLE VII - Notices
Section 1. Notices . . . . . . . . . . . . . . . . 12
Section 2. Waivers of Notice . . . . . . . . . . . 12
ARTICLE VIII - Contracts
Section 1. Interested Directors or Officers . . . . 12
ARTICLE IX - Seal
Section 1. Seal . . . . . . . . . . . . . . . . . . 13
ARTICLE X - Indemnification
Section 1. Indemnification in Third Party
Actions . . . . . . . . . . . . . . . . 13
Section 2. Indemnification in an Action by or in
the Right of the Corporation . . . . . . 14
Section 3. Indemnification as of Right . . . . . . 14
Section 4. Determination of Indemnification . . . . 15
Section 5. Advance for Expenses . . . . . . . . . . 15
Section 6. General Provisions . . . . . . . . . . . 15
ARTICLE XI - Amendments
Section 1. Amendments . . . . . . . . . . . . . . . . 16
By-Laws
of
REYNOLDS METALS COMPANY
(Incorporated under the Laws of Delaware)
ARTICLE I - Stock
1. Certificates for Stock. Certificates of Stock shall be
issued in numerical order, be signed by the Chairman of the Board
of Directors, a Vice Chairman of the Board of Directors, the
President or a Vice President, and by the Secretary or an Assis
tant Secretary, or the Treasurer or an Assistant Treasurer, and
sealed with the corporate seal; provided, that where any Certifi
cate of Stock is signed by a duly appointed and authorized
Transfer Agent or Registrar the signatures of the Chairman of the
Board of Directors, Vice Chairman of the Board of Directors, the
President, Vice President, Secretary, Assistant Secretary,
Treasurer or Assistant Treasurer may be facsimile, engraved or
printed, and the seal of the corporation on any such Certificate
of Stock may be facsimile, engraved or printed. In case any
officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before
such certificate is issued, it may be issued by the corporation
with the same effect as if he or she were such officer, transfer
agent or registrar at the date of issue.
2. Transfers of Stock. Transfers of stock shall be made
only upon the books of the corporation, and only by the person
named in the certificate or by attorney, lawfully constituted in
writing, and only upon surrender of the certificate therefor.
The directors may by resolution make reasonable regulations for
the transfers of stock.
3. Holders of Record. Registered stockholders only shall
be entitled to be treated by the corporation as the holders in
fact of the stock standing in their respective names and the
corporation shall not be bound to recognize any equitable or
other claim to or interest in any share on the part of any other
person, whether or not it shall have express or other notice
thereof, except as expressly provided by the laws of Delaware.
4. Lost or Destroyed Certificates. In case of loss or
destruction of any certificate of stock another may be issued in
its place upon satisfactory proof of such loss or destruction and
upon the giving of a satisfactory bond of indemnity to the
corporation, all as determined either expressly by the directors
or pursuant to general authority granted by them.
ARTICLE II - Stockholders' Meetings
1. Place of Meetings. Meetings of the stockholders shall
be held at such place, within or outside the State of Delaware,
as the Board of Directors may determine.
2. Annual Meeting. The annual meeting of the stockholders
of the corporation, for the election of directors to succeed
those whose terms expire, and for the transaction of such other
business as may come before the meeting, shall be held on the
first Wednesday after April 15th of each year, if not a legal
holiday, and if a legal holiday, then on the first business day
following, at eleven o'clock in the forenoon, or on such other
date and at such other time as may be fixed by the Board of
Directors. If the annual meeting of the stockholders be not held
as herein prescribed, the election of directors may be held at
any meeting thereafter called pursuant to these By-Laws.
3. Special Meetings. Special meetings of the stockholders
may be called by the Chairman of the Board of Directors, or a
Vice Chairman of the Board of Directors, or the President or by
the Board of Directors, and shall be called at any time by the
Board of Directors upon the request in writing of stockholders
entitled to cast a majority of the votes which all stockholders
are entitled to cast. Such request must state the purpose of the
meeting.
4. Matters to be Brought Before Stockholders Meetings.
Except as otherwise provided by law, at any annual or special
meeting of stockholders only such business shall be conducted as
shall have been properly brought before the meeting in accordance
with this Section.
In order to be properly brought before the meeting,
such business must have either been (i) specified in the written
notice of the meeting (or any supplement thereto) given to
stockholders of record on the record date for such meeting by or
at the direction of the Board of Directors, (ii) brought before
the meeting at the direction of the Board of Directors or the
officer presiding over the meeting, or (iii) specified in a
written notice given by or on behalf of a stockholder of record
on the record date for such meeting entitled to vote thereat or a
duly authorized proxy for such stockholder, in accordance with
all of the following requirements.
A notice referred to in clause (iii) hereof must be
delivered personally to, or mailed to and received at, the
principal executive office of the corporation, addressed to the
attention of the Secretary, not more than ten (10) days after the
date of the initial notice referred to in clause (i) hereof, in
the case of business to be brought before a special meeting of
stockholders, and not less than thirty (30) days prior to the
first anniversary date of the initial notice referred to in
clause (i) hereof of the previous year's annual meeting, in the
case of business to be brought before an annual meeting of
stockholders, provided, however, that such notice shall not be
required to be given more than ninety (90) days prior to an
annual meeting of stockholders. Such notice referred to in
clause (iii) hereof shall set forth:
(a) a full description of each such item of business
proposed to be brought before the meeting;
(b) the name and address of the person proposing to bring
such business before the meeting;
(c) the class and number of shares held of record, held
beneficially and represented by proxy by such person as of the
record date for the meeting (if such date has then been made
publicly available) and as of the date of such notice;
(d) if any item of such business involves a nomination for
director, all information regarding each such nominee that would
be required to be set forth in a definitive proxy statement filed
with the Securities and Exchange Commission pursuant to Section
14 of the Securities Exchange Act of 1934, as amended, or any
successor thereto and the written consent of each such nominee to
serve if elected; and
(e) all other information that would be required to be
filed with the Securities and Exchange Commission if, with
respect to the business proposed to be brought before the meet
ing, the person proposing such business was a participant in a
solicitation subject to Section 14 of the Securities Exchange Act
of 1934, as amended, or any successor thereto.
No business shall be brought before any meeting of
stockholders of the corporation otherwise than as provided in
this Section.
5. Notice of Meetings. Written notice of the place, date
and hour of the annual and of all special meetings of the stock
holders and, in the case of special meetings, of the purpose or
purposes for which such special meeting is called, shall be given
in the manner specified in Section l of Article VII of these By-
Laws not less than ten (10) nor more than sixty (60) days prior
to the meeting, to each stockholder of record of the corporation
entitled to vote thereat. Business transacted at all special
meetings shall be confined to the purposes stated in the notice.
6. Quorum. A quorum at any annual or special meeting of
the stockholders shall consist of the presence, in person or by
proxy, of stockholders entitled to cast a majority of the votes
which all stockholders are entitled to cast, except as otherwise
specifically provided by law or in the Certificate of Incorpora
tion.
7. Adjourned Meetings. If a quorum be not present at a
properly called stockholders' meeting, the meeting may be ad
journed from time to time by a majority in interest of those
present in person or by proxy and entitled to vote thereat. At
any such adjourned meeting at which a quorum shall be present,
any business may be transacted which might have been transacted
at the meeting as originally notified. If the adjournment is for
more than thirty (30) days, or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the
adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting; otherwise, no notice of such
adjourned meeting need be given if the time and place thereof are
announced at the meeting at which the adjournment is taken. The
absence from any meeting of stockholders holding the number of
shares of stock of the corporation required by law, the Certifi
cate of Incorporation or these By-Laws for action upon any given
matter shall not prevent action at such meeting upon any other
matter or matters which may properly come before the meeting, if
there shall be present thereat in person or by proxy stockholders
holding the number of shares of stock of the corporation required
in respect of such other matter or matters.
8. Inspectors of Election. In advance of any meeting of
stockholders or any corporate action to be taken by the stock
holders in writing without a meeting, the Chief Executive Offi
cer, Chief Operating Officer, Chief Financial Officer or Secre
tary of the corporation shall appoint one or more inspectors of
election to serve at such meeting or to examine such written
consents and to make a written report with respect thereto. In
addition, any such officer may, but shall not be required to,
designate one or more persons as alternate inspectors to replace
any inspector who fails to act. If no inspector or alternate is
able to act at a meeting of stockholders, the presiding officer
at such meeting shall appoint one or more inspectors to act at
the meeting. Each inspector shall discharge his or her duties in
accordance with applicable law and shall, before entering upon
the discharge of his or her duties, take and sign an oath faith
fully to execute the duties of inspector with strict impartiality
and according to the best of his or her ability.
9. List of Stockholders. A complete list of the stock
holders entitled to vote at each annual or special meeting of the
stockholders of the corporation, arranged in alphabetical order,
showing the address of record of each and the number of voting
shares held by each, shall be prepared by the Secretary, who
shall have charge of the stock ledger, and filed in the City (or,
if such meeting is to be held at a place not within any city,
then in the county) where the meeting is to be held, at a loca
tion specified in the Notice of Meeting, or if no such location
is specified in such notice, at the place where the meeting is to
be held, at least ten (10) days before every such meeting, and
shall, during the usual hours for business, be open to the
examination of any stockholder for any purpose germane to the
meeting, and during the whole time of said meeting be open to the
examination of any stockholder.
10. Voting. Subject to the provisions of Article VI,
Section 2 of these By-Laws, and except where a different vote per
share is prescribed by the Certificate of Incorporation for a
class of stock, each holder of stock of a class which is entitled
to vote in any election or on any other questions at any annual
or special meeting of the stockholders shall be entitled to one
vote, in person or by written proxy, for each share of such class
held of record. Except where, and to the extent that, a differ
ent percentage of votes and/or a different exercise of voting
power is prescribed by law, the Certificate of Incorporation or
these By-Laws, all elections and other questions shall be decided
by the vote of stockholders, present in person or by proxy and
entitled to vote, representing a majority of the votes cast.
Abstentions shall be counted in the tabulation of the votes cast.
The votes for directors, and, upon demand of any stockholder, or
where required by law, the votes upon any question before the
meeting, shall be by ballot; otherwise, the election shall be
held as the presiding officer prescribes.
11. Consents in Writing. Any action which might have been
taken under these By-Laws by a vote of the stockholders at a
meeting thereof may be taken by them without a meeting, without
prior notice and without a vote, if a consent in writing setting
forth the action so taken shall be signed by the holders of
outstanding shares of stock of the corporation having not less
than the minimum number of votes that would be necessary to
authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted; provided, that
prompt notice of the taking of such corporate action shall be
given to those stockholders who have not consented thereto if
less than unanimous written consent is obtained.
ARTICLE III - Board of Directors
1. Number; Term of Office; Powers. The business and
affairs of the corporation shall be under the direction of a
Board of Directors, consisting of fifteen (15) persons. Direc
tors shall be elected for one year, and shall hold office until
their successors are elected and qualified. Directors need not
be stockholders. In addition to the power and authority express
ly conferred upon them by the By-Laws and the Certificate of
Incorporation, the Board of Directors may exercise all such
powers of the corporation and do all such lawful acts and things
as are not by law or by the Certificate of Incorporation or by
these By-Laws directed or required to be exercised or done by the
stockholders.
2. Resignations. Any director may resign at any time by
giving written notice of resignation to the Board of Directors,
to the Chief Executive Officer or to the Secretary of the corpo
ration. Any such resignation shall take effect at the time
specified therein, or if the time be not specified therein, then
upon receipt thereof. The acceptance of such resignation shall
not be necessary to make it effective.
3. Vacancies. Except as otherwise specifically provided
by law, the Certificate of Incorporation or these By-Laws, all
vacancies in the Board of Directors, whether caused by resigna
tion, death, increase in the number of authorized directors or
otherwise, may be filled by a majority of the Board of Directors
then in office, even though less than a quorum, or by the stock
holders at a special meeting. A director thus elected to fill
any vacancy shall hold office until the next annual meeting of
stockholders and until a successor is elected and qualified.
4. Annual Meeting. The annual meeting of the Board of
Directors, for the election of officers and the transaction of
other business, shall be held on the same day and at the same
place as, and as soon as practicable following, the annual
meeting of stockholders, or at such other date, time or place as
the directors may by resolution designate.
5. Regular Meetings. Regular meetings of the Board of
Directors shall be held at such times, and at such place within
or outside the State of Delaware, as the Board of Directors may
from time to time by resolution designate.
6. Special Meetings. Special meetings of the directors
may be called at any time by the Chairman of the Board of Direc
tors, a Vice Chairman of the Board of Directors, the President or
an Executive Vice President, or by the Secretary upon written
request of one-third of the directors, such request stating the
purpose for which the meeting is to be called. Special meetings
shall be held at the principal office of the corporation or at
such office within or outside the State of Delaware as the
directors may from time to time designate.
7. Notice of Meetings. Except as otherwise required by
law, notice of special meetings of the Board of Directors or of
any committee of the Board of Directors shall be given to each
director or to each committee member, as the case may be, by mail
at least two days before the day on which the meeting is to be
held or by personal delivery, word-of-mouth, telephone, tele
graph, radio, cable or other comparable means at least six hours
before the time at which the meeting is to be held. Such notice
shall state the time and place of such meeting, but need not
state the purposes thereof unless otherwise required by law. No
notice need be given of the annual meeting of directors or of
regular meetings of directors or of committees of the Board of
Directors, provided that, whenever the time or place of such
meetings shall be fixed or changed, notice of such action shall
be given promptly to each director or to each committee member,
as the case may be, who shall not have been present at the
meeting at which such action was taken.
8. Quorum; Adjourned Meetings; Required Vote. A majority
of the Board of Directors as constituted from time to time shall
be necessary and sufficient at all meetings to constitute a
quorum for the transaction of business. In the absence of a
quorum, a majority of those present may adjourn the meeting from
time to time and the meeting may be held as adjourned without
further notice provided a quorum be present at such adjourned
meeting. Unless otherwise specifically provided by the Certifi
cate of Incorporation or statute, the act of a majority of the
directors present at any properly convened meeting at which there
is a quorum, but in no case less than one-third of all of the
directors then in office, shall be the act of the Board of
Directors.
9. Committees. Standing or Temporary Committees may be
appointed from their own number by the Board of Directors from
time to time, and the directors may from time to time vest such
committees with such powers as the directors may see fit, subject
to such conditions as the directors may prescribe or as may be
prescribed by law. All committees shall consist of two or more
directors. The term of office of the members of each committee
shall be as fixed from time to time by the Board of Directors;
provided, however, that any committee member who ceases to be a
director shall ipso facto cease to be a committee member. Any
member of any committee may be removed at any time with or
without cause by the Board of Directors, and any vacancy in any
committee may be filled by the Board of Directors. All commit
tees shall keep regular minutes of their transactions and shall
cause them to be recorded in books kept for that purpose in the
office of the corporation, and shall report the same to the Board
of Directors at their regular meetings. Subject to this Section
9 and except as otherwise determined by the Board of Directors,
each committee may make rules for the conduct of its business.
