EXHIBIT 10.16
DEFERRED COMPENSATION PLAN NO. 2
ChoicePoint Inc. (the "Company") does hereby adopt this ChoicePoint
Inc. Deferred Compensation Plan No. 2, effective October 1, 2002.
ARTICLE I.
PREFACE
SECTION 1.1. Effective Date. The effective date of this Plan is
October 1, 2002.
SECTION 1.2. Purpose of the Plan. The purpose of this Plan is to
provide unfunded deferred compensation to certain persons as
follows:
Pursuant to the provisions of the Company's 1997 Omnibus Stock
Incentive Plan (the "Omnibus Plan") and particularly section 19(c) thereof, to
provide for a select group of highly compensated management Employees of the
Company (and certain affiliated companies) the ability to elect to defer
receipt, until the termination of their employment or attainment of a stated
age, if later, of (i) unrestricted stock, which they would otherwise receive at
the time when the restrictions pertaining to their Restricted Share awards
granted pursuant to the Omnibus Plan would lapse, and (ii) certain cash bonuses
granted at the time of grant of said Restricted Share awards.
SECTION 1.3. Governing Law. This Plan shall be regulated, construed
and administered under the laws of the State of Georgia, except
when preempted by federal law.
SECTION 1.4. Gender and Number. For purposes of interpreting the
provisions of this Plan, the masculine gender shall be deemed to
include the feminine, the feminine gender shall be deemed to
include the masculine, and the singular shall include the plural
unless otherwise clearly required by the context.
ARTICLE II.
DEFINITIONS
The following words and phrases shall have the following respective
meanings for purposes of this Plan:
SECTION 2.1. Account shall mean the record maintained in accordance
with Section 4.3 by the Employer to reflect the number of shares
of the Company's common stock the receipt of which has been
deferred pursuant to the terms hereof.
SECTION 2.2. Beneficiary shall mean the person or persons designated
by the Participant as his Beneficiary under this Plan, in
accordance with the provisions of Article VII hereof.
SECTION 2.3. Benefit shall mean the value as of any given date of
the contributions and appropriate investment experience credited
to a Participant's Account identified in Section 2.1.
SECTION 2.4. ChoicePoint Inc. Stock Fund shall mean a hypothetical
fund established for each Participant to reflect the value of the
Participant's Account invested in said fund. Said fund shall be
credited with shares and fractional shares of Company common stock
at the time of any addition to the Fund which are equal to the
number of shares, including any coincidental cash bonus (converted
into shares), subject to a Participant's deferral election
hereunder. Dividends paid on shares of the Company's common stock
shall be calculated in dollars based on the number of shares held
in the fund and shall be converted into shares based on the amount
of the dividend divided by the value of a share of Company common
stock and credited to the fund as of the date paid, as additional
hypothetical earnings experienced by the fund. Transfers out of
said fund shall be made in shares of Company stock only, and the
fund shall be reduced by the number of shares required. For these
purposes, the value of Company common stock will be the closing
price for the stock quoted in The Wall Street Journal for the date
in question.
SECTION 2.5. Code shall mean the Internal Revenue Code of 1986, as
amended.
SECTION 2.6. Company shall mean ChoicePoint Inc.
SECTION 2.7. Committee shall mean the Management Compensation and
Benefits Committee of the Board of Directors of the Company.
SECTION 2.8. Controlled Group means the Company and any other
corporation which is a member of the controlled group of
corporations of which the Company is a member as defined in
section 414(b) of the Code.
SECTION 2.9. Employee shall mean a person who (a) performs services
for an Employer (b) is a common law employee of such an Employer,
and (c) is classified on the Employer's records, and paid, as a
salaried employee of the Employer.
SECTION 2.10. Employer shall mean the Company and any other
Controlled Group member that adopts this Plan pursuant to Section
8.7.
SECTION 2.11. Insolvent. For purposes of this Plan, an Employer shall
be considered Insolvent at such time as it (a) is unable to pay
its debts as they mature, or (b) is subject to a pending voluntary
or involuntary proceeding as a debtor under the United States
Bankruptcy Code, as heretofore or hereafter amended.
