Exhibit 10.2

 

 

EMPLOYMENT AGREEMENT

BETWEEN

JAMES G. KELLY

AND

GLOBAL PAYMENTS INC.

 

 

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EMPLOYMENT AGREEMENT

CONTENTS

 

1. Effective Date

   1

2. Employment

   1

3. Employment Period

   1

4. Extent of Service

   2

5. Compensation and Benefits

   2

(a)    Base Salary

   2

(b)    Incentive and Savings Plans

   2

(c)    Welfare Benefit Plans

   3

(d)    Expenses

   3

(e)    Fringe Benefits

   3

6. Change in Control

   3

7. Termination of Employment

   4

(a)    Death, Retirement or Disability

   4

(b)    Termination by the Company

   5

(c)    Resignation by Executive

   6

(d)    Notice of Termination

   7

(e)    Date of Termination

   7

8. Obligations of the Company upon Termination

   8

(a)    Prior to a Change in Control: Notice of Resignation Given by Executive
During the Time Period between the Earliest Notice Date and the First
Anniversary Date, or Termination by the Company Other Than for Cause or
Disability on or before the First Anniversary Date

   8

(b)    Prior to a Change in Control: Resignation by Executive for Good Reason
after the First Anniversary Date; Termination by the Company Other Than for
Cause or Disability after the First Anniversary Date

   10

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(c)    After or in Connection with a Change in Control: Resignation by Executive
for Good Reason after the First Anniversary Date; Termination by the Company
Other Than for Cause or Disability

   12

(d)    Death, Disability or Retirement

   14

(e)    Cause, Voluntary Termination, Resignation without Good Reason, or
Resignation in Accordance with Section 7(c)(i)

   15

(f)     Limited Exclusion for Private Equity Firms

   15

9. Non-exclusivity of Rights

   16

10. Stock Retention

   16

11. Costs of Enforcement

   16

12. Representations and Warranties

   16

13. Restrictions on Conduct of Executive

   17

(a)    General

   17

(b)    Definitions

   17

(c)    Restrictive Covenants

   19

(d)    Enforcement of Restrictive Covenants

   21

14. Arbitration

   22

15. Rabbi Trust

   22

16. Assignment and Successors

   23

17. Miscellaneous

   23

(a)    Waiver

   23

(b)    Severability

   23

(c)    Other Agents

   23

(d)    Entire Agreement

   23

(e)    Governing Law

   23

(f)     Notices

   24

(g)    Amendments and Modifications

   24

18. Section 409A

   24

 

-ii-

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EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 30th
day of March, 2010 by and between Global Payments Inc., a Georgia corporation
(the “Company”), and James G. Kelly (“Executive”), to be effective as of the
Effective Date, as defined in Section 1.

BACKGROUND

As of the Effective Date of this Agreement, Executive shall serve as the
President and Chief Operating Officer of the Company and, as of June 1, 2010, as
the Vice Chairman and Chief Operating Officer of the Company. Executive and the
Company desire to memorialize the terms of such employment in this Agreement. In
addition, the Board of Directors of the Company (the “Board”), has determined
that it is in the best interests of the Company and its stockholders to assure
that the Company will have the continued dedication of Executive,
notwithstanding the possibility, threat or occurrence of a Change in Control (as
defined below) of the Company. As it is desired and anticipated that Executive
will continue to be employed and provide services for the Company’s successor
for some period of time following a Change in Control, one purpose of this
Agreement is to provide Executive with compensation and benefits arrangements
which ensure that the compensation and benefits expectations of Executive will
be satisfied and which are competitive with those of other corporations.
Therefore, in order to accomplish these objectives, the Board has caused the
Company to enter into this Agreement. The terms of this Agreement replace
Executive’s previous Employment Agreement dated June 2, 2006, as amended, and
any terms that might have been contained in any prior agreement or other
communication regarding Executive’s employment.

NOW THEREFORE, in consideration of the foregoing and of the mutual covenants and
agreements set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1. Effective Date. The effective date of this Agreement (the “Effective Date”)
is March 30, 2010.

2. Employment. As of the Effective Date, Executive is hereby employed as the
President and Chief Operating Officer of the Company and, as of June 1, 2010, as
the Vice Chairman and Chief Operating Officer of the Company. In each such
capacity, Executive shall have the duties and responsibilities as shall be
assigned to him by the Chief Executive Officer of the Company (in his sole
discretion) from time to time.

3. Employment Period. Subject to Section 7, Executive’s initial Employment
Period shall be the three (3) consecutive year period which begins on the
Effective Date; provided, Executive’s initial Employment Period shall
automatically be extended for one additional year on the second anniversary of
the Effective Date and again on each

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subsequent anniversary of such date unless either the Company or Executive
provides notice (in accordance with Section 17(f)) before such anniversary date
that there will be no such extension. Executive’s initial Employment Period and
any subsequent extension of the initial Employment Period shall be referred to
collectively as Executive’s “Employment Period”. A failure to extend Executive’s
Employment Period shall not be treated for any reason whatsoever as a
termination of Executive’s employment under Section 7.

4. Extent of Service. During the Employment Period, Executive shall render his
services to the Company (or to its successor following a Change in Control) in
conformity with professional standards, in a prudent and workmanlike manner and
in a manner consistent with the obligations imposed on officers of corporations
under applicable law. Executive shall promote the interests of the Company and
its subsidiaries in carrying out Executive’s duties and shall not deliberately
take any action which could, or fail to take any action which failure could,
reasonably be expected to have a material adverse effect upon the business of
the Company or any of its subsidiaries or any of their respective affiliates.
Executive agrees to devote his business time, attention, skill and efforts
exclusively to the faithful performance of his duties hereunder (both before and
after a Change in Control); provided, however, that it shall not be a violation
of this Agreement for Executive to (i) devote reasonable periods of time to
charitable and community activities and, with the approval of the Company,
industry or professional activities, and/or (ii) manage or participate in
personal business interests and investments, so long as such activities do not
materially interfere with the performance of Executive’s responsibilities under
this Agreement and comply with all Company policies and codes and/or (iii) seek
a Competitive Position in the Restricted Territory in accordance with the
provisions of the last sentence of Section 13(c)(iv).

5. Compensation and Benefits.

(a) Base Salary. Thereafter, during the Employment Period, the Company will pay
to Executive a base salary in the amount of U.S. $600,000 per year (“Base
Salary”), less normal withholdings, payable in equal bi-weekly or other
installments as are customary under the Company’s payroll practices from time to
time. Executive’s Base Salary will be reviewed periodically and, subject to
approval of the Compensation Committee of the Board (the “Committee”), the
Company may increase (but not decrease) Executive’s Base Salary from time to
time. The periodic review of Executive’s salary by the Committee will consider,
among other things, Executive’s own performance and the Company’s performance.

(b) Incentive and Savings Plans. During the Employment Period, Executive shall
be entitled to participate in incentive and savings plans, practices, policies
and programs applicable generally to employees of the Company. Certain executive
programs will be made available on a selective basis at the discretion of the
Chief Executive Officer, Chairman, or the Committee. Without limiting the
foregoing, the following shall apply:

(i) Annual Bonus. Executive will have an annual bonus opportunity based on
achievement of agreed-upon financial and performance objectives (“Bonus
Opportunity”). The annual Bonus Opportunity and specific performance and
financial objectives will be set forth in Executive’s individual performance and
incentive plan for each fiscal year. Executive’s annual Bonus Opportunity shall
not be less than 85% of his then current Base Salary. If Executive’s annual
Bonus Opportunity is increased from 85% to some higher percentage of his then
current salary, then Executive’s annual Bonus Opportunity thereafter shall not
be less than such then current percentage. Except as otherwise set forth in this
Agreement, Executive must be an active employee on the date the annual bonuses
are paid on a Company wide basis in order to be eligible to receive any bonus
payment.

 

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(ii) Incentive Awards. From time to time, upon approval by the Committee, the
Company may grant to Executive stock options, shares of restricted stock,
restricted stock units, performance shares, performance units, and/or other
stock related grants as a long-term incentive for performance. For greater
certainty, any incentive awards are granted solely in the discretion of the
Company and the Committee and the Executive shall have no right to receive any
such incentive awards.

(c) Welfare Benefit Plans. During the Employment Period, Executive and
Executive’s family shall be eligible for participation in, and shall receive all
benefits under, the welfare benefit plans, practices, policies and programs
provided by the Company (including, without limitation, medical, prescription,
dental, disability, employee life, group life, accidental death and travel
accident insurance plans and programs) (“Welfare Plans”).

(d) Expenses. During the Employment Period, Executive shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred by Executive
in accordance with the policies, practices and procedures of the Company.

