Document:

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EXHIBIT 10.6

REMINGTON OIL AND GAS CORPORATION

EMPLOYEE SEVERANCE PLAN

 

 

I.

DEFINITIONS AND CONSTRUCTION

      1.1 Definitions. Where the following words and phrases appear in the Plan, they shall
have the respective meanings set forth below, unless their context clearly indicates to the
contrary.

      (a) “Base Salary” shall mean the annual rate of base compensation paid by the Company
to a Covered Employee (including amounts which the Covered Employee could have received in
cash had he not elected to contribute to an employee benefit plan maintained by the
Company), excluding overtime pay, bonuses, employee benefits, automobile allowances, added
premiums, differentials, and all forms of incentive compensation. Base Salary shall be
determined effective as of the date of the Covered Employee’s termination. A “Month’s Base
Pay” shall mean Base Salary divided by twelve.

      (b) “Change of Control” shall be deemed to have occurred upon any of the following
events:

      (1) A merger or consolidation to which the Company is a part if the individuals
and entities who were stockholders of the Company immediately prior to the effective
date of such a merger or consolidation have beneficial ownership (as defined in Rule
13d-3 under the Exchange Act) of less than 50% of the total combined voting power
for election of directors of the surviving corporation following the effective date
of such merger or consolidation;

      (2) The acquisition or holding of direct or indirect beneficial ownership (as
defined under Rule 13d-3 of the Exchange Act) of securities of the Company
representing the aggregate 30% or more of the total combined voting power of the
Company’s then issued and outstanding voting securities by any person, entity or
group of associated persons or entities acting in concert, other than an employee
benefit plan of the Company or of any subsidiary of the Company, or any entity
holding such securities for or pursuant to the terms of any such plan. The
Directors may, by a majority vote, determine the acquisition of 30%-49.9% is not a
hostile action and therefore does not trigger a change of control.

      (3) The sale of all or substantially all of the assets of the Company to any
person or entity that is not a wholly owned subsidiary of the Company; or

      (4) The approval by the stockholders of the Company of any plan or proposal for
the liquidation of the Company or its material subsidiaries, other than into the
Company.

      (c) “Code” means the Internal Revenue Code of 1986 as amended.

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      (d) “Committee” shall mean the committee appointed by the Company to administer the
Plan.

      (e) “Covered Employee” shall mean any individual who is a regular full-time employee of
the Company on the Effective Date of the Plan, or any individual employed as a regular
full-time employee of the Company after the Effective Date of the Plan who has completed six
months of service. “Covered Employee” shall not include the Chief Executive Officer, the
Chief Operating Officer or any other employee who is eligible for severance under any other
contract or arrangement with the Company.

      (f) “Effective Date” shall mean January 1, 2005.

      (g) “Company” shall mean Remington Oil and Gas Corporation.

      (h) “Directors” shall mean the Board of Directors of the Company.

      (i) “Disability” shall mean as to exempt and non-exempt employees a condition entitling
the Covered Employee to benefits under the Company’s short-term or long-term disability plan
and as to officers and selected exempt employees shall mean a physical or mental infirmity
which impairs the Covered Employee’s ability to substantially perform the Covered Employee’s
duties, which continues for a period of at least one hundred eighty (180) continuous days.

      (j) “Good Reason” shall mean the occurrence after a Change in Control of any of the
following events or conditions: (1) a reduction in the Covered Employee’s combined Base
Salary and bonus opportunity of more than 10%, (2) a material reduction in benefits without
substitution of benefits that are substantially comparable in the aggregate, or (3) the
permanent relocation of a Covered Employee’s principal place of employment with the Company
to a location that is more than 40 miles from such Covered Employee’s prior principal place
of employment.

      (k) “Involuntary Termination” shall mean any termination, on or after the Effective
Date, of a Covered Employee’s employment with the Company which does not result from a
voluntary resignation or retirement by the Covered Employee; provided, however, the term
“Involuntary Termination” shall not include:

      (1) a Termination for Cause;

      (2) a termination as a result of the Covered Employee’s death;

      (3) any termination as the result of the Covered
Employee’s Disability;

      (4) a termination by the Covered Employee for Good Reason; or

      (5) any termination which the Company expects to be of short duration and
pursuant to which the Covered Employee is subject to reemployment with the Company
within a reasonable period of time (as determined by the Committee).

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      (l) “Plan” shall mean the Remington Oil and Gas Corporation Employee Severance Plan.

      (m) “Termination for Cause” shall mean any termination of a Covered Employee’s
employment with the Company by reason of the Covered Employee’s (1) conviction of any felony
or of a misdemeanor involving moral turpitude, (2) material failure to perform his duties or
responsibilities in a manner satisfactory to the Company, (3) engagement in conduct which is
injurious (monetarily or otherwise) to the Company or any of its affiliates (including,
without limitation, misuse of the Company’s or an affiliate’s funds or other property), (4)
engagement in business activities which are in conflict with the business interests of the
Company, (5) insubordination, (6) engagement in conduct which is in violation of the
Company’s safety rules or standards or which otherwise causes injury to another employee or
any other person, (7) engagement in conduct which is in violation of any policy or work rule
of the Company or (8) engagement in conduct which is in violation of the Company’s
guidelines for appropriate employee conduct or which is otherwise inappropriate in the
office or work environment. Termination for Cause shall be determined in the sole
good-faith discretion of the Committee.

      (n) “Year of Service” shall mean, with respect to a particular Covered Employee, each
full year of such Covered Employee’s continuous employment by the Company from his most
recent date of hire to the date his employment is subject to an Involuntary Termination.

      1.2 Number and Gender. Wherever appropriate herein, word used in the singular shall
be considered to include the plural and the plural to include the singular. The masculine gender,
where appearing in this Plan, shall be deemed to include the feminine gender.

      1.3 Headings. The headings of Articles and Sections herein are included solely for
convenience and if there is any conflict between such headings and the text of the Plan, the text
shall control.

II.

SEVERANCE BENEFITS 

      2.1 Severance Benefits. Subject to the provisions of Section 2.2 hereof, if a Covered
Employee’s employment by the Company is terminated and such Covered Employee is not entitled to
severance benefits under an individual contract, agreement or arrangement, or if such Covered
Employee waives his rights to any severance benefits to which he may be entitled under an
individual contract, agreement or arrangement, then the Covered Employee shall be entitled to
severance benefits as provided in this Section 2.1. A Covered Employee’s entitlement to severance
benefits under the Plan depends upon the Covered Employee’s employment classification and the
circumstance of the Covered Employee’s termination of employment. Upon termination of the Covered
Employee’s employment, the Covered Employee shall be entitled to the severance benefits as follows:

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      (A) Officers and Selected Exempt Employees. With respect to a particular Covered Employee who
is classified by the Company as an officer or is classified by the Company as an exempt employee
and is selected by the Committee for purposes of the Plan, the Covered Employee will be entitled to
severance benefits as follows:

         (1) If the Covered Employee’s employment with the Company is terminated by reason of the
Covered Employee’s death or Disability, the Company shall pay the Covered Employee or the Covered
Employee’s beneficiaries the Covered Employee’s accrued Base Salary through the termination date
and, in addition thereto, an amount equal to the Covered Employee’s target bonus multiplied by a
fraction, the numerator of which is the number of days in such plan year through termination date
and the denominator of which is 365.