10. Compensation. Directors, as such, may receive, pursu
ant to resolution of the Board of Directors, fixed fees, other
compensation and expenses for their services as directors,
including, without limitation, services as chairmen or as members
of committees of the directors; provided, however, that nothing
herein contained shall be construed to preclude any director from
serving the corporation in any other capacity and receiving
compensation therefor.
11. Consents in Writing. Any action required or permitted
to be taken at any meeting of the Board of Directors or of any
committee thereof may be taken without a meeting if all members
of the Board of Directors or committee, as the case may be,
consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the Board of Directors or
committee.
12. Participation by Conference Telephone. Members of the
Board of Directors or of any committee may participate in a
meeting of such Board of Directors or committee, as the case may
be, by means of conference telephone or similar communications
equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting by
such means shall constitute presence in person at the meeting.
ARTICLE IV - Officers
1. Officers. The corporation may have a Chairman of the
Board of Directors, one or more Vice Chairmen of the Board of
Directors, a President, one or more Vice Presidents, which may
include Executive and Senior Vice Presidents, a General Counsel,
a Secretary, a Treasurer, a Controller and such other officers
and assistant officers as the Board of Directors shall deem
appropriate; provided, that the corporation shall have such
officers as are required by applicable law. Officers shall be
elected annually by the Board of Directors. One person may hold
more than one office.
The Board of Directors shall designate a Chief Execu
tive Officer, and may designate a Chief Operating Officer and a
Chief Financial Officer from among the officers of the corpora
tion.
The Chief Executive Officer shall have general supervi
sion and management of the business and affairs of the corpora
tion, subject to the control of the Board of Directors, and may
prescribe the duties to be performed by the officers of the
corporation in addition to the duties prescribed by these By-Laws
or by the Board of Directors. In the absence or disability of
the Chairman of the Board of Directors, the Chief Executive
Officer shall preside at all meetings of stockholders and direc
tors. In the absence or disability of the Chief Executive
Officer, such officer of the corporation as the Chief Executive
Officer shall have designated in writing to the Board of Direc
tors or to the Secretary of the corporation shall, subject to
further action by the Board of Directors, have the powers and
perform the duties of the Chief Executive Officer.
2. Chairman of the Board. The Chairman of the Board of
Directors shall preside at all meetings of stockholders and
directors.
3. Vice Chairmen of the Board. A Vice Chairman shall
perform such duties as are properly required by the Board of
Directors or the Chief Executive Officer.
4. President. The President shall perform such duties as
are properly required by the Board of Directors or the Chief
Executive Officer.
5. Vice Presidents. Each of the Executive Vice presi
dents, Senior Vice Presidents and other Vice Presidents shall
perform such duties as are properly required by the Board of
Directors or the Chief Executive Officer.
6. General Counsel. The General Counsel shall advise the
corporation on legal matters affecting the corporation and its
activities, shall supervise and direct the handling of all such
legal matters and shall perform all such other duties as are
incident to the office of General Counsel.
7. Secretary. The Secretary shall keep the minutes of the
meetings of the stockholders and of the Board of Directors, and,
when required, the minutes of the meetings of the committees, and
shall be responsible for the custody of all such minutes. The
Secretary shall be responsible for the custody of the stock
ledger and documents of the corporation. The Secretary shall
have custody of the corporate seal and may affix and attest such
seal to any instrument whose execution shall have been duly
authorized and shall perform all other duties incident to the
office of Secretary.
8. Treasurer. The Treasurer shall have the custody of all
moneys and securities of the corporation and shall keep or cause
to be kept accurate accounts of all money received or payments
made in books kept for that purpose. The Treasurer shall deposit
or cause to be deposited funds of the corporation in accordance
with Article V, Section 2 of these By-Laws and shall disburse the
funds of the corporation by checks or vouchers as authorized by
the Board of Directors. The Treasurer shall also perform all
other duties incident to the office of Treasurer.
9. Controller. The Controller shall be the chief account
ing officer of the corporation. The Controller shall keep or
cause to be kept all books of accounts and accounting records of
the corporation and shall keep and maintain, or cause to be kept
and maintained, adequate and correct accounts of the properties
and business transactions of the corporation. The Controller
shall prepare or cause to be prepared appropriate financial
statements for the corporation and shall perform such other
duties as may be incident to the office of Controller.
10. Other Officers and Assistant Officers. All other
officers and assistant officers shall exercise such powers and
perform such duties as shall be determined from time to time by
the Board of Directors or the Chief Executive Officer.
11. Term of Office; Vacancies. Each officer shall hold
office until the annual meeting of the Board of Directors follow
ing the end of the term of the Board by which such officer is
elected, except in the case of earlier death, resignation or
removal. Vacancies in any office arising from any cause may be
filled by the directors at any regular or special meeting.
12. Removal. Any officer elected or appointed by the Board
of Directors may be removed at any time, with or without cause,
by the Board of Directors.
ARTICLE V - Dividends and Finance
1. Dividends. Dividends may be declared to the full
extent permitted by law at such times as the Board of Directors
shall direct.
2. Deposits; Withdrawals; Notes and Other Instruments.
The moneys of the corporation shall be deposited in the name of
the corporation in such banks or trust companies as shall be
designated by the Board of Directors, and shall be drawn out only
by check signed by persons designated, from time to time, by the
Board of Directors or by an officer of this corporation to whom
the Board of Directors has delegated such authority. All notes
and other instruments for the payment of money shall be signed or
endorsed by officers or other persons authorized from time to
time by the Board of Directors or by an officer of this corpora
tion to whom the Board of Directors has delegated such authority.
3. Fiscal Year. The fiscal year of the corporation shall
date from the first day of January in each year.
ARTICLE VI - Books and Records; Record Date
1. Books and Records. The books, accounts and records of
the corporation, except as may be otherwise required by the laws
of the State of Delaware, may be kept within or outside of the
said State at such places as the Board of Directors may from time
to time appoint.
2. Record Date.
(a) The Board of Directors is authorized to fix in advance
a date, not exceeding sixty (60) days preceding the date of any
meeting of stockholders, or the date for the payment of any
dividend, or other distribution or allotment of any rights, or
the date when any change, conversion or exchange of capital stock
shall go into effect, as a record date for the determination of
the stockholders entitled to notice of, and to vote at, any such
meeting and any adjournment thereof, or entitled to receive
payment of any such dividend or other distribution or allotment
of rights, or to exercise any rights in respect of any such
change, conversion or exchange of capital stock. Such stockhold
ers and only such stockholders as shall be stockholders of record
on the record date so fixed shall be entitled to such notice of,
and to vote at, such meeting and any adjournment thereof, or to
receive payment of such dividend or other distribution or allot
ment of rights, or to exercise such rights, as the case may be,
notwithstanding any transfer of any stock on the books of the
corporation after any such record date fixed as aforesaid. Any
such record date fixed in connection with a meeting of stockhold
ers shall not be less than ten (10) days before the date of such
meeting.
(b) In order that the corporation may determine the stock
holders entitled to consent to corporate action in writing
without a meeting, the Board of Directors is authorized to fix in
advance a record date, which record date shall not be more than
ten (10) days after the date upon which the resolution fixing the
record date is adopted by the Board of Directors. Any stockhold
er of record seeking to have the stockholders authorize or take
corporate action by written consent shall, by written notice to
the Secretary, request the Board of Directors to fix a record
date. If no record date has been fixed by the Board of Directors
within ten (10) days of the date on which such a request is
received, the record date for determining stockholders entitled
to consent to corporate action in writing without a meeting, when
no prior action by the Board of Directors is required by applica
ble law, shall be the first date on which a signed written
consent setting forth the action taken or proposed to be taken is
delivered to the corporation by delivery to its registered office
in the State of Delaware, its principal place of business, or the
Secretary. If no record date has been fixed by the Board of
Directors and prior action by the Board of Directors is required
by applicable law, the record date for determining stockholders
entitled to consent to corporate action in writing without a
meeting shall be at the close of business on the date on which
the Board of Directors adopts the resolution taking such prior
action. Such stockholders and only such stockholders as shall be
stockholders of record on the record date so fixed shall be
entitled to give such consent, notwithstanding any transfer of
any stock on the books of the corporation after any such record
date fixed as aforesaid.
ARTICLE VII - Notices
1. Notices. Whenever any provision of law or these By-
Laws requires notice to be given to any director, officer or
stockholder, such notice may be given in writing by mailing the
same to such director, officer or stockholder at his or her
address as the same appears in the books of the corporation,
unless such stockholder shall have filed with the Secretary a
written request that notices intended for him or her be mailed to
some other address, in which case it shall be mailed to the
address designated in such request. The time when the same shall
be mailed shall be deemed to be the time of the giving of such
notice. This section shall not be deemed to preclude the giving
of notice by other means if permitted by the applicable provision
of law or these By-Laws.
2. Waivers of Notice. A waiver of any notice in writing,
signed by a stockholder, director or officer, whether before or
after the time stated in said waiver for holding a meeting, shall
be deemed equivalent to a notice required to be given to any
stockholder, director or officer.
ARTICLE VIII - Contracts
1. Interested Directors or Officers. No contract or
transaction between the corporation and one or more of its
directors or officers, or between the corporation and any other
corporation, partnership, association or other organization in
which one or more of the directors or officers of the corporation
are directors or officers, or have a financial interest, shall be
void or voidable solely for this reason, or solely because the
director or officer of the corporation is present at or partici
pates in the meeting of the Board of Directors or committee
thereof which authorizes the contract or transaction, or solely
because his, her or their votes are counted for such purpose, if:
(i) The material facts as to the relationship or
interest of such person and as to the contract or transac
tion are disclosed or are known to the Board of Directors or
the committee thereof, and the Board of Directors or commit
tee in good faith authorizes the contract or transaction by
a vote sufficient for such purpose without counting the vote
of the interested director or directors of the corporation;
provided, however, that common or interested directors may
be counted in determining the presence of a quorum at a
meeting of the Board of Directors or committee; or
(ii) The material facts as to the relationship or
interest of such person and as to the contract or transac
tion are disclosed or are known to the stockholders of the
corporation entitled to vote thereon, and the contract or
transaction is specifically approved in good faith by vote
of the stockholders of the corporation; or
(iii) The contract or transaction is fair as to the
corporation as of the time it is authorized, approved or
ratified by the Board of Directors, a committee thereof or
the stockholders of the corporation.
ARTICLE IX - Seal
1. Seal. The corporate seal of the corporation shall
consist of two concentric circles, between which is the name of
the corporation, and in the center shall be inscribed the year of
its incorporation and the words, "Corporate Seal, Delaware."
ARTICLE X - Indemnification
1. Indemnification in Third Party Actions. The corpora
tion shall indemnify each person who was or is a party or is
threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in
the right of the corporation) by reason of the fact that such
person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corpora
tion as a director, officer, employee or agent of another corpo
ration, partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, against
all expense, liability and loss (including attorneys fees,
judgments, fines, ERISA excise taxes or penalties, and amounts
paid or to be paid in settlement) actually and reasonably in
curred by such person in connection with such action, suit or
proceeding if he or she acted in good faith and in a manner he or
she reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or
her conduct was unlawful, except that no indemnification shall be
made in respect of any proceeding (or part thereof) initiated by
such person unless such proceeding (or part thereof) was autho
rized by the Board of Directors of the corporation. The termina
tion of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which the person
reasonably believed to be in or not opposed to the best interests
of the corporation, and with respect to any criminal action or
proceeding, had reasonable cause to believe that his or her
conduct was unlawful.
2. Indemnification in an Action by or in the Right of the
Corporation. The corporation shall indemnify each person who was
or is a party or is threatened to be made a party to any threat
ened, pending or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason of
the fact that such person is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request
of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit
plans, against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense
or settlement of such action or suit if the person acted in good
faith and in a manner the person reasonably believed to be in or
not opposed to the best interests of the corporation and except
that no indemnification shall be made in respect of (a) any
claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery of the State of Delaware or the
court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses
which such Court of Chancery or such other court shall deem
proper, or (b) any proceeding (or part thereof) initiated by such
person unless such proceeding (or part thereof) was authorized by
the Board of Directors of the corporation.
3. Indemnification as of Right. To the extent that a
director, officer, employee or agent of the corporation has been
successful on the merits or otherwise in defense of any action,
suit or proceeding referred to in Sections l and 2 of this
Article X, or in defense of any claim, issue or matter therein,
such person shall be indemnified against expenses (including
attorneys fees) actually and reasonably incurred by such person
in connection therewith.
4. Determination of Indemnification. Any indemnification
under Sections 1 and 2 of this Article X (unless ordered by a
court) shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circum
stances because the person has met the applicable standard of
conduct set forth in such Sections l and 2. Such determination
shall be made (a) by the Board of Directors (the Board) by a
majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, or (b) if such a
quorum is not obtainable, or, even if obtainable a quorum of
disinterested directors so directs, by independent legal counsel
in a written opinion or (c) by the stockholders.
5. Advance for Expenses. Expenses (including attorneys'
fees) incurred in defending any civil, criminal, administrative
or investigative action, suit or proceeding shall be paid by the
corporation in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf
of the director, officer, employee or agent to repay such amount
if it shall ultimately be determined that he or she is not
entitled to be indemnified by the corporation as authorized in
this Article X.
6. General Provisions.
(a) All expenses (including attorneys' fees) incurred in
defending any civil, criminal, administrative or investigative
action, suit or proceeding which are advanced by the corporation
under Section 5 of this Article X shall be repaid (i) in case the
person receiving such advance is ultimately found, under the
procedure set forth in this Article X, not to be entitled to
indemnification, or (ii) where indemnification is granted, to the
extent that the expenses so advanced by the corporation exceed
the indemnification to which such person is entitled.
(b) The corporation may indemnify each person, though he or
she is not or was not a director, officer, employee or agent of
the corporation, who served at the request of the corporation on
a committee created by the Board to consider and report to it in
respect of any matter. Any such indemnification may be made
under the preceding provisions of this Article X and shall be
subject to the limitations thereof except that (as indicated) any
such committee member need not be nor have been a director,
officer, employee or agent of the corporation.
