EX-10.1






Exhibit 10.1




			
	 	 	 
	DELUXE 

CORPORATION
	 	CASH PERFORMANCE

AWARD AGREEMENT






	 	 	 	 	 	 	 	 	 
	 
	 	AWARDED TO	 	 	AWARD DATE	 	 	TARGET PERFORMANCE PAYMENT	 
	 	 	 	 	 	 	 

 

 	 	 
	 






	1.	 	The Award. Deluxe Corporation, a Minnesota corporation (“Deluxe”) hereby grants to you as of
the above Award Date the right to receive a payment or payments in cash (the “Performance
Payments”) under the terms and conditions contained in this Cash Performance Award Agreement
(this “Agreement”) and in the 2008 Stock Incentive Plan (the “Plan”). You will be assigned an
award percentage that will be used in calculating any Performance Payments made to you.
	 
	2.	 	Performance Period. The performance period for purposes of determining whether the
Performance Payments will be made shall be the two-year period commencing on January 1 of the
year in which this Award was granted (the “Performance Period”).
	 
	3.	 	Performance Goals. The performance goals for purposes of determining whether the Performance
Payments will be paid are set forth in the attached Performance Goals Schedule.
	 
	4.	 	Payment. The Performance Payments shall be made if and to the extent that performance goals
are achieved, as set forth in the attached Performance Goals Schedule and as determined and
certified by the Compensation Committee of the Board of Directors (the “Committee”) in
accordance with the Plan after the end of the Performance Period. In the event the Committee
determines that the Target performance goal has been achieved, fifty percent of the applicable
Performance Payment will be paid to you on or before March 15 of the year following completion
of the Performance Period and the remaining fifty percent will be paid to you on or before
March 15 of the second year following completion of the Performance Period. In the event that
the Committee determines that the Target performance goal was not achieved, but that the
Threshold performance goal was achieved, you will receive the applicable Performance Payment
in a lump sum on or before March 15 of the second year following completion of the Performance
Period. In the event that the Committee determines that the Threshold performance goal was
not achieved, you will receive a payment equal to the minimum retention payment (“Retention
Payment”), if any, specified on the Performance Goals Schedule on or before March 15 of the
second year following completion of the Performance Period. Performance Payments (but not
Retention Payments) may be adjusted by the Committee to the extent permitted by the Plan.
	 
	5.	 	Restrictions on Transfer. Neither the Performance Payments nor the Retention Payment, nor
any rights therein, may be assigned, transferred or pledged, other than by will or the laws of
descent and distribution, and any such attempted transfer shall be void.
	 
	6.	 	Forfeiture. Except as described in this Section, in the event your employment is terminated
prior to January 1 of the second year following the end of the Performance Period, the
Performance and Retention Payments, and your rights to receive them, shall be immediately and
irrevocably forfeited, unless your termination occurs on or after the one-year
anniversary of commencement of the Performance Period and is by reason of (a) involuntary
termination without Cause, (b) resignation for Good Reason, (c) death, (d) Disability, or (e)
Qualified Retirement (as those capitalized terms are defined in the Addendum to this
Agreement).
	 
	 	 	In the event your employment is terminated on or after the one-year anniversary of commencement
of the Performance Period and prior to the end of the Performance Period for any of the reasons
(a) through (e) in the first paragraph of this Section, you or your estate shall be entitled to
receive a pro-rata payment (based on the days elapsed in the Performance Period prior to the
employment termination date) of either (x) the Retention Payment, or (y) if greater, the
Performance Payment determined by the Committee upon completion of the Performance Period to be
paid, in its sole discretion, to holders of similar Award Agreements, based on the attached
Performance Goals Schedule. In the event your employment is terminated for any of the reasons
(a) through (e) in the first paragraph of this Section after completion of the Performance
Period but prior to a payment date, you or your estate shall be entitled to receive either the
Retention Payment or, if greater, the Performance Payment determined by the Committee upon
completion of the Performance Period to be paid, in its sole discretion, to holders of similar
Award Agreements, based on the attached Performance Goals Schedule. Such payments shall be made
at the same time that payments are made to active employees.
	 