         (2) If the Covered Employee’s employment with the Company is subject to an Involuntary
Termination not in connection with a Change of Control, the Covered Employee shall be entitled to
the following: (a) the Company shall pay the Covered Employee a lump sum cash payment, as soon as administratively feasible after the
Covered Employee’s termination, an amount equal to 1 times the sum of (i) the Covered Employee’s
then current Base Salary and (ii) the Covered Employee’s average annual incentive bonus paid during
the last three years, (b) all stock options, restricted stock and other equity compensation awards
granted the Covered Employee shall be subject to the terms of the grant agreement, other signed
agreements and plan under which they were granted (c) for a term of one (1) year following the
termination date, or until the Covered Employee gains new employment with substantially similar
benefits, the Company, at its expense, shall provide the Covered Employee and his or her immediate
family the same level of group medical and dental benefits as provided to active employees, (d) the
Company shall provide the Covered Employee twelve (12) months of out placement services at the
Company’s sole expense, and (e) all non-qualified deferred compensation benefits of the Covered
Employee shall be immediately vested and subject to an immediate distribution; provided, however,
that if the Covered Employee is a key employee (as defined in section 416(i) or the Code without
regard to paragraph (5) thereof) of the Company and the Company’s stock is publicly traded on an
established securities market or otherwise, then any amounts described above which are “deferred
compensation” under section 409A of the Code shall not be paid or commence until the date that is
six (6) months after the termination date. The provision of group medical and dental benefits shall
start and run concurrently with any continuation coverage as may be elected by the Covered Employee
under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”).

         (3) If the Covered Employee’s employment with Company is subject to an Involuntary
Termination within two (2) years following a Change of Control, or if the Covered Employee
terminates his employment with the Company for Good Reason within two (2) years following a Change
of Control: (a) the Company shall pay the Covered Employee a lump sum cash payment, as soon as administratively feasible after the Covered
Employee’s termination, an amount equal to 2 times the sum of (i) the Covered Employee’s then
current Base Salary and (ii) the Covered Employee’s maximum annual incentive opportunity, (b) all
stock options, restricted stock and other equity compensation awards granted the Covered Employee
shall be subject to the terms of the grant agreement and plan under which they were granted (c) for
a term of two (2) years following the termination date, or until the Covered Employee gains new
employment with substantially similar benefits,

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the Company, at its expense, shall provide the Covered Employee and his or her immediate family the
same level of group medical and dental benefits as provided to active employees (d) the Company
shall provide the Covered Employee twelve (12) months of out placement services at the Company’s
sole expense, and (e) all non-qualified deferred compensation benefits of the Covered Employee
shall be immediately vested and subject to an immediate distribution; provided, however, that if
the Covered Employee is a key employee (as defined in section 416(i) or the Code without regard to
paragraph (5) thereof) of the Company and the Company’s stock is publicly traded on an established
securities market or otherwise, then any amounts described above which are “deferred compensation”
under section 409A of the Code shall not be paid or commence until the date that is six (6) months
after the termination date. The provision of group medical and dental benefits shall start and run
concurrently with any continuation coverage as may be elected by the Covered Employee under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”).

      (B) Exempt and Non-Exempt Employees. With respect to a particular Covered Employee who is
classified by the Company as an exempt or non-exempt employee, but is not covered by Section 2.1(A)
above, the Covered Employee will be entitled to severance benefits as follows:

         (1) If the Covered Employee’s employment with the Company is terminated by reason of the
Covered Employee’s death or Disability, the Company shall pay the Covered Employee’s accrued Base
Salary through the termination date, and in addition thereto, an amount equal to the Covered
Employee’s target bonus multiplied by a fraction, the numerator of which is the number of days in
such plan year through termination date and the denominator of which is 365.

         (2) If the Covered Employee’s employment with the Company is subject to an Involuntary
Termination or, if within one (1) year following a Change of Control the Covered Employee
terminates his employment with Good Reason, the Covered Employee shall be entitled to the
following: (a) the Company shall pay the Covered Employee a lump sum cash payment, as soon as
administratively feasible after the Covered Employee’s termination, an amount equal to the greater
of (1) 6 Months’ Base Pay or (2) 1 Month’s Base Pay for each of such Covered Employee’s Years of
Service up to a maximum of 9 Month’s Base Pay, (b) all stock options, restricted stock and other
equity compensation awards granted the Covered Employee shall be subject to the terms of the grant
agreement and plan under which they were granted and (c) for a term of six months, or if greater
for a term equal to the number of months for each Covered Employee’s Years of Service up to a
maximum of 9 months, following the termination date, or until the Covered Employee gains new
employment with substantially similar benefits, the Company, at its expense, shall provide the
Covered Employee and his or her immediate family the same level of group medical and dental
benefits as provided to active employees. Notwithstanding the foregoing, if the Covered Employee
is a key employee (as defined in Section 416(i) of the Code without regard to paragraph (5)
thereof) of the Company, and the Company’s Stock is publicly traded on an established securities
market or otherwise, then any amounts described above which are “deferred compensation” shall not
be paid or commence until the date that is six (6) months after the termination date. The
provision of group medical and dental benefits shall start and run concurrently with any
continuation coverage as

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may be elected by the Covered Employee under the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”).

      2.2 Other Severance Arrangements. Severance payments provided herein shall be subject
to any required tax withholding. If a Covered Employee is entitled to severance benefits under an
individual contract, agreement or arrangement and does not waive such entitlement to severance
benefits under such contract, agreement or arrangement, such Covered Employee shall not be entitled
to any severance benefits pursuant to the Plan but shall instead be entitled to severance benefits
in such amount and form as are provided pursuant to the terms of such contract, agreement or
arrangement (which contract, agreement or arrangement is hereby incorporated by reference and made
a part of this Plan).

      2.3 Release and Full Settlement. As a condition to the receipt of any severance
benefits hereunder, the Company, in its sole discretion, may require a Covered Employee whose
employment by the Company has been subject to an Involuntary Termination to first execute a
release, in the form established by the Company, releasing the Company, its shareholders, partners,
officers, directors, employees, attorneys and agents from any and all claims and from any and all
causes of action of any kind or character, including but not limited to all claims or causes of
action arising out of such Covered Employee’s employment with the Company or the termination of
such employment, and the performance of the Company’s obligations hereunder and the receipt of the
benefits provided hereunder by such Covered Employee shall constitute full settlement of all such
claims and causes of action.

      2.4 Excise Tax Payments. In the event that any payment, award, benefit or
distribution (or any acceleration of any payment, award, benefit or distribution) made or provided
to or for the benefit of a Covered Employee in connection with this Agreement, or Covered
Employee’s employment with Company or the termination thereof (the “Payments”) are determined to be
subject to the excise tax imposed by Sections 409A or 4999 of the Code or any interest or penalties
with respect to such excise taxes (such excise taxes, together with any such interest and
penalties, are collectively referred to as the “Excise Tax”), then the Employee shall be entitled
to receive an additional payment (a “Gross-Up Payment”) from Company such that the net amount
received by the Employee after paying any applicable Excise Tax and any federal, state or local
income or FICA taxes on such Gross-Up Payment, shall be equal to the amount the Employee would have
received if such Excise Tax were not applicable to the Payments. All determinations of the Excise
Tax and Gross-Up Payment, if any, shall be made by tax counsel acceptable to the Employee. For
purposes of determining the amount of the Gross-Up Payment, if any, the Employee shall be deemed to
pay federal income tax at the highest marginal rate of federal income taxation in the calendar year
in which the total Payments are made and State and local income taxes at the highest marginal rate
of taxation in the State and locality of the Employee’s residence on the date the total Payments
are made, net of the maximum reduction in federal income taxes which could be obtained from
deduction of such State and local taxes. In the event that the Excise Tax is determined by the
IRS, on audit or otherwise, to exceed the amount taken into account hereunder in calculating the
Gross-Up Payment (including by reason of any payment the existence or amount of which cannot be
determined at the time of the Gross-Up Payment), the Company shall make another Gross-Up Payment in
respect of such excess (plus any interest, penalties or additions payable by the Employee with
respect to such excess) within the ten (10) business days immediately following

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the date that the amount of such excess is finally determined. The Employee and the Company
shall each reasonably cooperate with the other in connection with any administrative or judicial
proceedings concerning the existence or amount of liability for Excise Tax with respect to the
total Payments. The Gross-Up Payments provided to the Employee shall be made not later than the
tenth (10th) business day following the last date the Payments are made.