(c) The provisions of this Article X shall be applicable to
appeals. References to "serving at the request of the corpora
tion" shall include without limitation any service as a director,
officer, employee or agent of the corporation which imposes
duties on, or involves services by, such director, officer,
employee or agent with respect to an employee benefit plan, its
participants or beneficiaries. A person who acted in good faith
and in a manner he or she reasonably believed to be in the
interest of the participants and beneficiaries of an employee
benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation."
(d) If any section, subsection, paragraph, sentence,
clause, phrase or word in this Article X shall be adjudicated
invalid or unenforceable, such adjudication shall not be deemed
to invalidate or otherwise affect any other section, subsection,
paragraph, sentence, clause, phrase or word of this Article.
(e) The indemnification and advancement of expenses provid
ed by, or granted pursuant to, this Article X shall not be deemed
exclusive of any other rights to which those seeking indemnifica
tion or advancement of expenses may be entitled under any By-Law,
agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in their official capacities and as
to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
ARTICLE XI - Amendments
1. Amendments. Alterations or amendments of these By-Laws
may be made by the stockholders at any annual or special meeting
if the notice of such meeting contains a statement of the pro
posed alteration or amendment, or by the Board of Directors at
any annual, regular or special meeting, provided notice of such
alteration or amendment has been given to each director in
writing at least five (5) days prior to said meeting or has been
waived by all the directors.
060195
bylaws\rmet
EXHIBIT 10.34
SPLIT DOLLAR LIFE INSURANCE AGREEMENT
[Trustee Owner, Trustee Pays Premiums]
This SPLIT DOLLAR LIFE INSURANCE AGREEMENT (the "Agreement")
is entered into as of this ____ day of __________, 1995, by and
between REYNOLDS METALS COMPANY, a Delaware corporation (the
"Corporation"); _____________, Trustee under a Agreement made by
______________ dated ___________ __, 19__ (the "Trustee"); and
__________________ (the "Employee").
RECITALS
In recognition of the services of the Employee to the
Corporation, the Corporation has determined that its best
interests would be served by entering into this Split Dollar Life
Insurance Agreement with the Trustee, whereby the Corporation
will assist the Trustee in maintaining certain life insurance on
the Employee's life, subject to the condition that the
Corporation is to be repaid for any amounts which the Corporation
may contribute toward the payment of any premiums due on such
policy.
In furtherance of the purposes of this Agreement, the
Trustee will own a policy or policies of life insurance
(collectively the "Policies" and individually the "Policy")
issued by Northwestern Mutual Life Insurance Company (the
"Insurer") on the Employee's life. The Trustee's ownership of
the Policies shall be subject to the terms and conditions
contained in this Agreement.
AGREEMENT
Now, therefore, the Corporation, the Trustee and the
Employee agree as follows:
I. DEATH BENEFIT.
The Trustee shall acquire, with the Corporation's
assistance, an insurance policy with a death benefit ("Trustee's
Death Benefit") in an amount equal to two times the Employee's
"Annual Earnings." Annual Earnings is defined as the Employee's
current annual base salary plus any amount awarded to the
Employee under a cash incentive plan in the previous calendar
year, or such other definition of Annual Earnings as may be in
effect from time to time under the Corporation's Group Term Life
Insurance Plan for Salaried Employees. The Trustee's Death
Benefit will be adjusted annually to reflect any increase in the
Employee's Annual Earnings. The Trustee's Death Benefit will
increase if the Employee's Annual Earnings increase. Except as
otherwise provided in this Agreement, the Trustee's Death Benefit
will not decrease if the Employee's Annual Earnings decrease.
The Trustee's Death Benefit shall be reduced as of each
Policy Release Date, as defined in Article VII of this Agreement,
by that amount equal to the difference between (i) the total
insurance death proceeds of the Released Policy, as defined in
Article VII of this Agreement, as of the Policy
<PAGE>
Release Date inclusive of any amounts borrowed against the
Released Policy by the Trustee, and (ii) the total premiums
advanced by the Corporation with respect to the Released Policy.
When the Employee reaches age sixty-five, the Trustee's
Death Benefit shall decrease by one percent (the "Reduction
Amount") of the Trustee's Death Benefit in effect at that time.
The Trustee's Death Benefit will continue to decrease by the
Reduction Amount each month for the next succeeding forty-nine
months. During the fifty month period in which the Trustee's
Death Benefit is being reduced by the Reduction Amount, if the
Trustee's Death Benefit is also reduced due to a Released Policy
pursuant to Article VII of this Agreement, the Reduction Amount
shall be an amount equal to the previous Reduction Amount
multiplied by a fraction. The numerator of the fraction shall
equal the reduction in the Trustee's Death Benefit due to the
Released Policy, and the denominator of the fraction shall equal
the Trustee's Death Benefit prior to such reduction in the
Trustee's Death Benefit.
If the Employee retires prior to the Employee's sixty-fifth
birthday, the Trustee's Death Benefit shall increase each year by
five percent of the previous year's Trustee's Death Benefit.
This annual five percent increase shall continue until the
Employee reaches age sixty-five.
As the Trustee's Death Benefit increases, temporary coverage
for such increase in the Trustee's Death Benefit may be provided
for under the Corporation's Group Term Life Insurance Plan for
Salaried Employees until an additional Policy is obtained under
this Agreement.
The Employee may be required to apply and qualify for
additional coverage that may arise due to increases in the
Trustee's Death Benefit. If the Employee does not receive
satisfactory underwriting, any increases in the Trustee's Death
Benefit will be provided for under the Corporation's Group Term
Life Insurance Plan for Salaried Employees.
Any part of the Trustee's Death Benefit paid under the
Corporation's Group Term Life Insurance Plan for Salaried
Employees will be paid to the beneficiary designated under that
plan in accordance with its terms and conditions.
II. RIGHTS IN THE POLICY.
All insurance policies on the life of the Employee that are
subject to this Agreement shall be identified and made part of
this Agreement by their inclusion on the attached Schedule A.
Other insurance policies on the life of the Employee may be made
subject to the terms of this Agreement by amending the
description in Schedule A to include such policies.
The Trustee is the owner of the Policies. The Policies are
subject to the terms of this Agreement. The Trustee may exercise
all ownership rights granted to the owner by the terms of the
Policies, including without limitation, the right to assign
rights and interests in the Policies, the right to change the
beneficiary of the Policies and the right to exercise any and all
settlement
<PAGE>
options applicable to the Policies. With written permission from
the Corporation, the Trustee may borrow against the cash value of
the Policies up to the difference between (i) the cash value of
the Policies and (ii) the total amount of the premiums advanced
by the Corporation.
III. PAYMENT OF PREMIUMS.
The Corporation will pay the entire annual premium due on
the Policies (after taking into account any dividends) and will
be reimbursed by the Trustee for the Trustee's portion of the
annual premium. The Trustee is responsible for that portion of
the annual premium which is equal to the lesser of (i) the amount
of the entire economic benefit that would be taxable to the
Trustee but for such payment, or (ii) the entire annual premium
due on the Policies (the "Trustee's Portion"). The amount of the
economic benefit to the Trustee shall be calculated using the
lower of the P.S. 58 rates or the Insurer's term rates in
accordance with Rev. Ruls. 64-328, 1964-2 C.B. 11, and 66-110,
1966-1 C.B. 12, or their successors, as in effect on the
effective date of this Agreement. The Corporation's portion of
the annual premium is equal to the entire annual premium less the
Trustee's Portion (the "Corporation's Portion").
The Trustee shall be required to reimburse the Corporation
for the Trustee's Portion of the premium within thirty days of
the receipt of a statement from the Corporation or its delegate
requesting such payment. If the Trustee does not reimburse the
Corporation within the thirty day period, the Corporation
(without notice to the Employee or Trustee) may make monthly or
semi-monthly payroll deductions for any amounts then due and may
continue to make monthly or semi-monthly payroll deductions for
any future Trustee's Portion of the premium from the Employee's
salary. The Employee hereby consents to the Corporation making
such monthly or semi-monthly payroll deductions from the
Employee's salary. In no case shall the Corporation be required
to advance the Trustee, under this Article III, an amount in
excess of $10,000.00.
IV. COLLATERAL ASSIGNMENT.
All sums advanced by the Corporation to pay the
Corporation's Portion of the annual premiums shall be repayable
to the Corporation as herein provided, notwithstanding
termination of this Agreement. The Trustee shall assign the
Policies to the Corporation as security for such advances by
executing an Assignment of Life Insurance Policy as Collateral
(the "Collateral Assignment") for each separate Policy.
Subject to the terms of the Collateral Assignment, the
Corporation shall not possess any incidents of ownership in the
Policies and shall not be entitled to exercise any rights,
privileges or benefits of ownership in the Policies. The Trustee
shall possess all incidents of ownership in the Policies.
V. TERMINATION OF AGREEMENT.
<PAGE>
This Agreement shall terminate upon the occurrence of any of
the following events:
A. Performance of its terms, following the death of the
Employee;
B. Upon the Policy Release Date of the last Policy to be
released from this Agreement pursuant to Article VII;
C. The termination of the Employee's employment with the
Corporation for reasons other than total disability (as defined
under the Corporation's Long Term Disability Plan for Salaried
Employees, or any successor plan) or retirement (defined as
termination of employment at a time when the Employee is entitled
to an immediate benefit under the Corporation's New Retirement
Program for Salaried Employees, or any successor plan);
D. Upon the failure of the Trustee or Employee to pay on a
timely basis the Trustee's Portion of the premiums;
E. Receivership or dissolution of the Corporation;
F. Delivery to the Corporation of a written instrument of
termination signed by the Trustee; or
G. Delivery to the Trustee of a written instrument of
termination authorized by the Corporation's Board of Directors.
VI. RIGHTS TO THE PROCEEDS AT DEATH.
So long as this Agreement is in effect, the beneficiary
provisions of the Policies shall provide that the death proceeds
due under the Policies shall be distributed to the following
persons in the following order: 1) the Corporation shall receive
an amount equal to the total premiums advanced by the Corporation
(excluding amounts already reimbursed to the Corporation by the
Trustee); 2) after the Corporation has received all of the
premiums it advanced as provided above, the Trustee's designated
beneficiary shall receive the remaining death proceeds, but in no
event shall the amount paid to the designated beneficiary
hereunder exceed an amount equal to the Trustee's Death Benefit;
and 3) the Corporation shall receive the remaining death
proceeds, if any.
VII. POLICY RELEASE.
Each separate Policy shall no longer be subject to the terms
of this Agreement upon the later of (i) the Policy's anniversary
date following the Employee's sixty-fifth birthday, or (ii) the
expiration of fifteen policy years commencing on the effective
date of the Policy (the "Policy Release Date"). At this time,
the Trustee may repay to the Corporation, within sixty (60) days
of
<PAGE>
such Policy Release Date, an amount equal to the total premiums
advanced by the Corporation with respect to that Policy (the
"Released Policy"). Also at this time, the Trustee's Death
Benefit will be reduced as provided in Article I of this
Agreement. Upon receipt of such payment from the Trustee, the
Corporation shall release the Collateral Assignment securing the
Released Policy by the execution and delivery of an appropriate
instrument(s) of release and shall deliver the Released Policy to
the Trustee.
If the Trustee does not repay the Corporation the amount
calculated above within the prescribed time period, the Trustee
shall be required to transfer ownership of the Released Policy to
the Corporation, and the Trustee's Death Benefit will be reduced
as provided in Article I of this Agreement. If the cash value of
the Released Policy as of the Policy Release Date is less than
the total premiums advanced by the Corporation with respect to
the Released Policy as of the Policy Release Date, the Trustee,
and otherwise the Employee, is obligated to reimburse the
Corporation for the difference between (i) the total premiums
advanced by the Corporation with respect to the Released Policy
as of the Policy Release Date and (ii) the cash value of the
Released Policy as of the Policy Release Date.
VIII. RIGHTS UPON TERMINATION OF THE AGREEMENT OTHER THAN
DEATH OF THE EMPLOYEE.
Upon the termination of this Agreement as provided in
paragraphs C. through G. of Article V, the Trustee may repay to
the Corporation, within sixty (60) days of such termination, an
amount equal to the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Trustee) as of the date of the termination of the Agreement.
Upon receipt of such payment from the Trustee, the Corporation
shall release the Collateral Assignments by the execution and
delivery of an appropriate instrument(s) of release and shall
deliver the Policies to the Trustee.
If the Trustee does not repay the Corporation the amount
calculated above within the prescribed time period, the Trustee
shall be required to transfer ownership of the Policies to the
Corporation. Except as provided below, if the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement is
less than the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Trustee) as of the date of the termination of the Agreement, the
Trustee, and otherwise the Employee, is obligated to reimburse
the Corporation for the difference between (i) the total premiums
advanced by the Corporation (excluding premiums already
reimbursed to the Corporation by the Trustee) as of the date of
the termination of the Agreement and (ii) the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement.
If the Corporation terminates the Agreement pursuant to
paragraph G. of Article V of this Agreement, the Trustee and
Employee are not obligated to reimburse the Corporation for the
<PAGE>
difference between (i) the total premiums advanced by the
Corporation (excluding premiums already reimbursed to the
Corporation by the Trustee) as of the date of the termination of
the Agreement and (ii) the cash value of the Policies (as may be
enhanced by any cash value enhancement rider in effect) as of the
date of the termination of the Agreement.
IX. NAMED FIDUCIARY.
The Corporation is hereby designated as the "Named
Fiduciary" under this Agreement. The Named Fiduciary shall have
authority to control and manage the operation and administration
of this Agreement, and it shall be responsible for establishing
and carrying out a funding policy and method consistent with the
objectives of this Agreement.
The Corporation shall, in its discretion, make all
determinations concerning rights to benefits under this
Agreement. Should the Trustee or other beneficiary of the
Policies fail to receive benefits to which the Trustee (or other
beneficiary) believes he is entitled, a claim may be filed. Any
claim for a benefit due in connection with this Agreement shall
be filed by the Trustee or other beneficiary (the "Claimant") by
written communication made by the Claimant or the Claimant's
authorized representative to the Named Fiduciary. All such
claims and notices shall be made in the manner provided in
Article XIII of this Agreement.
If a claim for a benefit is wholly or partially denied, a
written notice of the decision shall be furnished to the Claimant
by the Named Fiduciary or its designee within a reasonable period
of time after receipt of the claim by the Named Fiduciary. The
notice shall include the following information:
a. The specific reason or reasons for the
denial;
b. Specific reference to the pertinent
provisions of this Agreement and/or the Policy
upon which the denial is based;
c. A description of any additional material
or information necessary for the Claimant to
perfect the claim and an explanation of why such
material or information is necessary; and
d. An explanation of all claim review
procedures available under this Agreement.
