Exhibit 10.7
NONQUALIFIED DEFERRED COMPENSATION PROGRAM
INCLUDING Section 401(k) TRANSFER
ADOPTION AGREEMENT
The Company named below hereby establishes a Nonqualified
Deferred Compensation Program for eligible Employees as provided
in this Adoption Agreement and the Basic Program Document.
Note: This document contains a feature allowing Participants to
elect to have their Deferrals and Company matching contributions
cashed out or transferred into the Company's Cash or Deferred
Plan annually at the end of each calendar year. In this
connection, the plan year for the Cash or Deferred Plan must be
the calendar year or this document may not be used.
I Company Information
(a) Name and Address:
RightCHOICE Managed Care, Inc.
0000 Xxxxxxxx Xxxxxx
St. Louis, Missouri 63103-2275
(b) Telephone Number: 3 1 4 - 9 2 3 - 4 4 4 4 .
(c) Tax ID Number: 4 3 - 1 6 7 4 0 5 2 .
(d) Program Name: RightCHOICE Managed Care, Inc.
Amended and Restated Non-employee Directors'
Nonqualified Deferred
Compensation Plan.
II Definitions
(a) Affiliate
[x] Any "parent corporation" or "subsidiary
corporation" of RightCHOICE as those terms
are defined in Code Sections 424(e) and (f).
(b) Benefit Distribution Date:
[ ] First day of the Program Year following a
Distributable Event.
[x] During January of the Program Year following
a Distributable Event.
[x] Plan Administrator, in its discretion, may defer
distribution for up to 24 months.
*Benefits accrued on or before January 1, 1999
will be paid in accordance with a Participant's
election as in effect prior to that date.
(c) Board:
[x] The Board of Directors of RightCHOICE Managed Care, Inc.
(d) Change in Control:
[x] A "change in the ownership" of RightCHOICE, a
"change in the effective control" of
RightCHOICE, or a "change in the ownership of
a substantial portion of the assets" of
RightCHOICE, as such terms are defined in the
Proposed Regulations under Code Section 280G.
(e) Compensation:
[x] For purposes of the Basic Plan Document and
this Adoption Agreement, the term
"Compensation" means the Retainer Fees and
the Meeting Fees earned by a Participant.
(f) Distributable Event:
The following Distributable Events are in addition
to those listed at paragraph 6.2 of the Basic
Program Document.
[ ] Upon completion of _______ Years of Service
determined with reference to the Employee's
date of hire.
[ ] Other as follows: _____________________________________
________________________________________________________
(g) Effective Date:
New Program: The Program shall be effective as
of ________________ .
Amended Program: Except as otherwise provided
herein, the amended provisions of the Program
shall be effective as of February 1, 1998.
(h) Employee:
[x] For purposes of the Basic Program
Document and this Adoption Agreement, the
term "Nonemployee Director" shall be
substituted for the term "Employee." The
term "Nonemployee Director" shall mean
any person serving on the Board who is
not an employee of RightCHOICE or of any
Affiliates.
(i) Entry Date:
[ ] The Effective Date of the Program. This
option applies only to those Employees who
satisfy the eligibility requirements of
Article II of the Basic Program Document on
the Effective Date of the Program. If this
option is chosen, the period of service upon
which deferrals are based shall commence with
the first payroll period subsequent to the
deferral election and the Effective Date of
the Program.
[ ] First day of the month following the date on
which the Employee satisfies the Program's
eligibility requirements.
[ ] First day of the calendar quarter following
the date on which the Employee satisfies the
Program's eligibility requirements.
[x] Upon completion of an initial Deferral
Agreement.
(j) Meeting Fees:
[x] All compensation (excluding Retainer
Fees) paid by RightCHOICE, or any Subsidiary
thereof, to a Nonemployee Director for his
attendance at Board meetings and Board
committee meetings, meetings of the Board of
Directors of a Subsidiary or committee
meetings of the Board of Directors of a
Subsidiary. Meeting fees are divided into
two subgroups: Called Board Meeting Fees and
Committee Meeting Fees.
(k) Retainer Fees:
[x] The annual compensation paid by
RightCHOICE or any Subsidiary to a
Nonemployee Director for service as a member
of the Board or as a member of the Board of
Directors of a Subsidiary.
(l) RightCHOICE:
[x] RightCHOICE Managed Care, Inc., a Missouri corporation.
(m) Subsidiary:
[x] HMO Missouri, Inc. (BlueCHOICE), Healthy
Alliance Life Insurance Co., Health Benefit
Alliance, Inc., Pension Associates
Incorporated, Diversified Life Insurance
Agency and other corporations in which
RightCHOICE should acquire and own more than
50% of the voting stock or more than 50% of
the voting power.
(n) Valuation Date (select one):
[x] Daily
[ ] As of the last day of each Month
[ ] As of the last day of each calendar Quarter
[ ] As of June 30 and December 31
[ ] December 31
III Eligibility Requirements (select one)
(a) Age, Service and Compensation:
[ ] An Employee shall be eligible to participate
upon attaining age _____ and having completed
_____ Years of Service with the Company
provided that the Employee's anticipated
annualized Compensation for the current
Program Year is greater than $___________ .
(b) Nomination By Board:
[ ] An Employee shall be eligible to participate
upon being named an eligible Employee by
resolution of the Board of Directors of the
Company.
IV Employee Deferrals
(a) Percentage of Compensation (select one or more):
[x] 100% of a Participant's Retainer Fees.
