Exhibit 10.1
EXPRESS SCRIPTS, INC.
EXECUTIVE DEFERRED COMPENSATION PLAN
AS AMENDED
TABLE OF CONTENTS
Page No.
1. PURPOSE..................................................................3
2. DEFINITIONS..............................................................3
2.1 Accounting Date......................................................3
2.2 Basic Company Credit.................................................3
2.3 Beneficiary..........................................................3
2.4 Board................................................................3
2.5 Business Day.........................................................3
2.6 Committee............................................................3
2.7 Common Stock.........................................................3
2.8 Common Stock Fund....................................................3
2.9 Company..............................................................3
2.10 Company Credits.....................................................4
2.11 Compensation........................................................4
2.12 Compensation Account(s).............................................4
2.13 Credit Date.........................................................4
2.14 Deferred Compensation...............................................4
2.15 Disability..........................................................4
2.16 Effective Date......................................................4
2.17 Election............................................................4
2.18 Employee............................................................4
2.19 Exchange Act........................................................4
2.20 Fair Market Value...................................................4
2.21 In-Service Account..................................................5
2.22 Participant.........................................................5
2.23 Past Service Credit.................................................5
2.24 Plan................................................................5
2.25 Plan Year...........................................................5
2.26 Retirement..........................................................5
2.27 Retirement Account..................................................5
2.28 Service Year........................................................5
2.29 Stock Unit(s).......................................................5
2.30 Termination.........................................................5
3. ADMINISTRATION...........................................................5
4. ELIGIBILITY..............................................................6
5. PARTICIPANT ACCOUNTS.....................................................6
6. ELECTION TO PARTICIPATE..................................................6
6.1 In General...........................................................6
6.2 Investment Alternatives For Existing Balances........................7
7. COMPANY CREDITS..........................................................7
7.1 Vesting..............................................................7
7.2 Forfeiture...........................................................7
8. DISTRIBUTION.............................................................7
8.1 Retirement Account...................................................7
8.2 In-Service Account...................................................7
8.3 Termination..........................................................8
8.4 Death................................................................8
8.5 Form of Distribution.................................................8
9. FINANCIAL HARDSHIP.......................................................8
10. BENEFICIARY DESIGNATION.................................................8
11. UNSECURED GENERAL CREDITOR STATUS OF EMPLOYEE...........................8
12. SHARES; ADJUSTMENTS IN EVENT OF CHANGES IN CAPITALIZATION...............9
13. INALIENABILITY OF BENEFITS..............................................9
14. GOVERNING LAW...........................................................9
15. AMENDMENTS..............................................................9
EXPRESS SCRIPTS, INC.
EXECUTIVE DEFERRED COMPENSATION PLAN
1. PURPOSE
The purpose of this Express Scripts, Inc. Executive Deferred Compensation Plan
(the "Plan") is to provide eligible key employees of the Company with an
opportunity to defer compensation to be earned by them from the Company as a
means of saving for retirement or other future purposes and to provide such
employees with competitive retirement and capital accumulation benefits. In
addition, the Plan is intended to provide eligible key employees additional
incentive to remain employed by the Company and to attract certain
executive-level employees.
2. DEFINITIONS
The following definitions shall be applicable throughout the Plan:
2.1 Accounting Date.
"Accounting Date" means each Business Day on which a
calculation concerning a Participant's Compensation Account is performed, or as
otherwise defined by the Committee.
2.2 Basic Company Credit.
"Basic Company Credit" means an amount, if any, credited to a
Participant's Retirement Account as described in Section 7.
2.3 Beneficiary.
"Beneficiary" means the person or persons designated by the
Participant in accordance with Section 10, or if no person or persons are so
designated, the estate of a deceased Participant.
2.4 Board.
"Board" means the Board of Directors of Express Scripts, Inc. or its
designee.
2.5 Business Day.
Business Day" means a day on which the New York Stock Exchange is open
for trading activity.
2.6 Committee.
"Committee" means the Compensation Committee of the Board.
2.7 Common Stock.
"Common Stock" means the Class A Common Stock, $0.01 par value, of
Express Scripts, Inc.
2.8 Common Stock Fund.
"Common Stock Fund" means that investment option, approved by the
Committee, in which a Participant's Compensation Accounts may be deemed to be
invested and may earn income (or incur losses) based on a hypothetical
investment in Common Stock.