For purposes of the immediately preceding paragraph, a
period of time shall be deemed to be unreasonable if it exceeds
90 days after receipt of the claim by the Named Fiduciary, unless
special circumstances require an extension of time for processing
the claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished to
the Claimant prior to the termination of the initial 90-day
period. In no event shall such extension exceed a
<PAGE>
period of 90 days from the end of such initial period. The
extension notice shall indicate the special circumstances
requiring an extension of time and the date by which the Named
Fiduciary expects to render the final decision.
In order that a Claimant may appeal a denial of claim, a
Claimant or his duly authorized representative may request a
review by written application to the Named Fiduciary or his
designee not later than 60 days after receipt by the Claimant of
written notification of denial of a claim and may submit issues
and comments in writing. A decision on review of a denied claim
shall be made not later than 60 days after the Named Fiduciary's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time,
but not later than 120 days after receipt of a request for
review. The decision on review shall be in writing and shall
include the specific reason(s) for the decision and the specific
reference(s) to the pertinent provisions of this Agreement and/or
the Policies on which the decision is based.
Notwithstanding anything contained in this Article IX to the
contrary, any claim for a death benefit under an insurance policy
listed on Schedule A attached hereto shall be filed with the
Insurer by the Claimant or his authorized representative on the
form or forms prescribed for such purpose by the Insurer. The
Insurer shall be responsible for determining whether a death
claim shall or shall not be paid, either in whole or in part, in
accordance with the terms of the insurance contract purchased on
the life of the Employee.
X. AMENDMENT AND ASSIGNMENT.
The Corporation may, in its sole discretion, alter, amend or
modify (including the addition of any extra Policy provisions)
this Agreement at any time by a written instrument authorized by
the Corporation, or its designee, and delivered to the Trustee
and Employee. The Corporation or the Trustee may, subject to the
limitations of Article IV, assign its rights and obligations
under this Agreement, provided, however, that any assignment will
be subject to the terms of this Agreement.
XI. SEVERABILITY.
The invalidity of any provision of this Agreement shall not
affect the validity of any other provision of this Agreement.
XII. POSSESSION OF POLICIES.
The Corporation will maintain possession of the Policies
during the term of this Agreement.
XIII. NOTICE.
<PAGE>
All notices, claims, requests and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed by certified or registered mail
to the Corporation as follows: Attention: Corporate Director,
Compensation and Benefits, Reynolds Metals Company, 6601 W. Broad
Street, P.O. Box 27003, Richmond, Virginia 23261-7003 or to the
Trustee and Employee at their last known addresses or at such
addresses as any party shall designate to the other parties in
writing.
XIV. GOVERNING LAW.
This Agreement sets forth the entire agreement of the
parties hereto, and any and all prior agreements, to the extent
inconsistent herewith, are hereby superseded. This Agreement
will be governed by the laws of the Commonwealth of Virginia.
XV. INTERPRETATION.
Where appropriate in this Agreement, words used in the
singular will include the plural and words used in the masculine
will include the feminine.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
Reynolds Metals Company
By: _____________________________
Title:___________________________
_________________________________
_________________________, Trustee
__________________________________
_________________________, Employee
<PAGE>
LIST OF SCHEDULES
A. Schedule of the Policies
LIST OF EXHIBITS
1. Copies of Insurance Policies
2. Assignments of Life Insurance Death Benefit as
Collateral
<PAGE>
SCHEDULE A
The following life insurance policies are subject to that
certain Split Dollar Life Insurance Agreement dated as
of__________ __, 1995, among Reynolds Metals Company,
________________, Trustee and___________________.
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
0190098.02
EXHIBIT 10.35
SPLIT DOLLAR LIFE INSURANCE AGREEMENT
[Trustee Owner, Employee Pays Premium]
This SPLIT DOLLAR LIFE INSURANCE AGREEMENT (the "Agreement")
is entered into as of this ____ day of __________, 1995, by and
between REYNOLDS METALS COMPANY, a Delaware corporation (the
"Corporation"); _____________, Trustee under a Trust Agreement
made by ______________ dated ___________ __, 19__ (the
"Trustee"); and __________________ (the "Employee").
RECITALS
In recognition of the services of the Employee to the
Corporation, the Corporation has determined that its best
interests would be served by entering into this Split Dollar Life
Insurance Agreement with the Trustee, whereby the Corporation
will assist the Trustee in maintaining certain life insurance on
the Employee's life, subject to the condition that the
Corporation is to be repaid for any amounts which the Corporation
may contribute toward the payment of any premiums due on such
policy.
In furtherance of the purposes of this Agreement, the
Trustee will own a policy or policies of life insurance
(collectively the "Policies" and individually the "Policy")
issued by Northwestern Mutual Life Insurance Company (the
"Insurer") on the Employee's life. The Trustee's ownership of
the Policies shall be subject to the terms and conditions
contained in this Agreement.
AGREEMENT
Now, therefore, the Corporation, the Trustee and the
Employee agree as follows:
I. DEATH BENEFIT.
The Trustee shall acquire, with the Corporation's
assistance, an insurance policy with a death benefit ("Trustee's
Death Benefit") in an amount equal to two times the Employee's
"Annual Earnings." Annual Earnings is defined as the Employee's
current annual base salary plus any amount awarded to the
Employee under a cash incentive plan in the previous calendar
year, or such other definition of Annual Earnings as may be in
effect from time to time under the Corporation's Group Term Life
Insurance Plan for Salaried Employees. The Trustee's Death
Benefit will be adjusted annually to reflect any increase in the
Employee's Annual Earnings. The Trustee's Death Benefit will
increase if the Employee's Annual Earnings increase. Except as
otherwise provided in this Agreement, the Trustee's Death Benefit
will not decrease if the Employee's Annual Earnings decrease.
The Trustee's Death Benefit shall be reduced as of each
Policy Release Date, as defined in Article VII of this Agreement,
by that amount equal to the difference between (i) the total
insurance death proceeds of the Released Policy, as defined in
Article VII of this Agreement, as of the Policy
<PAGE>
Release Date inclusive of any amounts borrowed against the
Released Policy by the Trustee, and (ii) the total premiums
advanced by the Corporation with respect to the Released Policy.
When the Employee reaches age sixty-five, the Trustee's
Death Benefit shall decrease by one percent (the "Reduction
Amount") of the Trustee's Death Benefit in effect at that time.
The Trustee's Death Benefit will continue to decrease by the
Reduction Amount each month for the next succeeding forty-nine
months. During the fifty month period in which the Trustee's
Death Benefit is being reduced by the Reduction Amount, if the
Trustee's Death Benefit is also reduced due to a Released Policy
pursuant to Article VII of this Agreement, the Reduction Amount
shall be an amount equal to the previous Reduction Amount
multiplied by a fraction. The numerator of the fraction shall
equal the reduction in the Trustee's Death Benefit due to the
Released Policy, and the denominator of the fraction shall equal
the Trustee's Death Benefit prior to such reduction in the
Trustee's Death Benefit.
If the Employee retires prior to the Employee's sixty-fifth
birthday, the Trustee's Death Benefit shall increase each year by
five percent of the previous year's Trustee's Death Benefit.
This annual five percent increase shall continue until the
Employee reaches age sixty-five.
As the Trustee's Death Benefit increases, temporary coverage
for such increase in the Trustee's Death Benefit may be provided
for under the Corporation's Group Term Life Insurance Plan for
Salaried Employees until an additional Policy is obtained under
this Agreement.
The Employee may be required to apply and qualify for
additional coverage that may arise due to increases in the
Trustee's Death Benefit. If the Employee does not receive
satisfactory underwriting, any increases in the Trustee's Death
Benefit will be provided for under the Corporation's Group Term
Life Insurance Plan for Salaried Employees.
Any part of the Trustee's Death Benefit paid under the
Corporation's Group Term Life Insurance Plan for Salaried
Employees will be paid to the beneficiary designated under that
plan in accordance with its terms and conditions.
II. RIGHTS IN THE POLICY.
All insurance policies on the life of the Employee that are
subject to this Agreement shall be identified and made part of
this Agreement by their inclusion on the attached Schedule A.
Other insurance policies on the life of the Employee may be made
subject to the terms of this Agreement by amending the
description in Schedule A to include such policies.
The Trustee is the owner of the Policies. The Policies are
subject to the terms of this Agreement. The Trustee may exercise
all ownership rights granted to the owner by the terms of the
Policies, including without limitation, the right to assign
rights and interests in the Policies, the right to change the
beneficiary of the Policies and the right to exercise any and all
settlement
<PAGE>
options applicable to the Policies. With written permission from
the Corporation, the Trustee may borrow against the cash value of
the Policies up to the difference between (i) the cash value of
the Policies and (ii) the total amount of the premiums advanced
by the Corporation.
III. PAYMENT OF PREMIUMS.
The Corporation will pay the entire annual premium due on
the Policies (after taking into account any dividends) and will
be reimbursed by the Employee for the Trustee's portion of the
annual premium. The Employee is responsible for that portion of
the annual premium which is equal to the lesser of (i) the amount
of the entire economic benefit that would be taxable to the
Trustee but for such payment, or (ii) the entire annual premium
due on the Policies (the "Trustee's Portion"). The amount of the
economic benefit to the Trustee shall be calculated using the
lower of the P.S. 58 rates or the Insurer's term rates in
accordance with Rev. Ruls. 64-328, 1964-2 C.B. 11, and 66-110,
1966-1 C.B. 12, or their successors, as in effect on the
effective date of this Agreement. The Corporation's portion of
the annual premium is equal to the entire annual premium less the
Trustee's Portion (the "Corporation's Portion").
The Employee hereby consents to the Corporation making
monthly or semi-monthly payroll deductions of the Trustee's
Portion of the premium from the Employee's salary. In no case
shall the Corporation be required to advance the Trustee, under
this Article III, an amount in excess of $10,000.00.
IV. COLLATERAL ASSIGNMENT.
All sums advanced by the Corporation to pay the
Corporation's Portion of the annual premiums shall be repayable
to the Corporation as herein provided, notwithstanding
termination of this Agreement. The Trustee shall assign the
Policies to the Corporation as security for such advances by
executing an Assignment of Life Insurance Policy as Collateral
(the "Collateral Assignment") for each separate Policy.
Subject to the terms of the Collateral Assignment, the
Corporation shall not possess any incidents of ownership in the
Policies and shall not be entitled to exercise any rights,
privileges or benefits of ownership in the Policies. The Trustee
shall possess all incidents of ownership in the Policies.
V. TERMINATION OF AGREEMENT.
This Agreement shall terminate upon the occurrence of any of
the following events:
A. Performance of its terms, following the death of the
Employee;
<PAGE>
B. Upon the Policy Release Date of the last Policy to be
released from this Agreement pursuant to Article VII;
C. The termination of the Employee's employment with the
Corporation for reasons other than total disability (as defined
under the Corporation's Long Term Disability Plan for Salaried
Employees, or any successor plan) or retirement (defined as
termination of employment at a time when the Employee is entitled
to an immediate benefit under the Corporation's New Retirement
Program for Salaried Employees, or any successor plan);
D. Upon the failure of the Employee to pay on a timely basis
the Trustee's Portion of the premiums;
E. Receivership or dissolution of the Corporation;
F. Delivery to the Corporation of a written instrument of
termination signed by the Trustee; or
G. Delivery to the Trustee of a written instrument of
termination authorized by the Corporation's Board of Directors.
VI. RIGHTS TO THE PROCEEDS AT DEATH.
So long as this Agreement is in effect, the beneficiary
provisions of the Policies shall provide that the death proceeds
due under the Policies shall be distributed to the following
persons in the following order: 1) the Corporation shall receive
an amount equal to the total premiums advanced by the Corporation
(excluding amounts already reimbursed to the Corporation by the
Trustee); 2) after the Corporation has received all of the
premiums it advanced as provided above, the Trustee's designated
beneficiary shall receive the remaining death proceeds, but in no
event shall the amount paid to the designated beneficiary
hereunder exceed an amount equal to the Trustee's Death Benefit;
and 3) the Corporation shall receive the remaining death
proceeds, if any.
VII. POLICY RELEASE.
Each separate Policy shall no longer be subject to the terms
of this Agreement upon the later of (i) the Policy's anniversary
date following the Employee's sixty-fifth birthday, or (ii) the
expiration of fifteen policy years commencing on the effective
date of the Policy (the "Policy Release Date"). At this time,
the Trustee may repay to the Corporation, within sixty (60) days
of such Policy Release Date, an amount equal to the total
premiums advanced by the Corporation with respect to that Policy
(the "Released Policy"). Also at this time, the Trustee's Death
Benefit will be reduced as provided in Article I of this
Agreement. Upon receipt of such payment from the Trustee, the
Corporation shall release the Collateral Assignment securing the
Released Policy by the
<PAGE>
execution and delivery of an appropriate instrument(s) of release
and shall deliver the Released Policy to the Trustee.
If the Trustee does not repay the Corporation the amount
calculated above within the prescribed time period, the Trustee
shall be required to transfer ownership of the Released Policy to
the Corporation, and the Trustee's Death Benefit will be reduced
as provided in Article I of this Agreement. If the cash value of
the Released Policy as of the Policy Release Date is less than
the total premiums advanced by the Corporation with respect to
the Released Policy as of the Policy Release Date, the Trustee,
and otherwise the Employee, is obligated to reimburse the
Corporation for the difference between (i) the total premiums
advanced by the Corporation with respect to the Released Policy
as of the Policy Release Date and (ii) the cash value of the
Released Policy as of the Policy Release Date.
VIII. RIGHTS UPON TERMINATION OF THE AGREEMENT OTHER THAN
DEATH OF THE EMPLOYEE.
Upon the termination of this Agreement as provided in
paragraphs C. through G. of Article V, the Trustee may repay to
the Corporation, within sixty (60) days of such termination, an
amount equal to the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Trustee) as of the date of the termination of the Agreement.
Upon receipt of such payment from the Trustee, the Corporation
shall release the Collateral Assignments by the execution and
delivery of an appropriate instrument(s) of release and shall
deliver the Policies to the Trustee.
If the Trustee does not repay the Corporation the amount
calculated above within the prescribed time period, the Trustee
shall be required to transfer ownership of the Policies to the
Corporation. Except as provided below, if the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement is
less than the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Trustee) as of the date of the termination of the Agreement, the
Trustee, and otherwise the Employee, is obligated to reimburse
the Corporation for the difference between (i) the total premiums
advanced by the Corporation (excluding premiums already
reimbursed to the Corporation by the Trustee) as of the date of
the termination of the Agreement and (ii) the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement.
