EXHIBIT 10.14
GRANTOR TRUST AGREEMENT
THIS GRANTOR TRUST AGREEMENT (the "Trust Agreement") is made this _____ day
of July, 2001, by and between Certegy Inc., a Georgia corporation, (the
"Company") and Wachovia Bank, N.A. (the "Trustee").
Recitals
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(a) WHEREAS, the Company has adopted the Executive Life and Supplemental
Retirement Benefit Plan (the "Plan");
(b) WHEREAS, the Company has incurred or expects to incur liability under the
terms of the Plan with respect to the individuals participating in the Plan
and their designated beneficiaries (the "Participants" and
"Beneficiaries");
(c) WHEREAS, the Company hereby establishes this Trust (the "Trust") and shall
contribute to the Trust assets that shall be held therein, subject to the
claims of the Company's creditors in the event of the Company's Insolvency,
as herein defined, until distributed in such manner and at such times as
specified in the Plan and in this Trust Agreement;
(d) WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the
Plan as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated
employees for purposes of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"); and
(e) WHEREAS, it is the intention of the Company to make contributions to the
Trust to provide itself with a source of funds (the "Fund") to assist it in
satisfying its liabilities under the Plan in the circumstances described
herein.
NOW, THEREFORE, the parties do hereby establish the Trust and agree that
the Trust shall be comprised, held and disposed of as follows:
Section 1. Establishment Of The Trust
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(a) The Trust is intended to be a grantor trust, of which the Company is the
grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
(b) The Company shall be considered the grantor for the purposes of the Trust.
(c) The Trust hereby established is revocable by the Company; and it shall
become irrevocable upon a Change of Control, as defined in Section 15.
(d) The Company hereby deposits with the Trustee in the Trust _________________
Dollars ($____________) which shall become the initial principal of the
Trust to be held, administered and disposed of by the Trustee as provided
in this Trust Agreement.
(e) The principal of the Trust, and any earnings thereon shall be held in the
Trust separate and apart from other funds of the Company and shall be used
exclusively for the uses and purposes of Participants and general creditors
as herein set forth. Participants and their Beneficiaries shall have no
preferred claim on, or any beneficial ownership interest in, any assets of
the Trust. Any rights created under the Plan and this Trust Agreement
shall be unsecured contractual rights of Participants and their
Beneficiaries against the Company. Any assets held by the Trust will be
subject to the claims of the general creditors of the Company under federal
and state law in the event the Company is Insolvent, as defined in Section
3(a) herein.
(f) The Company, in its sole discretion, may at any time, and from time to
time, make additional deposits of cash or other property, including Company
stock, acceptable to the Trustee to augment the principal to be held,
administered and disposed of by the Trustee as provided in this Trust
Agreement. Prior to a Change of Control, neither the Trustee nor any
Participant or Beneficiary shall have any right to compel additional
deposits.
(g) Upon a Potential Change of Control (as defined in Section 15), the Company
shall, as soon as possible, but in no event longer than thirty (30) days
following the occurrence of a Potential Change of Control, make an
additional contribution to the Trust, if required, in an amount that is
sufficient, when aggregated with the other assets of the Trust, to fund the
Trust in an amount equal to no less than 100% but no more than 120% of the
amount necessary to pay the insurance premiums required on Policies, as
defined herein, purchased pursuant to the Plan, until such Policies have
been fully paid, in accordance with Section 2(c) below.
(h) In the event a Change of Control does not occur within one year of a
Potential Change of Control, the Company shall have the right to recover
any amounts contributed to and remaining on hand in the Trust.
(i) Upon a Change of Control, the Company shall, as soon as possible, but in no
event longer than thirty (30) days following the occurrence of a Change of
Control make an irrevocable contribution to the Trust in any additional
amount which is necessary to be sufficient to fund the Trust in an amount
equal to no less than 100% but no more than 120% of the amount necessary to
pay the insurance premiums required on Policies purchased pursuant to the
Plan, until such Policies have been fully paid, in accordance with Section
2(c) below.
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Section 2. Payments From The Trust
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(a) Prior to a Change of Control, distributions from the Trust shall be made by
the Trustee to the insurance company identified in or pursuant to Section
2(e) below (the "Insurance Company") at the direction of the Company.
(b) As insurance premiums become due with respect to the life insurance
policies (each a "Policy") purchased pursuant to the Plan on the lives of
the Participants, the Company shall - (i) pay such insurance premiums
directly to the Insurance Company, (ii) transfer to the Trustee within
thirty (30) days prior to the premium due date funds sufficient to allow
the Trustee to pay to the Insurance Company such insurance premiums, or
(iii) direct the Trustee to pay directly to the Insurance Company such
insurance premiums from the Fund.
