EXHIBIT 10(n)
CHECKFREE CORPORATION
NONQUALIFIED DEFERRED COMPENSATION PLAN
THIS NONQUALIFIED DEFERRED COMPENSATION PLAN (the "Plan"), the terms and
provisions of which are herein contained, is made and entered into effective as
of this 31st day of December 1998 (the "Effective Date") by CHECKFREE
CORPORATION, a Delaware corporation (the "Company").
1. PURPOSE OF THE PLAN.
The purpose of this Plan is to establish a deferred compensation program
for certain key management and highly-compensated associates of the Company and
any of its Subsidiaries and Affiliates permitting such associates with the
ability to defer the receipt of compensation from the Company.
2. DEFINITIONS.
As used in this Plan, the following capitalized terms shall have the
indicated meaning.
"Affiliate" means any entity other than the Company and its
Subsidiaries that is designated by the Board as a participating employer under
the Plan, provided that the Company directly or indirectly owns at least 20% of
the combined voting power of all classes of stock of such entity or more than
50% of the ownership interests in such entity.
"Annual Enrollment Form" means, with respect to each Participant and
any calendar year, the form attached hereto as Exhibit B or as may otherwise be
specified by the Plan Administrator, as completed and delivered to the Company
by each Participant pursuant to such specific deadlines as may exist from time
to time pursuant to the Plan.
"Beneficiary" has the meaning set forth in Section 9 hereof.
"Board" means the Board of Directors of the Company.
"Bonus Compensation" means any cash compensation payable to a
Participant pursuant to a written incentive plan of the Company for any fiscal
year of the Company.
"Bonus Deferral Election" means an election to defer a portion of a
Participant's Bonus Compensation for any fiscal year of the Company pursuant to
the Plan and as set forth in the Participant's Annual Enrollment Form for the
calendar year in which ends the Company's fiscal year.
"Business Day" means any day on which both (i) the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") is open
for trading and (ii) each of the Company, the Trustee, each Investment and any
record keeper retained by the Plan Administrator is open for business.
"Change of Control" means the occurrence of one or more of the
following events:
(a) Any Person (other than a Person in control of the Company as of
the Effective Date of the Plan, or other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company, or a company
owned directly or indirectly by the stockholders of the Company in substantially
the same proportions as their ownership of voting securities of the Company)
becomes the Beneficial Owner, directly or indirectly, of securities of the
Company representing a majority of the combined voting power of the Company's
then outstanding securities; or
(b) The stockholders of the Company approve: (i) a plan of complete
liquidation of the Company; or (ii) an agreement for the sale or disposition of
all or substantially all the Company's assets; or (iii) a merger, consolidation,
or reorganization of the Company with or involving any other corporation, other
than a merger, consolidation, or reorganization that would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least a majority of the combined voting
power of the voting securities of the Company (or such surviving entity)
outstanding immediately after such merger, consolidation, or reorganization.
However, in no event shall a "Change of Control" be deemed to have
occurred, with respect to a Participant, if the Participant is part of a
purchasing group which consummates the Change of Control transaction. A
Participant shall be deemed "part of a purchasing group" for purposes of the
preceding sentence if the Participant is an equity participant or has been
identified as a potential equity participant in the purchasing company or group
except for: (i) passive ownership of less than three percent (3%) of the stock
of the purchasing company; or (ii) ownership of equity participation in the
purchasing company or group which is otherwise not significant, as determined
prior to the Change of Control by a majority of the nonemployee continuing
directors.
For purposes of this definition of Change of Control, "Person" shall
have the meaning ascribed to such term in Section 3(a)(9) of the 1934 Act, and
used in Section 13(d) and 14(d) thereof, including a "group" as defined in
Section 13(d) thereof, and "Beneficial Owner" shall have the meaning ascribed to
such term in Rule 13d-3 of the General Rules and Regulations under the 1934 Act.
- 2 -
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means CheckFree Corporation, a corporation organized under
the laws of the State of Delaware, or any successor corporation.
"Deferral Account" means, with respect to each Participant, the
book-keeping record maintained by the Company for each Participant in accordance
with the terms of this Plan.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Effective Date" has the meaning as set forth in the introductory
paragraph of this Plan.
