August 1, 2006

 

 

Chris Reidy

 

 

Dear Chris:

 

I have outlined below the terms of our agreement with respect to your taking the
position of Vice President/Chief Financial Officer of ADP. We anticipate your
start date will be not later than Monday, October 2, 2006.

 

Base Salary:

$500,000/paid monthly

 

Target Bonus @ 80%:

$400,000

 

Time Based Restricted

26,000 shares

 

Stock:

(vesting 13,000 shares in FY ‘07 and 13,000 shares in FY ‘08)

 

2-Year Performance

Based Restricted Stock:

13,000 shares @ Target. First expected payout on these shares in 8/08, with 6
month vesting schedule. This is a 2-year rolling/renewal program based on ADP
2-year EPS CAGR.

 

Initial Stock Option Grant:

75,000 options grant with six year ratable vesting – zero in year one. Grant to
be made on October 2, 2006.

 

Follow-on Stock Option

Grants:

20,000/year in January of each year. The first of these grants would be in
January 2008.

 

ARP @ Target (FY’07-FY’08):

60% of Base Salary ($300,000)

 

Separation Pay:

In the event you are non-voluntarily terminated from ADP within the first three
years of your employment, you will receive two years of base salary, bonus and
restricted stock. After your third year of employment, your separation pay will
be the equivalent of one year of base salary, bonus and restricted stock.

 

Change of Control:

The same as all other Officers

 

ADP SORP:

Participation in SORP Program

 

 

 

 

 

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Other Corporate

Officer Programs:

Participation in all other Corporate Officer programs (e.g., executive auto,
matching gift program ($20K/year), executive physicals, executive retiree
medical, deferred compensation)

 

 

 

If you are in agreement with the terms stipulated above, please sign a copy of
this document and

return an original to me in the enclosed envelope, as well as fax to me at
973-974-3450. All of us who have met you look forward to working with you.

 

 

Sincerely yours,

 

 

 

 

/s/      Gary Butler                                    

 

Gary Butler

 

 

 

Agreed to:

 

 

/s/      Chris Reidy                            

 

Chris Reidy