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 2007-84, 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.

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     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)

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c/o U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, New York 10005

Attention: Thomas E. Tabor

Telephone: (212) 361-6184

Facsimile: (212) 809-5459

With a copy to:

Citibank, N.A.

Citibank Agency and Trust

388 Greenwich Street, 14th Floor

New York, New York 10013

Attention: Nancy Forte

Telephone: (212) 816-5685

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

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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 March 2, 2007
	 
	 	 	 	 
	By:

	 	/s/ Diana L. Cook	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Name:

	 	Diana L. Cook	 	 
	 
	 	 	 	 
	Title:

	 	Vice President	 	 
	 
	 	 	 	 
	Date:

	 	The Effective Date (as defined in
the Funding Agreement)	 	 
	 

	 		 	 

4EX-10.1 Employment letter agrmt/ Donna Noce Colaco

 

EXHIBIT 10.1

July 19, 2007

VIA FEDERAL EXPRESS

Donna Noce Colaco

8 Stratford Drive

Livingston, NJ 07039

Dear Donna:

Chico’s is very pleased to offer you the opportunity to join our organization. We believe that you
can make a tremendous impact on our organization and look forward to the chance to work with you.
As one of the top specialty retailers we offer tremendous opportunity for personal and professional
growth. Please let this letter serve as an offer to join Chico’s FAS, Inc. and your acceptance of
that offer. The following will outline the specifics:

	 	 	 
	Title:

	 	President White House/Black Market
	 
	 	 
	Reporting to:

	 	Chief Executive Officer
	 
	 	 
	Base Salary:

	 	$600,000.00 annually
	 
	 	 
	Start Date:

	 	August 6, 2007
	 
	 	 
	Incentive Bonus:

	 	Range: 0%–140% of base salary earned during the
semi-annual bonus period, which is contingent upon the
achievement of corporate targets; paid semi-annually
(generally in September and March).
Incentive bonus is guaranteed at 60% of base salary earned
during
the fall season 2007 bonus period and guaranteed at 60% of
base salary earned during the spring 2008 bonus period. Our two
semi-annual bonus periods are February thru July and August thru
January.
	 
	 	 
	Sign on Bonus:

	 	$125,000.00, less applicable taxes to be paid to you
within 30 days of reporting to work at Chico’s. You
agree to repay this entire amount within 60 days if
you voluntarily leave Chico’s within 12 months of
your start date.
	 
	 	 
	Stock Options:

	 	A one-time grant of 30,000 non-qualified stock
options at Fair Market Value granted on the first
day of the open window period immediately following
your date of hire (September 7, 2007). These
options will vest over a three-year period with
one-third vesting each year. You will be eligible
for additional grants in March.
	 
	 	 

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	Restricted Stock:

	 	A one-time grant of 10,000 shares of restricted
stock granted on the first day of the open window
period immediately following your date of hire
(September 7, 2007). These shares will vest over a
three-year period with one-third vesting each year.
You will be eligible for additional grants in March.
	 
	 	 
	Severance:

	 	If we terminate your employment without cause, we
will continue to pay you your base salary for a
period of twelve months following the date of
termination. In general terms, cause shall mean any
action or inaction by you that causes the company
substantial harm. If, however, Chico’s adopts a
severance plan applicable to all officers, you agree
that any such plan will supersede the provisions of
this paragraph.
	 
	 	 
	Change of Control:

	 	If there is a greater than 50% change in Company
ownership or greater than 50% turnover in the
Company’s Board of Directors in any 12-month period
that results in your good faith determination that
you can no longer adequately perform your duties as
a senior officer, resulting in your voluntarily
terminating your employment, then you will be
entitled to a lump sum payment of your annual
salary. If, however, Chico’s adopts a severance
plan applicable to all officers that covers a change
of control, you agree that any such plan will
supersede the provisions of this paragraph.
	 
	 	 
	Change of Management:

	 	If Scott Edmonds ceases to be employed by Chico’s,
for any reason, within the first year of your
employment that results in your good faith
determination that you can no longer adequately
perform your duties as a senior officer, resulting
in your voluntarily terminating your employment,
then you will be entitled to a lump sum payment of
your annual salary; provided, however, that your
rights under this paragraph must be exercised within
90 days of Mr. Edmonds leaving and you must provide
Chico’s with at least 90 days written notice of your
intention to voluntarily terminate your employment.
If you exercise your rights under this paragraph,
you agree to execute a Non-Completion and
Non-Solicitation Agreement substantially in the form
of Agreement attached to this.
	 
	 	 
	Time Off:

	 	You will be eligible for 10 PTO days this year and
20 PTO days per calendar year starting in 2008.
	 
	 	 
	Annual Review:

	 	Merit reviews and equity grants for officers are
considered at the end of the fiscal year, and issued
in March of each year.

You will also be eligible to participate in Chico’s FAS, Inc. comprehensive benefits program
outlined below:

	 	 	 
	Group Insurance 

Plan:

	 	Medical/Dental/Vision

Chico’s will reimburse you for COBRA premiums on medical insurance, if
applicable, until you are eligible for the Chico’s medical insurance. If you
elect not to enroll in the Chico’s program when eligible, reimbursement for
COBRA payments will cease.
	 
	 	 
	 

	 	Eligibility Date: first day of the month after 60 days of employment

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	Life Insurance:

	 	Chico’s provides term insurance equal to 1x your base salary; in addition Chico’s
provides accidental death and dismemberment insurance equal to 1x your base salary.
Supplemental insurance is available for purchase.
	 
	 	 
	 

	 	Eligibility Date: first day of the month after 60 days of employment
	 
	 	 
	401(k) Plan:

	 	Eligible deferral of 1-100% of your compensation (subject to an IRS maximum), with a
match of 50% of the first 6% of compensation you defer. You will be able to roll over
existing qualified funds immediately.
	 
	 	 
	 

	 	Eligibility Date: first quarter after 12 months of employment
	 
	 	 
	Deferred 

Compensation 

Plan:

	 	As an officer of Chico’s, you will be immediately eligible
to participate in the Chico’s Deferred Compensation Plan
for the remainder of calendar year 2007. You will have the
opportunity to defer pre-tax compensation (less applicable
FICA/Medicare tax withholding). You may defer up to 80% of
your base salary and up to 100% of your semi-annual bonus.
	 
	 	 
	Stock Purchase 

Plan:

	 	Opportunity to purchase Chico’s stock directly from the
company, two times a year, in March and September.
	 
	 	 
	 

	 	Eligibility Date: September 2008
	 
	 	 
	Relocation:

	 	In order to ensure a successful relocation, Chico’s FAS,
Inc. will provide the relocation assistance outlined in the
attached Chico’s Tier I Relocation Program.

Please indicate your acceptance of our offer by signing below and returning to my attention by a
confidential fax at 239-274-4284. By signing this letter you warrant that you are not a party to
any agreement that would bar or limit the scope of your employment with Chico’s FAS, Inc.

Donna, we are looking forward to having you on our Chico’s team. Let me be the first to welcome
you aboard! We are sure you will find it a challenging and rewarding experience. As we discussed,
this offer is contingent upon the successful completion of references and background check.

If you have any questions, please feel free to call me at 239-274-4145.

Regards,

/s/ Scott
A. Edmonds,

Scott A. Edmonds,

President

Chief Executive Officer

Accepted by:

	 	 	 
	 
	 	 
	 

	 	 
	/s/
Donna Noce Colaco 

	 	8/8/07 
	Donna Noce Colaco

	 	Date

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