2.9 Company.
"Company" means Express Scripts, Inc., its divisions, subsidiaries and
affiliates.
2.10 Company Credits.
"Company Credits" means amounts credited as either Basic Company
Credits or Past Service Credits by the Company to Compensation Accounts, in the
sole discretion of the Committee, pursuant to Section 7.
2.11 Compensation.
"Compensation" means any employee compensation determined by the
Committee to be properly deferrable under the Plan.
2.12 Compensation Account(s).
"Compensation Account(s)" means the Retirement Account and/or the
In-Service Accounts.
2.13 Credit Date.
"Credit Date" means each date on which Deferred Compensation is
credited to Compensation Accounts in accordance with rules prescribed by the
Committee.
2.14 Deferred Compensation.
"Deferred Compensation" means the Compensation elected by the
Participant to be deferred pursuant to the Plan.
2.15 Disability.
"Disability" means qualification for disability benefits under a
long-term disability plan under which a Participant is covered and which is
maintained by the Company.
2.16 Effective Date.
"Effective Date" means January 1, 1999.
2.17 Election.
"Election" means a Participant's delivery of a written notice of
election to the Committee or its designee electing to defer payment of a
specified percentage of his or her Compensation (in accordance with rules
prescribed by the Committee) either until Retirement, death or such other time
as further permitted by the Committee.
2.18 Employee.
"Employee" means an individual classified by the Committee as a
full-time, regular salaried employee of the Company, its present and future
subsidiary corporations as defined in Section 424 of the Internal Revenue Code
of 1986, as amended, or its affiliates.
2.19 Exchange Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
2.20 Fair Market Value.
"Fair Market Value" means, as of any specified date, the closing sales
price of a share of Common Stock, as reported on the Nasdaq National Market on
that date (or, if there are no sales on that date, the last preceding date on
which there was a sale), or, in the event the Common Stock is listed on a stock
exchange, the closing sales price of a share of Common Stock, as reported on
such exchange on that date (or, if there are no sales on that date, the last
preceding date on which there was a sale). In the absence of any listing of the
Common Stock on the Nasdaq National Market or on any established stock exchange,
Fair Market Value means the fair market value of the Common Stock on any
specified date as determined in good faith by the Committee.
2.21 In-Service Account.
"In-Service Account" means the account or accounts to which a
Participant elects to contribute Deferred Compensation and from which, pursuant
to Section 8.2, distributions are made.
2.22 Participant.
"Participant" means an Employee selected by the Committee to
participate in the Plan who has elected to defer payment of all or a portion of
his or her Compensation under the Plan.
2.23 Past Service Credit.
"Past Service Credit" means an amount, if any, credited to a
Participant's Retirement Account as described in Section 7.
2.24 Plan.
"Plan" means this Express Scripts, Inc. Executive Deferred Compensation
Plan, as amended from time to time.
2.25 Plan Year.
"Plan Year" means the annual period commencing January 1 and ending the
following December 31.
2.26 Retirement.
"Retirement" means a Participant's termination of employment on or
after age 57 or upon attaining age 55 with ten (10) Service Years in a position
at least as senior as a senior vice-president.
2.27 Retirement Account.
"Retirement Account" means the account to which a Participant elects to
contribute Deferred Compensation and to which Company Credits are made, and from
which, pursuant to Section 8.1, distributions are made.
2.28 Service Year.
"Service Year" means, as designated by the Committee, such year or
portion thereof during which the services have been rendered by a Participant
for which Compensation is payable.
2.29 Stock Unit(s).
"Stock Unit(s)" means the share equivalents credited to the Common
Stock Fund of a Participant's Compensation Account in accordance with Sections
5, 6 and 7.
2.30 Termination.
"Termination" means termination of services as an Employee for any
reason other than Retirement. In the event of a Participant's Disability, a
Termination will be deemed to have occurred as of the earlier of (a) the
Committee's determination that a Participant has experienced a termination of
services or (b) the date which is nine (9) months after the date the Participant
begins receiving disability benefits under a long-term disability plan
maintained by the Company.