(e) Additional Benefits. During the Employment Period, Executive shall be
entitled to receive or participate in any additional benefits in accordance with
the plans, practices, programs, eligibility requirements, and policies of the
Company.

6. Change in Control. For the purposes of this Agreement, a “Change in Control”
shall mean:

(a) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of the combined
voting power of the then outstanding voting securities of the Company entitled
to vote generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that for purposes of this subsection (a), the
following acquisitions shall not constitute a

 

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Change in Control: (i) any acquisition by a Person who is on the Effective Date
the beneficial owner of 35% or more of the Outstanding Company Voting
Securities, (ii) any acquisition directly from the Company, (iii) any
acquisition by the Company which reduces the number of Outstanding Company
Voting Securities and thereby results in any person having beneficial ownership
of more than 35% of the Outstanding Company Voting Securities, (iv) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company, or
(v) any acquisition by any corporation pursuant to a transaction which complies
with clauses (i) and (ii) of subsection (b) of this Section 6; or

(b) Consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (a
“Business Combination”), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 50% of,
respectively, 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, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, and (ii) no
Person (excluding the Company or any employee benefit plan (or related trust) of
the Company or such corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 35% or more of the combined voting
power of the then outstanding voting securities of such corporation.

7. Termination of Employment.

(a) Death, Retirement or Disability. Executive’s employment and the Employment
Period shall terminate automatically upon Executive’s death or Retirement. For
purposes of this Agreement, “Retirement” shall mean normal retirement as defined
in the Company’s then-current retirement plan, or if there is no such retirement
plan, “Retirement” shall mean voluntary termination after age 65 with ten years
of service. If the Company determines in good faith that the Disability of
Executive has occurred (pursuant to the definition of Disability set forth
below), the Company may give to Executive written notice of its intention to
terminate Executive’s employment. In such event, Executive’s employment with the
Company shall terminate effective on the 30th day after receipt of such written
notice by Executive (the “Disability Effective Date”), provided that, within the
30 days after such receipt, Executive shall not have returned to full-time
performance of Executive’s duties. For purposes of this Agreement, “Disability”
shall mean the inability of Executive, as determined by the Committee, to

 

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substantially perform the essential functions of his regular duties and
responsibilities with or without a reasonable accommodation due to a medically
determinable physical or mental illness which has lasted (or can reasonably be
expected to last) for a substantially continuous period of at least six
consecutive months.

(b) Termination by the Company. The Company may terminate Executive’s employment
with or without Cause. For purposes of this Agreement “Cause” shall mean (in the
reasonable determination of the Company):

(i) the failure of Executive to perform substantially Executive’s duties with
the Company (other than any such failure resulting from incapacity due to
physical or mental illness, and specifically excluding any failure by Executive
to meet performance expectations), after a written demand for substantial
performance is delivered to Executive by the Chief Executive Officer, the
Chairman, or the Committee which specifically identifies the manner in which
such Committee or officer believes that Executive has not substantially
performed Executive’s duties and which has not been cured to the satisfaction of
such person or the Committee within the cure period designated in the written
demand delivered to Executive, or

(ii) any act of fraud, misappropriation, embezzlement or similar dishonest or
wrongful act by Executive, including, without limitation, any violation of the
Sarbanes-Oxley Act or similar laws or legal standards, but excluding for this
purpose any non-criminal violation of Sarbanes-Oxley or similar laws or legal
standards that has no adverse impact on the Company or its reputation and does
not involve dishonesty or render Executive ineligible for any licensing, bonding
or insurance coverage or for employment or engagement in any Company work or
activity; or

(iii) Executive’s abuse of alcohol, prescription drugs or any substance which
materially interferes with Executive’s ability to perform Executive’s duties and
responsibilities under this Agreement or Executive’s use of illegal drugs; or

(iv) Executive’s violation of any laws, agreements or Company policies or codes
prohibiting employment discrimination, harassment, conflicts of interest,
retaliation, competition with the Company, solicitation of Company customers or
employees on behalf of anyone other than Company, improper use or disclosure of
Trade Secrets, Confidential Information or other proprietary information of the
Company; or

(v) Executive’s conviction for, or plea of guilty or nolo contendere to, a
felony; or

(vi) Executive’s failure to comply with the provisions of this Agreement,
including but not limited to the provisions of Sections 10 and 13 hereunder.

 

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(c) Resignation by Executive.

(i) For the time period from the Effective Date through the date that is ninety
days after the Effective Date, Executive may resign for any reason or no reason;
provided, however, that no resignation pursuant to a Notice of Termination
delivered during such period shall be considered a resignation for Good Reason
(as defined below), regardless of whether any such events of Good Reason shall
have occurred. Any resignation referred to above shall be treated in accordance
with the provisions of Section 8(e). Notwithstanding the foregoing, during such
time period the Company shall not change its reporting structure such that
Executive no longer reports directly to the Chief Executive Officer of the
Company or the Chairman of the Board, reduce Executive’s Base Salary, reduce
Executive’s Bonus Opportunity below the minimum defined in Section 5(b)(i),
reduce the benefits pursuant to the Welfare Plans (unless a similar reduction is
made in the benefits of similarly-situated senior executives), fail to comply
with and satisfy Section 16(c) of this Agreement, or require that Executive be
based in any office or location other than in the greater metropolitan area of
Atlanta, Georgia. If Executive believes that the Company has breached any of the
foregoing provisions, he shall provide written notice. The Company shall not be
considered in breach of the foregoing unless it has not cured any such breach
within ten days of receipt of such written notice.

(ii) For the time period from the 91st day after the Effective Date (“Earliest
Notice Date”) through the first anniversary of the Effective Date (the “First
Anniversary Date”), Executive may resign for any reason or no reason, and any
resignation pursuant to a 30-day Notice of Termination delivered during such
period shall entitle Executive to the benefits set forth in Section 8(a) of this
Agreement.

(iii) After the First Anniversary Date, Executive may resign for any reason or
no reason, including without limitation, for Good Reason. For purposes of this
Agreement, “Good Reason” shall mean the occurrence of any of the following
events after the First Anniversary Date, without the written consent of
Executive:

(A) the assignment to Executive to a position (a) materially different from Vice
Chairman and Chief Operating Officer or (b) to which he is not the Vice Chairman
and Chief Operating Officer of a publicly traded corporation having a class of
securities registered pursuant to the Securities Exchange Act of 1934, as
amended; which assignment is not rescinded within ten (10) days after the
Company receives written notice from Executive that he believes that the
assignment constitutes Good Reason and that he intends to resign if it is not
rescinded; or

(B) the Company changes its reporting structure such that Executive no longer
reports directly to the Chief Executive Officer of the Company or the Chairman
of the Board; or

(C) a reduction by the Company: (a) in Executive’s Base Salary as in effect on
the Effective Date or as the same may be increased from time to time; or (b) in
Executive’s Bonus Opportunity below the minimum defined in Section 5(b)(i); or

 

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(c) in the benefits pursuant to the Welfare Plans (unless a similar reduction is
made in the benefits of similarly-situated senior executives), and which
reduction set forth in (a), (b), or (c) above is not rescinded within ten
(10) days after the Company receives written notice from Executive that he
believes that the reduction constitutes Good Reason and that he intends to
resign if it is not rescinded; or

(D) any failure by the Company to comply with and satisfy Section 16(c) of this
Agreement; or

(E) a requirement that Executive be based in any office or location other than
in the greater metropolitan area of Atlanta, Georgia.

Notwithstanding the foregoing, no event or act or omission shall constitute
“Good Reason” under this Section 7(c)(iii) unless (i) Executive in accordance
with Section 17(f) provides notice of such event or act or omission to the
Company no later than 30 days after Executive has knowledge of such event or act
or omission, (ii) the Company fails to remedy such event or act or omission with
30 days of the receipt of such notice (the “Cure Period”), and (iii) failing
such cure by the Company, Executive delivers a Notice of Termination no later
than 90 days after the end of the Cure Period.

(d) Notice of Termination. Any termination by the Company or resignation by
Executive shall be communicated by Notice of Termination to the other party
hereto given in accordance with Section 17(f) of this Agreement. For purposes of
this Agreement, a “Notice of Termination” means a written notice which
(i) indicates the specific termination provision in this Agreement relied upon,
(ii) to the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of Executive’s
employment under the provision so indicated, and (iii) subject to Section 7(e)
below, specifies the applicable termination date. The failure by Executive or
the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any right
of Executive or the Company, respectively, hereunder or preclude Executive or
the Company, respectively, from asserting such fact or circumstance in enforcing
Executive’s or the Company’s rights hereunder.

