Document:

exv10w2

GUARANTEE

     FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged, and in connection with
that certain funding agreement (the “Funding Agreement”), entered into by and between Principal
Life Insurance Company, an Iowa insurance company (“Principal Life”), and Principal Life Income
Fundings Trust 2008-79, a New York common law trust (the “Trust”), relating to the notes (the
“Notes”) issued by the Trust, Principal Financial Group, Inc., a Delaware corporation and the
indirect parent company of Principal Life (the “Guarantor”), hereby furnishes to the Trust its full
and unconditional guarantee of the Guaranteed Amounts (as hereinafter defined) as follows:

     1. Guarantee.

          (a) The Guarantor hereby fully, irrevocably, absolutely and unconditionally guarantees, as a
guarantee of payment and not merely as a guarantee of collection, immediate payment when due to the
Trust any payments required to be made by Principal Life to the Trust under the Funding Agreement
which shall become due and payable regardless of whether such payment is due at maturity, on an
interest payment date or as a result of redemption or otherwise (the “Scheduled Payments”) but
shall be unpaid by Principal Life (the “Guaranteed Amounts”). Notwithstanding anything to the
contrary contained herein, in no event shall the Guaranteed Amounts exceed the Deposit (as defined
in the Funding Agreement) of the Funding Agreement, plus accrued but unpaid interest and any other
amounts due and owing under the Funding Agreement, less any amounts paid by Principal Life to the
Trust.

          (b) In the event that Principal Life fails to make a Scheduled Payment in full when due (the
“Payment Notice Date”), then the Trust or Citibank, N.A., as indenture trustee for the benefit of
the holders of the Notes (the “Indenture Trustee”), pursuant to the indenture (the “Indenture”)
between the Trust and the Indenture Trustee, may present the Guarantor with notice (each, a
“Payment Notice”) of such failure in writing on or after the Payment Notice Date. The Payment
Notice shall identify (1) the Funding Agreement, (2) the Trust, (3) the Payment Notice Date and (4)
the amount of the Scheduled Payments not paid by Principal Life to the Trust as of the Payment
Notice Date. Upon receipt of such Payment Notice, the Guarantor will immediately pay the
Guaranteed Amounts pursuant to Section 7.

          (c) In the event that, after receipt of a Payment Notice from the Trust, the Guarantor fails
to make immediate payment to the Trust or the Indenture Trustee of the Guaranteed Amounts, then
the Trust and the Indenture Trustee may enforce the obligations of the Guarantor under this
Guarantee, including by immediately bringing suit directly against the Guarantor (without first
bringing suit against Principal Life) for the Guaranteed Amounts not paid to the Trust as of the
Payment Notice Date.

          (d) This Guarantee is an unsecured, unsubordinated and contingent obligation of the Guarantor
and ranks equally with all other unsecured and unsubordinated obligations of the Guarantor.

1

 

     2. Termination. This Guarantee is a continuing and irrevocable guarantee of the Guaranteed
Amounts now or hereafter existing and shall terminate and be of no further force and effect with
respect to the Funding Agreement and the Notes upon the full payment of the Scheduled Payments or
upon the earlier extinguishment of the obligations of Principal Life under the Funding Agreement.

     3. Amendments. Subject to the trust agreement relating to the Trust and the Indenture, no
provision of this Guarantee may be waived, amended, supplemented or modified, except by a written
instrument executed by the Trust and the Guarantor.

     4. Assignment; Governing Law. This Guarantee shall inure to the benefit of the Trust and its
successors, assigns and pledgees. This Guarantee shall be governed by, and construed in accordance
with, the laws of the State of New York without regard to conflict of law principles.

     5. Notices. All notices given pursuant to this Guarantee shall be in writing, and shall
either be delivered, mailed or telecopied to the locations listed below or at such other address or
to the attention of such other persons as such party shall have designated for such purpose in a
written notice complying as to delivery with the terms of this Section 5. Each such notice shall
be effective (i) if given by telecopy, when transmitted to the applicable number so specified in
this Section 5 (such notice shall also be sent by mail, with first class postage prepaid), (ii) if
given by mail, three days after deposit in the mails with first class postage prepaid, or (iii) if
given by any other means, when actually delivered at such address.