SECTION 2.12. Participant. For a particular Plan Year, the term
Participant shall mean (a) any Employee designated by the Chief
Executive Officer of the Company or, if the Participant in
question is the Chief Executive Officer, by the Management
Compensation and Benefits Committee of the Board of Directors of
the Company,
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as eligible to participate in the Plan. So long as such a person
has an undistributed benefit under the Plan, he shall continue to
be a Participant even though he is no longer an Employee.
SECTION 2.13. Plan shall mean the ChoicePoint Inc. Deferred
Compensation Plan No. 2, as set forth herein or as duly amended.
SECTION 2.14. Plan Administrator shall mean the Chief Financial
Officer and the Vice President, Compensation and Benefits, of the
Company or the person or persons appointed by the Committee or the
Board of Directors to administer the Plan pursuant to Article IX.
SECTION 2.15. Plan Year shall mean the calendar year; provided,
however, that the first Plan Year shall begin on the Effective
Date and end on December 31, 2002.
SECTION 2.16. Restricted Shares shall mean shares of Company common
stock granted to a Participant pursuant to the Omnibus Plan which
are subject to restrictions on transfers and/or a substantial risk
of forfeiture.
SECTION 2.17. Valuation Date shall mean each day in the calendar year
or such other date determined by the Plan Administrator and
communicated to the Participants.
ARTICLE III.
CONTRIBUTIONS
SECTION 3.1. Elections to Defer. Each Participant may, at any time
prior to one (1) year prior to the date on which restrictions
pertaining to Restricted Share awards lapse, elect irrevocably to
defer the receipt of said shares, by instrument in writing
delivered to the Plan Administrator. The irrevocable election to
defer receipt of said shares shall extinguish the Participant's
rights with respect to said shares pursuant to the Omnibus Plan
and replace those rights with the rights described herein. The
number of said Restricted Shares as to which such an election is
made shall be credited to the ChoicePoint Inc. Stock Fund. With
respect to any cash bonus which was granted to the Participant as
of the same date as the Restricted Shares in question, and which
would have been payable, if vested, at the same date as the
restrictions would have lapsed as to said Restricted Shares, each
Participant may also elect to defer the receipt of any portion or
all of said cash bonus award, as designated by the Participant on
the relevant election form, which must be filed no later than one
(1) year prior to the date on which the cash bonus award would be
payable. The deferred cash bonus award will be credited to the
Participant's Account and treated as if invested in common stock
of the Company in the ChoicePoint Inc. Stock Fund based on the
value of said shares determined by the Administrator as of the
date of the deferral.
SECTION 3.2. Effect and Duration of Election. Any elections made in
accordance with Section 3.1 above shall be irrevocable.
Notwithstanding the foregoing, a Participant's election to defer
shall automatically terminate on the earlier of the
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date the Participant's Employer is deemed Insolvent, or the date
the Plan is terminated.
ARTICLE IV.
ACCOUNT ADMINISTRATION
SECTION 4.1. Account Earnings Credit. As of each Valuation Date, the
Accounts attributable to each Participant shall be revalued based
on the closing price of the Company's stock, quoted in The Wall
Street Journal, for said date or for the most immediately
preceding date for which such a quote is published if not
published on the Valuation Date.
SECTION 4.2. Investment Fund. The sole investment fund available to
determine the earnings credit to be applied (see Section 4.1) to
each account is the ChoicePoint Inc. Stock Fund. Notwithstanding
the foregoing, in the absence of a formal amendment to the Plan to
permit otherwise, under no circumstances shall any Employer
actually invest any amounts of the Employer's cash or other assets
in ChoicePoint Inc. stock for the purposes of this Plan.
SECTION 4.3. Participant's Accounts. Each Employer shall establish
and maintain on its books a reserve in an aggregate amount equal
to the total of the accounts for each Participant. The Plan
Administrator shall maintain records for individual Participants
which shall contain the following entries, as applicable:
(a) Amounts deferred pursuant to Section 3.1;
(b) Amounts to all Accounts for the earnings described in
Section 4.1 which shall continue until such Accounts have
been distributed to the Participant or his Beneficiary, and
(c) Debits for any distributions made from the Accounts.