(e) Date of Termination. “Date of Termination” means (i) if Executive resigns
pursuant to the provisions of Sections 7(c)(i), 7(c)(ii), or 7(c)(iii), the date
that is 30 days after the Notice of Termination, provided that the Company may
specify any earlier Date of Termination, (ii) if Executive’s employment is
terminated by the Company other than by reason of Disability, the date of
receipt of the Notice of Termination, or any later date specified therein, or
(iii) if Executive’s employment is terminated by reason of death, Disability or
Retirement, the Date of Termination will be the date of death or Retirement, or
the Disability Effective Date, as the case may be.

 

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8. Obligations of the Company upon Termination.

(a) Prior to a Change in Control: Notice of Resignation Given by Executive
During the Time Period between the Earliest Notice Date and the First
Anniversary Date, or Termination by the Company Other Than for Cause or
Disability on or before the First Anniversary Date. If, prior to a Change in
Control or prior to a Termination by the Company for Cause, the Company shall
terminate Executive’s employment other than for Cause or Disability on or before
the First Anniversary Date or Executive shall deliver a Notice of Termination
(for any reason or no reason) between the Earliest Termination Date and the
First Anniversary Date (inclusive of such dates), then (and with respect to the
payments and benefits described in clauses (ii) through (x) below, only if
Executive has complied with the provisions of this Agreement, including but not
limited to the provisions of Sections 10 and 13, and only if within 60 days
after the Date of Termination Executive shall have executed the Release and the
applicable revocation period shall have expired:

(i) the Company shall pay to Executive in a lump sum in cash within 30 days
after the Date of Termination the sum of Executive’s Base Salary through the
Date of Termination to the extent not theretofore paid (“Accrued Obligations”),
and

(ii) on the first day of the seventh month after the Date of Termination (the
“Six-Month Pay Date”), the Company shall pay Executive a lump sum equal to the
amount of Executive’s Base Salary from the Date of Termination until the
Six-Month Pay Date: provided, however, that the Company shall have no obligation
to make such payment if Executive has violated any of the Restrictive Covenants
(as defined in Section 13 of this Agreement) and failed to remedy such violation
to the satisfaction of the Committee within 10 days of notice of such violation
or if Executive has violated the provisions Section 10 of this Agreement. If
Executive has performed services of any kind for any Competing Person or for any
Person who has a parent, affiliate, or subsidiary who is a Competing Person
between the Date of Termination and the Six-Month Pay Date, then the amount
otherwise due shall be multiplied by a fraction, the numerator of which is the
number of days that elapsed from the Date of Termination until his first date of
service for such Person (which cannot exceed 180) and the denominator of which
is 180; and

(iii) thereafter, for up to twelve (12) additional months following the
Six-Month Pay Date, the Company will continue to pay Executive an amount equal
to his monthly Base Salary, payable in equal monthly or more frequent
installments as are customary under the Company’s payroll practices from time to
time; provided, however that the Company’s obligation to make or continue such
payments shall cease if Executive violates any of the Restrictive Covenants (as
defined in Section 13 of this Agreement) and fails to remedy such violation to
the satisfaction of the Committee within 10 days of notice of such violation, if
Executive violates Section 10 of this Agreement, or if Executive performs
services of any kind for any Competing Person or for any Person who has a
parent, affiliate, or subsidiary who is a Competing Person; and

 

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(iv) for a period of eighteen (18) months after the Date of Termination,
Executive shall have the right to elect continuation of health care coverage
under the Company’s group health plan in accordance with “COBRA,” and the
Company shall pay (and report as taxable income to Executive) all premiums for
such COBRA coverage for Executive and his covered dependents for the eighteen
(18) month period, provided, however, that the obligation of the Company to pay
the cost for such COBRA coverage shall terminate upon Executive’s obtaining
other employment to the extent that such health care coverage is provided by the
new employer; and

(v) unless already paid, the Company shall pay to Executive, on the later of the
Six-Month Pay Date or the normal payment date for the 2010 bonus payments, the
amount of his fiscal year 2010 bonus, to the extent earned based on actual
performance through the end of the performance period as if Executive had
remained employed during the entire performance period provided that such bonus
shall be paid only if the pre-established performance targets are in fact
certified by the Committee in the ordinary course to have been met on a basis
consistent with the Chief Executive Officer and the other senior executives
under the senior executive compensation plan (the “Plan”); and

(vi) the Company shall pay to Executive, on the later of the Six-Month Pay Date
or the normal payment date for such bonus payments, a pro-rated bonus with
respect to the 2011 performance period if commenced prior to the Date of
Termination (such bonus shall be calculated based on actual performance through
the end of the performance period and then multiplied by a fraction, the
numerator of which is the number of full months in the fiscal year preceding the
Date of Termination and the denominator of which is 12; provided that such bonus
shall be paid only if the pre-established performance targets are in fact
certified by the Committee in the ordinary course to have been met on a basis
consistent with the Chief Executive Officer and the other senior executives
under the Plan; and

(vii) all grants of restricted stock of the Company (“Restricted Stock”) held by
Executive as of the Effective Date will become immediately vested as of the Date
of Termination; and

(viii) any other performance-based incentive awards held by Executive as of the
Effective Date shall continue in effect until the normal payment date for such
awards, at which time such awards will be paid out, on the later of (a) the
normal payment date for such awards or (b) the Six Month Pay Date, based on
actual performance through the end of the applicable performance period as if
Executive had remained employed during the entire performance period; provided
that such award shall be made only if the pre-established performance targets
are in fact certified by the Committee in the ordinary course to have been met
on a basis consistent with the Chief Executive Officer and the other senior
executives under the Plan. If there are any other performance-based incentive
awards granted to Executive after the Effective Date, such awards shall continue
in effect until the normal payment date for such awards, at which time such
awards will be paid out, on the later of (a) the normal payment date for such

 

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awards or (b) the Six Month Pay Date, on a pro-rated basis equal to (i) the
award Executive would have earned, if any, based on actual financial performance
through the end of the applicable performance period as if Executive had
remained employed during the entire performance period, times (ii) a fraction,
the numerator of which is the number of full months in the performance period
preceding the Date of Termination and the denominator of which is the number of
full months in the performance period; provided that such award shall be made
only if the pre-established performance targets are in fact certified by the
Committee in the ordinary course to have been met on a basis consistent with the
Chief Executive Officer and the other senior executives under the Plan; and

(ix) all of Executive’s options to acquire Common Stock of the Company
(“Options”) that were granted prior to the Effective Date and would have become
vested (by lapse of time) following the Date of Termination had Executive
remained employed during such period will become immediately vested as of the
Date of Termination; and

(x) all of Executive’s vested but unexercised Options as of the Date of
Termination (including those with accelerated vesting pursuant to
Section 8(a)(ix) above) shall remain exercisable through the earlier of (A) the
original expiration date of the Option, (B) the 13-month anniversary date of the
Date of Termination, or (C) the date that is the 10th anniversary of the
original date of grant of the Option; and

(xi) to the extent not theretofore paid or provided, the Company shall timely
pay or provide to Executive any other amounts or benefits required to be paid or
provided or which Executive is eligible to receive otherwise than under this
Agreement under any plan, program, policy or practice or contract or agreement
of the Company (such other amounts and benefits shall be hereinafter referred to
as the “Other Benefits”).

(b) Prior to a Change in Control: Resignation by Executive for Good Reason after
the First Anniversary Date; Termination by the Company Other Than for Cause or
Disability after the First Anniversary Date. If, prior to a Change in Control,
the Company shall terminate Executive’s employment other than for Cause or
Disability after the First Anniversary Date or Executive shall deliver a Notice
of Termination for Good Reason after the First Anniversary Date, then (and with
respect to the payments and benefits described in clauses (ii) through
(ix) below, only if Executive has complied with the provisions of this
Agreement, including but not limited to the provisions of Sections 10 and 13 and
only if within 60 days after the Date of Termination Executive shall have
executed the Release and the applicable revocation period shall have expired):

(i) the Company shall pay to Executive the Accrued Obligations in a lump sum in
cash within 30 days after the Date of Termination to the extent not theretofore
paid, and

(ii) on the Six-Month Pay Date, the Company shall pay Executive a lump sum equal
to the amount of Executive’s Base Salary from the Date of Termination

 

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until the Six-Month Pay Date: provided, however, that the Company shall have no
obligation to make such payment if Executive has violated any of the Restrictive
Covenants (as defined in Section 13 of this Agreement) and failed to remedy such
violation to the satisfaction of the Committee within 10 days of notice of such
violation or has violated the provisions of Section 10 of this Agreement. If
Executive has performed services of any kind for any Competing Person or for any
Person who has a parent, affiliate, or subsidiary who is a Competing Person
between the Date of Termination and the Six-Month Pay Date, then the amount
otherwise due shall be multiplied by a fraction, the numerator of which is the
number of days that elapsed from the Date of Termination until his first date of
service for such Person (which cannot exceed 180) and the denominator of which
is 180; and