"Fair Market Value" means, with respect to any Investment, the closing
price on the date of reference, or if there were no sales on such date, then the
closing price on the nearest preceding day on which there were such sales, and
in the case of an unlisted security, the mean between the bid and asked prices
on the date of reference, or if no such prices are available for such date, then
the mean between the bid and asked prices on the nearest preceding day for which
such prices are available. With respect to any Investment which reports "net
asset values" or similar measures of the value of an ownership interest in the
Investment, Fair Market Value shall mean such closing net asset value on the
date of reference, or if no net asset value was reported on such date, then the
net asset value on the nearest preceding day on which such net asset value was
reported. For any Investment not described in the preceding sentences, Fair
Market Value shall mean the value of the Investment as determined by the Plan
Administrator in its reasonable judgment on a consistent basis, based upon such
available and relevant information as the Plan Administrator determines to be
appropriate.
"Installment Distribution Option" means the distribution option for a
Participant's Retirement Account as described in Section 8(b)(i) hereof.
"Investment" means the options set forth in Exhibit "A" attached
hereto, as the same may be amended from time to time by the Company in its sole
and absolute discretion.
"Lump Sum Distribution Option" means the distribution option for a
Participant's Retirement Account as described in Section 8(b)(ii) hereof.
"Mandatory Commencement Date" means, with respect to each Participant,
the date of the Participant's 65th birthday. For example, the Mandatory
Commencement Date for a Participant born on October 1, 1950 is October 1, 2015.
"Participant" means an associate of the Company or any Subsidiary or
Affiliate
- 3 -
designated in Section 4 hereof, or otherwise designated by the Plan
Administrator in its sole and absolute discretion for participation in the Plan
who enters into a Participation Agreement, or a person who was such at the time
of his retirement, death, or other termination of employment and who obtains, or
whose beneficiary obtains, benefits under this Plan in accordance with its
terms.
"Participation Agreement" means an agreement between the Company and
an individual pursuant to which the individual becomes a Participant in the form
set forth in Exhibit "C" attached hereto or such other form as may otherwise be
specified by the Plan Administrator. Participation Agreements for each
Participant need not be the same and may contain such terms and conditions, not
inconsistent with the Plan, as the Plan Administrator may determine appropriate.
"Permitted Retirement Date" means the date on which a Participant both
has (i) completed at least ten (10) years of full-time employment with the
Company or any subsidiary or Affiliate, and (ii) is at least 55 years old.
"Plan" means this CheckFree Corporation Nonqualified Deferred
Compensation Plan, as it may be amended from time to time.
"Plan Administrator" means the Company or such person or persons as
may be designated from time to time in writing by the Company.
"Retirement Account" means, with respect to each Participant, that
portion of a Participant's Deferral Account which is determined in accordance
with Section 6(d) hereof.
"Salary Compensation" means any base salary plus any receipts of
commission compensation which is otherwise payable to a Participant in cash by
the Company in any calendar year, without reduction for the amount of any
contributions made by the Company on behalf of Participant under any salary
reduction or similar arrangement to a qualified deferred compensation, pension
or cafeteria plan, contributions toward a simplified employee pension plan
described in Section 408(k) of the Code, contributions towards the purchase of
an annuity contract described in Section 403(b) of the Code, and/or
contributions of elective contributions pursuant to an arrangement qualified
under Section 401(k) of the Code; provided, however, that in no event shall
"Salary Compensation" include any severance payments or other compensation which
is paid to Participant as a result of the Participant's termination of
employment with the Company. Notwithstanding anything herein to the contrary, in
no event shall Salary Compensation include Bonus Compensation.
"Salary Deferral Election" means an election to defer a portion of a
Participant's Salary Compensation pursuant to the Plan and as set forth in the
Participant's Annual Enrollment Form for the calendar year in which ends the
Company's fiscal year.
"Specified Date Account" means, with respect to each Participant, that
portion of the Participant's Deferral Account which is determined in accordance
with Section 6(d) hereof.
- 4 -
"Sub Account" means, with respect to any Participant, the
Participant's Retirement Account or any Specified Date Account of the
Participant.