If the Corporation terminates the Agreement pursuant to
paragraph G. of Article V of this Agreement, the Trustee and
Employee are not obligated to reimburse the Corporation for the
difference between (i) the total premiums advanced by the
Corporation (excluding premiums already reimbursed to the
Corporation by the Trustee) as of the date of the termination of
the Agreement and (ii) the cash value of the Policies (as may be
enhanced by any cash value enhancement rider in effect) as of the
date of the termination of the Agreement.
<PAGE>
IX. NAMED FIDUCIARY.
The Corporation is hereby designated as the "Named
Fiduciary" under this Agreement. The Named Fiduciary shall have
authority to control and manage the operation and administration
of this Agreement, and it shall be responsible for establishing
and carrying out a funding policy and method consistent with the
objectives of this Agreement.
The Corporation shall, in its discretion, make all
determinations concerning rights to benefits under this
Agreement. Should the Trustee or other beneficiary of the
Policies fail to receive benefits to which the Trustee (or other
beneficiary) believes he is entitled, a claim may be filed. Any
claim for a benefit due in connection with this Agreement shall
be filed by the Trustee or other beneficiary (the "Claimant") by
written communication made by the Claimant or the Claimant's
authorized representative to the Named Fiduciary. All such
claims and notices shall be made in the manner provided in
Article XIII of this Agreement.
If a claim for a benefit is wholly or partially denied, a
written notice of the decision shall be furnished to the Claimant
by the Named Fiduciary or its designee within a reasonable period
of time after receipt of the claim by the Named Fiduciary. The
notice shall include the following information:
a. The specific reason or reasons for the
denial;
b. Specific reference to the pertinent
provisions of this Agreement and/or the Policy
upon which the denial is based;
c. A description of any additional material
or information necessary for the Claimant to
perfect the claim and an explanation of why such
material or information is necessary; and
d. An explanation of all claim review
procedures available under this Agreement.
For purposes of the immediately preceding paragraph, a
period of time shall be deemed to be unreasonable if it exceeds
90 days after receipt of the claim by the Named Fiduciary, unless
special circumstances require an extension of time for processing
the claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished to
the Claimant prior to the termination of the initial 90-day
period. In no event shall such extension exceed a period of 90
days from the end of such initial period. The extension notice
shall indicate the special circumstances requiring an extension
of time and the date by which the Named Fiduciary expects to
render the final decision.
<PAGE>
In order that a Claimant may appeal a denial of claim, a
Claimant or his duly authorized representative may request a
review by written application to the Named Fiduciary or his
designee not later than 60 days after receipt by the Claimant of
written notification of denial of a claim and may submit issues
and comments in writing. A decision on review of a denied claim
shall be made not later than 60 days after the Named Fiduciary's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time,
but not later than 120 days after receipt of a request for
review. The decision on review shall be in writing and shall
include the specific reason(s) for the decision and the specific
reference(s) to the pertinent provisions of this Agreement and/or
the Policies on which the decision is based.
Notwithstanding anything contained in this Article IX to the
contrary, any claim for a death benefit under an insurance policy
listed on Schedule A attached hereto shall be filed with the
Insurer by the Claimant or his authorized representative on the
form or forms prescribed for such purpose by the Insurer. The
Insurer shall be responsible for determining whether a death
claim shall or shall not be paid, either in whole or in part, in
accordance with the terms of the insurance contract purchased on
the life of the Employee.
X. AMENDMENT AND ASSIGNMENT.
The Corporation may, in its sole discretion, alter, amend or
modify (including the addition of any extra Policy provisions)
this Agreement at any time by a written instrument authorized by
the Corporation, or its designee, and delivered to the Trustee
and Employee. The Corporation or the Trustee may, subject to the
limitations of Article IV, assign its rights and obligations
under this Agreement, provided, however, that any assignment will
be subject to the terms of this Agreement.
XI. SEVERABILITY.
The invalidity of any provision of this Agreement shall not
affect the validity of any other provision of this Agreement.
XII. POSSESSION OF POLICIES.
The Corporation will maintain possession of the Policies
during the term of this Agreement.
XIII. NOTICE.
All notices, claims, requests and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed by certified or registered mail
to the Corporation as follows: Attention: Corporate Director,
Compensation and Benefits, Reynolds Metals Company, 6601 W. Broad
Street, P.O. Box 27003, Richmond, Virginia 23261-7003 or to
<PAGE>
the Trustee and Employee at their last known addresses or at such
addresses as any party shall designate to the other parties in
writing.
XIV. GOVERNING LAW.
This Agreement sets forth the entire agreement of the
parties hereto, and any and all prior agreements, to the extent
inconsistent herewith, are hereby superseded. This Agreement
will be governed by the laws of the Commonwealth of Virginia.
XV. INTERPRETATION.
Where appropriate in this Agreement, words used in the
singular will include the plural and words used in the masculine
will include the feminine.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
Reynolds Metals Company
By: ______________________________
Title:____________________________
__________________________________
_________________________, Trustee
__________________________________
_________________________, Employee
<PAGE>
LIST OF SCHEDULES
A. Schedule of the Policies
LIST OF EXHIBITS
1. Copies of Insurance Policies
2. Assignments of Life Insurance Death Benefit as
Collateral
<PAGE>
SCHEDULE A
The following life insurance policies are subject to that
certain Split Dollar Life Insurance Agreement dated as
of__________ __, 1995, among Reynolds Metals Company,
________________, Trustee and___________________.
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
0190098.01
EXHIBIT 10.36
SPLIT DOLLAR LIFE INSURANCE AGREEMENT
[Employee Owner, Employee Pays Premium]
This SPLIT DOLLAR LIFE INSURANCE AGREEMENT (the "Agreement")
is entered into as of this ____ day of __________, 1995, by and
between REYNOLDS METALS COMPANY, a Delaware corporation (the
"Corporation"), and __________________ (the "Employee").
RECITALS
In recognition of the services of the Employee to the
Corporation, the Corporation has determined that its best
interests would be served by entering into this Split Dollar Life
Insurance Agreement with the Employee, whereby the Corporation
will assist the Employee in maintaining certain life insurance on
the Employee's life, subject to the condition that the
Corporation is to be repaid for any amounts which the Corporation
may contribute toward the payment of any premiums due on such
policy.
In furtherance of the purposes of this Agreement, the
Employee will own a policy or policies of life insurance
(collectively the "Policies" and individually the "Policy")
issued by Northwestern Mutual Life Insurance Company (the
"Insurer") on the Employee's life. The Employee's ownership of
the Policies shall be subject to the terms and conditions
contained in this Agreement.
AGREEMENT
Now, therefore, the Corporation and the Employee agree as
follows:
I. DEATH BENEFIT.
The Employee shall acquire, with the Corporation's
assistance, an insurance policy with a death benefit ("Employee's
Death Benefit") in an amount equal to two times the Employee's
"Annual Earnings." Annual Earnings is defined as the Employee's
current annual base salary plus any amount awarded to the
Employee under a cash incentive plan in the previous calendar
year, or such other definition of Annual Earnings as may be in
effect from time to time under the Corporation's Group Term Life
Insurance Plan for Salaried Employees. The Employee's Death
Benefit will be adjusted annually to reflect any increase in the
Employee's Annual Earnings. The Employee's Death Benefit will
increase if the Employee's Annual Earnings increase. Except as
otherwise provided in this Agreement, the Employee's Death
Benefit will not decrease if the Employee's Annual Earnings
decrease.
The Employee's Death Benefit shall be reduced as of each
Policy Release Date, as defined in Article VII of this Agreement,
by that amount equal to the difference between (i) the total
insurance death proceeds of the Released Policy, as defined in
Article VII of this Agreement, as of the Policy Release Date
inclusive of any amounts borrowed against the Released Policy by
the
<PAGE>
Employee, and (ii) the total premiums advanced by the Corporation
with respect to the Released Policy.
When the Employee reaches age sixty-five, the Employee's
Death Benefit shall decrease by one percent (the "Reduction
Amount") of the Employee's Death Benefit in effect at that time.
The Employee's Death Benefit will continue to decrease by the
Reduction Amount each month for the next succeeding forty-nine
months. During the fifty month period in which the Employee's
Death Benefit is being reduced by the Reduction Amount, if the
Employee's Death Benefit is also reduced due to a Released Policy
pursuant to Article VII of this Agreement, the Reduction Amount
shall be an amount equal to the previous Reduction Amount
multiplied by a fraction. The numerator of the fraction shall
equal the reduction in the Employee's Death Benefit due to the
Released Policy, and the denominator of the fraction shall equal
the Employee's Death Benefit prior to such reduction in the
Employee's Death Benefit.
If the Employee retires prior to the Employee's sixty-fifth
birthday, the Employee's Death Benefit shall increase each year
by five percent of the previous year's Employee's Death Benefit.
This annual five percent increase shall continue until the
Employee reaches age sixty-five.
As the Employee's Death Benefit increases, temporary
coverage for such increase in the Employee's Death Benefit may be
provided for under the Corporation's Group Term Life Insurance
Plan for Salaried Employees until an additional Policy is
obtained under this Agreement.
The Employee may be required to apply and qualify for
additional coverage that may arise due to increases in the
Employee's Death Benefit. If the Employee does not receive
satisfactory underwriting, any increases in the Employee's Death
Benefit will be provided for under the Corporation's Group Term
Life Insurance Plan for Salaried Employees.
Any part of the Employee's Death Benefit paid under the
Corporation's Group Term Life Insurance Plan for Salaried
Employees will be paid to the beneficiary designated under that
plan in accordance with its terms and conditions.
II. RIGHTS IN THE POLICY.
All insurance policies on the life of the Employee that are
subject to this Agreement shall be identified and made part of
this Agreement by their inclusion on the attached Schedule A.
Other insurance policies on the life of the Employee may be made
subject to the terms of this Agreement by amending the
description in Schedule A to include such policies.
The Employee is the owner of the Policies. The Policies are
subject to the terms of this Agreement. The Employee may
exercise all ownership rights granted to the owner by the terms
of the Policies, including without limitation, the right to
assign rights and interests in the Policies, the right to change
the beneficiary of the Policies and the right to exercise any and
all settlement
<PAGE>
options applicable to the Policies. With written permission from
the Corporation, the Employee may borrow against the cash value
of the Policies up to the difference between (i) the cash value
of the Policies and (ii) the total amount of the premiums
advanced by the Corporation.
III. PAYMENT OF PREMIUMS.
The Corporation will pay the entire annual premium due on
the Policies (after taking into account any dividends) and will
be reimbursed by the Employee for the Employee's portion of the
annual premium. The Employee is responsible for that portion of
the annual premium which is equal to the lesser of (i) the amount
of the entire economic benefit that would be taxable to the
Employee but for such payment, or (ii) the entire annual premium
due on the Policies (the "Employee's Portion"). The amount of
the economic benefit to the Employee shall be calculated using
the lower of the P.S. 58 rates or the Insurer's term rates in
accordance with Rev. Ruls. 64-328, 1964-2 C.B. 11, and 66-110,
1966-1 C.B. 12, or their successors, as in effect on the
effective date of this Agreement. The Corporation's portion of
the annual premium is equal to the entire annual premium less the
Employee's Portion (the "Corporation's Portion").
The Employee hereby consents to the Corporation making
monthly or semi-monthly payroll deductions of the Employee's
Portion of the premium from the Employee's salary. This consent
shall not be revoked if the Employee subsequently assigns his
rights and obligations under this Agreement. In no case shall
the Corporation be required to advance the Employee, under this
Article III, an amount in excess of $10,000.00.
IV. COLLATERAL ASSIGNMENT.
All sums advanced by the Corporation to pay the
Corporation's Portion of the annual premiums shall be repayable
to the Corporation as herein provided, notwithstanding
termination of this Agreement. The Employee shall assign the
Policies to the Corporation as security for such advances by
executing an Assignment of Life Insurance Policy as Collateral
(the "Collateral Assignment") for each separate Policy.
Subject to the terms of the Collateral Assignment, the
Corporation shall not possess any incidents of ownership in the
Policies and shall not be entitled to exercise any rights,
privileges or benefits of ownership in the Policies. The
Employee shall possess all incidents of ownership in the
Policies.
V. TERMINATION OF AGREEMENT.
This Agreement shall terminate upon the occurrence of any of
the following events:
A. Performance of its terms, following the death of the
Employee;
<PAGE>
B. Upon the Policy Release Date of the last Policy to be
released from this Agreement pursuant to Article VII;
C. The termination of the Employee's employment with the
Corporation for reasons other than total disability (as defined
under the Corporation's Long Term Disability Plan for Salaried
Employees, or any successor plan) or retirement (defined as
termination of employment at a time when the Employee is entitled
to an immediate benefit under the Corporation's New Retirement
Program for Salaried Employees, or any successor plan);
D. Upon the failure of the Employee to pay on a timely basis
the Employee's Portion of the premiums;
E. Receivership or dissolution of the Corporation;
F. Delivery to the Corporation of a written instrument of
termination signed by the Employee; or
G. Delivery to the Employee of a written instrument of
termination authorized by the Corporation's Board of Directors.
VI. RIGHTS TO THE PROCEEDS AT DEATH.
So long as this Agreement is in effect, the beneficiary
provisions of the Policies shall provide that the death proceeds
due under the Policies shall be distributed as follows: 1) the
Corporation shall receive an amount equal to the total premiums
advanced by the Corporation (excluding amounts already reimbursed
to the Corporation by the Employee); 2) after the Corporation has
received all of the premiums it advanced as provided above, the
Employee's designated beneficiary shall receive the remaining
death proceeds, but in no event shall the amount paid to the
designated beneficiary hereunder exceed an amount equal to the
Employee's Death Benefit; and 3) the Corporation shall receive
the remaining death proceeds, if any.
VII. POLICY RELEASE.
Each separate Policy shall no longer be subject to the terms
of this Agreement upon the later of (i) the Policy's anniversary
date following the Employee's sixty-fifth birthday, or (ii) the
expiration of fifteen policy years commencing on the effective
date of the Policy (the "Policy Release Date"). At this time,
the Employee may repay to the Corporation, within sixty (60) days
of such Policy Release Date, an amount equal to the total
premiums advanced by the Corporation with respect to that Policy
(the "Released Policy"). Also at this time, the Employee's Death
Benefit will be reduced as provided in Article I of this
Agreement. Upon receipt of such payment from the Employee, the
Corporation shall release the Collateral Assignment securing the
Released
<PAGE>
Policy by the execution and delivery of an appropriate
instrument(s) of release and shall deliver the Released Policy to
the Employee.