(c) (1) After a Potential Change of Control and before a Change of Control,
the Company shall deliver to the Trustee a schedule of insurance premiums
due under the Plan. Subsequent to a Change of Control, the Trustee shall
pay insurance premiums due in accordance with such schedule. If the
Company has not transferred the required amounts at least thirty (30) days
prior to each due date, the Trustee shall make such payments from the
assets of the Fund. If the principal of the Trust, and any earnings
thereon, are not sufficient to make payments of insurance premiums in
accordance with the terms of such schedule, the Company shall make the
balance of each such payment as it falls due in accordance with such
Schedule. The Trustee shall notify the Company in the event that principal
and earnings are not sufficient to make any premium payment. Nothing in
this Trust Agreement shall relieve the Company of its liabilities to pay
benefits due under the Plan except to the extent such liabilities are met
by application of assets of the Trust.
(2) Subsequent to a Change of Control, if the Company borrows any portion
of the cash surrender value of any Policy, the Trustee shall immediately
repay to the Insurance Company any amount that has been so borrowed, as
certified to it by the Participant whose Policy is the subject of the loan.
The Trustee may request any further reasonable evidence of such a loan.
(3) Subsequent to a Change of Control, if the Trustee becomes aware that
the Company withdraws any portion of the cash surrender value of any
Policy, the Trustee shall consult with the Insurance Company or the broker
of record, as it deems appropriate, to determine the maximum premiums which
may be paid on an annual basis to restore any such withdrawal and to retain
the life insurance nature of the Policy, and shall make said payments.
(d) The Trustee may institute an action to collect a contribution due the Trust
following a Change of Control or in the event that the Trust should ever
experience a short-fall in the amount of assets necessary to make current
payments pursuant to the terms of the Plan.
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(e) The primary purposes of this Trust are to insure (i) that, following a
Change of Control, premiums will continue to be paid to Pacific Life
Insurance Company, or such successor company as the Company may identify to
the Trustee in writing, as required pursuant to the Plan and all split-
dollar life insurance agreements with employees of the Company or its
subsidiaries which have been entered into by the Company and Plan
Participants pursuant to the Plan, and (ii) that any successor to the
Company, or its successor management, does not withdraw cash values from
the Policies prior to the respective distribution dates of said Policies.
Prior to a Change of Control, the payment of Policy insurance premiums will
be made pursuant to the provisions of Section 2(b). Subsequent to a Change
of Control, the Trustee shall make such payments unless the Company has
previously certified to having made them, according to the provisions
hereof. In order to make such payments, the Trustee may be required to
sell all or a portion of any assets held in the Fund. In the event that
the Fund includes Company stock, the Company hereby agrees to promptly, and
in any event within sixty (60) days of a request for registration by the
Trustee, take any and all actions necessary to register the Company stock
held in the fund for sale and to maintain on a continuous basis any
registrations required to permit said sales pursuant to applicable federal
and state laws, until all Company stock has been sold. In connection with
any such securities registrations, the Company shall take any and all
actions necessary in connection therewith, including without limitation:
(i) causing any special audits to be performed, if required and (ii) if
requested by the Trustee, entering into an underwriting agreement with
underwriters selected by the Trustee in customary form including providing
indemnification for the underwriters and the Trustee. Any and all costs
arising in connection with the filing of any securities registrations,
including the fees and disbursements of counsel for the Trustee, shall be
borne entirely by the Company other than underwriting discounts and
commissions or commissions of broker dealers which shall be payable by the
Trustee from the assets of the Trust. The Company consents that an action
may be brought in equity or in law by the Trustee or by any Participant in
the Plan, to compel its compliance with the provisions of this Trust,
including but not limited to the foregoing sentence and the provisions of
Section 2(d) above.
Section 3. Trustee Responsibility Regarding Payments When The Company Is
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Insolvent
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(a) The Trustee shall cease payment of insurance premiums to the Insurance
Company if the Company is Insolvent. The Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) the Company is
unable to pay its debts as they become due, (ii) the Company is subject to
a pending proceeding as a debtor under the United States Bankruptcy Code or
(iii) the Company is determined to be insolvent by the Federal Deposit
Insurance Corporation, the Federal Reserve, or the Office of the
Comptroller of Currency.
(b) At all times during the continuance of this Trust, the principal and income
of the Trust shall be subject to claims of general creditors of the Company
under federal and state law as set forth below.
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(1) The Board of Directors and the Chief Executive Officer of the Company
shall have the duty to inform the Trustee in writing that the Company
is Insolvent. If a person claiming to be a creditor of the Company
alleges in writing to the Trustee that the Company has become
Insolvent, the Trustee shall determine whether the Company is
Insolvent and, pending such determination, the Trustee shall
discontinue payment of insurance premiums to the Insurance Company.