(iii) thereafter, for up to twelve (12) additional months following the
Six-Month Pay Date, the Company will continue to pay Executive an amount equal
to his monthly Base Salary, payable in equal monthly or more frequent
installments as are customary under the Company’s payroll practices from time to
time; provided, however, that the Company’s obligation to make or continue such
payments shall cease if Executive violates any of the Restrictive Covenants (as
defined in Section 13 of this Agreement) and fails to remedy such violation to
the satisfaction of the Committee within 10 days of notice of such violation or
violates the provisions of Section 10 of this Agreement or if Executive performs
services of any kind for any Competing Person or for any Person who has a
parent, affiliate, or subsidiary who is a Competing Person; and

(iv) for a period of eighteen (18) months after the Date of Termination,
Executive shall have the right to elect continuation of health care coverage
under the Company’s group health plan in accordance with “COBRA,” and the
Company shall pay (and report as taxable income to Executive) all premiums for
such COBRA coverage for Executive and his covered dependents for the eighteen
(18) month period, provided, however, that the obligation of the Company to pay
the cost for such COBRA coverage shall terminate upon Executive’s obtaining
other employment to the extent that such health care coverage is provided by the
new employer; and

(v) the Company shall pay to Executive, on the later of the Six-Month Pay Date
or the normal payment date for such bonus payments, a pro-rated annual bonus
with respect to any ongoing annual bonus performance period that commenced prior
to the Date of Termination (such bonus shall be calculated based on actual
performance through the end of the performance period and then multiplied by a
fraction, the numerator of which is the number of full months in the fiscal year
preceding the Date of Termination and the denominator of which is 12; provided
that such bonus shall be paid only if the pre-established performance targets
are in fact certified by the Committee in the ordinary course to have been met
on a basis consistent with the Chief Executive Officer and the other senior
executives under the Plan; and

(vi) all grants of Restricted Stock held by Executive as of the Date of
Termination will become immediately vested as of the Date of Termination; and

 

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(vii) any other performance-based incentive awards held by Executive on the Date
of Termination shall continue in effect until the normal payment date for such
awards, at which time such awards will be paid out, on the later of (a) the
normal payment date for such awards or (b) the Six Month Pay Date, on a
pro-rated basis equal to (i) the award Executive would have earned, if any,
based on actual financial performance through the end of the applicable
performance period as if Executive had remained employed during the entire
performance period, times (ii) a fraction, the numerator of which is the number
of full months in the performance period preceding the Date of Termination and
the denominator of which is the number of full months in the performance period;
provided that such award shall be made only if the pre-established performance
targets are in fact certified by the Committee in the ordinary course to have
been met on a basis consistent with the Chief Executive Officer and the other
senior executives under the Plan; and

(viii) all of Executive’s Options that would have become vested (by lapse of
time) within the 24-month period following the Date of Termination had Executive
remained employed during such period will become immediately vested as of the
Date of Termination; and

(ix) all of Executive’s vested but unexercised Options as of the Date of
Termination (including those with accelerated vesting pursuant to
Section 8(a)(viii) above) shall remain exercisable through the earlier of
(A) the original expiration date of the Option, (B) the 90th day following the
Date of Termination, or (C) the date that is the 10th anniversary of the
original date of grant of the Option; and

(x) to the extent not theretofore paid or provided, the Company shall timely pay
or provide to Executive his Other Benefits.

(c) After or in Connection with a Change in Control: Resignation by Executive
for Good Reason after the First Anniversary Date; Termination by the Company
Other Than for Cause or Disability. If there occurs a Change in Control and,
within 36 months following such Change in Control (or if Executive can
reasonably show that such termination by the Company was in anticipation of the
Change in Control), the Company shall terminate Executive’s employment other
than for Cause or Disability, or Executive shall terminate employment for Good
Reason after the First Anniversary Date, then (and with respect to the payments
and benefits described in clauses (ii) through (ix) below, only if within 60
days after the Date of Termination Executive shall have executed the Release and
the applicable revocation period shall have expired):

(i) the Company (or its successor) shall pay to Executive the Accrued
Obligations in a lump sum in cash within 30 days after the Date of Termination
to the extent not theretofore paid; and

 

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(ii) on the Six-Month Pay Date, the Company (or its successor) shall pay
Executive a lump sum equal to the amount of Executive’s Base Salary from the
Date of Termination until the Six-Month Pay Date; provided, however, that the
Company shall have no obligation to make such payment if Executive has violated
any of the Restrictive Covenants (as defined in Section 13 of this Agreement)
and failed to remedy such violation to the satisfaction of the Committee within
10 days of notice of such violation; and

(iii) thereafter, for up to eighteen (18) additional months after the Six-Month
Pay Date, the Company (or its successor) will continue to pay Executive an
amount equal to his monthly Base Salary, payable in equal monthly or more
frequent installments as are customary under the Company’s payroll practices
from time to time; provided, however, that the Company’s obligation to make or
continue such payments shall cease if Executive violates any of the Restrictive
Covenants (as defined in Section 13 of this Agreement) and fails to remedy such
violation to the satisfaction of the Committee within 10 days of notice of such
violation; and

(iv) for a period of eighteen (18) months after the Date of Termination,
Executive shall have the right to elect continuation of health care coverage
under the Company’s group health plan in accordance with “COBRA,” and the
Company shall pay (and report as taxable income to Executive) all premiums for
such COBRA coverage for Executive and his covered dependents for the eighteen
(18) month period, provided, however, that that the obligation of the Company to
pay the cost for such COBRA coverage shall terminate upon Executive’s obtaining
other employment to the extent that such health care coverage is provided by the
new employer; and

(v) on the Six-Month Payment Date, the Company shall pay Executive a lump sum
bonus for the year in which the Date of Termination occurs in an amount equal to
100% of Executive’s then current target Bonus Opportunity; and

(vi) all grants of Restricted Stock held by Executive as of the Date of
Termination will become immediately vested as of the Date of Termination; and

(vii) any other performance-based incentive awards held by Executive as of the
Date of Termination shall continue in effect until the normal payment date for
such awards, at which time such awards will be paid out, on the later of (a) the
normal payment date for such awards or (b) the Six Month Pay Date, on a
pro-rated basis equal to (i) the award Executive would have earned, if any,
based on actual financial performance through the end of the applicable
performance period as if Executive had remained employed during the entire
performance period, times (ii) a fraction, the numerator of which is the number
of full months in the performance period preceding the Date of termination and
the denominator of which is the number of full months in the performance period;
provided that such award shall be made only if the pre-established performance
targets are in fact certified by the Committee in the ordinary course to have
been met on a basis consistent with the Chief Executive Officer and the other
senior executives under the Plan; and

 

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(viii) all of Executive’s Options held by Executive as of the Date of
Termination will become immediately vested and exercisable as of the Date of
Termination; and

(ix) all of Executive’s vested but unexercised Options as of the Date of
Termination (including those with accelerated vesting pursuant to the
Section 8(c)(viii) above) shall remain exercisable through the earlier of
(A) the original expiration date of the Option, (B) the 90th day following the
Date of Termination, or (C) the date that is the 10th anniversary of the
original date of grant of the Option; and

(x) to the extent not theretofore paid or provided, the Company shall timely pay
or provide to Executive his Other Benefits.

(d) Death, Disability or Retirement. If Executive’s employment terminates due to
Executive’s death, Disability or Retirement, then:

(i) all grants of Restricted Stock held by Executive as of the Date of
Termination will become immediately vested as of the Date of Termination; and

(ii) in the case of termination on account of Retirement only, any
performance-based equity incentive awards held by Executive as of the Date of
Termination shall continue in effect until the normal payment date for such
awards, and the Company shall deliver to Executive, on the later of (a) the
normal payment date for such awards or (b) the Six Month Pay Date, the number of
shares of common stock equal to the number of shares that would have been
awarded, if any, based on actual performance through the end of the applicable
performance period as if Executive had remained employed during the entire
performance period; provided that such award shall be made only if the
pre-established performance targets are in fact certified by the Committee in
the ordinary course to have been met on a basis consistent with the Chief
Executive Officer and the other senior executives under the Plan and

(iii) in the case of termination on account of death or Disability only, any
performance-based equity incentive awards held by Executive as of the Date of
Termination shall vest at the target level on the Date of Termination, and the
Company shall deliver to Executive or Executive’s beneficiary, as applicable, on
the later of (a) the normal payment date for such awards or (b) the Six Month
Pay Date, fully vested common stock equal to the number of shares that would
have been awarded assuming the performance goals had been reached at target
levels; and

(iv) all Options held by Executive as of the Date of Termination will become
immediately vested and exercisable as of the Date of Termination and shall
remain exercisable through the earliest of (A) the original expiration date of
the Option, (B) the 90th day following the Date of Termination or such longer
period as specified in the plan document governing the applicable award, or
(C) the date that is the 10th anniversary of the original date of grant of the
Option; and

 

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(v) for a period of eighteen (18) months after the Date of Termination Executive
shall have the right to elect continuation of healthcare coverage under the
Company’s group plan (if allowed by the plan) in accordance with “COBRA”
provided Executive shall pay the entire cost of such coverage.