If the Employee does not repay the Corporation the amount
calculated above within the prescribed time period, the Employee
shall be required to transfer ownership of the Released Policy to
the Corporation, and the Employee's Death Benefit will be reduced
as provided in Article I of this Agreement. If the cash value of
the Released Policy as of the Policy Release Date is less than
the total premiums advanced by the Corporation with respect to
the Released Policy as of the Policy Release Date, the Employee
is obligated to reimburse the Corporation for the difference
between (i) the total premiums advanced by the Corporation with
respect to the Released Policy as of the Policy Release Date and
(ii) the cash value of the Released Policy as of the Policy
Release Date.
VIII. RIGHTS UPON TERMINATION OF THE AGREEMENT OTHER THAN
DEATH OF THE EMPLOYEE.
Upon the termination of this Agreement as provided in
paragraphs C. through G. of Article V, the Employee may repay to
the Corporation, within sixty (60) days of such termination, an
amount equal to the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Employee) as of the date of the termination of the Agreement.
Upon receipt of such payment from the Employee, the Corporation
shall release the Collateral Assignments by the execution and
delivery of an appropriate instrument(s) of release and shall
deliver the Policies to the Employee.
If the Employee does not repay the Corporation the amount
calculated above within the prescribed time period, the Employee
shall be required to transfer ownership of the Policies to the
Corporation. Except as provided below, if the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement is
less than the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Employee) as of the date of the termination of the Agreement, the
Employee is obligated to reimburse the Corporation for the
difference between (i) the total premiums advanced by the
Corporation (excluding premiums already reimbursed to the
Corporation by the Employee) as of the date of the termination of
the Agreement and (ii) the cash value of the Policies (as may be
enhanced by any cash value enhancement rider in effect) as of the
date of the termination of the Agreement.
If the Corporation terminates the Agreement pursuant to
paragraph G. of Article V of this Agreement, the Employee is not
obligated to reimburse the Corporation for the difference between
(i) the total premiums advanced by the Corporation (excluding
premiums already reimbursed to the Corporation by the Employee)
as of the date of the termination of the Agreement and (ii) the
cash value of the Policies (as may be enhanced by any cash value
enhancement rider in effect) as of the date of the termination of
the Agreement.
<PAGE>
IX. NAMED FIDUCIARY.
The Corporation is hereby designated as the "Named
Fiduciary" under this Agreement. The Named Fiduciary shall have
authority to control and manage the operation and administration
of this Agreement, and it shall be responsible for establishing
and carrying out a funding policy and method consistent with the
objectives of this Agreement.
The Corporation shall, in its discretion, make all
determinations concerning rights to benefits under this
Agreement. Should the Employee or other beneficiary of the
Policies fail to receive benefits to which the Employee (or other
beneficiary) believes he is entitled, a claim may be filed. Any
claim for a benefit due in connection with this Agreement shall
be filed by the Employee or other beneficiary (the "Claimant") by
written communication made by the Claimant or the Claimant's
authorized representative to the Named Fiduciary. All such
claims and notices shall be made in the manner provided in
Article XIII of this Agreement.
If a claim for a benefit is wholly or partially denied, a
written notice of the decision shall be furnished to the Claimant
by the Named Fiduciary or its designee within a reasonable period
of time after receipt of the claim by the Named Fiduciary. The
notice shall include the following information:
a. The specific reason or reasons for the
denial;
b. Specific reference to the pertinent
provisions of this Agreement and/or the Policy
upon which the denial is based;
c. A description of any additional material
or information necessary for the Claimant to
perfect the claim and an explanation of why such
material or information is necessary; and
d. An explanation of all claim review
procedures available under this Agreement.
For purposes of the immediately preceding paragraph, a
period of time shall be deemed to be unreasonable if it exceeds
90 days after receipt of the claim by the Named Fiduciary, unless
special circumstances require an extension of time for processing
the claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished to
the Claimant prior to the termination of the initial 90-day
period. In no event shall such extension exceed a period of 90
days from the end of such initial period. The extension notice
shall indicate the special circumstances requiring an extension
of time and the date by which the Named Fiduciary expects to
render the final decision.
<PAGE>
In order that a Claimant may appeal a denial of claim, a
Claimant or his duly authorized representative may request a
review by written application to the Named Fiduciary or his
designee not later than 60 days after receipt by the Claimant of
written notification of denial of a claim and may submit issues
and comments in writing. A decision on review of a denied claim
shall be made not later than 60 days after the Named Fiduciary's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time,
but not later than 120 days after receipt of a request for
review. The decision on review shall be in writing and shall
include the specific reason(s) for the decision and the specific
reference(s) to the pertinent provisions of this Agreement and/or
the Policies on which the decision is based.
Notwithstanding anything contained in this Article IX to the
contrary, any claim for a death benefit under an insurance policy
listed on Schedule A attached hereto shall be filed with the
Insurer by the Claimant or his authorized representative on the
form or forms prescribed for such purpose by the Insurer. The
Insurer shall be responsible for determining whether a death
claim shall or shall not be paid, either in whole or in part, in
accordance with the terms of the insurance contract purchased on
the life of the Employee.
X. AMENDMENT AND ASSIGNMENT.
The Corporation may, in its sole discretion, alter, amend or
modify (including the addition of any extra Policy provisions)
this Agreement at any time by a written instrument authorized by
the Corporation, or its designee, and delivered to the Employee.
Either party may, subject to the limitations of Article IV,
assign its rights and obligations under this Agreement, provided,
however, that any assignment will be subject to the terms of this
Agreement.
XI. SEVERABILITY.
The invalidity of any provision of this Agreement shall not
affect the validity of any other provision of this Agreement.
XII. POSSESSION OF POLICIES.
The Corporation will maintain possession of the Policies
during the term of this Agreement.
XIII. NOTICE.
All notices, claims, requests and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed by certified or registered mail
to the Corporation as follows: Attention: Corporate Director,
Compensation and Benefits, Reynolds Metals Company, 6601 W. Broad
Street, P.O. Box 27003, Richmond, Virginia 23261-7003 or to
<PAGE>
the Employee at his last known address or at such address as
either party shall designate to the other party in writing.
XIV. GOVERNING LAW.
This Agreement sets forth the entire agreement of the
parties hereto, and any and all prior agreements, to the extent
inconsistent herewith, are hereby superseded. This Agreement
will be governed by the laws of the Commonwealth of Virginia.
XV. INTERPRETATION.
Where appropriate in this Agreement, words used in the
singular will include the plural and words used in the masculine
will include the feminine.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
Reynolds Metals Company
By: _____________________________
Title:___________________________
_________________________________
_________________________, Employee
<PAGE>
LIST OF SCHEDULES
A. Schedule of the Policies
LIST OF EXHIBITS
1. Copies of Insurance Policies
2. Assignments of Life Insurance Death Benefit as
Collateral
<PAGE>
SCHEDULE A
The following life insurance policies are subject to that
certain Split Dollar Life Insurance Agreement dated as
of__________ __, 1995, among Reynolds Metals Company
and___________________.
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
0184942.07
EXHIBIT 10.37
SPLIT DOLLAR LIFE INSURANCE AGREEMENT
[Third Party Owner, Third Party Pays Premiums]
This SPLIT DOLLAR LIFE INSURANCE AGREEMENT (the "Agreement")
is entered into as of this ____ day of __________, 1995, by and
between REYNOLDS METALS COMPANY, a Delaware corporation (the
"Corporation"); _____________, (the "Owner"); and
__________________ (the "Employee").
RECITALS
In recognition of the services of the Employee to the
Corporation, the Corporation has determined that its best
interests would be served by entering into this Split Dollar Life
Insurance Agreement with the Owner, whereby the Corporation will
assist the Owner in maintaining certain life insurance on the
Employee's life, subject to the condition that the Corporation is
to be repaid for any amounts which the Corporation may contribute
toward the payment of any premiums due on such policy.
In furtherance of the purposes of this Agreement, the Owner
will own a policy or policies of life insurance (collectively the
"Policies" and individually the "Policy") issued by Northwestern
Mutual Life Insurance Company (the "Insurer") on the Employee's
life. The Owner's ownership of the Policies shall be subject to
the terms and conditions contained in this Agreement.
AGREEMENT
Now, therefore, the Corporation, the Owner and the Employee
agree as follows:
I. DEATH BENEFIT.
The Owner shall acquire, with the Corporation's assistance,
an insurance policy with a death benefit ("Owner's Death
Benefit") in an amount equal to two times the Employee's "Annual
Earnings." Annual Earnings is defined as the Employee's current
annual base salary plus any amount awarded to the Employee under
a cash incentive plan in the previous calendar year, or such
other definition of Annual Earnings as may be in effect from time
to time under the Corporation's Group Term Life Insurance Plan
for Salaried Employees. The Owner's Death Benefit will be
adjusted annually to reflect any increase in the Employee's
Annual Earnings. The Owner's Death Benefit will increase if the
Employee's Annual Earnings increase. Except as otherwise
provided in this Agreement, the Owner's Death Benefit will not
decrease if the Employee's Annual Earnings decrease.
The Owner's Death Benefit shall be reduced as of each Policy
Release Date, as defined in Article VII of this Agreement, by
that amount equal to the difference between (i) the total
insurance death proceeds of the Released Policy, as defined in
Article VII of this Agreement, as of the Policy Release Date
inclusive of any amounts borrowed against the Released Policy by
the Owner, and (ii) the total premiums advanced by the
Corporation with respect to the Released Policy.
<PAGE>
When the Employee reaches age sixty-five, the Owner's Death
Benefit shall decrease by one percent (the "Reduction Amount") of
the Owner's Death Benefit in effect at that time. The Owner's
Death Benefit will continue to decrease by the Reduction Amount
each month for the next succeeding forty-nine months. During the
fifty month period in which the Owner's Death Benefit is being
reduced by the Reduction Amount, if the Owner's Death Benefit is
also reduced due to a Released Policy pursuant to Article VII of
this Agreement, the Reduction Amount shall be an amount equal to
the previous Reduction Amount multiplied by a fraction. The
numerator of the fraction shall equal the reduction in the
Owner's Death Benefit due to the Released Policy, and the
denominator of the fraction shall equal the Owner's Death Benefit
prior to such reduction in the Owner's Death Benefit.
If the Employee retires prior to the Employee's sixty-fifth
birthday, the Owner's Death Benefit shall increase each year by
five percent of the previous year's Owner's Death Benefit. This
annual five percent increase shall continue until the Employee
reaches age sixty-five.
As the Owner's Death Benefit increases, temporary coverage
for such increase in the Owner's Death Benefit may be provided
for under the Corporation's Group Term Life Insurance Plan for
Salaried Employees until an additional Policy is obtained under
this Agreement.
The Employee may be required to apply and qualify for
additional coverage that may arise due to increases in the
Owner's Death Benefit. If the Employee does not receive
satisfactory underwriting, any increases in the Owner's Death
Benefit will be provided for under the Corporation's Group Term
Life Insurance Plan for Salaried Employees.
Any part of the Owner's Death Benefit paid under the
Corporation's Group Term Life Insurance Plan for Salaried
Employees will be paid to the beneficiary designated under that
plan in accordance with its terms and conditions.
II. RIGHTS IN THE POLICY.
All insurance policies on the life of the Employee that are
subject to this Agreement shall be identified and made part of
this Agreement by their inclusion on the attached Schedule A.
Other insurance policies on the life of the Employee may be made
subject to the terms of this Agreement by amending the
description in Schedule A to include such policies.
The Owner is the owner of the Policies. The Policies are
subject to the terms of this Agreement. The Owner may exercise
all ownership rights granted to the owner by the terms of the
Policies, including without limitation, the right to assign
rights and interests in the Policies, the right to change the
beneficiary of the Policies and the right to exercise any and all
settlement options applicable to the Policies. With written
permission from the Corporation, the Owner may
<PAGE>
borrow against the cash value of the Policies up to the
difference between (i) the cash value of the Policies and (ii)
the total amount of the premiums advanced by the Corporation.
III. PAYMENT OF PREMIUMS.
The Corporation will pay the entire annual premium due on
the Policies (after taking into account any dividends) and will
be reimbursed by the Owner for the Owner's portion of the annual
premium. The Owner is responsible for that portion of the annual
premium which is equal to the lesser of (i) the amount of the
entire economic benefit that would be taxable to the Owner but
for such payment, or (ii) the entire annual premium due on the
Policies (the "Owner's Portion"). The amount of the economic
benefit to the Owner shall be calculated using the lower of the
P.S. 58 rates or the Insurer's term rates in accordance with Rev.
Ruls. 64-328, 1964-2 C.B. 11, and 66-110, 1966-1 C.B. 12, or
their successors, as in effect on the effective date of this
Agreement. The Corporation's portion of the annual premium is
equal to the entire annual premium less the Owner's Portion (the
"Corporation's Portion").
The Owner shall be required to reimburse the Corporation for
the Owner's Portion of the premium within thirty days of the
receipt of a statement from the Corporation or its delegate
requesting such payment. If the Owner does not reimburse the
Corporation within the thirty day period, the Corporation
(without notice to the Employee or Owner) may make monthly or
semi-monthly payroll deductions for any amounts then due and may
continue to make monthly or semi-monthly payroll deductions for
any future Owner's Portion of the premium from the Employee's
salary. The Employee hereby consents to the Corporation making
such monthly or semi-monthly payroll deductions from the
Employee's salary. In no case shall the Corporation be required
to advance the Owner, under this Article III, an amount in excess
of $10,000.00.
IV. COLLATERAL ASSIGNMENT.
All sums advanced by the Corporation to pay the
Corporation's Portion of the annual premiums shall be repayable
to the Corporation as herein provided, notwithstanding
termination of this Agreement. The Owner shall assign the
Policies to the Corporation as security for such advances by
executing an Assignment of Life Insurance Policy as Collateral
(the "Collateral Assignment") for each separate Policy.
Subject to the terms of the Collateral Assignment, the
Corporation shall not possess any incidents of ownership in the
Policies and shall not be entitled to exercise any rights,
privileges or benefits of ownership in the Policies. The Owner
shall possess all incidents of ownership in the Policies.
V. TERMINATION OF AGREEMENT.
This Agreement shall terminate upon the occurrence of any of
the following events:
<PAGE>
A. Performance of its terms, following the death of the
Employee;
B. Upon the Policy Release Date of the last Policy to be
released from this Agreement pursuant to Article VII;
C. The termination of the Employee's employment with the
Corporation for reasons other than total disability (as defined
under the Corporation's Long Term Disability Plan for Salaried
Employees, or any successor plan) or retirement (defined as
termination of employment at a time when the Employee is entitled
to an immediate benefit under the Corporation's New Retirement
Program for Salaried Employees, or any successor plan);
D. Upon the failure of the Owner or Employee to pay on a timely
basis the Owner's Portion of the premiums;
E. Receivership or dissolution of the Corporation;
F. Delivery to the Corporation of a written instrument of
termination signed by the Owner; or
G. Delivery to the Owner of a written instrument of termination
authorized by the Corporation's Board of Directors.