3. ADMINISTRATION
Full power and authority to construe, interpret and administer the Plan
shall be vested in the Committee. This power and authority includes, but is not
limited to, selecting which Employees are eligible to participate in the Plan,
selecting Compensation eligible for deferral, selecting investment indices,
establishing the level of Company Credits (if any) to the Plan, establishing
deferral terms and conditions, receiving and approving beneficiary designation
forms, and adopting modifications, amendments and procedures as may be deemed
necessary, appropriate or convenient by the Committee. Decisions of the
Committee shall be final, conclusive and binding upon all parties. The
Committee, in its sole discretion, may delegate day-to-day administration of the
Plan to an employee or employees of the Company or to a third-party
administrator. The Committee may also rely on outside counsel, independent
accountants or other consultants or advisors for advice and assistance in
fulfilling its administrative duties under the Plan.
4. ELIGIBILITY
The Committee shall have the authority to select from senior and vice
president-level executives those Employees who shall be eligible to participate
in the Plan.
5. PARTICIPANT ACCOUNTS
Upon a Participant's initial election to participate in the Plan, there
shall be established a Retirement Account and an In-Service Account, as
designated by the Participant, to which there shall be credited any Deferred
Compensation as of each Credit Date. In addition, Company Credits, if any, made
pursuant to Section 7 shall be allocated to a Participant's Retirement Account
in accordance with rules prescribed by the Committee. Each such Compensation
Account shall be credited (or debited) on each Accounting Date with income (or
loss) based upon a hypothetical investment in any one or more of the investment
options available under the Plan, as prescribed by the Committee for the
particular Compensation credited, which may include a Common Stock Fund.
If a Participant elects to invest all or any portion of his or her
Compensation Account(s) in the Common Stock Fund, that portion of the
Participant's Compensation Account(s) shall be credited on each Credit Date with
Stock Units equal to the number of shares of Common Stock (including fractions
of a share) that could have been purchased with the amount of such Deferred
Compensation at the Fair Market Value on the Credit Date. As of any date for the
payment of cash dividends on the Common Stock, the portion of the Participant's
Compensation Account(s) invested in the Common Stock Fund as of the dividend
record date shall be credited with additional Stock Units calculated by dividing
(i) the product of (a) the dollar value of the dividend declared in respect of a
share of Common Stock multiplied by (b) the number of Stock Units credited to
the Participant's Compensation Account(s) as of the dividend record date by (ii)
the Fair Market Value of a share of Common Stock on the dividend payment date.
6. ELECTION TO PARTICIPATE
6.1(1) In General.
Any Employee selected by the Committee to participate in the
Plan may elect to do so by delivering to the Committee or its designee an
Election on a form prescribed by the Committee, designating the Compensation
Account to which the Deferred Compensation is to be credited, electing the
timing and form of distribution (if applicable), and setting forth the manner in
which such Deferred Compensation shall be invested in accordance with Section 5.
A Participant's initial Election must be filed at such time as designated by the
Committee, but in no event later than the day immediately preceding the date on
which the Participant becomes eligible to participate in the Plan. Such initial
Election shall only be effective as to the Plan Year to which such Election
relates. A Participant must submit a new Election for each subsequent Plan Year
in order to defer Compensation. Such subsequent Election must be filed at such
time as designated by the Committee, but in no event later than the day
immediately preceding the first day of the Plan Year to which such Election
relates. An effective Election may not be revoked or modified except as
otherwise determined by the Committee or as stated in the Plan.
[FN]
(1) Section 6.1 was amended on November 22, 1999. Prior to its amendment,
Section 6.1 read as follows in its entirety:
Any Employee selected by the Committee to participate in the Plan may elect
to do so by delivering to the Committee or its designee an Election on a form
prescribed by the Committee, designating the Compensation Account to which the
Deferred Compensation is to be credited, electing the timing and form of
distribution (if applicable), and setting forth the manner in which such
Deferred Compensation shall be invested in accordance with Section 5. A
Participant's initial Election must be filed within thirty (30) days of the date
on which the Participant becomes eligible to participate in the Plan. Such
initial Election shall only be effective as to the Plan Year to which such
Election relates. A Participant must submit a new Election for each subsequent
Plan Year in order to defer Compensation. Such subsequent Election must be filed
at least thirty (30) days prior to the first day of the Plan Year to which such
Election relates. An effective Election may not be revoked or modified except as
otherwise determined by the Committee or as stated in the Plan.
</FN>
6.2 Investment Alternatives For Existing Balances.
A Participant may elect to change an existing selection as to
the investment alternatives in effect with respect to an existing Compensation
Account (in increments prescribed by the Committee) as often, and with such
restrictions, as determined by the Committee.