"Termination Date" means, with respect to each Participant, the date
on which a Participant terminates employment with the Company and all its
subsidiaries and Affiliates for any reason, including death or disability.
"Trust" means the trust created pursuant to the Trust Agreement.
"Trust Agreement" means that certain Trust Agreement by and between
the Company and the Trustee, entered into or to be entered into in substantially
the form attached hereto as Exhibit "D", as the same may be amended from time to
time in accordance with the terms hereof.
"Trustee" means the trustee of the Trust. The Trustee shall at all
times be a bank with trust powers. The initial and any successor Trustee shall
be as selected by the Company pursuant to the Trust Agreement.
"Unforeseeable Emergency" means with respect to any Participant, an
unanticipated emergency that is caused by an event beyond the control of the
Participant and that would result in severe financial hardship to the
Participant if an early payment of amounts pursuant to this Plan were not
permitted.
"Voting Securities" means any security which ordinarily possesses the
power to vote in the election of the Board without the happening of any
precondition or contingency.
3. ADMINISTRATION.
The Plan shall be administered by the Plan Administrator. The Plan
Administrator shall have the authority to adopt, alter and repeal such rules,
guidelines and practices governing the Plan as it shall, from time to time, deem
advisable; to interpret the terms and provisions of the Plan and any award
issued under the Plan (and any agreements relating thereto); and to otherwise
supervise the administration of the Plan. All decisions made by the Plan
Administrator pursuant to the provisions of the Plan shall be made in the Plan
Administrator's sole discretion and shall be final and binding on all persons,
including Participants.
Without limiting the generality of the foregoing, the Plan Administrator
shall have the following powers and duties:
(a) To require any person to furnish such reasonable information as
may be requested for the purpose of the proper administration of the Plan
as a condition to receiving any benefits under the Plan;
- 5 -
(b) To make and enforce such rules and regulations and prescribe the
use of such forms as it shall deem necessary for the efficient
administration of the Plan;
(c) To determine the amount of benefits that shall be payable to any
person in accordance with the provisions of the Plan, and to provide a full
and fair review to any Participant whose claim for benefits has been denied
in whole or in part;
(d) To employ at the expense of the Company other persons (who may or
may not be employed by the Company) to assist the Plan Administrator in
carrying out its duties under the terms of the Plan;
(e) To keep records of all acts and determinations, and to keep all
such records, books of account, data and other documents as may be
necessary for the proper administration of the Plan;
(f) To prepare and distribute to all Participants, and Beneficiaries
information concerning the Plan and their rights under the Plan;
(g) To exercise any powers reserved to the Company under the Trust
executed in connection with this Plan, including but not limited to the
power to provide investment guidelines to the trustee under the Trust; and
(h) To do all things necessary to operate and administer the Plan in
accordance with its provisions.
4. PARTICIPANTS.
The Plan Administrator, in its sole and absolute discretion, shall select
those management or other key associates of the Company or any Affiliate or
Subsidiary who are responsible for or contribute to the management, growth
and/or profitability of the business of the Company and/or its Subsidiaries and
Affiliates to participate in the Plan. No one shall be treated as a Participant
unless and until the person has entered into a Participation Agreement.
5. DEFERRED COMPENSATION.
(a) Salary Deferrals. Any Participant may elect to defer the receipt of a
portion of the Salary Compensation otherwise payable to the Participant by the
Company or any Subsidiary or Affiliate in any calendar year, which portion, not
to exceed twenty-five percent (25%) per annum, shall be designated by the
Participant pursuant to a Salary Deferral Election as set forth on the Annual
Enrollment Form.
(b) Bonus Deferrals. Any Participant may elect to defer annually the
receipt of a portion of or all of the Bonus Compensation otherwise payable to
the Participant by the Company or
- 6 -
any Subsidiary or Affiliate in any fiscal year, which portion shall be
designated by him/her pursuant to a Bonus Deferral Election as set forth on the
Annual Enrollment Form.