      2.5 Confidential Information. In consideration of the receipt of severance benefits,
hereunder, each Covered Employee who is classified by the Company as an officer or is classified by
the Company as an exempt employee and is selected by the Committee for purposes of the Plan, will
not, without the prior written consent of the Company, for a period of three (3) years following
the Covered Employee’s termination date, except as may be required by any competent legal
authority, use or disclose to any person, firm or other legal authority, any confidential record,
secret or information related to the Company or any of its subsidiaries.

      2.6 Covenant Against Competition. In consideration of receipt of any severance
benefits hereunder, each Covered Employee who is classified by the Company as an officer or is
classified by the Company as an exempt employee and is selected by the Committee for purposes of
the Plan, for a period of one (1) year following the Covered Employee’s termination date where
termination occurred without a Change of Control, the Covered Employee shall not have any interest
in or be engaged by any business or enterprise that is in the business of exploring for,
developing, or producing hydrocarbons in specific areas where the Company has interest at the time
of the Covered Employee’s termination. Company interest shall be deemed an area within a two (2)
mile radius from the current owned acreage, offshore block, concession, or active prospect area.
For purposes of this Section, the Covered Employee shall be deemed to have an “interest in or be
engaged by a business or enterprise” if the Covered Employee acts (a) individually, (b) as a
partner, officer, director, shareholder, employee, associate, agent or owner of an entity, or (c)
as an advisor, consultant, leader or other person related directly or indirectly, to any business
or entity that is engaging in, or is planning to engage in, exploring for, developing, or producing
hydrocarbon in specific areas where the Company has interests (“the Prohibited Activity”).
Ownership of less than five percent (5%) of the outstanding capital stock of a publicly traded
entity that engages in any Prohibited Activity shall not be in violation of this Section.

      2.7 Non-Solicitation. In consideration of receipt of any severance benefits
hereunder, each Covered Employee who is classified by the Company as an officer or is classified by
the Company as an exempt employee and is selected by the Committee for purposes of the Plan, for a
period of one (1) year following the Covered Employee’s termination date, the Covered Employee will
not, directly or indirectly, in any manner or capacity induce any person to discontinue his or her
employment in the Company or the Company’s successor or to interfere with the business of the
Company or the Company’s successor.

      2.8 Liquidated Damages. If a Covered Employee who is classified by the Company as an
officer or is classified by the Company as an exempt employee and is selected by the Committee for
purposes of the Plan and who has received severance benefits pursuant to Section 2.1 above is found
by the Committee to be in violation of the confidentiality, non-competition, and/or
non-solicitation provisions as described in Sections 2.5, 2.6, and 2.7 above, then the Covered
Employee shall be required to repay to the Company as liquidated damages the full

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amount of severance received by the Covered Employee. Any payment required pursuant to this
Section shall be due and payable in a single lump sum within 30 days of written notice to such
Covered Employee of such Committee’s finding.

      2.9 Mitigation. A Covered Employee shall not be required to mitigate the amount of
any payment provided for in this Article II by seeking other employment or otherwise, nor shall the
amount of any payment provided for in this Article II be reduced by any compensation or benefit
earned by the Covered Employee as the result of employment by another employer or by retirement
benefits.

      2.10 Repayment Upon Reemployment. If a Covered Employee who has received severance
benefits pursuant to Section 2.1 above is reemployed by the Company other than on a temporary or
part-time basis or as an independent contractor, he shall be required to repay to the Company the
following amount:

      (a) The severance amount paid to him by the Company incident to his Involuntary
Termination; minus

      (b) The amount of Months’ Base Pay that he would have received from the Company between
the date of his Involuntary Termination and the date of his reemployment by the Company had
he remained employed by the Company during such period.

Any repayment required pursuant to this Section shall be made in a single lump sum within thirty
days of the Covered Employee’s reemployment with the Company; provided, however, that the Company,
in its sole discretion, may permit the Covered Employee to tender such repayment by payroll
deductions over such period of time as the Company may determine.

III.

ADMINISTRATION OF PLAN

      3.1 Plan Administration. For the purposes of the Plan and the Employee Retirement
Income Security Act of 1974, as amended, the plan administrator and named fiduciary of the Plan is
the Committee. The Committee shall hold such meetings and establish such rules and procedures as
may be necessary to enable it to discharge its duties hereunder. All actions of the Committee
shall be recorded by a secretary who need not be a Committee member. The Committee shall have all
powers necessary or proper to administer the Plan and to discharge its duties under the Plan,
including, but not limited to, the following powers:

      (a) To make and enforce such rules and regulations as it may deem necessary or proper
for the orderly and efficient administration of the Plan;

      (b) To interpret the Plan, its interpretation thereof in good faith to be final and
conclusive on all persons claiming benefits under the Plan;

      (c) To authorize the payment of benefits under the Plan;

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      (d) To prepare and distribute information explaining the Plan;

      (e) To appoint or employ persons to assist in the administration of the Plan; and

      (f) To obtain such information as is necessary for the proper administration of the Plan.

The Committee may allocate to others certain aspects of the management, operation and
responsibilities of the Plan, including the employment of advisors and the delegation of any
ministerial duties or functions to qualified individuals. The Company agrees to indemnify the
members of the Committee against all liabilities, damages, costs and expenses (including attorneys’
fees and amounts paid in settlement of any claims approved by the Company) occasioned by any act or
omission to act in connection with the Plan if such act or omission was in good faith.

      3.2 Claims Review. The Committee will advise each Covered Employee of any Plan
benefits to which the Covered Employee is entitled. If the Covered Employee believes that the
Committee has failed to advise him or her of any Plan benefits to which he or she is entitled, then
the Covered Employee may file a written claim with the Committee. The Committee shall review such
claim and respond thereto within a reasonable time after receiving the claim. In any case in which
a Covered Employee’s claim for Plan benefits is denied or modified, the Committee shall:

      (a) state the specific reason for the denial or modification;

      (b) provide specific reference to pertinent Plan provisions on which the denial or
modification is based;

      (c) provide a description of any additional material or information necessary for the
Covered Employee or his representative to perfect the claim and an explanation of why such
material or information is necessary; and

      (d) explain the Plan’s claim review procedure as contained herein.

In the event the request is denied or modified, if the Covered Employee or his representative
desires to have such denial or modification reviewed, he must, within sixty days following receipt
of the notice of such denial or modification, submit a written request for review by the Committee
of its initial decision. Within sixty days following such request for review the Committee shall
render its final decision in writing to the Covered Employee or his representative stating specific
reasons for such decision. If special circumstances require an extension of such sixty-day period,
the Committee’s decision shall be rendered as soon as possible, but not later than 120 days after
receipt of the request for review. If an extension of time for review is required, written notice
of the extension shall be furnished to the Covered Employee or representative prior to the
commencement of the extension period.

      3.3 Mandatory Arbitration. Any controversy or claim arising from or relating to a
claim for benefits payable by the Plan of a Covered Employee who is not satisfied with the

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decision of the Committee pursuant to the Plan’s claims review procedure, shall be settled by
arbitration administered by the American Arbitration Association under its Employee Benefit Plan
Claims Arbitration Rules, incorporated by reference herein.. The decision of the arbitrator shall
be final and binding and judgment on the award may be entered in any court having jurisdiction. In
reviewing the decision of the Committee, the arbitrator shall use the standard of review which
would be used by a Federal court in reviewing such decision under the provisions of the Employee
Retirement Income Security Act of 1974, as amended. The Covered Employee and the Company shall
share equally the cost of such arbitration.

IV.

GENERAL PROVISIONS

      4.1 Funding. The benefits provided herein shall be unfunded and shall be provided
from the Company’s general assets.

      4.2 Cost of Plan. The entire cost of the Plan shall be borne by the Company and no
contributions shall be required of the Covered Employees.