[x] 100% of a Participant's Committee Meeting Fees.
[x] 100% of a Participant's Board Meeting Fees.
[ ] Up to ____% of a Participant's Compensation
in excess of the limitation on Compensation
permitted under Code 401(a)(17), as indexed.
[ ] A Participant's deferrals shall be limited to
a maximum of $___________ for each Program Year.
(b) Dollar Amount:
[ ] A dollar amount specified by a
Participant from a minimum of $________ to a
maximum of $_________ with respect to each
Program Year.
V Company Match
Note: The matching contribution provisions of this
Program must be the same or more liberal than those
contained in the Cash or Deferred Plan to coordinate
with the cashout/transfer provisions of this Program.
(a) The Company's matching contribution shall be
determined in accordance with one or more of the
following methods:
[ ] The Company shall contribute and allocate to
each eligible Participant ______ % of such
Participant's Deferrals.
[ ] The Company shall contribute and allocate to
each eligible Participant ______ % of the
first _______% of such Participant's
Deferrals, plus ______ % of the next ______ %
of such Participant's Deferrals,
plus _______% of the next ______ % of such
Participant's Deferrals.
[ ] An amount determined in the discretion of the
Company. Such matching contribution shall be
allocated to eligible Participants in
proportion to their Deferrals for the Program
Year.
(b) Limitations (select one or more):
[ ] The matching contribution shall not exceed
$____________ for any Participant.
[ ] The Company shall not match any Deferral in
excess of ______ % of the Participant's
Compensation.
[ ] The Company's matching contribution shall be
payable from its net profit for the
applicable Program Year.
(c) Eligibility For Match (select one or more):
[ ] All Participants who have made deferrals
under this Program for the Program Year.
[ ] Participants employed on the last day of a
Program Year for which a matching
contribution is made.
(d) Cashout Amount (select one):
If a Participant elects to cash out his or her
Deferrals for a Program Year, the Administrator
shall take the following action with respect to
any Company matching contribution attributable to
such Deferral:
[ ] The Company matching contribution shall be
distributed to the Participant along with the
Deferral.
[ ] The Company matching contribution shall be
retained in the Program as part of the
Participant's account and shall be
administered as provided by the Program.
VI Company Discretionary
(a) Amount (select one or more):
[ ] An amount determined in the discretion of the Company.
[ ] An amount determined by the following formula:
______________________________________________________
(b) Allocation Formula (select one):
[ ] Contributions are allocated in proportion to
each eligible Participant's Compensation.
[ ] Other as follows: ___________________________________
___________________________________
(c) Eligibility For Allocation (select one or more):
[ ] All Participants employed at any time during
a Program Year for which a contribution is
made.
[ ] Participants employed on the last day of a
Program Year for which a contribution is
made.
VII Vesting
Participants shall always have a fully vested and
nonforfeitable right to benefits attributable to Deferrals
made under the Program. Participants shall acquire a vested
interest in benefits attributable to Company discretionary
and matching contributions as follows:
[ ] Participants shall be fully vested in [ ] Company [ ]
Discretionary and [ ] Matching contributions.
[ ] A Participant's vested benefit shall be determined
from the following schedule:
Percentage Vested
Credited Service Discretionary Matching
Less than one year ____ % ____ %
One year ____ % ____ %
Two years ____ % ____ %
Three years ____ % ____ %
Four years ____ % ____ %
Five years ____ % ____ %
Six years ____ % ____ %
Seven or more years ____ % ____ %
VIII Participant Accounts
Each Participant Account shall be reduced by its pro
rata share for the relevant period, of:
[ ] Program administrative expenses .
[ ] Income taxes paid by the Company attributable to
the Program.
IX Investment Preference
Participants [x] shall [ ] shall not be permitted to
indicate investment preferences for their [x] Deferrals
and [ ] Company contributions. If preferences are
permitted, Participants shall be authorized to submit a
nonbinding request to change an existing investment
preference [ ] daily [x] monthly or [ ] quarterly.
To the extent a Participant elects to receive his
Deferrals under the Plain in Company stock, the Company
will establish and maintain a separate subaccount under
the Plan. No Company stock will be held in trust by
INVESCO.
X Form Of Payment (select one or more)
[x] Lump sum.
[x] Installment payments. In the sole discretion of
the Administrator, a Participant's benefits may be
paid as follows:
[ ] monthly installment payments over a
period of ________ years.
[ ] quarterly installment payments over a
period of ________ years.
[x] annual installment payments over a
period of up to five (5) years.
XI Miscellaneous
If a Participant becomes entitled to a distribution of
benefits under the Plan, and if at such time the
Participant has outstanding any debt, obligation, or
other liability representing an amount owing to the
Company, then the Company, in its discretion may offset
such amount owed to it against the amount of benefits
otherwise distributable.
Any dispute between a Participant and the Company as to
the interpretation or application of the provisions of
the Plan or a Deferral Agreement and the amounts
payable hereunder shall be determined by binding
arbitration before a single arbitrator in St. Louis,
Missouri in accordance with the Commercial Arbitration
Rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's
award in any court of competent jurisdiction.
XII Signature
This Adoption Agreement and Basic Program Document were
adopted
by the Company the 4th day of Sept. 1998
Signed for the Company by: Xxxx X'Xxxxxx
Title of Individual: CEO
Signature: /s/ Xxxx X'Xxxxxx