(2) Unless the Trustee has actual knowledge that the Company is Insolvent,
or has received notice from the Company or a person claiming to be a
creditor alleging that the Company is Insolvent, the Trustee shall
have no duty to inquire whether the Company is Insolvent. The Trustee
may in all events rely on such evidence concerning the Company's
solvency as may be furnished to the Trustee and that provides the
Trustee with a reasonable basis for making a determination concerning
the Company's solvency.
(3) If at any time the Trustee has determined that the Company is
Insolvent, the Trustee shall discontinue paying insurance premiums to
the Insurance Company and shall hold the assets of the Trust for the
benefit of the Company's general creditors. Nothing in this Trust
Agreement shall in any way diminish any rights of Participants or
their Beneficiaries to pursue their rights as general creditors of the
Company with respect to payments due under the Plan or otherwise.
(4) The Trustee shall resume the payment of insurance premiums to the
Insurance Company in accordance with Section 2 of this Trust Agreement
only after the Trustee has determined that the Company is not
Insolvent (or is no longer Insolvent).
(c) Provided that there are sufficient assets, if the Trustee discontinues the
payment of insurance premiums from the Trust pursuant to Section 3(b)
hereof and subsequently resumes such payments, the first payment following
such discontinuance shall include the aggregate amount of all payments due
to the Insurance Company under the terms of the Plan for the period of such
discontinuance, less the aggregate amount of any payments made to the
Insurance Company by the Company in lieu of the payments provided for
hereunder during any such period of discontinuance.
Section 4. Payments When A Shortfall Of The Trust Assets Occurs
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(a) If there are not sufficient assets for the payment of insurance premiums
pursuant to Section 2 or Section 3(c) hereof and the Company does not
otherwise make such payments within a reasonable time after demand from the
Trustee, the Trustee shall make payment of insurance premiums from the
Trust to the Insurance Company for the benefit of Participants and their
Beneficiaries in the following order of priority:
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(1) All Policies should be funded based on original expected performance,
with premiums adequate to keep the Policies in force until the insured
attains age 100; and
(2) Any remaining funding should be made pro-rata based upon remaining
scheduled premium payments.
It is understood that it is not possible to anticipate precisely future
financial status of the Policies, and the contingencies that could occur
both before and after a Change of Control. Therefore, the Trustee will
have discretion to implement any reasonable method of allocating Trust
assets that are, in its sole discretion, determined to ensure complete
funding of the Policies pursuant to the premium schedule provided. The
Trustee may rely solely on the services of the broker of record as well as
any other sources in making this determination.
(b) Upon receipt of a contribution from the Company necessary to make up for a
shortfall in the payments due, the Trustee shall resume payments to the
Insurance Company under the Plan. Following a Change of Control, the
Trustee shall have the right to compel a contribution to the Trust from the
Company to make up for any shortfall.
Section 5. Payments To The Company
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Except as provided in Section 3 hereof in the event the Company is Insolvent,
after the Trust has become irrevocable (as provided in Section 1) the Company
shall have no right or power to direct the Trustee to return to the Company or
to divert to others any of the Trust assets before all payment of insurance
premiums have been made to the Insurance Company pursuant to the terms of the
Plan.
Section 6. Investment Authority
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(a) Consistent with the provisions of Section 10(a) below, the Trustee shall
not be liable in discharging its duties hereunder, including, without
limitation, its duty to invest and reinvest the Fund, if it acts for the
exclusive benefit of the Participants and their Beneficiaries, in good
faith and as a prudent person would act in accomplishing a similar task and
in accordance with the terms of this Trust Agreement and any applicable
federal or state laws, rules or regulations.
