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EXHIBIT 10(nnn)
CHECKFREE CORPORATION
STOCK RESTRICTION AGREEMENT
This Agreement is made as of the 15th day of September 1996 between
Checkfree Corporation and Intuit Inc.
RECITALS
A. CHECKFREE CORPORATION, a Delaware corporation ("Parent") and INTUIT
INC., a Delaware corporation ("Holdings"), together with CHECKFREE ACQUISITION
CORPORATION II, a wholly owned subsidiary of Parent, and INTUIT SERVICES
CORPORATION, a wholly owned subsidiary of Holdings, have entered into an
Agreement and Plan of Merger of even date herewith, pursuant to which, by merger
(the "Merger"), Parent will acquire the business of Intuit Services Corporation.
B. In connection with the Merger, Parent will issue to Holdings that number
of shares of the common stock of Parent ("Parent Common Stock") specified in the
Agreement and Plan of Merger, subject to adjustment as provided therein ("Merger
Securities"), and the parties hereto desire to express in this Agreement their
agreement with respect to certain limitations on the actions which may be taken
by Holdings with respect to the Parent Common Stock issued to Holdings in the
Merger.
AGREEMENT
NOW, THEREFORE, in consideration of the Merger and of the mutual agreements
and covenants hereinafter and therein contained, the parties hereto agree as
follows:
1. RESTRICTIONS. While this Agreement remains in effect, Holdings shall not
sell, assign, or otherwise transfer or purchase any shares of Parent Common
Stock except as specifically permitted hereunder and shall be subject to the
following restrictions with respect to the taking of certain other actions with
respect to Parent Common Stock.
1.1. SALES
(i) SALES TO QUALIFIED INSTITUTIONAL BUYERS -- Holdings may sell
shares of Parent Common Stock to any Qualified Institutional Buyer, as defined
herein, where such Qualified Institutional Buyer would own, after such purchase
by it, not more than 10% of the then outstanding shares of Parent Common Stock.
"Qualified Institutional Buyer," as that term is used herein, means any person
who would be eligible, under Rule 13d-1(b)(1) under the Securities and Exchange
Act of 1934, as amended ("Exchange Act"), assuming that such person owns 5% or
more of the then outstanding shares of Parent Common Stock, to file reports of
beneficial ownership on Schedule 13G as prescribed by the Securities and
Exchange Commission ("SEC"), because such person both:
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(A) is acquiring shares of Parent Common
Stock in the ordinary course of his business
and not with the purpose nor with the effect
of changing or influencing the control of
the issuer, nor in connection with or as a
participant in any transaction having such
purpose or effect, including any transaction
subject to Rule 13d-3(b); and
(B) is (i) a broker or dealer registered
under Section 15 of the Exchange Act, (ii) a
bank as defined in Section 3(a)(6) of the
Exchange Act, (iii) an insurance company as
defined in Section 3(a)(19) of the Exchange
Act, (iv) an investment company registered
under Section 8 of the Investment Company
Act of 1940, (v) an investment advisor
registered under Section 203 of the
Investment Advisers Act of 1940, (vi) an
employee benefit plan, or pension fund which
is subject to the provisions of the Employee
Retirement Income Security Act of 1974
("ERISA") or an endowment fund, (vii) a
parent holding company, provided that the
aggregate amount held directly by the
parent, and directly and indirectly by its
subsidiaries which are not persons specified
in Rule 13d-1(b)(ii)(A)-(F) promulgated
under the Exchange Act, does not exceed one
percent of the securities of the subject
class, or (viii) a group, provided that all
the members are persons specified in Rule
13d-1(b)(ii)(A)-(G) promulgated under the
Exchange Act.
(ii) SALES TO OTHER BUYERS -- Holdings may sell shares of Parent
Common Stock to any person who is not a Qualified Institutional Buyer ("Other
Buyer") which Other Buyer would own, after such purchase by it, not more than 5%
of the then outstanding shares of Parent Common Stock. Holdings shall notify
Parent in writing of its intention to sell Parent Common Stock in advance of any
sale to an Other Buyer, and Parent shall have the right, during the five
business days following the receipt of such notice, to purchase such shares for
the price at which Holdings has agreed to sell the shares to such Other Buyer.