Except as set forth above and regardless of whether or not a Change in Control
shall have occurred, if Executive’s employment is terminated by reason of
Executive’s death, Disability or Retirement, this Agreement shall terminate
without further obligations to Executive or his estate or legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be paid
to Executive’s estate or beneficiary, as applicable, in a lump sum in cash
within 30 days after the Date of Termination. With respect to the provision of
Other Benefits, the term Other Benefits as used in this Section 8(d) shall
include, without limitation, and Executive or his estate and/or beneficiaries
shall be entitled to receive, benefits under such plans, programs, practices and
policies relating to death, disability or retirement benefits, if any, as are
applicable to Executive on the Date of Termination.

(e) Cause, Voluntary Termination, Resignation without Good Reason, or
Resignation in Accordance with Section 7(c)(i). Regardless of whether or not a
Change in Control shall have occurred, if Executive’s employment shall be
terminated for Cause, or if Executive terminates employment (a) in accordance
with Section 7(c)(i) or prior to July 31, 2010 (except as expressly waived in
writing by the Company), (b) not pursuant to the provisions of Section 7(c)(ii),
or (c) without Good Reason after the First Anniversary Date, or if Executive
fails to comply with the provisions of this Agreement (including but not limited
to the provisions of Sections 10 and 13), this Agreement shall terminate without
further obligations to Executive, other than for payment of Accrued Obligations
and the timely payment or provision of Other Benefits. Accrued Obligations shall
be paid to Executive’s estate or beneficiary, as applicable, in a lump sum in
cash within 30 days after the Date of Termination. For a period of eighteen
(18) months after the Date of Termination, Executive shall have the right to
elect continuation of healthcare coverage under the Company’s group plan in
accordance with “COBRA” provided Executive shall pay the entire cost of such
coverage (except as otherwise expressly provided hereunder).

(f) Limited Exclusion for Private Equity Firms. For purposes of
Section 8(a)(ii), 8(a)(iii), 8(b)(ii), and 8(b)(iii), the term “Person who has a
parent, affiliate, or subsidiary who is a Competing Person” shall exclude a
private equity firm having an investment in a Competing Person provided that
Executive can demonstrate to the reasonable satisfaction of the Company’s Chief
Executive Officer that (i) Executive’s services for such private equity firm are
not in any way related to the private equity firm’s investment in such Competing
Person, (ii) Executive receives no information about the activities of such
Competing Person, and (iii) Executive shares no information about Competitive
Services with anyone at such private equity firm or such Competing Person.

 

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9. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit
Executive’s continuing or future participation in any plan, program, policy or
practice provided by the Company and for which Executive may qualify, nor,
subject to Section 17(d), shall anything herein limit or otherwise affect such
rights as Executive may have under any contract or agreement with the Company.
Amounts which are vested benefits or which Executive is otherwise entitled to
receive under any plan, policy, practice or program of or any contract or
agreement with the Company at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract or
agreement except as explicitly modified by this Agreement.

10. Stock Retention. During the 90-day period following the Effective Date and
subject to all applicable laws and to the Company’s trading policies, Executive
shall only be allowed to sell, pledge, encumber or otherwise transfer 100,000
shares of Company stock in total but not more than 50,000 shares in any one
month period; provided, however, that the Company may withhold shares or
Executive may sell shares in an amount sufficient to cover statutory tax
withholding requirements in connection with the vesting, exercise or settlement
of equity-based awards. From the end of such 90-day period until the earlier of
(a) the date Executive is no longer employed by the Company and (b) the First
Anniversary Date, Executive may sell or otherwise dispose of up to 10,000 of his
shares per month. The amounts set forth above are cumulative.

11. Costs of Enforcement. Unless otherwise provided by the arbitrator(s) in an
arbitration proceeding pursuant to Section 14 hereof, in any action taken in
good faith relating to the enforcement of this Agreement or any provision
herein, Executive shall be entitled to be paid any and all costs and expenses
incurred by him in enforcing or establishing his rights thereunder, including,
without limitation, reasonable attorneys’ fees, whether suit be brought or not,
and whether or not incurred in trial, bankruptcy or appellate proceedings, but
only if Executive is successful on at least one material issue raised in the
enforcement proceeding. Any costs or expenses that otherwise meet the
requirements for reimbursement under this Section 11 shall be reimbursed within
60 days of submission by Executive for a request for reimbursement, but in no
event later than the last day of Executive’s taxable year following the taxable
year in which the Employee becomes entitled to such reimbursement by reason of
being successful on at least one material issue (provided a request for
reimbursement has been made).

12. Representations and Warranties. Executive hereby represents and warrants to
the Company that Executive is not a party to, or otherwise subject to, any
covenant not to compete with any person or entity, and Executive’s execution of
this Agreement and performance of his obligations hereunder will not violate the
terms or conditions of any contract or obligation, written or oral, between
Executive and any other person or entity.

 

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13. Restrictions on Conduct of Executive.

(a) General. Executive and the Company understand and agree that the purpose of
the provisions of this Section 13 is to protect legitimate business interests of
the Company, as more fully described below, and is not intended to eliminate
Executive’s post-employment competition with the Company per se, nor is it
intended to impair or infringe upon Executive’s right to work, earn a living, or
acquire and possess property from the fruits of his labor. Executive hereby
acknowledges that the post-employment restrictions set forth in this Section 13
are reasonable and that they do not, and will not, unduly impair his ability to
earn a living after the termination of this Agreement. Therefore, subject to the
limitations of reasonableness imposed by law, Executive shall be subject to the
restrictions set forth in this Section 13. For the purposes of this Section 13,
“Company” shall be deemed to include Company and all its parents, affiliates,
and subsidiaries.

(b) Definitions. The following terms used in this Section 13 (and elsewhere in
the Agreement) shall have the meanings assigned to them below, which definitions
shall apply to both the singular and the plural forms of such terms:

“Competitive Position” means any employment with a Competitor in which Executive
has duties for such Competitor that relate to Competitive Services and that are
the same or similar to those services actually performed by Executive for the
Company.

“Competitive Services” means the provision of products and services to
facilitate or assist with the movement in electronic commerce of payment and
financial information, merchant acquiring, merchant processing, credit and debit
transaction processing, check guarantee and verification, electronic
authorization and capture, terminal management services, purchase card services,
financial electronic data interchange, and cash management services but shall
exclude card issuing services, pre-paid card issuing services, and gift card
issuing services.

“Competing Person” is any Person engaged in Competitive Services either directly
or through any parent, affiliate, subsidiary, joint venture, partnership,
limited liability company, association or other entity or enterprise.

“Competitor” means any of the following companies, all of whom engage in
Competitive Services (and all of their parents, subsidiaries, or affiliates who
engage in Competitive Services) and all of the successors in interest to any of
the foregoing: TSYS Acquiring Solutions, Chase Paymentech Solutions, First Data
Corporation, Total System Services, Inc., Fifth Third Processing Solutions,
Wells Fargo Merchant Services, Heartland Payment Systems, First National
Merchant Solutions, RBS Lynk, Royal Bank of Scotland, TransFirst Holdings,
iPayment, BA Merchant Services, NPC, Elavon Merchant Services, Alliance Data,
and Moneris Solutions.

“Confidential Information” means all information regarding the Company, its
activities, business or clients that is the subject of reasonable efforts by the
Company to maintain its confidentiality and that is not generally disclosed by
practice or

 

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authority to persons not employed by the Company, but that does not rise to the
level of a Trade Secret. “Confidential Information” shall include, but is not
limited to, financial plans and data concerning the Company; management planning
information; business plans; operational methods; market studies; marketing
plans or strategies; product development techniques or plans; lists of current
or prospective customers; details of customer contracts; current and anticipated
customer requirements; past, current and planned research and development;
business acquisition plans; and new personnel acquisition plans. “Confidential
Information” shall not include information that has become generally available
to the public by the act of one who has the right to disclose such information
without violating any right or privilege of the Company. This definition shall
not limit any definition of “confidential information” or any equivalent term
under state or federal law.

“Determination Date” means the date of termination of Executive’s employment
with the Company for any reason whatsoever or any earlier date of an alleged
breach of the Restrictive Covenants by Executive.