      4.3 Plan Year. The Plan shall operate on a plan year consisting of the twelve
consecutive month period commencing on January 1 of each year.

      4.4 Amendment and Termination. The Plan may be amended from time to time, or
terminated and discontinued, at any time, in each case at the discretion of the Directors;
provided, however, that the Plan may not be amended or terminated within one year after a Change of
Control or in any manner that would negatively affect a Covered Employee’s rights under the Plan
without the consent of the Covered Employees whose Plan benefits are affected by such amendment or
termination. A Plan amendment shall be effected by adoption of the Directors of a resolution
setting forth such amendment and by execution by the Company’s president or his delegatee of a
written instrument of Plan amendment. Plan termination shall be effected by adoption by the
Directors of a resolution to terminate the Plan and by execution of the Company’s president or his
delegatee of a written instrument of Plan termination.

      4.5 Not Contract of Employment. The adoption and maintenance of the Plan shall not be
deemed to be a contract of employment between the Company and any person or to be consideration for
the employment of any person. Nothing herein contained shall be deemed to give any person the
right to be retained in the employ of the Company or to restrict the right of the Company to
discharge any person at any time nor shall the Plan be deemed to give the Company the right to
require any person to remain in the employ of the Company or to restrict any person’s right to
terminate his employment at any time.

      4.6 Severability. Any provision in the Plan that is prohibited or unenforceable in
any jurisdiction by reason of applicable law shall, as to such jurisdiction, be ineffective only to
the extent of such prohibition or unenforceability without invalidating or affecting the remaining
provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.

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      4.7 Nonalienation. Covered Employees shall not have any right to pledge, hypothecate,
anticipate or assign benefits or rights under the Plan, except by will or the laws of descent and
distribution.

      4.8 Governing Law. The Plan shall be interpreted and construed in accordance with the
laws of the State of Texas except to the extent preempted by federal law.

      IN WITNESS WHEREOF, the Company has executed this Plan this ___day of
___, 2005.

	 	 	 	 	 
	 	REMINGTON OIL AND GAS CORPORATION

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 

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OMNIBUS INSTRUMENT

      WHEREAS, the parties named herein desire to enter into certain Program Documents contained
herein, each such document dated as of this 15th day of April, 2005, relating to the
issuance by Principal Life Income Fundings Trust 2005-35 (the “Trust”) of Notes to investors under
Principal Life’s secured notes program;

      WHEREAS, the Trust is a trust and will be organized under and its activities will be governed
by the provisions of the Trust Agreement (set forth in Section A of this Omnibus Instrument), dated
as of the date of the Pricing Supplement (attached to this Omnibus Instrument as Exhibit D)
(the “Pricing Supplement”), by and between the parties thereto indicated in Section F herein;

      WHEREAS, certain expense and indemnification arrangements between Principal Life and the
Trustee, on behalf of itself and on behalf of the Trust, are governed pursuant to the provisions of
the Expense and Indemnity Agreement dated as of March 5, 2004, by and between Principal Life and
the Trustee;

      WHEREAS, certain licensing arrangements between the Trust and Principal Financial Services,
Inc. will be governed pursuant to the provisions of the License Agreement (set forth in Section B
of this Omnibus Instrument), dated as of the date of the Pricing Supplement, by and between the
parties thereto indicated in Section F herein;

      WHEREAS, certain custodial arrangements of the Funding Agreement and the Guarantee will be
governed pursuant to the provisions of the Custodial Agreement (the “Custodial Agreement”) dated as
of March 5, 2004 by and among Bankers Trust Company, N.A., acting as custodian (the “Custodian”),
the Indenture Trustee and the Trustee, on behalf of the Trust;

      WHEREAS, the Notes will be issued pursuant to the Indenture (set forth in Section C of this
Omnibus Instrument), dated as of the Original Issue Date, by and between the parties thereto
indicated in Section F herein;

      WHEREAS, the sale of the Notes will be governed by the Terms Agreement (set forth in Section D
of this Omnibus Instrument), dated the date of the Pricing Supplement, by and among the parties
thereto indicated in Section F herein; and

      WHEREAS, certain agreements relating to the Notes, the Funding Agreement and the Guarantee are
set forth in the Coordination Agreement (set forth in Section E of this Omnibus Instrument), dated
as of the date of the Pricing Supplement, by and among the parties thereto indicated in Section F
herein.

      All capitalized terms used herein and not otherwise defined will have the meanings set forth
in the Indenture.

[Remainder of Page
Intentionally Left Blank.]

 

SECTION A

TRUST AGREEMENT

     This TRUST AGREEMENT (this “Trust Agreement”), dated as of the date of the
Pricing Supplement, is entered into by and between GSS Holdings II, Inc., a
Delaware corporation, as trust beneficial owner (the “Trust Beneficial Owner”),
and U.S. Bank Trust National Association, a national banking association, as
Trustee (the “Trustee”).

W I T N E S S E T H:

     WHEREAS, the Trust Beneficial Owner and the Trustee desire to authorize
the issuance of a Trust Beneficial Interest and a series of Notes in connection
with the entry into this Trust Agreement;

     WHEREAS, all things necessary to make this Trust Agreement a valid and
legally binding agreement of the Trustee and the Trust Beneficial Owner,
enforceable in accordance with its terms, have been done;

     WHEREAS, the parties intend to provide for, among other things, (i) the
issuance and sale of the Notes (pursuant to the Indenture, the Distribution
Agreement and the related Terms Agreement) and the Trust Beneficial Interest,
(ii) the use of the proceeds of the sale of the Notes and Trust Beneficial
Interest to acquire the Funding Agreement, the payment obligations of which
will be fully and unconditionally guaranteed by the Guarantee, and (iii) all
other actions deemed necessary or desirable in connection with the transactions
contemplated by this Trust Agreement; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Trust Terms, dated as of March 5, 2004, and attached to the
Omnibus Instrument as Exhibit A (the “Standard Trust Terms”) and all
capitalized terms not otherwise defined herein (including the recitals hereof)
shall have the meanings set forth in the Standard Trust Terms (the Standard
Trust Terms and this Trust Agreement, collectively, the “Trust Agreement”).

     NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which are hereby acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Trust Terms (except to the extent
expressly modified herein) are hereby incorporated herein by reference with the
same force and effect as though fully set forth herein. To the extent that the
terms set forth in Article 2 of this Trust Agreement are inconsistent with the
terms of the Standard Trust Terms, the terms set forth in Article 2 herein
shall apply.

A-1

 

ARTICLE 2

     Section 2.01 Name. The Trust created and governed by the Trust Agreement
shall be the trust specified in the Omnibus Instrument. The name of the Trust
shall be the name specified in the first paragraph of the Omnibus Instrument,
as such name may be modified from time to time by the Trustee following written
notice to the Trust Beneficial Owner.

     Section 2.02 Jurisdiction. The Trust is hereby organized in, and formed
under and pursuant to, the laws of the State of New York.

     Section 2.03 Initial Capital Contribution and Ownership. The Trust
Beneficial Owner has paid or has caused to be paid to, or to an account at the
direction of, the Trustee, on the date hereof, the sum of $15 (or, in the case
of Notes issued with original issue discount, such amount multiplied by the
issue price of the Notes). The Trustee hereby acknowledges receipt in trust
from the Trust Beneficial Owner, as of the date hereof, of the foregoing
contribution, which shall be used along with the proceeds from the sale of the
series of Notes to purchase the Funding Agreement. Upon the creation of the
Trust and the registration of the Trust Beneficial Interest in the Securities
Register (as defined in the Trust Agreement) by the Registrar in the name of
the Trust Beneficial Owner, the Trust Beneficial Owner shall be the sole
beneficial owner of the Trust.

     Section 2.04 Acknowledgment. The Trustee, on behalf of the Trust,
expressly acknowledges its duties and obligations set forth in the Standard
Trust Terms incorporated herein.

     Section 2.05 Additional Terms.