(b) Subsequent to a Change of Control, the Trustee shall have the following
powers, in investing and reinvesting the Fund, in its sole discretion:
(1) To invest and reinvest in any readily marketable common and preferred
stocks, bonds, notes, debentures (including convertible stocks and
securities but not including any stock or security of the Trustee
other than a de minimis amount held in a collective or mutual fund),
certificates of deposit or demand or time deposits (including any such
deposits with the Trustee) and shares of investment companies and
mutual funds, without being limited to the classes or property in
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which the Trustee is authorized to invest by any law or any rule of
court of any state and without regard to the proportion any such
property may bear to the entire amount of the Fund. Without
limitation, the Trustee may invest the Trust in any investment company
(including any investment company or companies for which the Trustee
or an affiliated company acts as the investment advisor ("Special
Investment Companies") or, any insurance contract or contracts issued
by an insurance company or companies in each case as the Trustee may
determine provided that the Trustee may in its sole discretion keep
such portion of the Trust in cash or cash balances for such reasonable
periods as may from time to time be deemed advisable pending
investment or in order to meet contemplated payments of insurance
premiums;
(2) To commingle for investment purposes all or any portion of the Fund
with assets of any other similar trust or trusts established by the
Company with the Trustee for the purpose of safeguarding deferred
compensation or retirement income benefits of its employees and/or
directors;
(3) To retain any property at any time received by the Trustee;
(4) To sell or exchange any property held by it at public or private sale,
for cash or on credit, to grant and exercise options for the purchase
or exchange thereof, to exercise all conversion or subscription rights
pertaining to any such property and to enter into any covenant or
agreement to purchase any property in the future;
(5) To participate in any plan of reorganization, consolidation, merger,
combination, liquidation or other similar plan relating to property
held by it and to consent to or oppose any such plan or any action
thereunder or any contract, lease, mortgage, purchase, sale or other
action by any person;
(6) To deposit any property held by it with any protective, reorganization
or similar committee, to delegate discretionary power thereto, and to
pay part of the expenses and compensation thereof any assessments
levied with respect to any such property to be deposited;
(7) To extend the time of payment of any obligation held by it;
(8) To hold uninvested any monies received by it, without liability for
interest thereon, but only in anticipation of payments due for
investments, reinvestments, expenses or disbursements;
(9) To exercise all voting or other rights with respect to any property
held by it and to grant proxies, discretionary or otherwise;
(10) For the purposes of the Trust, to borrow money from others, to issue
its promissory note or notes therefor, and to secure the repayment
thereof by pledging any property held by it;
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(11) To employ suitable contractors and counsel, who may be counsel to the
Company or to the Trustee, and to pay their reasonable expenses and
compensation from the Fund to the extent not paid by the Company;
(12) To register investments in its own name or in the name of a nominee;
to hold any investment in bearer form; and to combine certificates
representing securities with certificates of the same issue held by it
in other fiduciary capacities or to deposit or to arrange for the
deposit of such securities with any depository, even though, when so
deposited, such securities may be held in the name of the nominee of
such depository with other securities deposited therewith by other
persons, or to deposit or to arrange for the deposit of any securities
issued or guaranteed by the United States government, or any agency or
instrumentality thereof, including securities evidenced by book
entries rather than by certificates, with the United States Department
of the Treasury or a Federal Reserve Bank, even though, when so
deposited, such securities may not be held separate from securities
deposited therein by other persons; provided, however, that no
securities held in the Fund shall be deposited with the United States
Department of the Treasury or a Federal Reserve Bank or other
depository in the same account as any individual property of the
Trustee, and provided, further, that the books and records of the
Trustee shall at all times show that all such securities are part of
the Trust Fund;
(13) To settle, compromise or submit to arbitration any claims, debts or
damages due or owing to or from the Trust, respectively, to commence
or defend suits or legal proceedings to protect any interest of the
Trust, and to represent the Trust in all suits or legal proceedings in
any court or before any other body or tribunal; provided, however,
that the Trustee shall not be required to take any such action unless
it shall have been indemnified by the Company to its reasonable
satisfaction against liability or expenses it might incur therefrom;
(14) To hold and retain policies of life insurance, annuity contracts, and
other property of any kind which policies are contributed to the Trust
by the Company or any subsidiary of the Company or are purchased by
the Trustee;
(15) To hold any other class of assets which may be contributed by the
Company and that is deemed reasonable by the Trustee, unless expressly
prohibited herein;
(16) To loan any securities at any time held by it to brokers or dealers
upon such security as may be deemed advisable, and during the terms of
any such loan to permit the loaned securities to be transferred into
the name of and voted by the borrower or others; and
(17) Generally, to do all acts, whether or not expressly authorized, that
the Trustee may deem necessary or desirable for the protection of the
Fund.
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(c) Prior to a Change of Control, the Company shall have the right, subject to
this Section, to direct the Trustee with respect to investments. Absent
any such direction, the Trustee shall continue the investment of the Fund
as provided in this section.
(1) The Company may at any time direct the Trustee to segregate all or a
portion of the Fund in a separate investment account or accounts and
may appoint one or more investment managers and/or an investment
committee established by the Company to direct the investment and
reinvestment of each such investment account or accounts. In such
event, the Company shall notify the Trustee of the appointment of each
such investment manager and/or investment committee. No such
investment manager shall be related, directly or indirectly, to the
Company, but members of the investment committee may be employees of
the Company.
(2) Thereafter, the Trustee shall make every sale or investment with
respect to such investment account as directed in writing by the
investment manager or investment committee. It shall be the duty of
the Trustee to act strictly in accordance with each direction. The
Trustee shall be under no duty to question any such direction of the
investment manager or investment committee, to review any securities
or other property held in such investment account or accounts acquired
by it pursuant to such directions or to make any recommendations to
the investment manager or investment committee with respect to such
securities or other property.