	 	 	If, in connection with or following a Change of Control (as defined in the Addendum to this
Agreement), your employment is terminated for any of the reasons (a) through (e) in the first
paragraph of this Section on or after the one-year anniversary of commencement of the
Performance Period and prior to the end of the Performance Period, you or your estate shall be
entitled to receive, on or before forty-five days after your employment termination, a pro-rata
payment based on an assumption that the performance goals have been achieved at Target level,
as set forth in the attached Performance Goals Schedule. If, in connection with or following a
Change of Control, your employment is terminated for any of the reasons (a) through (e) in the
first paragraph of this Section after the end of the Performance Period, you or
your estate shall be entitled to receive, on or before forty-five days after your employment
termination, the greater of the





ver. 2/09




 










 









	 	 	Retention Payment or the applicable Performance Payment based on
the attached Performance Schedule. Notwithstanding the foregoing, in the event you are a “key
employee” under Internal Revenue Code Section 409A and your employment termination following a
Change of Control constitutes a Qualified Retirement after the end of the Performance Period, no
Payment to you after such termination shall be made prior to six months after your date of
termination.
	 
	7.	 	Income Taxes. You are liable for any federal and state income or other taxes applicable
upon the receipt of the Performance Payments, and you acknowledge that you should consult with
your own tax advisor regarding the applicable tax consequences. Upon issuance of the Payments
by Deluxe, you shall promptly pay to Deluxe in cash, unless otherwise withheld by Deluxe under
applicable law, all applicable taxes required by Deluxe to be withheld or collected upon such
payment.
	 
	8.	 	Terms and Conditions. This Agreement does not guarantee your continued employment or
alter the right of Deluxe or its affiliates to terminate your employment at any time.
This Award is granted pursuant to the Plan and is subject to its terms. In the event of any
conflict between the provisions of this Agreement and the Plan, the provisions of the Plan
shall govern.





	 	 	 	 	 
	 	DELUXE CORPORATION

 	 
	 	BY:  	
 	 



 









 






	 	 	 	 	 



ADDENDUM TO

CASH PERFORMANCE AWARD AGREEMENT



For the purposes hereof the terms used herein shall have the following meanings:



“Affiliate” shall mean a company controlled directly or indirectly by Deluxe, where “control” shall
mean the right, either directly or indirectly, to elect a majority of the directors thereof without
the consent or acquiescence of any third party.



“Cause” shall mean (i) you have breached your obligations of confidentiality to Deluxe or any of
its Affiliates; (ii) you have otherwise failed to perform your employment duties and do not cure
such failure within thirty (30) days after receipt of written notice thereof; (iii) you commit an
act, or omit to take action, in bad faith which results in material detriment to Deluxe or any of
its Affiliates; (iv) you have had excessive absences unrelated to illness or vacation (“excessive”
shall be defined in accordance with local employment customs); (v) you have committed fraud,
misappropriation, embezzlement or other act of dishonesty in connection with Deluxe or any of its
Affiliates or its or their businesses; (vi) you have been convicted or have pleaded guilty or nolo
contendere to criminal misconduct constituting a felony or a gross misdemeanor, which gross
misdemeanor involves a breach of ethics, moral turpitude, or immoral or other conduct reflecting
adversely upon the reputation or interest of Deluxe or its Affiliates; (vii) your use of narcotics,
liquor or illicit drugs has had a detrimental effect on your performance of employment
responsibilities; or (viii) you are in material default under any agreement between you and Deluxe
or any of its Affiliates following any applicable notice and cure period.



“Change of Control” shall be deemed to have occurred if the conditions set forth in any one of the
following paragraphs shall have been satisfied:





	 	(I)	 	The date on which any one person, or more than one person acting as a group,
acquires ownership of stock of Deluxe that, together with stock held by such person or
group, constitutes more than 50% of the total fair market value or total voting power
of the stock of Deluxe. If any one person, or more than one person acting as a group,
is already considered to own more than 50% of the total fair market value or total
voting power of the stock of the Deluxe, the acquisition of additional stock by the
same person or persons is not considered to cause a Change in Control under this
paragraph or paragraph (II). An increase in the percentage of stock owned by any one
person, or persons acting as a group, as a result of a transaction in which Deluxe
acquires its stock in exchange for property will be treated as an acquisition of stock
for purposes of this paragraph. This paragraph applies only when there is a transfer or
issuance of stock of Deluxe and stock in Deluxe remains outstanding after the
transaction.
	 
	 	(II)	 	The date any one person, or more than one person acting as a group, acquires
(or has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of Deluxe possessing 30% or
more of the total voting power of the stock of such corporation. If any one person, or
more than one person acting as a group, is already considered to own more than 30% of
the total voting power of the stock of the Deluxe, the acquisition of additional stock
by the same person or persons is not considered to cause a Change in Control under this
paragraph.
	 