     None

     Section 2.06 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the Trust Agreement will enter into the Trust Agreement by
executing the Omnibus Instrument.

     By executing the Omnibus Instrument, the Trustee and the Trust Beneficial
Owner hereby agree that the Trust Agreement will constitute a legal, valid and
binding agreement between the Trustee and the Trust Beneficial Owner.

     All terms relating to the Trust or the series of Notes not otherwise
included in the Trust Agreement will be as specified in the Omnibus Instrument
or Pricing Supplement, as indicated herein.

A-2

 

     Section 2.07 Governing Law. The Trust Agreement will be governed by, and
construed in accordance with, the laws of the State of New York.

     Section 2.08 Counterparts. The Trust Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

A-3

 

SECTION B

LICENSE AGREEMENT

     This LICENSE AGREEMENT (this “License Agreement”), dated as of the date of
the Pricing Supplement, is entered into by and between Principal Financial
Services, Inc., an Iowa corporation with its principal place of business at 711
High Street, Des Moines, Iowa 50392 (the “Licensor”), and the Principal Life
Income Fundings Trust specified in the Omnibus Instrument (the “Licensee”).

W I T N E S S E T H:

     WHEREAS, the Licensor is the owner of certain trademarks and service marks
and registrations and pending applications therefor, and may acquire additional
trademarks and service marks in the future, all as described more fully below;

     WHEREAS, the Licensee desires to use certain of the Licensor’s trademarks
and service marks in connection with the Licensee’s activities, as described
more fully below;

     WHEREAS, the Licensor and the Licensee wish to formalize the agreement
between them regarding the Licensee’s use of the Licensor’s marks; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard License Agreement Terms, dated March 5, 2004, and attached to
the Omnibus Instrument as Exhibit B (the “Standard License Agreement Terms”)
and all capitalized terms not otherwise defined herein (including the recitals
hereof) shall have the meanings set forth in the Standard License Agreement
Terms (the Standard License Agreement Terms and this License Agreement,
collectively, the “License Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein
and for other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard License Agreement Terms (except to the
extent expressly modified herein) are hereby incorporated herein by reference
with the same force and effect as though fully set forth herein. To the extent
that the terms set forth in Article 2 of this License Agreement are
inconsistent with the terms of the Standard License Agreement Terms, the terms
set forth in Article 2 herein shall apply.

ARTICLE 2

     Section 2.01 Additional Terms.

     None

B-1

 

     Section 2.02 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the License Agreement will enter into the License Agreement
by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, the Licensor and the Licensee hereby
agree that the License Agreement will constitute a legal, valid and binding
agreement between the Licensor and the Licensee.

     All terms relating to the Trust or the Notes not otherwise included in the
License Agreement will be as specified in the Omnibus Instrument or Pricing
Supplement, as indicated herein.

     Section 2.03 Counterparts. The License Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

B-2

 

SECTION C

INDENTURE

     This INDENTURE (this “Indenture”) is entered into as of the Original Issue
Date by and between the Principal Life Income Fundings Trust specified in the
Omnibus Instrument (the “Trust”) and Citibank, N.A., as indenture trustee (the
“Indenture Trustee”).

     Citibank, N.A., in its capacity as indenture trustee, hereby accepts its
role as Registrar, Paying Agent, Transfer Agent and Calculation Agent
hereunder.

     References herein to “Indenture Trustee,” “Registrar,” “Transfer Agent,”
“Paying Agent” or “Calculation Agent” shall include the permitted successors
and assigns of any such entity from time to time.

W I T N E S S E T H:

     WHEREAS, the Trust has duly authorized the execution and delivery of this
Indenture to provide for the issuance of Notes;

     WHEREAS, all things necessary to make this Indenture a valid and legally
binding agreement of the Trust and the other parties to this Indenture,
enforceable in accordance with its terms, have been done, and the Trust
proposes to do all things necessary to make the Notes, when executed by the
Trust and authenticated and delivered pursuant hereto, valid and legally
binding obligations of the Trust as hereinafter provided; and

     WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Indenture Terms, dated as of March 5, 2004, and attached to
the Omnibus Instrument as Exhibit C (the “Standard Indenture Terms”) and all
capitalized terms not otherwise defined herein (including the recitals hereof)
shall have the meanings set forth in the Standard Indenture Terms (the Standard
Indenture Terms and this Indenture, collectively, the “Indenture”).

     NOW, THEREFORE, for and in consideration of the premises and the purchase
of the Notes by the Holders thereof, it is mutually covenanted and agreed by
each of the parties hereto as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Indenture Terms (except to the extent
expressly modified herein) are hereby incorporated herein by reference (with
the same force and effect as though fully set forth herein). To the extent
that the terms set forth in Article 2 of this Indenture are inconsistent with
the terms of the Standard Indenture Terms, the terms set forth in Article 2
herein shall apply.

C-1

 

ARTICLE 2

     Section 2.01 Agreement to be Bound. Each of the Trust, the Indenture
Trustee, the Registrar, the Transfer Agent, the Paying Agent and the
Calculation Agent hereby agrees to be bound by all of the terms, provisions and
agreements set forth in the Indenture, with respect to all matters contemplated
in the Indenture, including, without limitation, those relating to the issuance
of the below-referenced Notes.

     Section 2.02 Designation of the Trust, the Notes, the Funding Agreement
and the Guarantee. The Trust created by the Trust Agreement and referred to in
the Indenture is the Principal Life Income Fundings Trust specified in the
Omnibus Instrument. The Notes issued by the Trust and governed by the
Indenture shall be the Notes specified in the Pricing Supplement. The Funding
Agreement designated hereby is the Funding Agreement designated in the Pricing
Supplement dated as of the Original Issue Date between the Trust and Principal
Life. The Guarantee designated hereby is the Guarantee dated as of the Original
Issue Date of PFG.

     Section 2.03 Additional Terms.

     None

     Section 2.04 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to the Indenture will enter into the Indenture by executing
the Omnibus Instrument.

     By executing the Omnibus Instrument, the Indenture Trustee, the Registrar,
the Transfer Agent, the Paying Agent, the Calculation Agent and the Trust
hereby agree that the Indenture will constitute a legal, valid and binding
agreement between the Indenture Trustee, the Registrar, the Transfer Agent, the
Paying Agent, the Calculation Agent and the Trust.

     All terms relating to the Trust or the Notes not otherwise included in the
Indenture will be as specified in the Omnibus Instrument or Pricing Supplement,
as indicated herein.

     Section 2.05 Counterparts. The Indenture, through the Omnibus Instrument,
may be executed in any number of counterparts, each of which counterparts shall
be deemed to be an original, and all of which counterparts shall constitute one
and the same instrument.

[Remainder of Page Intentionally Left Blank.]

C-2

 

SECTION D

TERMS AGREEMENT

     This TERMS AGREEMENT (this “Terms Agreement”) is entered into as of the
Original Issue Date by and among Principal Life Insurance Company (“Principal
Life”), Principal Financial Group, Inc. (“PFG”), the Principal Life Income
Fundings Trust specified in the Omnibus Instrument (the “Trust”) and the
Purchasing Agent specified in the Pricing Supplement (the “Purchasing Agent”).

W I T N E S S E T H:

     WHEREAS, Principal Life, PFG and the agents named therein, including the
Purchasing Agent have entered into that certain Distribution Agreement dated
March 5, 2004 (the “Distribution Agreement”).

     NOW, THEREFORE, in consideration of the mutual promises set forth herein
and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, each of the parties hereby agrees as follows:

ARTICLE 1

     Section 1.01 Incorporation by Reference. The provisions of the
Distribution Agreement and the related definitions (unless otherwise specified
herein) are incorporated by reference herein and shall be deemed to have the
same force and effect as if set forth in full herein.

ARTICLE 2

     Section 2.01 Addition of Trust as Party to Distribution Agreement.