VI. RIGHTS TO THE PROCEEDS AT DEATH.
So long as this Agreement is in effect, the beneficiary
provisions of the Policies shall provide that the death proceeds
due under the Policies shall be distributed to the following
persons in the following order: 1) the Corporation shall receive
an amount equal to the total premiums advanced by the Corporation
(excluding amounts already reimbursed to the Corporation by the
Owner); 2) after the Corporation has received all of the premiums
it advanced as provided above, the Owner's designated beneficiary
shall receive the remaining death proceeds, but in no event shall
the amount paid to the designated beneficiary hereunder exceed an
amount equal to the Owner's Death Benefit; and 3) the Corporation
shall receive the remaining death proceeds, if any.
VII. POLICY RELEASE.
Each separate Policy shall no longer be subject to the terms
of this Agreement upon the later of (i) the Policy's anniversary
date following the Employee's sixty-fifth birthday, or (ii) the
expiration of fifteen policy years commencing on the effective
date of the Policy (the "Policy Release Date"). At this time,
the Owner may repay to the Corporation, within sixty (60) days of
such Policy Release Date, an amount equal to the total premiums
advanced by the Corporation with
<PAGE>
respect to that Policy (the "Released Policy"). Also at this
time, the Owner's Death Benefit will be reduced as provided in
Article I of this Agreement. Upon receipt of such payment from
the Owner, the Corporation shall release the Collateral
Assignment securing the Released Policy by the execution and
delivery of an appropriate instrument(s) of release and shall
deliver the Released Policyto the Owner.
If the Owner does not repay the Corporation the amount
calculated above within the prescribed time period, the Owner
shall be required to transfer ownership of the Released Policy to
the Corporation, and the Owner's Death Benefit will be reduced as
provided in Article I of this Agreement. If the cash value of
the Released Policy as of the Policy Release Date is less than
the total premiums advanced by the Corporation with respect to
the Released Policy as of the Policy Release Date, the Owner, and
otherwise the Employee, is obligated to reimburse the Corporation
for the difference between (i) the total premiums advanced by the
Corporation with respect to the Released Policy as of the Policy
Release Date and (ii) the cash value of the Released Policy as of
the Policy Release Date.
VIII. RIGHTS UPON TERMINATION OF THE AGREEMENT OTHER THAN
DEATH OF THE EMPLOYEE.
Upon the termination of this Agreement as provided in
paragraphs C. through G. of Article V, the Owner may repay to the
Corporation, within sixty (60) days of such termination, an
amount equal to the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Owner) as of the date of the termination of the Agreement. Upon
receipt of such payment from the Owner, the Corporation shall
release the Collateral Assignments by the execution and delivery
of an appropriate instrument(s) of release and shall deliver the
Policies to the Owner.
If the Owner does not repay the Corporation the amount
calculated above within the prescribed time period, the Owner
shall be required to transfer ownership of the Policies to the
Corporation. Except as provided below, if the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement is
less than the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Owner) as of the date of the termination of the Agreement, the
Owner, and otherwise the Employee, is obligated to reimburse the
Corporation for the difference between (i) the total premiums
advanced by the Corporation (excluding premiums already
reimbursed to the Corporation by the Owner) as of the date of the
termination of the Agreement and (ii) the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement.
If the Corporation terminates the Agreement pursuant to
paragraph G. of Article V of this Agreement, the Owner and
Employee are not obligated to reimburse the Corporation for the
difference between (i) the total premiums advanced by the
Corporation (excluding premiums
<PAGE>
already reimbursed to the Corporation by the Owner) as of the
date of the termination of the Agreement and (ii) the cash value
of the Policies (as may be enhanced by any cash value enhancement
rider in effect) as of the date of the termination of the
Agreement.
IX. NAMED FIDUCIARY.
The Corporation is hereby designated as the "Named
Fiduciary" under this Agreement. The Named Fiduciary shall have
authority to control and manage the operation and administration
of this Agreement, and it shall be responsible for establishing
and carrying out a funding policy and method consistent with the
objectives of this Agreement.
The Corporation shall, in its discretion, make all
determinations concerning rights to benefits under this
Agreement. Should the Owner or other beneficiary of the Policies
fail to receive benefits to which the Owner (or other
beneficiary) believes he is entitled, a claim may be filed. Any
claim for a benefit due in connection with this Agreement shall
be filed by the Owner or other beneficiary (the "Claimant") by
written communication made by the Claimant or the Claimant's
authorized representative to the Named Fiduciary. All such
claims and notices shall be made in the manner provided in
Article XIII of this Agreement.
If a claim for a benefit is wholly or partially denied, a
written notice of the decision shall be furnished to the Claimant
by the Named Fiduciary or its designee within a reasonable period
of time after receipt of the claim by the Named Fiduciary. The
notice shall include the following information:
a. The specific reason or reasons for the
denial;
b. Specific reference to the pertinent
provisions of this Agreement and/or the Policy
upon which the denial is based;
c. A description of any additional material
or information necessary for the Claimant to
perfect the claim and an explanation of why such
material or information is necessary; and
d. An explanation of all claim review
procedures available under this Agreement.
For purposes of the immediately preceding paragraph, a
period of time shall be deemed to be unreasonable if it exceeds
90 days after receipt of the claim by the Named Fiduciary, unless
special circumstances require an extension of time for processing
the claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished to
the Claimant prior to the termination of the initial 90-day
period. In no event shall such extension exceed a period of 90
days from the end of such initial period. The extension notice
shall indicate the special
<PAGE>
circumstances requiring an extension of time and the date by
which the Named Fiduciary expects to render the final decision.
In order that a Claimant may appeal a denial of claim, a
Claimant or his duly authorized representative may request a
review by written application to the Named Fiduciary or his
designee not later than 60 days after receipt by the Claimant of
written notification of denial of a claim and may submit issues
and comments in writing. A decision on review of a denied claim
shall be made not later than 60 days after the Named Fiduciary's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time,
but not later than 120 days after receipt of a request for
review. The decision on review shall be in writing and shall
include the specific reason(s) for the decision and the specific
reference(s) to the pertinent provisions of this Agreement and/or
the Policies on which the decision is based.
Notwithstanding anything contained in this Article IX to the
contrary, any claim for a death benefit under an insurance policy
listed on Schedule A attached hereto shall be filed with the
Insurer by the Claimant or his authorized representative on the
form or forms prescribed for such purpose by the Insurer. The
Insurer shall be responsible for determining whether a death
claim shall or shall not be paid, either in whole or in part, in
accordance with the terms of the insurance contract purchased on
the life of the Employee.
X. AMENDMENT AND ASSIGNMENT.
The Corporation may, in its sole discretion, alter, amend or
modify (including the addition of any extra Policy provisions)
this Agreement at any time by a written instrument authorized by
the Corporation, or its designee, and delivered to the Owner and
Employee. The Corporation or the Owner may, subject to the
limitations of Article IV, assign its rights and obligations
under this Agreement, provided, however, that any assignment will
be subject to the terms of this Agreement.
XI. SEVERABILITY.
The invalidity of any provision of this Agreement shall not
affect the validity of any other provision of this Agreement.
XII. POSSESSION OF POLICIES.
The Corporation will maintain possession of the Policies
during the term of this Agreement.
XIII. NOTICE.
All notices, claims, requests and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed by certified or registered mail
to the
<PAGE>
Corporation as follows: Attention: Corporate Director,
Compensation and Benefits, Reynolds Metals Company, 6601 W. Broad
Street, P.O. Box 27003, Richmond, Virginia 23261-7003 or to the
Owner and Employee at their last known addresses or at such
addresses as any party shall designate to the other parties in
writing.
XIV. GOVERNING LAW.
This Agreement sets forth the entire agreement of the
parties hereto, and any and all prior agreements, to the extent
inconsistent herewith, are hereby superseded. This Agreement
will be governed by the laws of the Commonwealth of Virginia.
XV. INTERPRETATION.
Where appropriate in this Agreement, words used in the
singular will include the plural and words used in the masculine
will include the feminine.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
Reynolds Metals Company
By: ______________________________
Title:____________________________
__________________________________
_________________________, Owner
__________________________________
_________________________, Employee
<PAGE>
LIST OF SCHEDULES
A. Schedule of the Policies
LIST OF EXHIBITS
1. Copies of Insurance Policies
2. Assignments of Life Insurance Death Benefit as
Collateral
<PAGE>
SCHEDULE A
The following life insurance policies are subject to that
certain Split Dollar Life Insurance Agreement dated as
of__________ __, 1995, among Reynolds Metals Company,
________________, Owner and ___________________.
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
0199558.01
EXHIBIT 10.38
SPLIT DOLLAR LIFE INSURANCE AGREEMENT
[Third Party Owner, Employee Pays Premiums]
This SPLIT DOLLAR LIFE INSURANCE AGREEMENT (the "Agreement")
is entered into as of this ____ day of __________, 1995, by and
between REYNOLDS METALS COMPANY, a Delaware corporation (the
"Corporation"); _____________, (the "Owner"); and
__________________ (the "Employee").
RECITALS
In recognition of the services of the Employee to the
Corporation, the Corporation has determined that its best
interests would be served by entering into this Split Dollar Life
Insurance Agreement with the Owner, whereby the Corporation will
assist the Owner in maintaining certain life insurance on the
Employee's life, subject to the condition that the Corporation is
to be repaid for any amounts which the Corporation may contribute
toward the payment of any premiums due on such policy.
In furtherance of the purposes of this Agreement, the Owner
will own a policy or policies of life insurance (collectively the
"Policies" and individually the "Policy") issued by Northwestern
Mutual Life Insurance Company (the "Insurer") on the Employee's
life. The Owner's ownership of the Policies shall be subject to
the terms and conditions contained in this Agreement.
AGREEMENT
Now, therefore, the Corporation, the Owner and the Employee
agree as follows:
I. DEATH BENEFIT.
The Owner shall acquire, with the Corporation's assistance,
an insurance policy with a death benefit ("Owner's Death
Benefit") in an amount equal to two times the Employee's "Annual
Earnings." Annual Earnings is defined as the Employee's current
annual base salary plus any amount awarded to the Employee under
a cash incentive plan in the previous calendar year, or such
other definition of Annual Earnings as may be in effect from time
to time under the Corporation's Group Term Life Insurance Plan
for Salaried Employees. The Owner's Death Benefit will be
adjusted annually to reflect any increase in the Employee's
Annual Earnings. The Owner's Death Benefit will increase if the
Employee's Annual Earnings increase. Except as otherwise
provided in this Agreement, the Owner's Death Benefit will not
decrease if the Employee's Annual Earnings decrease.
The Owner's Death Benefit shall be reduced as of each Policy
Release Date, as defined in Article VII of this Agreement, by
that amount equal to the difference between (i) the total
insurance death proceeds of the Released Policy, as defined in
Article VII of this Agreement, as of the Policy Release Date
inclusive of any amounts borrowed against the Released Policy by
the Owner, and (ii) the total premiums advanced by the
Corporation with respect to the Released Policy.
<PAGE>
When the Employee reaches age sixty-five, the Owner's Death
Benefit shall decrease by one percent (the "Reduction Amount") of
the Owner's Death Benefit in effect at that time. The Owner's
Death Benefit will continue to decrease by the Reduction Amount
each month for the next succeeding forty-nine months. During the
fifty month period in which the Owner's Death Benefit is being
reduced by the Reduction Amount, if the Owner's Death Benefit is
also reduced due to a Released Policy pursuant to Article VII of
this Agreement, the Reduction Amount shall be an amount equal to
the previous Reduction Amount multiplied by a fraction. The
numerator of the fraction shall equal the reduction in the
Owner's Death Benefit due to the Released Policy, and the
denominator of the fraction shall equal the Owner's Death Benefit
prior to such reduction in the Owner's Death Benefit.
If the Employee retires prior to the Employee's sixty-fifth
birthday, the Owner's Death Benefit shall increase each year by
five percent of the previous year's Owner's Death Benefit. This
annual five percent increase shall continue until the Employee
reaches age sixty-five.
As the Owner's Death Benefit increases, temporary coverage
for such increase in the Owner's Death Benefit may be provided
for under the Corporation's Group Term Life Insurance Plan for
Salaried Employees until an additional Policy is obtained under
this Agreement.
The Employee may be required to apply and qualify for
additional coverage that may arise due to increases in the
Owner's Death Benefit. If the Employee does not receive
satisfactory underwriting, any increases in the Owner's Death
Benefit will be provided for under the Corporation's Group Term
Life Insurance Plan for Salaried Employees.
Any part of the Owner's Death Benefit paid under the
Corporation's Group Term Life Insurance Plan for Salaried
Employees will be paid to the beneficiary designated under that
plan in accordance with its terms and conditions.
II. RIGHTS IN THE POLICY.
All insurance policies on the life of the Employee that are
subject to this Agreement shall be identified and made part of
this Agreement by their inclusion on the attached Schedule A.
Other insurance policies on the life of the Employee may be made
subject to the terms of this Agreement by amending the
description in Schedule A to include such policies.
The Owner is the owner of the Policies. The Policies are
subject to the terms of this Agreement. The Owner may exercise
all ownership rights granted to the owner by the terms of the
Policies, including without limitation, the right to assign
rights and interests in the Policies, the right to change the
beneficiary of the Policies and the right to exercise any and all
settlement options applicable to the Policies. With written
permission from the Corporation, the Owner may
<PAGE>
borrow against the cash value of the Policies up to the
difference between (i) the cash value of the Policies and (ii)
the total amount of the premiums advanced by the Corporation.
III. PAYMENT OF PREMIUMS.
The Corporation will pay the entire annual premium due on
the Policies (after taking into account any dividends) and will
be reimbursed by the Employee for the Owner's portion of the
annual premium. The Employee is responsible for that portion of
the annual premium which is equal to the lesser of (i) the amount
of the entire economic benefit that would be taxable to the Owner
but for such payment, or (ii) the entire annual premium due on
the Policies (the "Owner's Portion"). The amount of the economic
benefit to the Owner shall be calculated using the lower of the
P.S. 58 rates or the Insurer's term rates in accordance with Rev.
Ruls. 64-328, 1964-2 C.B. 11, and 66-110, 1966-1 C.B. 12, or
their successors, as in effect on the effective date of this
Agreement. The Corporation's portion of the annual premium is
equal to the entire annual premium less the Owner's Portion (the
"Corporation's Portion").