(3) Notwithstanding the foregoing, the Trustee, without obtaining prior
approval or direction from an investment manager or investment
committee, shall invest cash balances held by it from time to time in
short term cash equivalents including, but not limited to, through the
medium of any short term common, collective or commingled trust fund
established and maintained by the Trustee subject to the instrument
establishing such trust fund, U.S. Treasury Bills, commercial paper
(including such forms of commercial paper as may be available through
the Trustee's Trust Department), certificates of deposit (including
certificates issued by the Trustee in its separate corporate
capacity), and similar type securities, with a maturity not to exceed
one year; and, furthermore, sell such short term investments as may be
necessary to carry out the instructions of an investment manager or
investment committee regarding more permanent type investment and
directed distributions.
(4) The Trustee shall neither be liable nor responsible for any loss
resulting to the Fund by reason of any sale or purchase of an
investment directed by an investment manager or investment committee
nor by reason of the failure to take any action with respect to any
investment which was acquired pursuant to any such direction in the
absence of further directions of such investment manager or investment
committee.
(5) Notwithstanding anything in this Agreement to the contrary, the
Trustee shall be indemnified and saved harmless by the Company from
and against any and all
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personal liability to which the Trustee may be subjected by carrying
out any directions of an investment manager or investment committee
issued pursuant hereto or for failure to act in the absence of
directions of the investment manager or investment committee including
all expenses reasonably incurred in its defense in the event the
Company fails to provide such defense; provided, however, the Trustee
shall not be so indemnified if it participates knowingly in, or
knowingly undertakes to conceal, an act or omission of an investment
manager or investment committee, having actual knowledge that such act
or omission is a breach of a fiduciary duty; provided further,
however, that the Trustee shall not be deemed to have knowingly
participated in or knowingly undertaken to conceal an act or omission
of an investment manager or investment committee with knowledge that
such act or omission was a breach of fiduciary duty by merely
complying with directions of an investment manager or investment
committee or for failure to act in the absence of directions of an
investment manager or investment committee. The Trustee may rely upon
any order, certificate, notice, direction or other documentary
confirmation purporting to have been issued by the investment manager
or investment committee which the Trustee believes to be genuine and
to have been issued by the investment manager or investment committee.
The Trustee shall not be charged with knowledge of the termination of
the appointment of any investment manager or investment committee
until it receives written notice thereof from the Company.
(d) Following a Change of Control, the Trustee shall have the sole and absolute
discretion in the management of the Trust assets and shall have all the
powers set forth under Section 6(b). In investing the Trust assets, the
Trustee shall consider:
(1) the needs of the Plan;
(2) the need for matching of the Trust assets with the liabilities of the
Plan; and
(3) the duty of the Trustee to act solely in the best interests of the
Participants and their Beneficiaries.
(e) The Trustee shall have the right, in its sole discretion, to delegate its
investment responsibility to an investment manager who may be an affiliate
of the Trustee. In the event the Trustee shall exercise this right, the
Trustee shall remain, at all times responsible for the acts of an
investment manager. The Trustee shall have the right to purchase an
insurance policy or an annuity to fund the benefits of the Plan.
(f) Prior to a Change of Control, the Company shall have the right at any time,
and from time to time in its sole discretion, to substitute assets of equal
fair market value for any asset held by the Trust. This right is
exercisable by the Company in a nonfiduciary capacity without the approval
or consent of any person in a fiduciary capacity.
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Section 7. Insurance Contracts
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(a) To the extent that the Trustee is directed by the Company prior to a Change
of Control to make payments from part or all of the Trust Fund in insurance
contracts, the type and amount thereof shall be specified by the Company.
The Trustee shall be under no duty to make inquiry as to the propriety of
the type or amount so specified.
(b) Each insurance contract issued shall provide that the owner thereof shall
have the power to exercise all rights, privileges, options and elections
granted by or permitted under such contract or under the rules of the
insurer.
(c) The Trustee shall have no power to name a beneficiary of the policy to
assign the policy (as distinct from conversion of the policy to a different
form), or to loan to any person the proceeds of any borrowing against such
an insurance policy.
(d) No insurer shall be deemed to be a party to the Trust and an insurer's
obligations shall be measured and determined solely by the terms of
contracts and other agreements executed by the insurer.
Section 8. Disposition Of Income
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(a) Prior to a Change of Control, all income received by the Trust, net of
expenses and taxes, may be returned to the Company or accumulated and
reinvested within the Trust at the direction of the Company.
(b) Following a Change of Control, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested within the Trust.