If to the Guarantor:

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: (866) 496-6527

If to the Trust:

Principal Life Income Fundings Trust (followed by the number of the Trust specified in this Guarantee)

2

 

c/o U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, New York 10005

Attention: Janet P. O’Hara

Telephone: (212) 361-2527

Facsimile: (212) 809-5459

With a copy to:

Citibank, N.A.

Corporate and Investment Banking

388 Greenwich Street, 14th Floor

New York, New York 10013

Attention: Jennifer H. McCourt

Telephone: (212) 816-5680

Facsimile: (212) 816-5527

     6. Representations and Warranties. The Guarantor represents and warrants that: (i) it is duly
organized and in good standing under the laws of the jurisdiction of its organization and has full
capacity and right to make and perform this Guarantee, and all necessary authority has been
obtained; (ii) this Guarantee constitutes a legal, valid and binding obligation of the Guarantor
enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency and similar
laws affecting creditors’ rights and general principles of equity, regardless of whether
enforcement is sought in a proceeding in equity or at law; (iii) the making and performance of this
Guarantee does not and will not violate the provisions of any applicable law, regulation or order,
and does not and will not result in the breach of, or constitute a default under, any material
agreement, instrument or document to which it is a party or by which it or any of its property may
be bound or affected, except to the extent disclosed in the registration statement registering the
issuance of this Guarantee and the Funding Agreement, as amended, supplemented or modified from
time to time (the “Registration Statement”), and to the extent that any such violation, breach or
default does not result in a material adverse effect on the Guarantor; and (iv) all consents,
approvals, licenses and authorizations of, and filings and registrations with, any governmental
authority required under applicable law and regulations for the making and performance of this
Guarantee have been obtained or made and are in full force and effect, except to the extent
disclosed in the Registration Statement and to the extent that the failure to acquire any such
consent, approval, license, authorization, filing or registration does not result in a material
adverse effect on the Guarantor.

     7. Notice of, and Consent to, Security Interest. The Trust hereby notifies the Guarantor that
it has granted to the Indenture Trustee, on behalf of the holders of the Notes, a security interest
in the Collateral (as defined in the Indenture), including, but not limited to, any and all payment
to be made by the Guarantor to the Trust under this Guarantee. The Trust hereby notifies the
Guarantor that it has collaterally assigned to the Indenture Trustee, for the benefit of the
holders of the Notes, this Guarantee. The Guarantor, by executing this Guarantee, hereby (i)
affirms that it has made or simultaneously will make changes to its books and records to reflect
such security interest and collateral assignment, (ii) consents to the security interest

3

 

granted, and collateral assignment made, by the Trust to the Indenture Trustee of this Guarantee,
(iii) agrees to make all payments due under this Guarantee to the Collection Account (as defined in
the Indenture) or any other account designated in writing to the Guarantor by the Indenture Trustee
and (iv) agrees to comply with all orders of the Indenture Trustee with respect to this Guarantee
without any further consent from the Trust.

     8. WAIVER OF JURY TRIAL; FINAL AGREEMENT. TO THE EXTENT ALLOWED BY APPLICABLE LAW, THE
GUARANTOR WAIVES TRIAL BY JURY WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING ON OR ARISING
OUT OF THIS GUARANTEE. THIS GUARANTEE REPRESENTS THE FINAL AGREEMENT BETWEEN THE GUARANTOR AND THE
TRUST AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS AMONG SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG SUCH PARTIES.

	 	 	 	 	 
	 	PRINCIPAL FINANCIAL GROUP, INC.

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

	 	 	Date:  	 The Effective Date (as defined in the Funding 
Agreement) 	 
	 

Acknowledged and Agreed:

	 	 	 	 	 
	THE PRINCIPAL LIFE INCOME FUNDINGS

TRUST DESIGNATED IN THIS GUARANTEE

 	 	 
	By:  	U.S. Bank Trust National Association,

not in its individual capacity, but solely in its

capacity as trustee

 	 	 
	By:  	Bankers Trust Company, N.A.,

under Limited Power of Attorney, dated November 21, 2007

 	 	 
	 	 	 	 	 
	By:  	  /s/  Diana L. Cook
 	 	 
	 	Name:  	Diana L. Cook 	 	 
	 	Title:  	Vice President

	 	Date:  	 The Effective Date (as defined in the Funding

Agreement) 	 	 

4exv10w1

Exhibit 10.1

EMULEX CORPORATION

EXECUTIVE BONUS PLAN

Plan Purpose

To focus members of the management team on the achievement of specific Company and individual
accomplishments that contribute to the creation of shareholder value.