The Employee hereby consents to the Corporation making
monthly or semi-monthly payroll deductions of the Owner's Portion
of the premium from the Employee's salary. In no case shall the
Corporation be required to advance the Owner, under this Article
III, an amount in excess of $10,000.00.
IV. COLLATERAL ASSIGNMENT.
All sums advanced by the Corporation to pay the
Corporation's Portion of the annual premiums shall be repayable
to the Corporation as herein provided, notwithstanding
termination of this Agreement. The Owner shall assign the
Policies to the Corporation as security for such advances by
executing an Assignment of Life Insurance Policy as Collateral
(the "Collateral Assignment") for each separate Policy.
Subject to the terms of the Collateral Assignment, the
Corporation shall not possess any incidents of ownership in the
Policies and shall not be entitled to exercise any rights,
privileges or benefits of ownership in the Policies. The Owner
shall possess all incidents of ownership in the Policies.
V. TERMINATION OF AGREEMENT.
This Agreement shall terminate upon the occurrence of any of
the following events:
A. Performance of its terms, following the death of the
Employee;
B. Upon the Policy Release Date of the last Policy to be
released from this Agreement pursuant to Article VII;
<PAGE>
C. The termination of the Employee's employment with the
Corporation for reasons other than total disability (as defined
under the Corporation's Long Term Disability Plan for Salaried
Employees, or any successor plan) or retirement (defined as
termination of employment at a time when the Employee is entitled
to an immediate benefit under the Corporation's New Retirement
Program for Salaried Employees, or any successor plan);
D. Upon the failure of the Employee to pay on a timely basis
the Owner's Portion of the premiums;
E. Receivership or dissolution of the Corporation;
F. Delivery to the Corporation of a written instrument of
termination signed by the Owner; or
G. Delivery to the Owner of a written instrument of termination
authorized by the Corporation's Board of Directors.
VI. RIGHTS TO THE PROCEEDS AT DEATH.
So long as this Agreement is in effect, the beneficiary
provisions of the Policies shall provide that the death proceeds
due under the Policies shall be distributed to the following
persons in the following order: 1) the Corporation shall receive
an amount equal to the total premiums advanced by the Corporation
(excluding amounts already reimbursed to the Corporation by the
Owner); 2) after the Corporation has received all of the premiums
it advanced as provided above, the Owner's designated beneficiary
shall receive the remaining death proceeds, but in no event shall
the amount paid to the designated beneficiary hereunder exceed an
amount equal to the Owner's Death Benefit; and 3) the Corporation
shall receive the remaining death proceeds, if any.
VII. POLICY RELEASE.
Each separate Policy shall no longer be subject to the terms
of this Agreement upon the later of (i) the Policy's anniversary
date following the Employee's sixty-fifth birthday, or (ii) the
expiration of fifteen policy years commencing on the effective
date of the Policy (the "Policy Release Date"). At this time,
the Owner may repay to the Corporation, within sixty (60) days of
such Policy Release Date, an amount equal to the total premiums
advanced by the Corporation with respect to that Policy (the
"Released Policy"). Also at this time, the Owner's Death Benefit
will be reduced as provided in Article I of this Agreement. Upon
receipt of such payment from the Owner, the Corporation shall
release the Collateral Assignment securing the Released Policy by
the execution and delivery of an appropriate instrument(s) of
release and shall deliver the Released Policy to the Owner.
<PAGE>
If the Owner does not repay the Corporation the amount
calculated above within the prescribed time period, the Owner
shall be required to transfer ownership of the Released Policy to
the Corporation, and the Owner's Death Benefit will be reduced as
provided in Article I of this Agreement. If the cash value of
the Released Policy as of the Policy Release Date is less than
the total premiums advanced by the Corporation with respect to
the Released Policy as of the Policy Release Date, the Owner, and
otherwise the Employee, is obligated to reimburse the Corporation
for the difference between (i) the total premiums advanced by the
Corporation with respect to the Released Policy as of the Policy
Release Date and (ii) the cash value of the Released Policy as of
the Policy Release Date.
VIII. RIGHTS UPON TERMINATION OF THE AGREEMENT OTHER THAN
DEATH OF THE EMPLOYEE.
Upon the termination of this Agreement as provided in
paragraphs C. through G. of Article V, the Owner may repay to the
Corporation, within sixty (60) days of such termination, an
amount equal to the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Owner) as of the date of the termination of the Agreement. Upon
receipt of such payment from the Owner, the Corporation shall
release the Collateral Assignments by the execution and delivery
of an appropriate instrument(s) of release and shall deliver the
Policies to the Owner.
If the Owner does not repay the Corporation the amount
calculated above within the prescribed time period, the Owner
shall be required to transfer ownership of the Policies to the
Corporation. Except as provided below, if the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement is
less than the total premiums advanced by the Corporation
(excluding premiums already reimbursed to the Corporation by the
Owner) as of the date of the termination of the Agreement, the
Owner, and otherwise the Employee, is obligated to reimburse the
Corporation for the difference between (i) the total premiums
advanced by the Corporation (excluding premiums already
reimbursed to the Corporation by the Owner) as of the date of the
termination of the Agreement and (ii) the cash value of the
Policies (as may be enhanced by any cash value enhancement rider
in effect) as of the date of the termination of the Agreement.
If the Corporation terminates the Agreement pursuant to
paragraph G. of Article V of this Agreement, the Owner and
Employee are not obligated to reimburse the Corporation for the
difference between (i) the total premiums advanced by the
Corporation (excluding premiums already reimbursed to the
Corporation by the Owner) as of the date of the termination of
the Agreement and (ii) the cash value of the Policies (as may be
enhanced by any cash value enhancement rider in effect) as of the
date of the termination of the Agreement.
<PAGE>
IX. NAMED FIDUCIARY.
The Corporation is hereby designated as the "Named
Fiduciary" under this Agreement. The Named Fiduciary shall have
authority to control and manage the operation and administration
of this Agreement, and it shall be responsible for establishing
and carrying out a funding policy and method consistent with the
objectives of this Agreement.
The Corporation shall, in its discretion, make all
determinations concerning rights to benefits under this
Agreement. Should the Owner or other beneficiary of the Policies
fail to receive benefits to which the Owner (or other
beneficiary) believes he is entitled, a claim may be filed. Any
claim for a benefit due in connection with this Agreement shall
be filed by the Owner or other beneficiary (the "Claimant") by
written communication made by the Claimant or the Claimant's
authorized representative to the Named Fiduciary. All such
claims and notices shall be made in the manner provided in
Article XIII of this Agreement.
If a claim for a benefit is wholly or partially denied, a
written notice of the decision shall be furnished to the Claimant
by the Named Fiduciary or its designee within a reasonable period
of time after receipt of the claim by the Named Fiduciary. The
notice shall include the following information:
a. The specific reason or reasons for the
denial;
b. Specific reference to the pertinent
provisions of this Agreement and/or the Policy
upon which the denial is based;
c. A description of any additional material
or information necessary for the Claimant to
perfect the claim and an explanation of why such
material or information is necessary; and
d. An explanation of all claim review
procedures available under this Agreement.
For purposes of the immediately preceding paragraph, a
period of time shall be deemed to be unreasonable if it exceeds
90 days after receipt of the claim by the Named Fiduciary, unless
special circumstances require an extension of time for processing
the claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished to
the Claimant prior to the termination of the initial 90-day
period. In no event shall such extension exceed a period of 90
days from the end of such initial period. The extension notice
shall indicate the special circumstances requiring an extension
of time and the date by which the Named Fiduciary expects to
render the final decision.
<PAGE>
In order that a Claimant may appeal a denial of claim, a
Claimant or his duly authorized representative may request a
review by written application to the Named Fiduciary or his
designee not later than 60 days after receipt by the Claimant of
written notification of denial of a claim and may submit issues
and comments in writing. A decision on review of a denied claim
shall be made not later than 60 days after the Named Fiduciary's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time,
but not later than 120 days after receipt of a request for
review. The decision on review shall be in writing and shall
include the specific reason(s) for the decision and the specific
reference(s) to the pertinent provisions of this Agreement and/or
the Policies on which the decision is based.
Notwithstanding anything contained in this Article IX to the
contrary, any claim for a death benefit under an insurance policy
listed on Schedule A attached hereto shall be filed with the
Insurer by the Claimant or his authorized representative on the
form or forms prescribed for such purpose by the Insurer. The
Insurer shall be responsible for determining whether a death
claim shall or shall not be paid, either in whole or in part, in
accordance with the terms of the insurance contract purchased on
the life of the Employee.
X. AMENDMENT AND ASSIGNMENT.
The Corporation may, in its sole discretion, alter, amend or
modify (including the addition of any extra Policy provisions)
this Agreement at any time by a written instrument authorized by
the Corporation, or its designee, and delivered to the Owner and
Employee. The Corporation or the Owner may, subject to the
limitations of Article IV, assign its rights and obligations
under this Agreement, provided, however, that any assignment will
be subject to the terms of this Agreement.
XI. SEVERABILITY.
The invalidity of any provision of this Agreement shall not
affect the validity of any other provision of this Agreement.
XII. POSSESSION OF POLICIES.
The Corporation will maintain possession of the Policies
during the term of this Agreement.
XIII. NOTICE.
All notices, claims, requests and other communications
hereunder shall be in writing and shall be deemed to have been
duly given if delivered or mailed by certified or registered mail
to the Corporation as follows: Attention: Corporate Director,
Compensation and Benefits, Reynolds Metals Company, 6601 W. Broad
Street, P.O. Box 27003, Richmond, Virginia 23261-7003 or to
<PAGE>
the Owner and Employee at their last known addresses or at such
addresses as any party shall designate to the other parties in
writing.
XIV. GOVERNING LAW.
This Agreement sets forth the entire agreement of the
parties hereto, and any and all prior agreements, to the extent
inconsistent herewith, are hereby superseded. This Agreement
will be governed by the laws of the Commonwealth of Virginia.
XV. INTERPRETATION.
Where appropriate in this Agreement, words used in the
singular will include the plural and words used in the masculine
will include the feminine.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the day and year first above written.
Reynolds Metals Company
By: ______________________________
Title:____________________________
__________________________________
_________________________, Owner
__________________________________
_________________________, Employee
<PAGE>
LIST OF SCHEDULES
A. Schedule of the Policies
LIST OF EXHIBITS
1. Copies of Insurance Policies
2. Assignments of Life Insurance Death Benefit as
Collateral
<PAGE>
SCHEDULE A
The following life insurance policies are subject to that
certain Split Dollar Life Insurance Agreement dated as
of__________ __, 1995, among Reynolds Metals Company,
________________, Owner and___________________.
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
Insurer: Northwestern Mutual Life Insurance Company
Insured:
Policy Number:
Face Amount:
Date of Issue:
0199846.01
<PAGE>
EXHIBIT 11
REYNOLDS METALS COMPANY AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
(In millions, except per share data)
EARNINGS PER SHARE
In the second quarter and six months of 1995, earnings per share
equals net income divided by the weighted-average number of
common shares and common share equivalents outstanding during the
period. The number of common share equivalents outstanding was
based on the assumed conversion of the Company's preferred stock
("PRIDES"). For the purpose of this computation, the conversion
rates of common stock for each share of PRIDES were based on the
average market value of the Company's common stock during the
period. In the second quarter and six months of 1994, earnings
per share equals net income, minus PRIDES dividends, divided by
the weighted-average number of common shares outstanding during
the period. Common share equivalents relating to the PRIDES were
not included in the second quarter or six months of 1994 since
their effect would have been anti-dilutive.
<TABLE>
<CAPTION>
QUARTERS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
_______________________ ________________________
1995 1994 1995 1994
_______________________ ________________________
<S> <C> <C> <C> <C>
Weighted-average shares outstanding:
Common shares 62,926,000 61,971,000 62,573,000 61,466,000
Common share equivalents 10,518,000 - 10,388,000 -
_______________________ ________________________
Total 73,444,000 61,971,000 72,961,000 61,466,000
======================= ========================
Net income (loss) $111 $12 $193 $(9)
Less preferred stock dividends - 9 - 16
_______________________ ________________________
$111 $3 $193 $(25)
======================= ========================
Earnings per share $1.51 $0.05 $2.64 $(0.41)
======================= ========================
Conversion rate 0.96 - 0.94 -
Average market value of common stock $49.41 - $50.03 -
</TABLE>
EARNINGS PER SHARE (FULLY DILUTED):
Earnings per share (fully diluted) equals net income divided by
the weighted-average number of common shares and common share
equivalents outstanding during the period. The number of common
share equivalents outstanding was based on the maximum potential
issuance of common shares upon conversion of PRIDES, which is one
share of common for each share of PRIDES. This computation was
made for presentation purposes only since its effect was not
material in 1995 and was anti-dilutive in 1994. The difference
between the number of common share equivalents for the six months
ended June 30, 1995 and 1994 is due to the PRIDES having been
issued on January 25, 1994.
<TABLE>
<CAPTION>
QUARTERS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
_________________________ ________________________
1995 1994 1995 1994
_________________________ ________________________
<S> <C> <C> <C> <C>
Weighted-average shares outstanding:
Common shares 62,926,000 61,971,000 62,573,000 61,466,000
Common share equivalents 11,000,000 11,000,000 11,000,000 9,533,000
________________________ ________________________
Total 73,926,000 72,971,000 73,573,000 70,999,000
======================== ========================
Net income (loss) $111 $12 $193 $(9)
======================== ========================
Earnings per share (fully diluted) $1.50 $0.16 $2.62 $(0.13)
======================== ========================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the Reynolds
Metals Company Condensed Consolidated Balance Sheet (Unaudited) for June 30,
1995 and Consolidated Statement of Income (Unaudited) for the Six Months ended
June 30, 1995 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1000000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 41
<SECURITIES> 71
<RECEIVABLES> 1178<F1>
<ALLOWANCES> 21
<INVENTORY> 1042
<CURRENT-ASSETS> 2381
<PP&E> 6471
<DEPRECIATION> 3326
<TOTAL-ASSETS> 7617
<CURRENT-LIABILITIES> 1428
<BONDS> 1868
<COMMON> 918
0
505
<OTHER-SE> 1063
<TOTAL-LIABILITY-AND-EQUITY> 7617
<SALES> 3515
<TOTAL-REVENUES> 3535
<CGS> 2952
<TOTAL-COSTS> 2952
<OTHER-EXPENSES> 220
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 87
<INCOME-PRETAX> 276
<INCOME-TAX> 83
<INCOME-CONTINUING> 193
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 193
<EPS-PRIMARY> 2.64
<EPS-DILUTED> 0
<FN>
<F1>This amount represents total receivables, since trade receivables are not
broken out separately at interim dates, in accordance with S-X 10-01(2).
</FN>
</TABLE>