Section 9. Accounting By The Trustee
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The Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between the
Company and the Trustee within forty-five (45) days following the close of each
calendar year and within forty-five (45) days after the removal or resignation
of the Trustee. The Trustee shall deliver to the Company a written account of
its administration of the Trust during such year or during the period from the
close of the last preceding year to the date of such removal or resignation
setting forth all investments, receipts, disbursements and other transactions
effected by it, including a description of all securities and investments
purchased and sold with the cost or net proceeds of such purchases or sales
(accrued interest paid or receivable being shown separately), and showing all
cash, securities and other property held in the Trust at the end of such year or
as of the date of such removal or resignation, as the case may be. The Company
may approve such written account by an instrument in writing delivered to the
Trustee. In the absence of the Company's filing with the Trustee objections to
any such written account within ninety (90) days after its receipt, the Company
shall be deemed to have so approved such written account. In such case, or upon
the written approval by the Company of any such written account, the Trustee
shall, to the extent permitted by law, be discharged from all liability to the
Company for its acts or failures to act described by such written account. The
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foregoing, however, shall not preclude the Trustee from having its accounting
settled by a court of competent jurisdiction.
Section 10. Responsibility Of The Trustee
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(a) The Trustee shall act with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, provided, however, that
the Trustee shall incur no liability to any person for any action taken
pursuant to a direction, request or approval given by the Company which is
contemplated by, and in conformity with, the terms of the Plan or this
Trust Agreement and is given in writing by the Company. In the event of a
dispute between the Company and a party, the Trustee may apply to a court
of competent jurisdiction to resolve the dispute, subject, however to
Section 2(d) hereof.
(b) The Company hereby indemnifies the Trustee against losses, liabilities,
claims, costs and expenses in connection with the administration of the
Trust, unless resulting from the gross negligence or misconduct of Trustee.
To the extent the Company fails to make any payment on account of an
indemnity provided in this Section 10(b), in a reasonably timely manner,
the Trustee may obtain payment from the Trust. If the Trustee undertakes
or defends any litigation arising in connection with this Trust or to
protect a Participant's or Beneficiary's rights under the Plan, the Company
agrees to indemnify the Trustee against the Trustee's costs, reasonable
expenses and liabilities (including, without limitation, attorneys' fees
and expenses) relating thereto and to be primarily liable for such
payments. If the Company does not pay such costs, expenses and liabilities
in a reasonably timely manner, the Trustee may obtain payment from the
Trust.
(c) Prior to a Change of Control, the Trustee may consult with legal counsel
(who may also be counsel for the Company generally) with respect to any of
its duties or obligations hereunder. Following a Change of Control the
Trustee shall select legal counsel independent from the Company's counsel
and may consult with counsel or other experts with respect to its duties
and with respect to the rights of Participants or their Beneficiaries under
the Plan.
(d) The Trustee may hire agents, accountants, actuaries, investment advisors,
financial consultants or other professionals to assist it in performing any
of its duties or obligations hereunder and may rely on any determinations
made by such agents and information provided to it by the Company.
(e) The Trustee shall have, without exclusion, all powers conferred on the
Trustee by applicable law, unless expressly provided otherwise herein.
(f) Notwithstanding any powers granted to the Trustee pursuant to this Trust
Agreement or to applicable law, the Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing
the gains therefrom.
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Section 11. Compensation And Expenses Of The Trustee
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The Trustee's compensation shall be as agreed in writing from time to time by
the Company and the Trustee. The Company shall pay all administrative expenses
and the Trustee's fees and shall promptly reimburse the Trustee for any fees and
expenses of its agents or such other costs as the Trustee is entitled to incur
hereunder. If not so paid, the fees and expenses shall be paid from the Trust.
Section 12. Resignation And Removal Of The Trustee
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(a) Prior to a Change of Control, the Trustee may resign at any time by written
notice to the Company, which shall be effective sixty (60) days after
receipt of such notice unless the Company and the Trustee agree otherwise.
Following a Change of Control, if the Trustee resigns, the resignation
shall only be effective after the appointment of a successor Trustee.
(b) The Trustee may be removed by the Company on sixty (60) days notice or upon
shorter notice accepted by the Trustee prior to a Change of Control.
Subsequent to a Change of Control, the Trustee may only be removed by the
Company with the consent of a majority of the Participants, after they have
been informed of the identity of a successor trustee.
(c) If the Trustee resigns within two years after a Change of Control, and if
the Company fails to act under Section 10(e) below within a reasonable
period of time following such resignation, the Trustee shall apply to a
court of competent jurisdiction for the appointment of a successor Trustee
or instructions.
(d) Upon resignation or removal of the Trustee and appointment of a successor
Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within sixty (60) days after
receipt of notice of resignation, removal or transfer, unless the Company
extends the time limit.
(e) If the Trustee resigns or is removed, a successor shall be appointed by the
Company, in accordance with Section 13 hereof, by the effective date of
resignation or removal under Sections 10(a) or 10(b) above. If no such
appointment has been made, the Trustee may apply to a court of competent
jurisdiction for appointment of a successor or for instructions. All
expenses of the Trustee in connection with the proceeding shall be allowed
as administrative expenses of the Trust.