(c) Annual Enrollment Forms. Unless otherwise approved by the Plan
Administrator, Annual Enrollment Forms must be completed, signed, and delivered
to the Company prior to January 1 of each calendar year for any Salary or Bonus
Deferred Elections to be effective. Notwithstanding the foregoing, with respect
to the calendar year in which a Participant first becomes eligible to
participate in this Plan, the newly eligible Participant may make a Salary or
Bonus Deferral Election pursuant to an Annual Enrollment Form if such election
is made within 30 days after the date the associate becomes eligible.
6. DEFERRAL ACCOUNTS.
(a) Any compensation deferred pursuant to Section 5 of this Plan shall be
credited to the Deferral Account maintained in the name of the Participant.
Deferral Accounts shall be bookkeeping accounts maintained on the Company's
records. Deferral Account shall be credited (i) with respect to deferrals of
Salary Compensation, on the same day of each month on which cash compensation
would otherwise have been paid to a Participant, with a dollar amount equal to
the total amount by which the Participant's cash compensation for such month was
reduced in accordance with the Participant's Salary Deferral Election, and (ii)
with respect to deferrals of Bonus Compensation, on the date such bonus
compensation would otherwise have been paid to the Participant in accordance
with the Company's normal practices.
(b) The credit balance of the Deferral Account for each Participant shall
be deemed to have been invested and reinvested from time to time in such
Investments as shall be designated by the Participant in accordance with the
following:
(i) Upon commencement of participation in the Plan, each Participant
shall make a designation of the Investments which the Participant desires to
have deemed to be purchased with the amounts credited to the Participant's
Deferral Account in accordance with Section 6(a) hereof. All such deemed
purchases of Investments with respect to such amounts shall be deemed to have
occurred on the day on which the deferrals are credited to the Participant's
Deferral Account, unless such day is not a Business Day, in which event the
deemed purchase shall be deemed to have occurred on the first Business Day
following such day.
(ii) Each Participant shall have the right, by giving notice to the
Plan Administrator to (A) change the existing Investments in which the
Participant's Deferral Account is deemed to be invested by deeming a portion of
the existing Investments in the Participant's Account to have been sold and the
new Investments purchased; and (B) change the Investments which are deemed to be
purchased with future credits to the Participant's Deferral Account pursuant to
Sections 6(a)(i) and (ii). No Participant shall be permitted to make more than
six (6) changes pursuant to (A) or (B) in any one calendar year. Such changes
shall be made in such specific manner as shall be specified from time to time by
the Plan Administrator. Any such change shall be
- 7 -
effective as of the day given so long as such day is a Business Day and the
notice of such change is given by 4:00 P.M. Eastern Standard Time on such day.
Otherwise, such change shall be effective on the Business Day immediately
following the date of such notice.
(iii) In the case of any deemed purchase, the Deferral Account shall
be debited with a dollar amount equal to the quantity and kind of the Investment
deemed to have been purchased multiplied by the Fair Market Value of such
Investment on the date of reference and shall be credited with the quantity and
kind of Investment so deemed to have been purchased. In the case of any deemed
sale of an Investment, the Deferral Account shall be debited with the quantity
and kind of Investment deemed to have been sold, and shall be credited with a
dollar amount equal to the quantity and kind of Investment deemed to have been
sold multiplied by the Fair Market Value of such Investment on the date of
reference.
(iv) In no event shall the Company be under any obligation, as a
result of any designation of Investments made by Participants, to acquire assets
(or to cause the Trust to acquire assets) which correspond with any such
Investments.
(c) The Company shall, within the 45-day period following the close of each
quarter during each calendar year (March 31, June 30, September 30 and December
31), furnish each Participant with a statement of the balance of the
Participant's Deferral Account and all Sub Accounts, showing all debits and
credits thereto in accordance with the terms of this Plan.
(d) A Participant's Deferral Account shall be divided into separate
Retirement and Specified Date Accounts which shall be Sub Accounts determined in
accordance with this Section 6(d) as follows:
(i) A Participant's Retirement Account shall initially be
credited with the portion of the Salary Compensation and the Bonus Compensation
credited to a Participant's Deferral Account pursuant to Section 6(a) hereof
which is specified by the Participant on his Annual Enrollment Form for such
calendar year to be credited to the Participant's Retirement Account. A
Participant shall have only 1 Retirement Account.