To assist in attracting and retaining top quality management.

General Plan Description

This Executive Bonus Plan (“Plan”) provides for a quarterly cash award based upon Company
performance against net revenue and net operating income plan goals and specified business goals.
In addition, a discretionary bonus for recognition of extraordinary contributions to the success of
the company may be recommended. All bonus recommendations are subject to the approval of the
Compensation Committee.

Eligibility

Corporate officers, executive officers, operating officers, senior vice presidents, vice
presidents, and senior directors, excluding those eligible for sales commission (unless otherwise
indicated within this Plan), are eligible for selection to participate in this Plan. A participant
must be an active regular full-time employee throughout the quarter for which the bonus is paid,
and no proration will be made of any payment for employment during portions of a quarter.
Participants whose employment is terminated for “cause” (as defined below) are not eligible for any
bonus payments even if the termination occurs following the end of a quarter for which a bonus
otherwise would be paid.

Participation and Term

Actual Executive Bonus Plan participants will normally be selected from among those eligible
annually, prior to the start of each fiscal year, by the Chief Executive Officer and approved by
the Compensation Committee. The Plan is based on a fiscal year and may be modified, extended, or
canceled annually at the discretion of the Compensation Committee.

 

 

Target Bonus Opportunity

Each eligible participant will be assigned a Target Award Opportunity expressed as a percentage of
their actual gross quarterly base salary in effect at the end of the respective quarter. The
Target Award Opportunity for:

[Category 1] is 90%

[Category 2] is 70%

[Category 3] is 60%

[Category 4] is 50%

[Category 5] is 45%

[Category 6] is 35%

[Category 7] is 10%

Bonus Award Criteria

Bonus award criteria will be based upon achieving a combination of corporate performance goals.

The weighting factors are:

	 	 	 	 	 	 	 	 	 
	 	 	Category 1, 2, 4, 5, 6, 7, and 8	 	Category 3
	Net revenue
	 	 	45	%	 	 	50	%
	Net operating income
	 	 	55	%	 	 	50	%

The actual goals for measurement purposes will be the Company’s fiscal Annual Operating Plan (AOP)
as approved by the Board of Directors. Corporate bonus components will be calculated according to
the following procedure:

	1.	 	The Target Award Opportunity times the participant’s quarterly gross base salary equals the
Target Award.

	 	 	 	 	 
	 

	 	Example :
	 	35% x $25,000 (quarterly salary) = $8,750 Target Award

	2.	 	The weighting factors for net revenue, net operating income, and subjective as stated above
times the Target Award give the bonus target for each weighting factor.

	 	 	 	 	 
	 

	 	Example :
	 	45% x $8,750 = $3,938.00 (net revenue target)
	 

	 	 	 	55% x $8,750 = $4,812.00 (net operating income target)

 

 

	3.	 	An accelerator formula of 1.5 x % of performance less 50% will be used for each part of the
quantitative bonus award calculation to reinforce over-achievement opportunity as well as to
minimize any bonus payments for performance below fiscal AOP planned levels.

     Using the Example if the first quarter performance is 105% of net revenue and 110% of net
income:

	 	 	 
	 

	 	(105% x 1.50) less 50% = 157.5% — 50% = 107.5% of net revenue target:
	 

	 	107.5% x $3,938.00 = $4,233.35 net revenue bonus component
	 
	 	 
	 

	 	(110% x 1.50) less 50% = 165% — 50% = 115% of net operating income target:
	 

	 	115% x $4,812.00 = $5,533.80 net operating income bonus component
	 
	 	 
	 

	 	               total first quarter bonus components = $9,767.15.