Section 13. Appointment Of Successor
------------------------
(a) If the Trustee resigns or is removed in accordance with Section 12 hereof,
the Company may appoint, subject to Section 12, another bank, not an
affiliate of the Company or any other grantor, any third party national
banking association with a market capitalization exceeding $100,000,000 to
replace the Trustee upon resignation or removal. The successor Trustee
shall have all of the rights and powers of the former Trustee, including
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ownership rights in the Trust. The former Trustee shall execute any
instrument necessary or reasonably requested by the Company or the
successor Trustee to evidence the transfer.
(b) The successor Trustee need not examine the records and acts of any prior
Trustee and may retain or dispose of existing Trust assets, subject to
Sections 8 and 9 hereof. The successor Trustee shall not be responsible
for and the Company shall indemnify and defend the successor Trustee from
any claim or liability resulting from any action or inaction of any prior
Trustee or from any other past event, or any condition existing at the time
it becomes successor Trustee.
Section 14. Amendment Or Termination
------------------------
(a) Prior to a Change of Control, this Trust Agreement may be amended by a
written instrument executed by the Trustee and the Company.
Notwithstanding the foregoing, no such amendment shall conflict with the
terms of the Plan or shall make the Trust revocable after it has become
irrevocable in accordance with Section 1 hereof.
(b) The Trust shall not terminate until the date on which all insurance
premiums listed on the schedule referred to in Section 2(c)(1) have been
paid or otherwise satisfied, and any payments required under Section
2(c)(3) are completed, or until the Company terminates the Trust (if prior
to a Change of Control).
(c) Prior to a Change of Control, the Company may terminate this Trust at any
time, including prior to the time all benefit payments under the Plan have
been made. All assets in the Trust at termination shall be returned to the
Company.
(d) This Trust Agreement may not be amended or terminated by the Company for
seven (7) years following a Change of Control without the written consent
of a majority of the Participants except, if in the opinion of counsel
satisfactory to the Trustee, such amendment is necessary to maintain the
tax status of this Trust or the inapplicability of ERISA to this Trust.
Section 15. Change Of Control
-----------------
(a) For purposes of this Trust, the following terms shall be defined as set
forth below:
(1) "Potential Change of Control" shall mean the occurrence of any one of
the following events:
(i) the purchase or other acquisition by any Person of Beneficial
Ownership of five percent (5%) or more of either the outstanding
shares of common stock or the combined voting power of the
Company's then outstanding voting securities entitled to vote
generally; provided, however, the purchase or other acquisition
by any employee benefit plan (or related trust) sponsored or
maintained by - (I) Equifax Inc. (to the extent the
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acquisition occurs as part of the initial distribution of
Company shares on Equifax Inc. shares held by the plan), (II)
the Company, or (III) any Subsidiary of the Company, shall be
disregarded for purposes of this Section 15(a)(1)(i);
(ii) the announcement by any person of an intention to take actions
which might reasonably result in a Change of Control of the
Company;
(iii) the issuance of a proxy statement by the Company with respect
to an election of directors for which there is proposed one or
more directors who are not recommended by the Board of Directors
of the Company or its nominating committee, where the election
of such proposed director or directors would result in a Change
of Control; or
(iv) submission to the Incumbent Board (as defined below) of
nominations which, if approved, would change the Executive
Officer configuration of the Company (at the Executive Vice
President level and above) by fifty percent (50%) or more.
(2) "Change of Control" shall mean the occurrence of any one of the
following events:
(i) Voting Stock Accumulations. The accumulation by any Person of
--------------------------
Beneficial Ownership of twenty percent (20%) or more of the
combined voting power of the Company's Voting Stock; provided
that for purposes of this Section15(a)(2)(i), a Change of
Control will not be deemed to have occurred if the accumulation
of twenty percent (20%) or more of the voting power of the
Company's Voting Stock results from any acquisition of Voting
Stock (I) directly from the Company that is approved by the
Incumbent Board, (II) by the Company, (III) by any employee
benefit plan (or related trust) sponsored or maintained by the
Company or any Subsidiary, or (IV) by any Person pursuant to a
Business Combination that complies with all of the provisions of
clauses (I), (II) and (III) of Section 15(a)(2)(ii);
(ii) Business Combinations. The consummation of a Business
---------------------
Combination, unless, immediately following that Business
Combination, (I) all or substantially all of the Persons who
were the beneficial owners of Voting Stock of the Company
immediately prior to that Business Combination beneficially own,
directly or indirectly, more than sixty-six and two-thirds
percent (66-2/3%) of the then outstanding shares of common stock
and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of
directors of the entity resulting from that Business Combination
(including, without limitation, an entity that as a result of
that transaction owns the Company or all or substantially all of
the Company's assets either directly or through one or
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more subsidiaries) in substantially the same proportions
relative to each other as their ownership, immediately prior to
that Business Combination, of the Voting Stock of the Company,
(II) no Person (other than the Company, that entity resulting
from that Business Combination, or any employee benefit plan (or
related trust) sponsored or maintained by the Company, any
Eighty Percent (80%) Subsidiary or that entity resulting from
that Business Combination) beneficially owns, directly or
indirectly, twenty percent (20%) or more of the then outstanding
shares of common stock of the entity resulting from that
Business Combination or the combined voting power of the then
outstanding voting securities entitled to vote generally in the
election of directors of that entity, and (III) at least a
majority of the members of the Board of Directors of the entity
resulting from that Business Combination were members of the
Incumbent Board at the time of the execution of the initial
agreement or of the action of the board providing for that
Business Combination;
(iii) Sale of Assets. A sale or other disposition of all or
--------------
substantially all of the assets of the Company; or
(iv) Liquidation or Dissolutions. Approval by the shareholders of
---------------------------
the Company of a complete liquidation or dissolution of the
Company, except pursuant to a Business Combination that complies
with all of the provisions of clauses (I), (II) and (III) of
Section 15(a)(2)(ii).