     Pursuant to Section 1 of the Distribution Agreement, each of the
undersigned parties hereby acknowledges and agrees that the Trust, upon
execution hereof by the Trust and the other parties to the Distribution
Agreement (other than any other trusts organized in connection with the
Registration Statement that are party thereto as of the date hereof), shall
become a Trust for purposes of the Distribution Agreement in accordance with
the terms thereof, in respect of the Notes, with all the authority, rights,
powers, duties and obligations of a Trust under the Distribution Agreement.
The Trust confirms that any agreement, covenant, acknowledgment, representation
or warranty under the Distribution Agreement applicable to the Trust is made by
the Trust at the date hereof, unless another time or times are specified in the
Distribution Agreement, in which case such agreement, covenant, acknowledgment,
representation or warranty shall be deemed to be confirmed by the Trust at such
specified time or times.

     Section 2.02 Purchase of Notes as Principal.

     (a) Subject in all respects to the terms and conditions of the
Distribution Agreement, the Trust hereby agrees to sell to the Purchasing Agent
and the Purchasing Agent hereby agrees to purchase the Notes having the terms
specified in the Pricing Supplement relating to such Notes.

D-1

 

     (b) In connection with any purchase of Notes from the Trust by the
Purchasing Agent as principal, the parties agrees that the items specified on
Schedule I of the Omnibus Instrument will be delivered as of the Settlement
Date.

     Section 2.03 Termination. Upon the termination of this Terms Agreement
pursuant to Section 13(b) of the Distribution Agreement the undersigned parties
hereby agree to that the expenses reasonably incurred prior to or in connection
with such termination will be borne by Principal Life and PFG.

     Section 2.04 Governing Law. This Terms Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard
to the principles of conflicts of laws thereof.

     Section 2.05 Notices. For purposes of Section 14 of the Distribution
Agreement, the Trust’s communications details are as set forth in Section E of
the Omnibus Instrument.

     Section 2.06 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Terms Agreement will enter into this Terms Agreement
by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, each party hereto agrees that this
Terms Agreement will constitute a legal, valid and binding agreement by and
among such parties.

     All terms relating to the Trust or the Notes not otherwise included in
this Terms Agreement will be as specified in the Omnibus Instrument or Pricing
Supplement, as indicated herein.

     Section 2.07 Counterparts. This Terms Agreement, through the Omnibus
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.

[Remainder of Page Intentionally Left Blank.]

D-2

 

SECTION E

COORDINATION AGREEMENT

     This COORDINATION AGREEMENT (this “Coordination Agreement”), dated as of
the date of the Pricing Supplement, is entered into by and among Principal Life
Insurance Company (“Principal Life”), Principal Financial Group, Inc. (“PFG”),
the Principal Life Income Fundings Trust specified in the Omnibus Instrument
(the “Trust”), Principal Financial Services, Inc. (“PFSI”), Bankers Trust
Company, N.A. and Citibank, N.A., as indenture trustee (the “Indenture
Trustee”).

W I T N E S S E T H

     WHEREAS, the Trust will enter into the Funding Agreement with Principal
Life dated as of the Original Issue Date specified in the Pricing Supplement;

     WHEREAS, PFG will issue a Guarantee to the Trust as of the Original Issue
Date specified in the Pricing Supplement, which will fully and unconditionally
guarantee the payment obligations of Principal Life under the Funding
Agreement;

     WHEREAS, the Purchasing Agent (as defined in the Distribution Agreement)
have agreed to sell the Notes in accordance with the Registration Statement;

     WHEREAS, the Trust intends to issue the Notes in accordance with the
Indenture, to collaterally assign to, and grant a security interest in, the
Funding Agreement and the Guarantee to and in favor of the Indenture Trustee in
accordance with the Indenture to secure payment of the Notes;

     WHEREAS, the Custodian will hold the Funding Agreement and the Guarantee
on behalf of the Indenture Trustee pursuant to the terms of the Custodial
Agreement; and

     WHEREAS, certain licensing arrangements between the Trust and PFSI will be
governed pursuant to the provisions of the License Agreement.

     NOW, THEREFORE, to give effect to the agreements and arrangements
established under the Terms Agreement included in the Omnibus Instrument, as
applicable, the Trust Agreement, the Indenture and the Notes, and in
consideration of the agreements and obligations set forth herein and for other
good and valuable consideration, the sufficiency of which are hereby
acknowledged, each party hereby agrees as follows:

ARTICLE 1

     Section 1.01 Delivery of the Funding Agreement and the Guarantee. The
Trust hereby authorizes the Custodian, on behalf of the Indenture Trustee, to
receive the Funding Agreement from Principal Life and the Guarantee from PFG
pursuant to the assignment of the Funding Agreement and Guarantee (the
“Assignment”), to be entered into on the Original Issue Date, included in the
closing instrument dated as of the Original Issue Date (the “Closing
Instrument”).

E-1

 

     Section 1.02 Issuance and Purchase of the Notes.

     (a) Delivery of the Funding Agreement and the Guarantee to the Custodian,
on behalf of the Indenture Trustee, pursuant to the Assignment or execution of
the cross receipt contained in the Closing Instrument shall be confirmation of
payment by the Trust for the Funding Agreement.

     (b) The Trust hereby directs the Indenture Trustee, upon receipt by the
Custodian, on behalf of the Indenture Trustee, of the Funding Agreement
pursuant to the Assignment and upon receipt by the Custodian, on behalf of the
Indenture Trustee, of the Guarantee, (i) to authenticate the certificates
representing the Notes (the “Notes Certificates”) in accordance with the
Indenture and (ii) to (A) deliver each relevant Notes Certificate to the
clearing system or systems identified in each such Notes Certificate, or to the
nominee of such clearing system, or the custodian thereof, for credit to such
accounts as the Purchasing Agent may direct, or (B) deliver each relevant Notes
Certificate to the purchasers thereof as identified by the Purchasing Agent.

ARTICLE 2

     Section 2.01 Directions Regarding Periodic Payments. As registered owner
of the Funding Agreement and the Guarantee as collateral securing payments on
the Notes, the Indenture Trustee will receive payments on the Funding Agreement
and the Guarantee on behalf of the Trust. The Trust hereby directs the
Indenture Trustee to use such funds to make payments on behalf of the Trust
pursuant to the Trust Agreement and the Indenture.

     Section 2.02 Maturity of the Funding Agreement. Upon the maturity of the
Funding Agreement and the return of funds thereunder, the Trust hereby directs
the Indenture Trustee to set aside from such funds an amount sufficient for the
repayment of the outstanding principal on the Notes and Trust Beneficial
Interest when due.

ARTICLE 3

     Section 3.01 Certificates. Principal Life hereby agrees to deliver an
Officer’s Certificate, a copy of which is attached hereto as Exhibit E, on a
quarterly basis to any rating agency currently rating the Program. The Trust
hereby agrees to deliver an Officer’s Certificate, a copy of which is attached
hereto as Exhibit F, on a quarterly basis to any rating agency currently rating
the Program.

     Section 3.02 Filings. Principal Life hereby covenants to file, or cause
to be filed, in a timely manner on behalf of the Trust all reports,
certifications or similar filings required under the Securities Exchange Act of
1934, as amended.

ARTICLE 4

     Section 4.01 No Additional Liability. Nothing in this Coordination
Agreement shall impose any liability or obligation on the part of any party to
this Coordination Agreement to make any payment or disbursement in addition to
any liability or obligation such party has under the Program Documents, except
to the extent that a party has actually received funds which it is obligated to
disburse pursuant to this Coordination Agreement.

E-2

 

     Section 4.02 No Conflict. This Coordination Agreement is intended to be
in furtherance of the agreements reflected in the documents related to the
Program Documents, and not in conflict. To the extent that a provision of this
Coordination Agreement conflicts with the provisions of one or more Program
Documents, the provisions of such Program Documents shall govern.