(ii) A Participant's Specified Date Account for any specified
year shall initially be credited with the portion of the Salary Compensation and
the Bonus Compensation credited to a Participant's Specified Date Account
pursuant to Section 6(a) hereof which is specified by the Participant to be
credited to the Participant's Specified Date Account for such specified year on
his Annual Enrollment Form for such calendar year. The Specified Date Accounts
shall be designated by any particular year which begins at least twelve (12)
months after an individual becomes a Participant; provided however, that a
Participant shall not be permitted to designate a year for a Specified Date
Account which is after the year in which occurs the Participant's Mandatory
Commencement Date. If a Participant designates a Specified Date Account pursuant
to any Annual Enrollment Form which is not permitted by the immediately
preceding sentence, such designation of Specified Date Account shall be deemed
null and void and all amounts otherwise
- 8 -
designated by the Participant to be credited to such Specified Date Account
shall instead be credited to the Participant's Retirement Account.
(iii) All deemed Investment designations made by a Participant
pursuant to this Plan shall be specified by percentages and shall be deemed to
apply in the same percentage to each of the credit balances of all Sub Accounts
of the Participant's Deferred Comp Account, so that at all times the portion of
the total credit balance of each Sub Account that is deemed to be invested in a
particular Investment designated by the Participant shall be identical for all
Sub Accounts.
(e) A Participant's Deferral Account (and Sub Accounts thereof) shall be
debited in an amount equal to the amount of cash distributed to the Participant
or the Participant's Beneficiary pursuant to Section 8 hereof.
(f) In determining the amounts of all debits and credits to Deferral
Accounts and Sub Accounts, the Plan Administrator shall exercise its reasonable
best judgment, and all such determinations (in the absence of bad faith) shall
be binding upon all Participants and their Beneficiaries. If an error is
discovered in the Deferral Account or any Sub Account of a Participant, the Plan
Administrator, in its sole and absolute discretion, shall cause appropriate,
equitable adjustments to be made as soon as administratively practicable
following the discovery of such error or omission.
7. THE TRUST.
(a) The Company shall enter into the Trust Agreement creating the
Trust for the purposes specified therein and herein. The Trust is intended to be
a "grantor trust" with the result that the corpus and income of the trust be
treated as assets and income of the Company for federal income tax purposes
pursuant to Subpart E, Part I, Subchapter J, Chapter 1, Subtitle A of the Code.
The Trust and any assets held by the Trust will in all events conform to the
substantive terms of the "model trust" described in Revenue Procedure 92-64,
1992-2 C.B. 422, all as determined by the Company in its sole and absolute
discretion. All amounts contributed to the Trust shall remain the assets of the
Company subject to the terms and conditions of the Trust Agreement.
(b) The Company shall contribute an amount equal to the credits to the
Participant's Deferral Account with respect to Salary Deferral Elections and
Bonus Deferral Elections at such times as such amounts are credited to a
Participants account in accordance with Sections 5 and 6 hereof.
(c) The Company shall remain primarily liable to make payments to
Participants and their Beneficiaries pursuant to this Plan and the Company's
contribution of amounts to the Trust shall not satisfy the Company's obligation
to make payments to Participants and/or Beneficiaries pursuant to this Plan.
Distributions from the Trust to Participants or Beneficiaries will, however, be
applied in satisfaction of such obligation of the Company to make payments
pursuant to Section 8 hereof.
- 9 -
(d) The Company shall be responsible for and pay without any debit to
the Deferral Account or reduction in the Trust, all amounts owed the Trustee
pursuant to the Trust Agreement (including, without limitation, any amounts
which are due pursuant to Section 9 of the Trust Agreement). In the event that
the Company does not pay any such amounts to the Trustee and the Trustee charges
such amount against, and pays it from, the Trust, the Company shall immediately
contribute an amount equal to such charge to the Trust.
8. DISTRIBUTIONS.
(a) Specified Date Accounts.
(i) Specified Date. Except as otherwise provided in this Section
8(a), Participant shall be paid an amount equal to the credit balance of the
Participant's Specified Date Account by January 15th of the year specified for
such Specified Date Account.