SECTION 4.4. Statements. Participants shall be provided with
statements of their Account balances as soon as practicable
following each calendar quarter.
ARTICLE V.
VESTING
A Participant shall be 100% vested in amounts credited to his Account
hereunder upon the date on which the substantial risk of forfeiture and/or
restriction on transfer of the Restricted Shares awarded to him would lapse by
the terms of said award.
ARTICLE VI.
DISTRIBUTION OF BENEFITS TO PARTICIPANTS
SECTION 6.1. Deferral Election Form.
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(a) Deferral Period. The Deferral Election Forms described in
the appropriate section above shall also contain such
Participant's election regarding the time of the
commencement of payment to him of his Benefit described
therein. Each Participant may elect that payment of his
Benefit shall commence on (i) the date on which he ceases to
be an Employee of all members of the Controlled Group, or if
later, (ii) the date on which he attains an age specified in
the Deferral Election Form.
(b) Form of Payment. In the Deferral Election Form, the
Participant shall also elect whether to receive his benefits
under the Plan in the form of a lump sum payment or in
annual installments for a period not exceeding 20 years.
Payments of benefits hereunder shall be made in the form
elected by the Participant, provided that the Participant
shall have made a written election with respect to the form
of payment at least twelve months prior to the commencement
of payments hereunder. In the event that the Participant has
made more than one such election, the most recent election
filed with the Plan Administrator, but no less than 12
months prior to the date payments are to commence, shall
control. If the Participant fails to make a valid election
with respect to the form of payment, payments hereunder
shall be made in the form of a single lump sum payment.
SECTION 6.2. Time and Manner of Payment.
(a) Timing. A Participant's Benefit shall be paid (or commence
to be paid) to the Participant no later than the 30th day
after the date specified in the Participant's Deferral
Election Form pursuant to Section 6.1.
(b) Form. A Participant's Benefit shall be distributed to the
Participant in the form(s) selected by the Participant in
the Deferral Election Form pursuant to Section 6.1 with
respect to such amounts. If installment payments are
elected, the first installment shall be paid on the date
specified in Section 6.2(a) and shall be made annually
thereafter, with each installment being based on the number
of shares of Company common stock held in the Account on the
date immediately preceding the date such installment is to
be paid. The installment shall be equal to such number
multiplied by a fraction the numerator of which is one and
the denominator of which is the total number of remaining
installments to be paid, provided that the resulting number
shall be rounded to the next higher whole number of shares,
unless the final installment consists of a fraction, in
which event it will be distributed in its cash equivalent
determined by the Plan Administrator in good faith. The
minimum installment payment shall be one share of Company
common stock, except that the final payment shall be the
remaining number, or fractions of shares of Company common
stock held in the Account.
(c) Small Accounts. Notwithstanding any provision of the Plan or
a Participant's Deferral Election Form to the contrary, in
the event that the
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Account of a Participant does not exceed 100 shares of
Company common stock at the time of the Participant's
termination of employment with all members of the Controlled
Group (regardless of whether the Participant has elected
distribution at a later age), such Account shall
automatically be paid to him in a single lump sum payment as
soon as practicable following such termination of
employment.
SECTION 6.3. Liability for Payment/Expenses. The Company shall pay
all Benefits and any administrative expenses hereunder to or on
behalf of a Participant.
ARTICLE VII.
DEATH BENEFITS
SECTION 7.1. Beneficiary Designations. A designation of a
Beneficiary hereunder may be made only by an instrument (in form
acceptable to the Plan Administrator) signed by the Participant
and filed with the Plan Administrator prior to the Participant's
death. In the absence of such a designation and at any other time
when there is no existing Beneficiary designated hereunder, the
Beneficiary of a Participant for his Benefits shall be the estate
of the Participant. If two or more persons designated as a
Participant's Beneficiary are in existence with respect to a
single Benefit, the amount of any payment to the Beneficiary under
this Plan shall be divided equally among such persons unless the
Participant's designation specifically provides for a different
allocation. Any change in Beneficiary shall be made by giving
written notice thereof to the Plan Administrator and any change
shall be effective only if received by the Plan Administrator
prior to the death of the Participant.