Using the Example if the second quarter performance is 90% of net revenue and 80% of net

operating income:

	 	 	 
	 

	 	(90% x 1.50) less 50% = 135% — 50% = 85% of net revenue target:
	 

	 	85% x $3,938.00= $3,347.30 net revenue bonus component
	 
	 	 
	 

	 	(80% x 1.50) less 50% = 120% — 50% = 70% of net operating income target:
	 

	 	70% x $4,812.00 = $3,368.40 net operating income bonus component
	 
	 	 
	 

	 	               total second quarter bonus components = $6,715.70

	4.	 	Net revenue and net operating income will be treated as separate components independent of
one another regardless of the award formula, and will be added to compute the cash award.
However, a minimum threshold of 80% of the Board of Directors’ approved AOP for net revenue
must be achieved for a net revenue bonus component to be included in the cash award.
Likewise, a minimum threshold of 80% of the Board of Directors’ approved AOP for net operating
income must be achieved for a net operating income component to be included in the cash award.
No cash award of any kind shall be made if net operating income falls below 50% of the AOP
approved plan.

	5.	 	In addition to the components based on net revenue and net operating income, a participant’s
cash award may be adjusted by a Performance Contribution Factor (PCF) which represents the
level of the employee’s contribution to the company’s results for the quarter, and the payment
made to the participant shall be the cash award multiplied by the PCF. The PCF will be
determined by the Company, and can range from 0.9 to 1.1, and a PCF other than 1.0 should be
applied on an exception basis. The PCF for a participant will be based on the objectives set
for that participant at the beginning of the quarter, and the participant’s progress against
those objectives as discussed with his or her manager. If a participant receives a PCF of
0.9, he or she should also be on a performance improvement plan.

 

 

Discretionary Bonuses

Occasionally, an individual makes an extraordinary contribution to the success of the company, a
contribution that deserves special recognition and financial reward. It is the intention of this
“Discretionary Bonus” provision to provide the CEO with the latitude to recommend unusual bonus
payments to be made to such contributors when they occur. Such bonus recommendations are not
subject to the guidelines of the Plan described above, but are subject to the review and prior
approval of the Compensation Committee.

Payment of Awards

Any proposed awards by the CEO must be reviewed and approved by the Compensation Committee.

Awards will be paid approximately 30 days following the end of each quarter. All legally required
deductions will be withheld.

Plan Administration

The Plan will be administered under the direction of the CEO of Emulex Corporation upon approval by
the Emulex Compensation Committee. The administrator’s authority will include, but not be limited
to:

Final approval of Plan participants, corporate performance goals, award opportunity and
award payment.

Interpretation of all rules pertaining to the Plan.

Changes to the Plan or termination of the Plan, provided such changes or termination
do not adversely affect the award opportunity or difficulty of earning awards following
the beginning of the fiscal year.

Treatment of special events in calculating performance versus plan, such as a major
acquisition or changes in accounting regulations.

Plan Term

This Plan will become effective on the first day of the fiscal year and end on the last day of the
fiscal year.

 

 

Foreign Currency Considerations

All Plan participants whose gross base salary is not denominated in U.S. dollars will be paid in
the same currency as their gross base salary. All bonus calculations will be made using the
equivalent base salary in US currency as indicated in the most recent payroll information.

Definitions

Active Regular Full-time Employee: An employee working 40 hours per week.

Gross Base Salary: An employee’s base salary, and does not include payments for overtime,
bonus payments of any type, or other income such as relocation allowances, employee referral
payments, etc.

Net Revenue: Net revenue as presented in the Company’s consolidated financial statements.

Net Operating Income: Operating income as presented in the Company’s consolidated
financial statements, excluding amortization, impairment of intangibles, bonus payments, profit
sharing payments, retirement savings plan payments, share based compensation, severance payments,
and worker’s compensation payments.

Termination for Cause: Termination of employment as a result of violation of one or more
written or unwritten Company policies, procedures, principles or rules regarding employee conduct
and behavior. If an employee is terminated for cause prior to payment of a quarterly bonus, the
employee will not be eligible for the payment. Nothing in this Plan shall alter the at-will
employment relationship between the Company and its employees. Either the Company or the employee
may terminate the employment relationship at any time, for any reason or no reason, with or without
any cause.

Approved by Compensation Committee:

	 	 	 	 	 	 	 
	 

Bruce C. Edwards

	 	 	 	 

Date
	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	Don M. Lyle

	 	 	 	Date	 	 
	 
	 	 	 	 	 	 
	Approved by CEO:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	James McCluney

	 	 	 	Date

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]