(ii) Termination of Employment. If a Participant's Termination
Date occurs prior to payment with respect to a Specified Date Account pursuant
to Section 8(a)(i) or (iii) hereof, the Participant shall be paid an amount
equal to the credit balance of such Specified Date Account within thirty (30)
days of the Participant's Termination Date.
(iii) Change of Control. If there is a Change of Control prior to
the payment with respect to a Specified Date Account pursuant to Section 8(a)(i)
or 8(a)(ii) hereof, a Participant shall be paid an amount equal to the credit
balance of such Specified Date Account within thirty (30) days following such
Change of Control.
(b) Retirement Account.
(i) Termination of Employment After Permitted Retirement Date or
Due to Death. Except as otherwise provided in this Section 8(b), if a
Participant's Termination Date occurs after the Participant's Permitted
Retirement Date or prior to the Participant's Permitted Retirement Date due to
the Participant's death, then the Participant shall be paid an amount equal to
the credit balance of the Participant's Retirement Account pursuant to the
distribution option set forth below that was specifically selected by the
Participant pursuant to the Participant's Participation Agreement:
(A) Installment Distribution Option. If the Participant
selects the "Installment Distribution Option," the Participant shall receive
annual payments commencing on any day which is no more than 30 days following
the Participant's Termination Date and continuing annually thereafter on the
same date for two (2) to fifteen (15) years (as selected by the Participant in
the Participant's Participation Agreement). The amount of each annual payment
shall be determined by dividing (I) the balance in the Participant's Retirement
Account, by (II) the number of payments that remain to be made to the
Participant based upon the payout period selected. For
- 10 -
example, if a Participant has selected a 10-year payout period and the first
annual payment is to be made on January 15, 2015, the amount of the payment to
be made on that date would be the quotient obtained by dividing (w) the balance
of the Deferral Account immediately prior to such payment date, by (x) 10; the
amount of the payment for January 15, 2016, would be the quotient obtained by
dividing (y) the balance of the Retirement Account immediately prior to such
payment date in December, Year 1, by (z) 9; and so forth.
(B) Lump Sum Distribution Option. If the Participant selects
the "Lump Sum Distribution Option" in the Participant's Participation Agreement,
the Participant shall be paid within thirty (30) days after the Participant's
Termination Date an amount equal to the credit balance of the Participant's
Retirement Account.
(C) Change in Distribution Options. A Participant shall be
entitled to change payout options of the Participant's Retirement Account
between those in Sections 8(b)(ii)(A) or (B) above by written notice to the
Company delivered any time which is no less than six (6) months prior to the
Termination Date. Any notice of change which is given less than six (6) months
prior to the Participant's Termination Date shall be of no force and effect.
(ii) Termination of Employment Prior to Permitted Retirement Date
Other than Due to Death. Except as otherwise provided in this Section 8(b), if a
Participant's Termination Date occurs prior the Participant's Permitted
Retirement Date for any reason other than the Participant's death, then the
Participant shall be paid, within thirty (30) days after the Participant's
Termination Date, an amount equal to the credit balance of the Participant's
Retirement Account.
(iii) Change of Control. If there is a Change of Control prior to
payment with respect to a Participant's Retirement Account pursuant to Section
8(b)(i) or 8(a)(ii) hereof, the Participant shall be paid an amount equal to the
credit balance of the Participant's Retirement Account within thirty (30) days
following such Change of Control.
(c) Hardship Distributions. If a Participant experiences an
Unforeseeable Emergency, upon application by the Participant, payments of the
then credit balance in the Participant's Deferral Account may be made to the
Participant in an amount which the Plan Administrator determines to be
reasonably necessary to meet the financial hardship associated with such
Unforeseeable Emergency. The Plan Administrator shall have exclusive authority
to determine the circumstances which will constitute an Unforeseeable Emergency.
Notwithstanding the foregoing in no event shall any distributions be made
pursuant to this Section 8(c) to the extent that the Plan Administrator
determines that the financial hardship related to the Unforeseeable Emergency is
or may be relieved (i) through reimbursement or compensation by insurance or
otherwise, or (ii) by liquidation of the Participant's assets, to the extent the
liquidation of such assets would not itself cause severe financial hardship.