“Person” means any individual or any corporation, partnership, joint venture,
limited liability company, association or other entity or enterprise.

“Principal or Representative” means a principal, owner, partner, shareholder,
joint venturer, investor, member, trustee, director, officer, manager, employee,
agent, representative or consultant.

“Protected Customers” means any Person (a) to whom the Company has sold or
provided its products or services during the twelve (12) months prior to the
Determination Date, including without limitation any independent sales
organization who is a party to a Merchant Services Agreement or other agreement
with the Company during the twelve (12) months prior to the Determination Date.

“Protected Employees” means employees of the Company who were employed by the
Company at any time within six (6) months prior to the Determination Date.

“Restricted Period” means the Employment Period and a period extending two
(2) years from the termination of Executive’s employment with the Company.

“Restricted Territory” means the States of California, Florida, Georgia,
Illinois, Maryland, Michigan, New York, Pennsylvania, Texas and Massachusetts.

“Restrictive Covenants” means the restrictive covenants contained in
Section 13(c) hereof.

 

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“Sales Agents” means any Person (a) who is an independent sales organization who
is a party to a Merchant Services Agreement or other agreement with the Company
during the twelve (12) months prior to the Determination Date or (b) who is or
was an independent sales representative or referral source with whom the Company
has a contract during the twelve (12) months prior to the Determination Date.

“Trade Secret” means all information, without regard to form, including, but not
limited to, technical or non-technical data, a formula, a pattern, a
compilation, a program, a device, a method, a technique, a drawing, a process,
financial data, financial plans, product plans, distribution lists or a list of
actual or potential customers, advertisers or suppliers which is not commonly
known by or available to the public and which information: (A) derives economic
value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use; and (B) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy. Without limiting the
foregoing, Trade Secret means any item of Confidential Information that
constitutes a “trade secret(s)” under the common law or applicable state law.

(c) Restrictive Covenants.

(i) Restriction on Disclosure and Use of Confidential Information and Trade
Secrets. Executive understands and agrees that the Confidential Information and
Trade Secrets constitute valuable assets of the Company and its affiliated
entities, and may not be converted to Executive’s own use. Accordingly,
Executive hereby agrees that Executive shall not, directly or indirectly, at any
time during the Employment Period or during the two (2) years immediately
following the end of the Employment Period for any reason reveal, divulge, or
disclose to any Person not expressly authorized by the Company any Confidential
Information, and Executive shall not, directly or indirectly, at any time during
the Employment Period or during the two (2) years immediately following the end
of the Employment Period for any reason use or make use of any Confidential
Information in connection with any business activity other than that of the
Company. Throughout the term of this Agreement and at all times after the date
that this Agreement terminates for any reason, Executive shall not directly or
indirectly transmit or disclose any Trade Secret of the Company to any Person,
and shall not make use of any such Trade Secret, directly or indirectly, for
himself or for others, without the prior written consent of the Company. The
parties acknowledge and agree that this Agreement is not intended to, and does
not, alter either the Company’s rights or Executive’s obligations under any
state or federal statutory or common law regarding trade secrets and unfair
trade practices.

Anything herein to the contrary notwithstanding, Executive shall not be
restricted from disclosing or using Confidential Information that is required to
be disclosed by law, court order or other legal process; provided, however, that
in the event disclosure is required by law, Executive shall provide the Company
with prompt notice of such requirement so that the Company may seek an
appropriate protective order prior to any such required disclosure by Executive.

 

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(ii) Non-solicitation of Protected Employees. Executive understands and agrees
that the relationship between the Company and each of its Protected Employees
and Sales Agents constitutes a valuable asset of the Company and may not be
converted to Executive’s own use. Accordingly, Executive hereby agrees that
during the Restricted Period Executive shall not directly or indirectly on
Executive’s own behalf or as a Principal or Representative of any Person or
otherwise solicit or induce any Protected Employee with whom Executive worked or
otherwise had material contact through his employment with the Company to
terminate his or her employment relationship with the Company or to enter into
employment with any other Person. Executive also agrees that during the
Restricted Period Executive shall not directly or indirectly on Executive’s own
behalf or as a Principal or Representative of any Person or otherwise solicit or
induce any Sales Agent with whom Executive worked or otherwise had Material
Contact (as defined in Section 13(c)(iii)) through his employment with the
Company to terminate his or her arrangement with the Company or to enter into an
arrangement with any other Person for the purpose of providing or selling
Competitive Services.

(iii) Restriction on Relationships with Protected Customers Executive
understands and agrees that the relationship between the Company and each of its
Protected Customers constitutes a valuable asset of the Company and may not be
converted to Executive’s own use. Accordingly, Executive hereby agrees that,
during the Restricted Period, Executive shall not, without the prior written
consent of the Company, directly or indirectly, on Executive’s own behalf or as
a Principal or Representative of any Person, solicit, divert, take away or
attempt to solicit, divert or take away a Protected Customer for the purpose of
providing or selling Competitive Services; provided, however, that the
prohibition of this covenant shall apply only to Protected Customers with whom
Executive had Material Contact on the Company’s behalf during the twelve
(12) months immediately preceding the termination of his employment hereunder.
For purposes of this Agreement, Executive had “Material Contact” with a
Protected Customer or Sales Agent if (a) he had business dealings with the
Protected Customer or Sales Agent on the Company’s behalf or (b) he was
responsible for supervising or coordinating the dealings between the Company and
the Protected Customer or Sales Agent.

(iv) Non-competition with the Company. The parties acknowledge: (A) that
Executive’s services under this Agreement require special expertise and talent
in the provision of Competitive Services and that Executive will have
substantial contacts with customers, suppliers, advertisers and vendors of the
Company; (B) that pursuant to this Agreement, Executive will be placed in a
position of trust and responsibility and he will have access to a substantial
amount of Confidential Information and Trade Secrets and that the Company is
placing him in such position and giving him access to such information in
reliance upon his agreement not to compete with the Company during the
Restricted Period; (C) that due to his management duties, Executive will be the
repository of a substantial portion of the goodwill of the Company and would
have an unfair advantage in competing with the Company; (D) that due to
Executive’s special experience and talent, the loss of Executive’s services to
the Company under this

 

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Agreement cannot reasonably or adequately be compensated solely by damages in an
action at law; (E) that Executive is capable of competing with the Company; and
(F) that Executive is capable of obtaining gainful, lucrative and desirable
employment that does not violate the restrictions contained in this Agreement.
In consideration of the compensation and benefits being paid and to be paid by
the Company to Executive hereunder, Executive hereby agrees that, during the
Restricted Period, Executive will not, without prior written consent of the
Company, directly or indirectly seek or obtain a Competitive Position in the
Restricted Territory; provided, however, that the provisions of this Agreement
shall not be deemed to prohibit the ownership by Executive of any securities of
the Company or its affiliated entities or not more than five percent (5%) of any
class of securities of any corporation having a class of securities registered
pursuant to the Securities Exchange Act of 1934, as amended. Notwithstanding the
foregoing, for the period between the Effective Date and 30 days after the First
Anniversary Date , the provisions of this Section 13(c)(iv) will not prohibit
Executive from seeking or obtaining a Competitive Position in the Restricted
Territory.

(d) Enforcement of Restrictive Covenants.

(i) Rights and Remedies Upon Breach. In the event Executive breaches, or
threatens to commit a breach of, any of the provisions of the Restrictive
Covenants, the Company shall have the following rights and remedies, which shall
be independent of any others and severally enforceable, and shall be in addition
to, and not in lieu of, any other rights and remedies available to the Company
at law or in equity:

(A) the right and remedy to enjoin, preliminarily and permanently, Executive
from violating or threatening to violate the Restrictive Covenants and to have
the Restrictive Covenants specifically enforced by any court of competent
jurisdiction, it being agreed that any breach or threatened breach of the
Restrictive Covenants would cause irreparable injury to the Company and that
money damages would not provide an adequate remedy to the Company; and

(B) the right and remedy to require Executive to account for and pay over to the
Company all compensation, profits, monies, accruals, increments or other
benefits derived or received by Executive as the result of any transactions
constituting a breach of the Restrictive Covenants.

(ii) Severability of Covenants. Executive acknowledges and agrees that the
Restrictive Covenants are reasonable and valid in time and scope and in all
other respects. The covenants set forth in this Agreement shall be considered
and construed as separate and independent covenants. Should any part or
provision of any covenant be held invalid, void or unenforceable in any court of
competent jurisdiction, such invalidity, voidness or unenforceability shall not
render invalid, void or unenforceable any other part or provision of this
Agreement. If any portion of the foregoing provisions is found to be invalid or
unenforceable by a court of competent jurisdiction because its duration, the

 

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territory, the definition of activities or the definition of information covered
is considered to be invalid or unreasonable in scope, the invalid or
unreasonable term shall be redefined, or a new enforceable term provided, such
that the intent of the Company and Executive in agreeing to the provisions of
this Agreement will not be impaired and the provision in question shall be
enforceable to the fullest extent of the applicable laws.