	 	(III)	 	The date a majority of members of Deluxe’s board of directors is replaced
during any 12-month period by directors whose appointment or election is not endorsed
by a majority of the members of the board of directors before the date of the
appointment or election.
	 
	 	(IV)	 	The date that any one person, or more than one person acting as a group,
acquires (or has acquired during the 12-month period ending on the date of the most
recent acquisition by such person or persons) assets from Deluxe that have a total
gross fair market value equal to or more than 40% of the total gross fair market value
of all of the assets of Deluxe immediately before such acquisition or acquisitions;
provided that a Change in Control shall not result from a transfer of assets by Deluxe
to (a) a shareholder of Deluxe (immediately prior to the transfer) in exchange for or
with respect to Deluxe’s stock, (b) an entity, 50% or more of the total value or voting
power of which is owned, directly or indirectly, by Deluxe immediately following the
transfer, (c) a person, or more than one person acting as a group, that owns, directly
or indirectly, 50% or more of the total value or voting power of all the outstanding
stock of Deluxe immediately following the transfer, or (d) an entity, at least 50% of
the total value or voting power of which is owned, directly or indirectly, by a person
or group of persons described in clause (c) For this purpose, gross fair market value
means the value of the assets of Deluxe, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets.




For purposes of determining whether a Change of Control has occurred, persons will not be
considered to be acting as a group solely because they purchase or own stock of the same
corporation at the same time, or as a result of the same public offering. However, persons will be
considered to be acting as a group if they are owners of a corporation that enters into a


 









 






merger, consolidation, purchase or acquisition of stock, or similar business transaction with
Deluxe. If a person, including an entity, owns stock in both corporations that enter into a merger,
consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is
considered to be acting as a group with other shareholders in a corporation only with respect to
the ownership in that corporation before the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.



This definition of Change of Control is intended to conform to the definition of a change in
control event as set forth in §409A of the Internal Revenue Code and Treas. Reg. §1.409A-3(i)(5),
and shall be so construed. A transaction shall not be considered to constitute a Change of Control
unless it also constitutes a change in control event for purposes of §409A, and any transaction
that constitutes a change in control event for purposes of § 409A shall be considered a Change of
Control.



“Company” shall mean Deluxe and its Affiliates, as herein defined.



“Disability” shall mean your medically determinable physical or mental impairment that can be
expected to result in death or to last for a continuous period of not less than twelve months and
you either have been receiving disability payments under any plan (including a short-term
disability plan or practice) of the Company for at least three months, or if you are not eligible
to participate in any disability plan, you are unable to engage in any substantial gainful
activity.



“Good Reason” shall mean (i) except with your written consent given in your discretion, (a) the
assignment to you of any position and/or duties which represent or otherwise entail a material
diminution in your position, authority, duties or responsibilities, or (b) any other action by the
Company which results in a material diminution in your position (or positions) with the Company,
excluding for this purposes an isolated, insubstantial or inadvertent action not taken in bad faith
and which is remedied by the Company promptly after receipt of written notice thereof given by you
and excluding any diminution attributable solely to the fact that Deluxe is no longer a public
company; (ii) any material reduction in your aggregate compensation and incentive opportunities, or
any failure by the Company to comply with any other written agreement between you and the Company,
other than an isolated, insubstantial or inadvertent failure not occurring in bad faith and which
is remedied by the Company promptly after receipt of written notice thereof given by you; (iii) the
Company’s requiring you to be based at any location more than 50 miles from your then current
location; (iv) any purported termination by the Company of your employment which is not effected
pursuant to a written notice of termination specifying the reasons for your termination and the
manner by which such reasons constitute “Cause” (as defined herein); or (v) any request or
requirement by the Company that you take any action or omit to take any action that is inconsistent
with or in violation of the Company’s ethical guidelines and policies as the same existed within
the 120-day period prior to the termination date or any professional ethical guidelines or
principles that may be applicable to you.



“Qualified Retirement” shall mean any termination of employment that the Compensation Committee of
Deluxe’s Board of Directors approves as a qualified retirement, provided (i) you have at least
twenty years of service with Deluxe and/or its Affiliates (“Service Years”), and (ii) the sum of
your age and Service Years equals or exceeds seventy-five.




Addendum

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