SECTION 7.2. Distribution to Beneficiaries.
(a) Amount of Benefits. The Benefits payable to a Participant's
Beneficiary under this Plan shall be equal to such
Participant's Account balance (or, in the case of a
Participant who is not fully vested, the appropriate
fraction thereof), on the date of the distribution of the
Account to the Beneficiary.
(b) Time of Payment. The Benefits payable to a Beneficiary under
this Plan shall be paid as soon as practicable following the
death of the Participant.
(c) Manner of Payment. All Benefits payable to a Beneficiary
hereunder shall be paid in the form of a lump sum payment,
unless the Participant has elected on the appropriate
Deferral Election Form, prior to his death, that the
Benefits shall be paid to the Beneficiary (i) in the form of
annual installments for a period not exceeding 5 years or
(ii) in the form currently being paid, if payments are in
pay status at the time of the death, or (iii) in such other
form as the Plan Administrator has made available on the
Deferral Election Form from time to time. All payments shall
be made in shares of Company common stock.
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ARTICLE VIII.
MISCELLANEOUS
SECTION 8.1. Liability of Employers. Nothing in this Plan shall
constitute the creation of a trust or other fiduciary relationship between an
Employer and any Participant, Beneficiary or any other person.
SECTION 8.2. Limitation on Rights of Participants and Beneficiaries
- No Lien. The Plan is designed to be an unfunded, nonqualified
plan. Nothing contained herein shall be deemed to create a trust
or lien in favor of any Participant or Beneficiary on any assets
of any Employer. The Employers shall have no obligation to
purchase any assets that do not remain subject to the claims of
the creditors of the Employers for use in connection with the
Plan. No Participant or Beneficiary or any other person shall have
any preferred claim on, or any beneficial ownership interest in,
any assets of an Employer prior to the time that such assets are
paid to the Participant or Beneficiary as provided herein. Each
Participant and Beneficiary shall have the status of a general
unsecured creditor of the Employers.
SECTION 8.3. No Guarantee of Employment. Nothing in this Plan shall
be construed as guaranteeing future employment to any Participant.
A Participant who is an Employee continues to be an Employee of an
Employer solely at the will of the Employer and is subject to
discharge at any time, with or without cause.
SECTION 8.4. Payment to Guardian. If a benefit payable hereunder is
payable to a minor, to a person declared incompetent or to a
person incapable of handling the disposition of his property, the
Plan Administrator may direct payment of such benefit to the
guardian, legal representative or person having the care and
custody of such minor, incompetent or person. The Plan
Administrator may require such proof of incompetency, minority,
incapacity or guardianship as it may deem appropriate prior to
distribution of the benefit. Such distribution shall completely
discharge the Employers from all liability with respect to such
benefit.
SECTION 8.5. Assignment. No right or interest under this Plan of any
Participant or Beneficiary shall be assignable or transferable in
any manner or be subject to alienation, anticipation, sale,
pledge, encumbrance or other legal process or in any manner be
liable for or subject to the debts or liabilities of the
Participant or Beneficiary.
SECTION 8.6. Severability. If any provision of this Plan or the
application thereof to any circumstance(s) or person(s) is held to
be invalid by a court of competent jurisdiction, the remainder of
the Plan and the application of such provision to other
circumstances or persons shall not be affected thereby.
SECTION 8.7. Adoption by Other Employers. Any member of the
Controlled Group may adopt this Plan with the consent of the Plan
Administrator or the Chief Executive Officer of the Company by
executing an instrument evidencing its adoption of this Plan on
the order of its Board of Directors and filing a copy
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thereof with the Company. Such adoption may be subject to such
terms and conditions as the Committee requires or approves.