This Section 13 shall survive the termination of this Agreement.

14. Arbitration. Any claim or dispute arising under this Agreement (other than
under Section 13) shall be subject to arbitration, and prior to commencing any
court action, the parties agree that they shall arbitrate all such
controversies. The arbitration shall be conducted in Atlanta, Georgia, in
accordance with the Employment Dispute Rules of the American Arbitration
Association and the Federal Arbitration Act, 9 U.S.C. §1, et. seq. The
arbitrator(s) shall be authorized to award both liquidated and actual damages,
in addition to injunctive relief, but no punitive damages. The arbitrator(s) may
also award attorney’s fees and costs, without regard to any restriction on the
amount of such award under Georgia or other applicable law. Such an award shall
be binding and conclusive upon the parties hereto, subject to 9 U.S.C. §10. Each
party shall have the right to have the award made the judgment of a court of
competent jurisdiction.

 

Initials of parties as to this Section 14:
Company:                                             
Executive:                                             

15. Rabbi Trust. In order to ensure the payment of the severance benefit
provided for in Section 8(c)(ii) and (iii) of this Agreement, immediately
following the commencement of any action by a third party with the aim of
effecting a Change in Control of the Company, or the publicly-announced threat
by a third party to commence any such action, the Company shall fully fund
through the Global Payments Inc. Benefit Security Trust, or similar “rabbi
trust” the amount of the severance payment that would have been paid to
Executive under Section 8(c)(ii) and (iii) if the Date of Termination had
occurred on the date of commencement, or publicly-announced threat of
commencement, of such action by the third party; provided, however, that the
trust shall not be funded if the funding thereof would result in taxable income
to Executive by reason of Section 409A(b) of the Code; and provided, further, in
no event shall any trust assets at any time be located or transferred outside of
the United States, within the meaning of Section 409A(b) of the Code. Amounts
shall be paid to Executive from such trust as provided under this Agreement and
the trust. The right of Executive to receive payments under this Agreement shall
be an unsecured claim against the general assets of the Company and Executive
shall have no rights in or against any specific assets of the Company.

 

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16. Assignment and Successors.

(a) This Agreement is personal to Executive and without the prior written
consent of the Company shall not be assignable by Executive otherwise than by
will or the laws of descent and distribution. This Agreement shall inure to the
benefit of and be enforceable by Executive’s legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company
and its successors and assigns.

(c) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to assume expressly and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place. As used in this
Agreement, “Company” shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.

17. Miscellaneous.

(a) Waiver. Failure of either party to insist, in one or more instances, on
performance by the other in strict accordance with the terms and conditions of
this Agreement shall not be deemed a waiver or relinquishment of any right
granted in this Agreement or of the future performance of any such term or
condition or of any other term or condition of this Agreement, unless such
waiver is contained in a writing signed by the party making the waiver.

(b) Severability. If any provision or covenant, or any part thereof, of this
Agreement should be held by any court to be invalid, illegal or unenforceable,
either in whole or in part, such invalidity, illegality or unenforceability
shall not affect the validity, legality or enforceability of the remaining
provisions or covenants, or any part thereof, of this Agreement, all of which
shall remain in full force and effect.

(c) Other Agents. Nothing in this Agreement is to be interpreted as limiting the
Company from employing other personnel on such terms and conditions as may be
satisfactory to it.

(d) Entire Agreement. Except as provided herein, this Agreement contains the
entire agreement between the Company and Executive with respect to the subject
matter hereof and, from and after the Effective Date, this Agreement shall
supersede any other agreement between the parties with respect to the subject
matter hereof.

(e) Governing Law. Except to the extent preempted by federal law, and without
regard to conflict of laws principles, the laws of the State of Georgia shall
govern this Agreement in all respects, whether as to its validity, construction,
capacity, performance or otherwise.

 

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(f) Notices. All notices, requests, demands and other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered or three days after mailing if mailed, first class, certified
mail, postage prepaid:

 

To Company:    Global Payments Inc.    10 Glenlake Parkway- North Tower   
Atlanta, Georgia 30328    Office of the Corporate Secretary To Executive:   
James G. Kelly    125 Lameloise Lane N.W.    Atlanta, GA 30327

Any party may change the address to which notices, requests, demands and other
communications shall be delivered or mailed by giving notice thereof to the
other party in the same manner provided herein.

(g) Amendments and Modifications. This Agreement may be amended or modified only
by a writing signed by both parties hereto, which makes specific reference to
this Agreement.

18. Section 409A.

(a) General. This Agreement shall be interpreted and administered in a manner so
that any amount or benefit payable hereunder shall be paid or provided in a
manner that is either exempt from or compliant with the requirements
Section 409A of the Code and applicable Internal Revenue Service guidance and
Treasury Regulations issued thereunder. While the Company and Executive agree to
cooperate fully and in good faith with one another to seek to minimize tax risk
under Section 409A of the Code, Executive acknowledges and agrees that nothing
in this Agreement shall be construed as a guarantee or indemnity by the Company
for the tax consequences to the payments and benefits called for under this
Agreement, including any tax consequences under Section 409A of the Code, and
Executive agrees that Executive shall be responsible for paying all taxes due
with respect to such payments made and benefits provided to Executive. Neither
the Company nor its directors, officers, employees or advisers shall be held
liable for any taxes, interest, penalties or other monetary amounts owed by
Executive as a result of the application of Section 409A of the Code.

(b) Definitional Restrictions. Notwithstanding anything in this Agreement to the
contrary, to the extent that any amount or benefit that would constitute
non-exempt “deferred compensation” for purposes of Section 409A of the Code
would otherwise be payable or distributable hereunder, or a different form of
payment would be effected, by reason of a Change in Control or the Executive’s
Disability or termination of employment, such amount or benefit will not be
payable or distributable to the Executive,

 

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and/or such different form of payment will not be effected, by reason of such
circumstance unless (i) the circumstances giving rise to such Change in Control,
Disability or termination of employment, as the case may be, meet any
description or definition of “change in control event”, “disability” or
“separation from service”, as the case may be, in Section 409A of the Code and
applicable regulations (without giving effect to any elective provisions that
may be available under such definition), or (ii) the payment or distribution of
such amount or benefit would be exempt from the application of Section 409A of
the Code by reason of the short-term deferral exemption or otherwise. This
provision does not prohibit the vesting of any amount upon a Change in Control,
Disability or termination of employment, however defined. If this provision
prevents the payment or distribution of any amount or benefit, such payment or
distribution shall be made on the date, if any, on which an event occurs that
constitutes a Section 409A-compliant “change in control event”, “disability” or
“separation from service,” as the case may be, or such later date as may be
required by subsection (c) below. If this provision prevents the application of
a different form of payment of any amount or benefit, such payment shall be made
in the same form as would have applied absent such designated event or
circumstance.

(c) Six-Month Delay in Certain Circumstances. Notwithstanding anything in this
Agreement to the contrary, if any amount or benefit that would constitute
non-exempt “deferred compensation” for purposes of Section 409A of the Code
would otherwise be payable or distributable under this Agreement by reason of
Executive’s separation from service during a period in which he is a Specified
Employee (as defined below), then, subject to any permissible acceleration of
payment by the Company under Treas. Reg. Section 1.409A-3(j)(4)(ii) (domestic
relations order), (j)(4)(iii) (conflicts of interest), or (j)(4)(vi) (payment of
employment taxes): (A) the amount of such non-exempt deferred compensation that
would otherwise be payable during the six-month period immediately following
Executive’s separation from service will be accumulated through and paid or
provided on the first day of the seventh month following Executive’s separation
from service (or, if Executive dies during such period, within 30 days after
Executive’s death) (in either case, the “Required Delay Period”); and (B) the
normal payment or distribution schedule for any remaining payments or
distributions will resume at the end of the Required Delay Period. For purposes
of this Agreement, the term “Specified Employee” has the meaning given such term
in Code Section 409A and the final regulations thereunder: provided, however,
that the Company’s Specified Employees and its application of the six-month
delay rule of Code Section 409A(a)(2)(B)(i) shall be determined in accordance
with rules adopted by the Board or a committee thereof, which shall be applied
consistently with respect to all nonqualified deferred compensation arrangements
of the Company, including this Agreement.