7. COMPANY CREDITS
In the sole discretion of the Committee, in a given Plan Year, the
Company may credit a specified percentage of a Participant's Compensation to the
Participant's Retirement Account as a Basic Company Credit. The Committee, in
its sole discretion, may cause the Company to credit such Basic Company Credit
for all or any portion of the participants in the Plan in such Plan Year. In
addition, the Committee may cause the Company to credit a Past Service Credit to
recognize past service as the Committee, in its sole discretion, deems
appropriate. Such Basic Company Credit and Past Service Credit, if any, shall be
credited to a Participant's Retirement Account and shall be subject to the
limitations determined appropriate by the Committee, including the limitation
contained in Section 8.3 and the limitations described below in this Section 7.
7.1 Vesting.
A Participant's Deferred Compensation shall be immediately
one-hundred percent (100%) nonforfeitable upon being credited to such
Participant's Retirement or In-Service Account.
A Participant's Basic Company Credit for a Plan Year shall
become nonforfeitable three (3) years after the end of the Plan Year to which
such Basic Company Credit relates.
A Participant's Past Service Credit shall be fifty-percent
(50%) nonforfeitable upon being credited to his or her Retirement Account. The
remaining fifty-percent (50%) shall become nonforfeitable as follows: one (1)
year after the end of the Plan Year in which the Past Service Credit is credited
to the Participant's Retirement Account, the Participant shall be one-third
(1/3) vested in the remaining fifty percent (50%); two (2) years after the end
of the Plan Year in which the Past Service Credit is credited to the
Participant's Retirement Account, the Participant shall be two-thirds (2/3)
vested in the remaining fifty percent (50%); and three (3) years after the end
of the Plan Year in which the Past Service Credit is credited to the
Participant's Retirement Account, the Participant shall be one-hundred percent
(100%) vested in the remaining fifty percent (50%).
Upon a Participant's termination of employment for any reason
prior to attaining age 57, he or she shall forfeit any nonvested benefits. A
Participant shall have a one-hundred percent (100%) nonforfeitable right to
Basic Company Credits and Past Service Credits upon attaining age 57.
7.2 Forfeiture.
Upon a Participant's Termination or Retirement, the Company
reserves the right to withhold payment of a portion of a Participant's
Retirement Account attributable to Basic Company Credits or Past Service Credits
made under Section 7 (and earnings thereon) in the event the Committee
determines that the Participant has violated the Company's standard
noncompetition and nondisclosure agreement or any other employment agreement
executed by the Participant, or otherwise acts against the interests of the
Company, as determined by the Committee in its sole discretion.
8. DISTRIBUTION
8.1 Retirement Account.
In the event of a Participant's Retirement, the Participant's
Retirement Account shall be distributed at the time and in the manner elected by
the Participant in his or her initial Election. If no Election is made by a
Participant as to the timing of distribution or form of payment of his or her
Retirement Account, upon the Participant's Retirement such account shall be paid
in a single lump sum.
8.2 In-Service Account.
Deferred Compensation credited to a Participant's In-Service
Account shall be distributed at the time and in the manner elected by the
Participant in his or her Election. A Participant may not change the Election as
to the distribution of Deferred Compensation in his or her In-Service Account
except as otherwise permitted in Section 9.
8.3 Termination.
In the event of a Participant's Termination, the Participant's
Compensation Accounts shall be distributed in a single lump sum to such
Participant as soon as administratively practicable following his or her
Termination.
8.4 Death.
In the event of the Participant's death (a) while in the
employment of the Company or (b) after the Participant's Termination but prior
to the payment of such Participant's Compensation Accounts pursuant to Section
8.3, the Company shall pay the following amounts to the Participant's
Beneficiary in a single lump sum:
(1) the remaining amounts, if any, in a Participant's In-Service
Account; and
(2) the amounts in the Participant's Retirement Account.
In the event of the Participant's death following Retirement,
the Company shall pay the amount in the Participant's Retirement Account to the
Participant's Beneficiary in the form and at the time elected by the Participant
pursuant to Section 6.1.
8.5 Form of Distribution.
Distribution of a Participant's Compensation Accounts shall be
made in cash; provided that, any amounts in a Participant's Compensation
Accounts invested in the Common Stock Fund shall be distributed to the
Participant in wholes shares of Common Stock with fractional shares paid in
cash.