SECTION 8.8. Tax Withholding. Any amount payable to a Participant or
Beneficiary under this Plan shall be subject to reduction by
amounts required to be withheld by the Company under any provision
of law (including without limitation the provisions of federal,
state, local and foreign tax laws).
SECTION 8.9. Effect on other Benefits. Benefits payable to or with
respect to a Participant under the 401 (k) Plan or any other
Employer-sponsored (qualified or nonqualified) plan, if any, are
in addition to those provided under this Plan.
ARTICLE IX.
ADMINISTRATION OF THE PLAN
SECTION 9.1. Administration.
(a) In general. The Plan shall be administered by the Plan
Administrator. The Plan Administrator shall have sole and
absolute discretion to interpret where necessary all
provisions of the Plan (including, without limitation, by
supplying omissions from, correcting deficiencies in, or
resolving inconsistencies or ambiguities in, the language of
the Plan), to determine the rights and status under the Plan
of Participants, or other persons, to resolve questions or
disputes arising under the Plan and to make any
determinations with respect to the Benefits payable under
the Plan and the persons entitled thereto as may be
necessary for the purposes of the Plan. Without limiting the
generality of the foregoing, the Plan Administrator is
hereby granted the authority (i) to determine whether a
particular Employee is a Participant, and (ii) to determine
if an Employee is entitled to Benefits hereunder and, if so,
the amount and duration of such Benefits, and (iii) to make
any other decisions required in connection with the ongoing
administration of the Plan. The Plan Administrator's
determination of the rights of any Employee or former
Employee or Beneficiary hereunder shall be final and binding
on all persons, subject only to the provisions of Sections
9.3 and 9.4 hereof.
(b) Delegation of Duties. The Plan Administrator may delegate
any of its administrative duties, including, without
limitation, duties with respect to the processing, review,
investigation, approval and payment of Benefits, to a named
administrator or administrators.
SECTION 9.2. Regulations. The Plan Administrator shall promulgate
any rules and regulations he deems necessary in order to carry out
the purposes of the Plan or to interpret the provisions of the
Plan; provided, however, that no rule, regulation or
interpretation shall be contrary to the provisions of the Plan.
The rules, regulations and interpretations made by the Plan
Administrator shall, subject to the provisions of Sections 9.3 and
9.4 hereof be final and binding on all persons.
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SECTION 9.3. Claims Procedures. The Plan Administrator shall
determine the rights of any Employee or former Employee or
Beneficiary to any Benefits hereunder. Any person who believes
that he has not received the Benefits to which he is entitled
under the Plan may file a claim in writing with the Plan
Administrator. The Plan Administrator shall, no later than 90 days
after the receipt of a claim (plus an additional period of 90 days
if required for processing, provided that notice of the extension
of time is given to the claimant within the first 90 day period),
either allow or deny the claim in writing. If a claimant does not
receive written notice of the Plan Administrator's decision on his
claim within the above-mentioned period, the claim shall be deemed
to have been denied in full.
A denial of a claim by the Plan Administrator, wholly or partially,
shall be written in a manner calculated to be understood by the claimant and
shall include:
(a) the specific reasons for the denial;
(b) specific reference to pertinent Plan provisions on which the
denial is based;
(c) a description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is
necessary; and
(d) an explanation of the claim review procedure.
A claimant whose claim is denied (or his duly authorized
representative) may within 60 days after receipt of denial of a claim file with
the Plan Administrator a written request for a review of such claim. If the
claimant does not file a request for review of his claim within such 60-day
period, the claimant shall be deemed to have acquiesced in the original decision
of the Plan Administrator on his claim. If such an appeal is so filed within
such 60-day period, the Company (or its delegate) shall conduct a full and fair
review of such claim.