     Section 4.03 Governing Law. This Coordination Agreement shall be governed
by and construed in accordance with the laws of the State of New York without
regard to the principles of conflicts of laws thereof.

     Section 4.04 Severability. If any provision in this Coordination
Agreement shall be invalid, illegal or unenforceable, such provision shall be
deemed severable from the remaining provisions of this Coordination Agreement
and shall in no way affect the validity or enforceability of such other
provisions of this Coordination Agreement.

     Section 4.05 Severability. If any provision in this Coordination
Agreement shall be invalid, illegal or unenforceable, such provision shall be
deemed severable from the remaining provisions of this Coordination Agreement
and shall in no way affect the validity or enforceability of such other
provisions of this Coordination Agreement.

     Section 4.06 Notices. All demands, notices and communications under this
Coordination Agreement shall be in writing and shall be deemed to have been
duly given upon receipt at the addresses set forth below:

	 	 	 
	To the Trust:
	 	 
	 
	

	 	Principal Life Income Fundings
Trust (followed by the number set forth in the Omnibus Instrument)
	

	 	c/o U.S. Bank Trust National Association
	

	 	100 Wall Street, 16th Floor
	

	 	New York, New York 10005
	

	 	Attention: Corporate Trust Administration
	

	 	Telephone: (212) 361-2458
	

	 	Facsimile: (212) 809-5459 and (212) 509-3384
	 
	To the Indenture Trustee:
	 	 
	 
	

	 	Citibank, N.A.
	

	 	Citibank Agency & Trust
	

	 	388 Greenwich Street, 14th Floor
	

	 	New York, New York 10013
	

	 	Attention: Nancy Forte
	

	 	Telephone: (212) 816-5685
	

	 	Facsimile: (212) 816-5527

E-3

 

	 	 	 
	To Principal Life:

	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011
	 
	 	 	With a copy to:

	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To PFG:

	 
	

	 	Principal Financial Group, Inc.
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011
	 
	 	 	With a copy to:
	 	 
	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To Principal Financial
Services, Inc.:
	 	 
	 
	

	 	Principal Financial Services, Inc.
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: General Counsel
	

	 	Telephone: (515) 247-5111
	

	 	Facsimile: (515) 248-3011

E-4

 

	 	 	 
	 	 	With a copy to:
	 	 
	 
	

	 	Principal Life Insurance Company
	

	 	711 High Street
	

	 	Des Moines, Iowa 50392
	

	 	Attention: Jim Fifield
	

	 	Telephone: (515) 248-9196
	

	 	Facsimile: (515) 235-9353
	 
	To Bankers Trust Company, N.A:
	 	 
	 
	

	 	Bankers Trust Company, N.A.
	

	 	665 Locust Street
	

	 	Des Moines, Iowa 50309-3702
	

	 	Attention: Angela C. Brick
	

	 	Telephone: (515) 245-2820
	

	 	Facsimile: (515) 247-2101

or at such other address as shall be designated by any such party in a written
notice to the other parties.

ARTICLE 5

     Section 5.01 Omnibus Instrument; Execution and Incorporation of Terms.

     The parties to this Coordination Agreement will enter into this
Coordination Agreement by executing the Omnibus Instrument.

     By executing the Omnibus Instrument, each party hereto agrees that this
Coordination Agreement will constitute a legal, valid and binding agreement by
and among the Trust, Principal Life, PFG, PFSI, the Custodian and the Indenture
Trustee.

     All terms relating to the Trust or the Notes not otherwise included in
this Coordination Agreement will be as specified in the Omnibus Instrument or
Pricing Supplement, as indicated herein.

     Section 5.02 Acknowledgment. Principal Life hereby acknowledges Section
2.10 of the Indenture and Section 6.1 of the Custodial Agreement. The Trust
hereby acknowledges and agrees to the terms of the Custodial Agreement.

     Section 5.03 Counterparts. This Coordination Agreement, through the
Omnibus Instrument, may be executed in any number of counterparts, each of
which counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.

     Section 5.04 Capitalized Terms. All capitalized terms used herein and not
otherwise defined in this Coordination Agreement will have the meanings set
forth in the Indenture.

[Remainder of Page Intentionally Left Blank.]

E-5

 

SECTION F

MISCELLANEOUS AND EXECUTION PAGES

      This Omnibus Instrument may be executed by each of the parties hereto in any number of
counterparts, and by each of the parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.

      Each signatory, by its execution hereof, does hereby become a party to each of the agreements
or indenture identified for such party as of the date specified in such agreements or indenture.

      IN WITNESS WHEREOF, the undersigned have executed this Omnibus Instrument with respect to the
Notes as of the date first written above.

	 	 	 	 	 
	 	PRINCIPAL LIFE INSURANCE COMPANY (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)

 	 
	 	By:  	/s/ Christopher P. Freese
 	 
	 	 	Name:  	Christopher P. Freese 	 
	 	 	Title:  	Officer 	 
	 

	 	 	 	 	 
	 	PRINCIPAL FINANCIAL GROUP, INC. (in executing below
agrees and becomes a party to (i) the Terms Agreement
set forth in Section D herein and (ii) the Coordination
Agreement set forth in Section E herein)

 	 
	 	By:  	/s/ Elizabeth D. Swanson
 	 
	 	 	Name:  	Elizabeth D. Swanson 	 
	 	 	Title:  	Counsel 	 
	 

	 	 	 	 	 
	 	PRINCIPAL FINANCIAL SERVICES, INC. (in executing below
agrees and becomes a party to (i) the License Agreement
set forth in Section B herein and (ii) the Coordination
Agreement set forth in Section E herein)

 	 
	 	By:  	/s/ Elizabeth D. Swanson
 	 
	 	 	Name:  	Elizabeth D. Swanson 	 
	 	 	Title:  	Counsel 	 
	 

[Execution Page 1 of 3]

 

 

	 	 	 	 	 
	 	THE PRINCIPAL LIFE INCOME FUNDINGS TRUST DESIGNATED IN
THIS OMNIBUS INSTRUMENT (in executing below agrees and
becomes a party to (i) the License Agreement set forth
in Section B herein, (ii) the Indenture set forth in
Section C herein, (iii) the Terms Agreement set forth
in Section D herein and (iv) the Coordination Agreement
set forth in Section E herein)

By: U.S. Bank Trust National Association, not in its
individual capacity but solely in its capacity as
trustee of the Trust

 	 
	 	By:  	/s/ Thomas E. Tabor
 	 
	 	 	Name:  	Thomas E. Tabor 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	U.S. BANK TRUST NATIONAL ASSOCIATION (in executing
below agrees and becomes a party to the Trust Agreement
set forth in Section A herein), as Trustee

 	 
	 	By:  	/s/ Thomas E. Tabor
 	 
	 	 	Name:  	Thomas E. Tabor 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	GSS HOLDINGS II, INC. (in executing below agrees and
becomes a party to the Trust Agreement set forth in
Section A herein), as Trust Beneficial Owner

 	 
	 	By:  	/s/ Andrew L. Stidd
 	 
	 	 	Name:  	Andrew L. Stidd 	 
	 	 	Title:  	President 	 
	 

	 	 	 	 	 
	 	CITIBANK, N.A. (in executing below agrees and becomes a
party to (i) the Indenture set forth in Section C
herein, as Indenture Trustee, Registrar, Transfer
Agent, Paying Agent and Calculation Agent and (ii) the
Coordination Agreement set forth in Section E herein),
as Indenture Trustee, Registrar, Transfer Agent, Paying
Agent and Calculation Agent

 	 
	 	By:  	/s/ Nancy Forte
 	 
	 	 	Name:  	Nancy Forte 	 
	 	 	Title:  	Assistant Vice President 	 
	 

[Execution Page 2 of 3]

 

 

	 	 	 	 	 
	 	BANKERS TRUST COMPANY, N.A. (in executing below agrees
and becomes a party to the Coordination Agreement set
forth in Section E herein)

 	 
	 	By:  	/s/ Patty Ashbaugh
 	 
	 	 	Name:  	Patty Ashbaugh 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED (in
executing below agrees and becomes a party to the Terms
Agreement set forth in Section D herein)

 	 
	 	By:  	/s/ Diane Kenna
 	 
	 	 	Name:  	Diane Kenna 	 
	 	 	Title:  	Authorized Signatory 	 
	 

[Execution Page 3 of 3]

 

 

INDEX OF EXHIBITS AND SCHEDULES TO THE OMNIBUS INSTRUMENT

	 	 	 
	Exhibit A

	 	Standard Trust Terms – Incorporated herein by reference to Exhibit
4.6 to Principal Life Insurance Company’s and Principal Financial
Group, Inc.’s Registration Statement on Form S-3 (Registration
Nos. 333-110499 and 333-110499-01).
	 