(The provisions of this Section 8(c) shall also apply following a Participant's
death to any Beneficiary that is entitled to receive distributions.) The
provisions of this Section 8(c) are intended to comply with the requirements of
Section 3.01(c) of Revenue Procedure 92-65, 1992-2 C.B. 428 and shall be
interpreted and applied in a manner
- 11 -
consistent therewith. All distributions pursuant to this Section 8(c) shall be
debited from each of the Participant's Sub Accounts in proportion to the
respective credit balance of each Sub Account.
(d) Early Payment and Withdrawal. Upon written notice to the Plan
Administrator any time prior to a Participant's Termination Date, a Participant
shall be paid, within thirty (30) days of the date of such written notice, an
amount equal to ninety percent (90%) of the credit balance of all Sub Accounts
of the Participant. If a Participant makes such election for early payment (i)
the Participant shall forfeit, have debited from the Participant's Deferral
Account, and not have any right to receive payment with respect to, ten percent
(10%) of the credit balance of all Sub Accounts of the Participant, (ii) the
Participant shall thereafter cease to be a Participant, and (iii) the
Participant shall not be permitted to again participate in the Plan until at
least the January 1st which is at least twelve (12) months after the date of
such withdrawal.
(e) Withholding and Other Taxes. Any payments pursuant to this Section
8 shall be subject to withholding of federal, state and local income taxes and
any other applicable withholding or employment taxes.
9. BENEFICIARIES.
Each Participant shall have the right to designate a beneficiary (a
"Beneficiary") who is to succeed to the Participant's right to receive payments
hereunder in the event of the Participant's death. If either (a) a Participant
dies without designating a Beneficiary, (ii) the Beneficiary designated by a
Participant is not surviving when a payment is to be made to such person under
the Plan, and no contingent Beneficiary has been designated by the Participant,
or (iii) the Beneficiary designated by a Participant cannot be located by the
Plan Administrator within 1 year from the date benefits are to be paid to such
person; then, in any of such events, the Beneficiary of such Participant with
respect to any benefits that remain payable under the Plan shall be the estate
of the Participant. No designation of Beneficiary shall be valid unless in
writing signed by the Participant, dated, and delivered to the Company.
Beneficiaries may be changed by a Participant without the consent of any prior
Beneficiaries.
10. RIGHTS UNSECURED; UNFUNDED PLAN; ERISA.
This Plan and the Company's obligations arising hereunder to pay benefits
to a Participant or his beneficiary constitutes a mere promise by the Company to
make payments in the future in accordance with the terms of this Plan and all
Participants and their respective beneficiaries have the status of a general
unsecured creditor of the Company. Neither a Participant nor his beneficiary
shall have any rights in or against any specific assets of the Company,
including, without limitation, the assets of the Trust or any assets of the
Company which correspond with the Investments in which Participants can deem
their Deferral Accounts to be invested.
It is the intention of the Company that this Plan and the Company's
obligations hereunder be unfunded for income tax purposes and for purposes of
Title I of ERISA.
- 12 -
The Company shall treat this Plan as an unfunded plan maintained for a
select group of management associates exempt from Parts 2, 3 and 4 of Title I of
ERISA. The Company shall comply with the reporting and disclosure requirements
of Part 1 of Title I of ERISA in accordance with U.S. Department of Labor
Regulation Section 2520.104-23.
11. NAMED FIDUCIARY AND CLAIMS PROCEDURES
(a) The Company is hereby designated as the named fiduciary under the
Plan and shall have the authority to control and manage the operation and
administration of this Plan, and shall be responsible for establishing and
carrying out the terms of this Plan.
(i) If for any reason a claim for benefits under this Plan is
denied by the Company, the Plan Administrator shall deliver to the claimant a
written explanation setting forth the specific reasons for the denial, pertinent
references to the Section(s) of this Plan and any other applicable document on
which the denial is based, such other data as may be pertinent and information
on the procedures to be followed by the claimant in obtaining a review of his
claim, all written in a manner calculated to be understood by the claimant. For
this purpose:
(A) The claimant's claim shall be deemed filed when
presented in writing to the Plan Administrator.