9. FINANCIAL HARDSHIP
Upon the written request of a Participant or a Participant's legal
representative and a finding that continued deferral will result in an
unforeseeable financial emergency to the Participant, the Committee (in its sole
discretion) may authorize (a) the payment of all or a part of a Participant's
Compensation Accounts representing Deferred Compensation and earnings thereon in
a single lump sum prior to his or her ceasing to be a Participant, or (b) a
Participant to cease contributing Deferred Compensation to the Plan during a
Plan Year. It is intended that the Committee's determinations as to whether the
Participant has suffered an "unforeseeable financial emergency" shall be made
consistent with the requirements under Section 457(d) of the Internal Revenue
Code of 1986, as amended.
10. BENEFICIARY DESIGNATION
A Participant may designate one or more persons (including a trust) to
whom or to which payments are to be made if the Participant dies before
receiving distribution of all amounts due under the Plan. A Participant may, at
any time, elect to change the designation of a Beneficiary. A designation of
Beneficiary will be effective only after the signed designation of Beneficiary
is filed with the Committee or its designee while the Participant is alive and
will cancel all designations of Beneficiary signed and filed earlier. If the
Participant fails to designate a Beneficiary as provided above or if all of a
Participant's Beneficiaries predecease him or her and he or she fails to
designate a new Beneficiary, the remaining unpaid amounts shall be paid in one
lump sum to the estate of such Participant. If all Beneficiaries of the
Participant die after the Participant but before complete payment of all amounts
due hereunder, the remaining unpaid amounts shall be paid in one lump sum to the
estate of the last to die of such Beneficiaries.
11. UNSECURED GENERAL CREDITOR STATUS OF EMPLOYEE
The payments to Participants and their Beneficiaries hereunder shall be
made from the general corporate assets of the Company. No person shall have any
interest in any such assets by virtue of the provisions of this Plan. The
Company's obligation hereunder shall be an unfunded and unsecured promise to pay
money in the future. To the extent that any person acquires a right to receive
payments from the Company under the provisions hereof, such right shall be no
greater than the right of any unsecured general creditor of the Company; no such
person shall have nor acquire any legal or equitable right, interest or claim in
or to any property or assets of the Company. Any accounts maintained under this
Plan shall be hypothetical in nature and shall be maintained for bookkeeping
purposes only. Neither the Plan nor any account shall hold any actual funds or
assets.
12. SHARES; ADJUSTMENTS IN EVENT OF CHANGES IN CAPITALIZATION
An aggregate of 50,000 shares of Common Stock have been initially
allocated to the Plan and reserved for the distribution of Compensation Accounts
as described in Section 8.5, subject to adjustment under this Section 12. The
Company may, in its discretion, use shares held in the Treasury under this Plan
in lieu of authorized but unissued shares of Common Stock.
In the event of any change in the outstanding Common Stock of the
Company by reason of any stock split, share dividend, recapitalization, merger,
consolidation, reorganization, combination, or exchange or reclassification of
shares, split-up, split-off, spin-off, liquidation or other similar change in
capitalization, or any distribution to common shareholders other than cash
dividends, the number or kind of shares or Stock Units that may be credited
under the Plan shall be automatically adjusted so that the proportionate
interest of the Participants shall be maintained as before the occurrence of
such event. Such adjustment shall be conclusive and binding for all purposes of
the Plan.
13. INALIENABILITY OF BENEFITS
The interests of the Participants and their Beneficiaries under the
Plan may not in any way be voluntarily or involuntarily transferred, alienated
or assigned, nor subject to attachment, execution, garnishment or other such
equitable or legal process. A Participant or Beneficiary cannot waive the
provisions of this Section 13.
14. GOVERNING LAW
The provisions of this plan shall be interpreted and construed in
accordance with the laws of the State of Missouri, except to the extent
preempted by Federal law.
15. AMENDMENTS
The Committee may amend, alter or terminate this Plan at any time
without the prior approval of the Board; provided, however, that the Committee
may not, without approval by the Board, materially increase the benefits
accruing to Participants under the Plan.
IN WITNESS WHEREOF, the Express Scripts, Inc. Executive Deferred
Compensation Plan is effective as of January 1, 1999.
EXPRESS SCRIPTS, INC.
By: /s/ Barrett A. Toan
Title: President and Chief Executive Officer