(iii) SALES PURSUANT TO RULE 144 AND UNDERWRITTEN PUBLIC
OFFERINGS -- Holdings may sell shares of Parent Common Stock in compliance with
SEC Rule 144 and pursuant to underwritten public offerings of Parent Common
Stock in which the parties have mutually approved the managing underwriters. Any
sales of Parent Common Stock to Qualified Institutional Buyers or to Other
Buyers, if made pursuant to this Section 1.1(iii) shall be exempt from the
restrictions set forth in Section 1.1(i) and Section 1.1(ii).
1.2. PURCHASES So long as this Agreement is in effect, Holdings may
purchase shares of Parent Common Stock only where such purchase would result in
its beneficial ownership of not more than 15% of the then outstanding shares of
Parent Common Stock, except where Holdings has received the prior written
consent of Parent's Board of Directors or its authorized representative;
provided, however, that Holdings may not hold more than the number of shares of
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Parent Common Stock constituting the Merger Securities so long as this Agreement
remains in effect.
1.3. SOLICITATION OF PROXY AND OTHER MATTERS
(i) SOLICITATION OF PROXIES -- Holdings will not solicit proxies
from Parent stockholders in opposition to any recommendation of Parent's Board
of Directors.
(ii) TAKEOVER BIDS -- Holdings will not initiate or participate
in any group which proposes, without the support of Parent's Board of Directors,
any change in the control of Parent, whether by tender offer, merger, or
otherwise. In any event, Holdings may, itself, make such an offer or proposal to
Parent's Board of Directors; provided, however, that any such offer or proposal
by Holdings shall be made on a strictly confidential basis and shall not be
publicly disclosed without the prior consent of Parent's Board of Directors.
2. LEGEND. The certificates representing shares of Parent Common Stock
beneficially owned by Holdings shall bear the following legend:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO AN AGREEMENT DATED
SEPTEMBER 15, 1996 BETWEEN INTUIT INC. AND
CHECKFREE CORPORATION IMPOSING CERTAIN
TRANSFER AND OTHER RESTRICTIONS ON THE HOLDER
OF SUCH SHARES.
Holdings shall deliver all shares of Parent Common Stock purchased hereunder to
Parent or its transfer agent to have this legend affixed to all such shares.
3. TERMINATION. This Agreement and the restrictions imposed hereby will
irrevocably terminate at the first time that Holdings shall beneficially own
less than 10% of the outstanding shares of Parent Common Stock, and this
Agreement shall not be revived by any subsequent transaction that results in
Holdings owning 10% or more of the outstanding shares of Parent Common Stock.
4. GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the law of the State of Delaware, without reference to its
choice of law rules.
5. ASSIGNMENT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective estates, heirs, legal
representatives, successors, and assigns; provided, however, that no assignment
of any rights or obligations shall be made by any party hereto without the
written consent of each other party hereto.
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6. NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed to be given if sent by United States mail, postage
prepaid and registered or certified with required return receipt, or otherwise
personally delivered and receipted therefor, and addressed as follows (or at
such other address as may be specified by notice given pursuant hereto):
(a) If to Checkfree:
CHECKFREE CORPORATION
0000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Attn: Chief Executive Officer
with copy to:
PORTER, WRIGHT, XXXXXX & XXXXXX
00 X. Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn.: Xxxxxx X. Xxxxxxxx, Esq.
(b) If to Intuit:
INTUIT INC.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: Chief Executive Officer
with copy to:
FENWICK & WEST LLP
Xxx Xxxx Xxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
7. CAPTIONS. The captions at the beginning of the several sections of this
Agreement are not a part of the context hereof, but have been inserted to assist
in locating and reading those sections. They shall be ignored in construing this
Agreement.
8. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement is held to be invalid, illegal, or unenforceable in any respect
for any reason, such invalidity, illegality, or unenforceability shall not
affect any other provisions hereof. It is the intention of the parties that if
any provision is held to be invalid, illegal, or unenforceable, there shall be
added in lieu thereof a valid and enforceable provision as similar in terms to
such provision as is possible.
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10. DUPLICATE ORIGINALS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be a duplicate original, and all
counterparts taken together shall constitute duplicate originals of one and the
same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
CHECKFREE CORPORATION
By: /s/ Xxxxx X. Xxxxx
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Its: President and CEO
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INTUIT INC.
By: Xxxxx X. Xxxxxx
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Its: Senior Vice President and CFO
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