(B) The Plan Administrator's explanation shall be in writing
delivered to the claimant within 90 days of the date the claim is
filed.
(ii) The claimant shall have 60 days following his receipt of the
denial of the claim to file with the Plan Administrator a written request for
review of the denial. For such review, the claimant or his representative may
submit pertinent documents and written issues and comments.
(iii) The Plan Administrator shall decide the issue on review and
furnish the claimant with a copy within 60 days of receipt of the claimant's
request for review of his claim. The decision on review shall be in writing and
shall include specific reasons for the decision, written in a manner calculated
to be understood by the claimant, as well as specific references to the
pertinent Plan provisions on which the decision is based. If a copy of the
decision is not so furnished to the claimant within such 60 days, the claim
shall be deemed denied on review.
12. NONASSIGNABILITY.
The rights of a Participant or his beneficiaries to payments pursuant to
this Plan are not subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment, or garnishment by
creditors of the Participant or his beneficiaries.
- 13 -
13. AMENDMENT OF THE PLAN.
The Plan Administrator may amend this Plan at any time, without the consent
of the Participants or their beneficiaries, provided, however, that no amendment
shall divest any Participant or beneficiary of the credit balance of his
Deferral Account except to the extent expressly provided otherwise in this Plan.
The Plan Administrator may amend the terms of any Participation Agreement,
prospectively or retroactively, but, subject to Section 3 above, no such
amendment shall impair the rights of any Participant without the Participant's
consent.
Subject to the above provisions, the Plan Administrator shall have broad
authority to amend the Plan to take into account changes in applicable
securities and tax laws and accounting rules, as well as other developments.
14. TERMINATION OF THIS PLAN.
The Plan Administrator may terminate this Plan at any time. Upon
termination of this Plan, distribution of the credit balance of each
Participant's Deferral Account shall be made in the manner and at the time
heretofore prescribed, it being the intent that no such termination shall
accelerate the payment of any amounts already credited to a Participant's
Deferral Account.
15. EXPENSES.
Costs of administration of this Plan will be paid by the Company.
16. NO SPECIAL EMPLOYMENT RIGHTS.
Nothing contained in this Plan shall confer upon any Participant any right
with respect to the continuation of his employment by the Company or interfere
in any way with the right of the Company, subject to the terms of any separate
employment agreement to the contrary, at any time to terminate such employment
or to increase or decrease the compensation of the Participant from the rate in
existence from time to time.
17. NOTICES.
(a) In Writing; Address. All notices, demands, consents and other
communications provided for in this Plan shall be in writing, shall be given by
a method prescribed in Section 17(b) hereof, and shall be given to the party to
whom it is addressed at the address set forth below or at such other address as
such party hereto may hereafter specify by at least fifteen (15) days prior
written notice:
If to the Company: CheckFree Corporation
- 14 -
4411 East Jones Bridge Road
Norcross, GA 30092
Attention: Plan Administrator - Nonqualified
Deferred Compensation Plan
If to a Participant: To the address designated by Participant to the
Company in the Participant's respective Participation
Agreement.
(b) Method. Any notice, report or other communication shall be
delivered by hand or nationally recognized overnight courier which maintains
evidence of receipt, or mailed by United States certified mail, return receipt
requested, postage prepaid, deposited in a United States post office or a
depository for the receipt of mail regularly maintained by the Post Office. Any
notices, demands, consents or other communication shall be deemed given when
received at the address for which such party has given notice in accordance with
the provisions hereof. Refusal to accept delivery at the address specified for
the giving of such notice in accordance herewith shall constitute delivery.
18. MISCELLANEOUS.
(a) Headings. The headings of the sections of this Plan are inserted solely
for convenience and are not to be given controlling effect, or used as an aid in
the construction of any provision hereof.
(b) Pronouns. All pronouns and any variations thereof shall be deemed to
refer to the masculine, feminine, neuter, singular or plural as the identity of
the person or persons may require.
(c) Exhibits. All Exhibits attached to this Plan are incorporated herein
and made a part hereof without need for any further reference.
Adopted by the Company as of the 31st day of December, 1998.
CHECKFREE CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
- 15 -