(d) Timing of Release of Claims. Whenever in this Agreement a payment or benefit
is conditioned on Executive’s execution and non-revocation of a release of
claims, such release must be executed and all revocation periods shall have
expired within 60 days after the Date of Termination; provided, however that
(i) if such 60-day period begins and ends in a single calendar year, the Company
may make or commence

 

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payment at any time during such period at its discretion, and (ii) if such
60-day period spans two calendar years, the payment shall be made or commence
during the second such calendar year (or any later date specified for such
payment under the applicable provision of this Agreement), even if such signing
and non-revocation of the release occur during the first such calendar year
included within such 60-day period. In other words, Executive is not permitted
to influence the calendar year of payment based on the timing of his signing of
the release.

(e) Timing of Reimbursements and In-kind Benefits. Items eligible for expense
reimbursement under the terms of this Agreement shall be reimbursed in a manner
intended to comply with Section 409A of the Code, which shall include
implementing the following limitations with respect to reimbursements: (i) the
amount of such expenses eligible for reimbursement in any calendar year shall
not affect the expenses eligible for reimbursement in another calendar year,
(ii) no such reimbursement may be exchanged or liquidated for another payment or
benefit, (iii) any reimbursements of such expenses shall be made as soon as
practicable under the circumstances but in any event no later than the end of
the calendar year following the calendar in which the related expenses were
incurred, and (iv) the Company’s obligation to make reimbursements or to provide
in-kind benefits that constitute deferred compensation under Section409A of the
Code shall not extend beyond Executive’s lifetime or, if later, the end of the
20 year period which starts on the Effective Date.

(f) Treatment of Installment Payments. Each payment of termination benefits
under Section 8 of this Agreement, including, without limitation, each
installment payment and each payment or reimbursement of premiums for continued
medical insurance coverage, shall be considered a separate payment, as described
in Treas. Reg. Section 1.409A-2(b)(2), for purposes of Section 409A of the Code.

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Employment Agreement as of the date first above written.

 

GLOBAL PAYMENTS INC. By:  

/s/ Suellyn Tornay

Name:  

Suellyn Tornay

Title:  

General Counsel

Date:  

March 30, 2010

EXECUTIVE:

/s/ James G. Kelly

James G. Kelly

 

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EXHIBIT A

Form of Release

This Release is granted effective as of the 30th day of March 30, 2010, by James
G. Kelly (“Executive”) in favor of Global Payments Inc. (the “Company”). This is
the Release referred to that certain Employment Agreement effective as of March
30, 2010 by and between the Company and Executive (the “Employment Agreement”).
Executive gives this Release in consideration of the Company’s promises and
covenants as recited in the Employment Agreement, with respect to which this
Release is an integral part.

1. Release of the Company. Executive, for himself, his successors, assigns,
attorneys, and all those entitled to assert his rights, now and forever hereby
releases and discharges the Company and its respective officers, directors,
stockholders, trustees, employees, agents, parent corporations, subsidiaries,
affiliates, estates, successors, assigns and attorneys (“the Released Parties”),
from any and all claims, actions, causes of action, sums of money due, suits,
debts, liens, covenants, contracts, obligations, costs, expenses, damages,
judgments, agreements, promises, demands, claims for attorney’s fees and costs,
or liabilities whatsoever, in law or in equity, which Executive ever had or now
has against the Released Parties, including, without limitation, any claims
arising by reason of or in any way connected with any employment relationship
which existed between the Company or any of its parents, subsidiaries,
affiliates, or predecessors, and Executive. It is understood and agreed that
this Release is intended to cover all actions, causes of action, claims or
demands for any damage, loss or injury, whether known or unknown, of any nature
whatsoever, including those which may be traced either directly or indirectly to
the aforesaid employment relationship, or the termination of that relationship,
that Executive has, had or purports to have, from the beginning of time to the
date of this Release, and including but not limited to claims for employment
discrimination under federal or state law, except as provided in Paragraph 2;
claims arising under the Age Discrimination in Employment Act, 29 U.S.C. § 621,
et seq., Title VII of the Civil Rights Act, 42 U.S.C. § 2000(e), et seq. or the
Americans With Disabilities Act, 42 U.S.C. § 12101 et seq.; claims for statutory
or common law wrongful discharge, claims arising under the Fair Labor Standards
Act, 29 U.S.C. § 201 et seq.; claims for attorney’s fees, expenses and costs;
claims for defamation; claims for emotional distress; claims for wages or
vacation pay; claims for benefits, including any claims arising under the
Executive Retirement Income Security Act, 29 U.S.C. § 1001, et seq.; and claims
under any other applicable federal, state or local laws or legal concepts;
provided, however, that nothing herein shall release the Company of any
indemnification obligations to Executive under the Company’s bylaws, certificate
of incorporation, Delaware law or otherwise.

2. Release of Claims Under Age Discrimination in Employment Act. Without
limiting the generality of the foregoing, Executive agrees that by executing
this Release, he has released and waived any and all claims he has or may have
as of the date of this Release for age discrimination under the Age
Discrimination in Employment Act, 29 U.S.C. § 621, et seq. Executive
acknowledges and agrees Executive has been, and

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hereby is, advised by Company to consult with an attorney prior to executing
this Release. Executive further acknowledges and agrees that Company has offered
Executive the opportunity, before executing this Release, to consider this
Release for a period of twenty-one (21) calendar days; and that the
consideration he receives for this Release is in addition to amounts to which he
was already entitled. It is further understood that this Release is not
effective until seven (7) calendar days after the execution of this Release and
that Executive may revoke this Release within seven (7) calendar days from the
date of execution hereof.

3. Non-Admission. It is understood and agreed by Executive that the payment made
to him is not to be construed as an admission of any liability whatsoever on the
part of the Company or any of the other Releasees, by whom liability is
expressly denied.

4. Acknowledgement and Revocation Period. Executive agrees that he has carefully
read this Release and is signing it voluntarily. Executive acknowledges that he
has had twenty one (21) days from receipt of this Release to review it prior to
signing or that, if Executive is signing this Release prior to the expiration of
such 21-day period, Executive is waiving his right to review the Release for
such full 21-day period prior to signing it. Executive has the right to revoke
this release within seven (7) days following the date of its execution by him.
In order to revoke this Release, Executive must deliver notice of the revocation
in writing to Company’s General Counsel before the expiration of the seven
(7) day period. However, if Executive revokes this Release within such seven
(7) day period, no severance benefit will be payable to him under the Employment
Agreement and he shall return to the Company any such payment received prior to
that date.

5. No Revocation After Seven Days. Executive acknowledges and agrees that this
Release may not be revoked at any time after the expiration of the seven (7) day
revocation period and that he/she will not institute any suit, action, or
proceeding, whether at law or equity, challenging the enforceability of this
Release. Executive further acknowledges and agrees that, with the exception of
an action to challenge the waiver of claims under the ADEA, Executive shall not
ever attempt to challenge the terms of this Release, attempt to obtain an order
declaring this Release to be null and void, or institute litigation against the
Company or any other Releasee based upon a claim that is covered by the terms of
the release contained herein, without first repaying all monies paid to him/her
under Section 8 of the Employment Agreement. Furthermore, with the exception of
an action to challenge his waiver of claims under the ADEA, if Executive does
not prevail in an action to challenge this Release, to obtain an order declaring
this Release to be null and void, or in any action against the Company or any
other Releasee based upon a claim that is covered by the release set forth
herein, Executive shall pay to the Company and/or the appropriate Releasee all
their costs and attorneys’ fees incurred in their defense of Executive’s action.

 

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6. Governing Law and Severability. This Release and the rights and obligations
of the parties hereto shall be governed and construed in accordance with the
laws of the State of Georgia. If any provision hereof is unenforceable or is
held to be unenforceable, such provision shall be fully severable, and this
document and its terms shall be construed and enforced as if such unenforceable
provision had never comprised a part hereof, the remaining provisions hereof
shall remain in full force and effect, and the court or tribunal construing the
provisions shall add as a part hereof a provision as similar in terms and effect
to such unenforceable provision as may be enforceable, in lieu of the
unenforceable provision.

EXECUTIVE HAS CAREFULLY READ THIS RELEASE AND ACKNOWLEDGES THAT IT CONSTITUTES A
GENERAL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS AGAINST THE COMPANY UNDER THE
AGE DISCRIMINATION IN EMPLOYMENT ACT. EXECUTIVE ACKNOWLEDGES THAT HE HAS HAD A
FULL OPPORTUNITY TO CONSULT WITH AN ATTORNEY OR OTHER ADVISOR OF HIS CHOOSING
CONCERNING HIS EXECUTION OF THIS RELEASE AND THAT HE IS SIGNING THIS RELEASE
VOLUNTARILY AND WITH THE FULL INTENT OF RELEASING THE COMPANY FROM ALL SUCH
CLAIMS.

 

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