For purposes of this Section 15(a), the following definitions will apply:
"Beneficial Ownership" means beneficial ownership as that term is used in
Rule 13d-3 promulgated under the Exchange Act.
"Business Combination" means a reorganization, merger or consolidation of
the Company.
"Eighty Percent (80%) Subsidiary" means an entity in which the Company
directly or indirectly beneficially owns eighty percent (80%) or more of
the outstanding Voting Stock.
"Exchange Act" means the Securities Exchange Act of 1934, including
amendments, or successor statutes of similar intent.
"Incumbent Board" means a Board of Directors at least a majority of whom
consist of individuals who either are (a) members of the Company's Board of
Directors as of the day after the spinoff of the Company from Equifax Inc.
becomes effective or (b) members who become members of the Company's Board
of Directors subsequent to said date whose election, or nomination for
election by the Company's shareholders, was approved by a vote of at least
two-thirds (2/3) of the directors then comprising the Incumbent Board
(either by a specific vote or by approval of the proxy statement of the
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Company in which that person is named as a nominee for director, without
objection to that nomination), but excluding, for that purpose, any
individual whose initial assumption of office occurs as a result of an
actual or threatened election contest (within the meaning of Rule 14a-11 of
the Exchange Act) with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board of Directors.
"Person" means any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act).
"Subsidiary" means an entity more than fifty percent (50%) of whose equity
interests are owned directly or indirectly by the Company.
"Voting Stock" means the then outstanding securities of an entity entitled
to vote generally in the election of members of that entity's Board of
Directors.
For purposes of this Section 15(a), the Incumbent Board, by a majority vote,
shall have the power to determine on the basis of information known to them (a)
the number of shares beneficially owned by any person, entity or group; (b)
whether there exists an agreement, arrangement or understanding with another as
to matters referred to in this Section 15(a); and (c) such other matters with
respect to which a determination is necessary under this Section 15(a).
(b) The General Counsel of the Company shall have the specific authority to
determine whether a Potential Change of Control or Change of Control has
transpired under the guidance of this Section 15(a) and shall be required
to give the Trustee notice of a Change of Control or Potential Change of
Control. The Trustee shall be entitled to rely upon such notice, but if
the Trustee receives notice of a Potential Change of Control or Change of
Control from another source, the Trustee shall be required to make its own
independent determination.
Section 16. Miscellaneous
-------------
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) The Company hereby represents and warrants that the Plan has been
established, maintained and administered in accordance with all applicable
law, including without limitation, ERISA. The Company hereby indemnifies
and agrees to hold the Trustee harmless from all liabilities, including
attorney's fees, relating to or arising out of the establishment,
maintenance and administration of the Plan. To the extent the Company does
not pay any of such liabilities in a reasonably timely manner, the Trustee
may obtain payment from the Trust.
(c) Benefits payable to Participants and their Beneficiaries under this Trust
Agreement may not be anticipated, assigned (either at law or in equity),
alienated, pledged, encumbered
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or subjected to attachment, garnishment, levy, execution or other legal or
equitable process.
(d) This Agreement is binding upon the successors and assigns of the Company
and the Trustee.
(e) This Trust Agreement shall be governed by and construed in accordance with
the laws of North Carolina.
IN WITNESS WHEREOF, this Grantor Trust Agreement has been executed on behalf
of the parties hereto on the day and year first above written.
CERTEGY INC.
By:
----------------------------
Name:
Title:
WACHOVIA BANK, N.A.
By:
----------------------------
Name:
Title:
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