The Company shall mail or deliver to the claimant a written decision on
the matter based on the facts and the pertinent provisions of the Plan within 60
days after the receipt of the request for review (unless special circumstances
require an extension of up to 60 additional days, in which case written notice
of such extension shall be given to the claimant prior to the commencement of
such extension). Such decision shall be written in a manner calculated to be
understood by the claimant, shall state the specific reasons for the decision
and the specific Plan provisions on which the decision was based and shall, to
the extent permitted by law, be final and binding on all interested persons. If
the decision on review is not furnished to the claimant within the
above-mentioned time period, the claim shall be deemed to have been denied on
review.
SECTION 9.4. Revocability of Plan Administrator/Employer Action. Any
action taken by the Plan Administrator or an Employer with respect
to the rights or benefits under the Plan of any person shall be
revocable by the Plan Administrator or the Employer as to payments
not yet made to such person, and acceptance of any Benefits under
the Plan constitutes acceptance of and agreement to the Plan
Administrator's or the Employer's making any appropriate
adjustments in future
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payments to such person (or to recover from such person) for any
excess payment or underpayment previously made to him.
SECTION 9.5. Amendment. The Committee may at any time (without the
consent of an Employer) amend any or all of the provisions of this
Plan, except that (a) no such amendment may adversely affect any
Participant's Benefit as of the date of such amendment and (b) no
such amendment may suspend the crediting of earnings on the
balance of a Participant's Account, until the entire balance of
such Account has been distributed, in either case, without the
prior written consent of the affected Participant. Any amendment
shall be in the form of a written instrument executed by an
authorized officer of the Company on the order of the Committee.
In addition, the Plan Administrator shall have the authority to
adopt (i) amendments to the Plan in order to comply with the
requirements of applicable laws and regulations, and (ii) any
other amendments that are consistent with the overall compensation
and benefit policies of the Company. Subject to the foregoing
provisions of this Section, such amendment shall become effective
as of the date specified in such instrument or, if no such date is
specified, on the date of its execution.
SECTION 9.6. Termination.
(a) The Committee, in its sole discretion, may terminate this
Plan at any time and for any reason whatsoever, except that
(i) no such termination may adversely affect any
Participant's Benefit as of the date of such termination,
except for the acceleration of distribution thereof, and
(ii) no such termination may suspend the crediting of
earnings on the balance of a Participant's Account, until
the entire balance of such Account has been distributed, in
either case, without the prior written consent of the
affected Participant. Any such termination shall be
expressed in the form of a written instrument executed by an
authorized officer of the Company on the order of the
Committee. Subject to the foregoing provisions of this
Subsection, such termination shall become effective as of
the date specified in such instrument or, if no such date is
specified, on the date of its execution. Written notice of
any termination shall be given to the Participants as soon
as practicable after the instrument is executed.
(b) Notwithstanding anything in the Plan to the contrary, in the
event of a termination of the Plan, the Company, in its sole
and absolute discretion, shall have the right to change the
time and form of distribution of Participants' Benefits,
including requiring that all amounts credited to
Participants' Accounts hereunder be immediately distributed
in the form of a lump sum payment.
(c) Any Employer (other than the Company) that adopts the Plan
may elect to withdraw from the Plan and such withdrawal
shall constitute a termination of the Plan as to such
Employer provided, however, that such terminating Employer
shall continue to be an Employer for the purposes hereof as
to
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Participants or Beneficiaries to whom it owes obligations
hereunder. Such withdrawal and termination shall be expressed in
an instrument executed by the terminating Employer on authority of
its Board of Directors (or the applicable Committee thereof) and
filed with the Plan Administrator, and shall become effective as
of the date designated in such instrument or, if no such date is
specified, on the date of its execution. Notwithstanding any other
provision of the Plan, if an Employer (other than the Company)
ceases to be a member of the Controlled Group, the Plan shall
automatically terminate with respect to such Employer and all
vested amounts credited to the Accounts of Employees of such
Employer shall be immediately payable in the form of a lump sum
payment or any applicable form of payment pursuant to the
Participant's election, which shall thereupon become effective, or
transferred to appropriate accounts established under a successor
plan by said Employer.
Executed as of the Effective Date.
CHOICEPOINT INC.
By: /s/ J. Michael de Janes
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Title: General Counsel and Secretary
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