	 	 
	Exhibit B

	 	Standard License Agreement Terms – Incorporated herein by
reference to Exhibit 99.1 to Principal Life Insurance Company’s
Current Report on Form 8-K, filed on March 29, 2004.
	 
	 	 
	Exhibit C

	 	Standard Indenture Terms – Incorporated herein by reference to
Exhibit 4.1 to Principal Life Insurance Company’s and Principal
Financial Group, Inc.’s Registration Statement on Form S-3
(Registration Nos. 333-110499 and 333-110499-01).
	 
	 	 
	Exhibit D

	 	Pricing Supplement – Incorporated herein by reference to the
Pricing Supplement with respect to Principal Life Income Fundings
Trust 2005-35, filed on April 18, 2005, with the Securities and
Exchange Commission pursuant to Rule 424(b)(5) under the
Securities Act of 1933, as amended.
	 
	 	 
	Exhibit E

	 	Principal Life Insurance Company Officer’s Certificate
	 
	 	 
	Exhibit F

	 	Principal Life Income Fundings Trusts Trustee Officer’s Certificate
	 
	 	 
	Schedule I

	 	Terms Agreement Specifications

 

 

EXHIBIT E

Principal Life Insurance Company

Officer’s Certificate

     The undersigned, an officer of Principal Life Insurance Company, an Iowa
stock life insurance company (“Principal Life”), does hereby certify to
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc., in such capacity and on behalf of Principal Life, to the knowledge of the
undersigned and after reasonable inquiry, that:

	 	 	 
	1.

	 	each of the representations and warranties of Principal Life
contained in each Expense and Indemnity Agreement entered into in
connection with the Registration Statement (defined below), and each
Funding Agreement issued in connection with the Program (the
“Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and
correct on and as of the date hereof, with the same effect as though
such representation or warranty had been made on and as of the date
hereof;
	 
	2.

	 	no default under any of the Specified Agreements and no event
or any condition which, with notice or lapse of time or both, would
become a default, has occurred and is continuing as of the date
hereof;
	 
	3.

	 	Principal Life has performed and complied with, respectively,
in all material respects, all of the agreements, covenants,
obligations and conditions applicable to Principal Life required by
the Specified Agreements to be performed or complied with by
Principal Life on or before the date hereof;
	 
	4.

	 	the Registration Statement filed on Form S-3 (File Nos.
333-110499 and 333-110499-01) (the “Registration Statement”) by
Principal Life and Principal Financial Group, Inc. has been declared
effective by the Securities and Exchange Commission (the
“Commission”) under the Securities Act of 1933, as amended (the
“Act”) and no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been commenced by or are pending before or contemplated
by the Commission;
	 
	5.

	 	all filings, if any, required by Rule 424 and Rule 430A under
the Act have been made in a timely manner;
	 
	6.

	 	since
     , the Trusts organized in connection with the
program contemplated by the Registration Statement have issued the
following series of Notes:
	 
	

	 	[List each series of Notes.] [(collectively, the “Designated Notes”)]; and
	 
	7.

	 	the Funding Agreements issued in connection with the Designated
Notes have been executed and delivered by Principal Life in accordance
with the terms and conditions of the Program Documents.

E-1

 

          Capitalized terms used herein and not otherwise defined herein shall have the meanings set
forth in the Standard Indenture Terms attached as Exhibit 4.1 to the
Registration Statement.

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
the • day of •, 200•.

	 	 	 
	

	[Name], [in his/her] capacity as an
authorized officer of Principal Life
	 
	 	By:
	 
	 	 	

	

	 	Name:
	

	 	Title:

	 	 	 	 	 

E-2

 

EXHIBIT F

Principal Life Income Fundings Trusts

Trustee Officer’s Certificate

     U.S. Bank Trust National Association, not in its individual capacity but
solely in its capacity as trustee acting on behalf of each common law trust
organized under the laws of the State of New York (in such capacity, the
“Trustee,” and each such common law trust being referred to herein as, a
“Trust”) in connection with the program contemplated by Registration Statement
Nos. 333-110499 and 333-110499-01 filed on Form S-3 (the “Registration
Statement”) by Principal Life Insurance Company and Principal Financial Group,
Inc. with the Securities and Exchange Commission, does hereby certify to
Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies,
Inc., in such capacity and on behalf of each Trust, to the knowledge of the
Trustee, that:

	 	 	 
	1.

	 	each of the representations and warranties of each Trust
contained in the Notes issued in connection with the Program, each
Indenture entered into in connection with the Registration Statement
and the Expense and Indemnity Agreement concerning the Trusts (the
“Specified Agreements”) (other than any representation or warranty
expressly made as of a date prior to the date hereof) are true and
correct on and as of the date hereof, with the same effect as though
such representation or warranty had been made on and as of the date
hereof;
	 
	2.

	 	no default under any of the Specified Agreements and no event
or any condition which, with notice or lapse of time or both, would
become a default, has occurred and is continuing as of the date
hereof;
	 
	3.

	 	each Trust has performed and complied with, respectively, in
all material respects, all of the agreements, covenants, obligations
and conditions applicable to such Trust required by the Specified
Agreements to be performed or complied with by such Trust on or
before the date hereof;
	 
	4.

	 	the Notes issued in connection with the Program, have been
issued, in all material respects, in accordance with the terms and
conditions of the Program Documents; and
	 
	5.

	 	each Funding Agreement has been executed and delivered by the
related Trust in accordance with the terms and conditions of the
Program Documents.

     Capitalized terms used herein and not otherwise defined herein shall have
the meanings set forth in the Standard Indenture Terms attached as Exhibit 4.1
to the Registration Statement. In no event shall U.S. Bank Trust National
Association in its personal corporate capacity have any liability for any of
the certifications or statements contained in this Trustee Officer’s
Certificate, such liability being solely that of each Trust.

F-1

 

     IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
the • day of •, 200•.

	 	 	 
	

	 	U.S. Bank Trust National Association, not
in its capacity but solely in its capacity
as Trustee acting on behalf of each Trust
	 
	 	By:
	 
	 	 	

	

	 	Name:
	

	 	Title:

F-2

 

SCHEDULE I

Terms Agreement Specifications

     In connection with Section 3(a)(iv) of the Distribution Agreement, the
Program under which the Notes are issued is rated Aa2 by Moody’s Investors
Service, Inc. (“Moody’s”) and AA by Standard & Poor’s Rating Services, a
division of The McGraw-Hill Companies, Inc. (“S&P”). Principal Life and PFG
expect that the Notes will be rated Aa2 by Moody’s. The Company’s financial
strength rating is Aa2 by Moody’s and AA by S&P.

     In accordance with Section 2.02(b) of the Terms Agreement and in
connection with the purchase of Notes from the Trust by the Purchasing Agent as
principal, the following items will be delivered on the Settlement Date:

	 	•	 	Opinion of Sidley Austin Brown & Wood LLP regarding the
enforceability of the Guarantee and the Notes.

     All capitalized terms used herein and not otherwise defined herein will
have the meanings set forth in the Distribution Agreement.

I-1

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