Exhibit 10.1


 





Sixth Amendment
to Employment Agreement


 


This Sixth Amendment (“Sixth Amendment”),
to the Employment Agreement (the “Agreement”) dated February 27, 2007 between Payment Data Systems, Inc. (“PDS”)
and Michael R. Long (“Executive”) is entered into this 8th day of September, 2016, and is made part of the Agreement
which is hereby amended as follows:


 


1.Definitions. All capitalized
terms used herein and not expressly defined herein shall have the respective meanings given to such terms in the Agreement.


 


2.Entire Agreement. Except as
expressly modified by this Sixth Amendment, the Agreement shall be and remain in full force and effect in accordance with its terms
and shall constitute the legal, valid, binding and enforceable obligations of PDS and Executive.


 


3.Successors and Assigns. This
Sixth Amendment shall be binding upon and inure to the benefit of the successors and permitted assigns of the parties hereto.


 


4.Section References. Section
titles and references used in this Sixth Amendment shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreements among the parties hereto evidenced hereby.


 


5. Now, therefore, in consideration
of the mutual covenants set forth herein and for other good and valuable consideration, the adequacy, receipt and sufficiency of
which are hereby acknowledged:


 


		a.	Section 4(c) of the Agreement is hereby amended solely with respect to Executive’s termination
as a result of death as follows:



 


“(i) When Due.
The estate of Executive shall be entitled to the Deferred Compensation as calculated below, the initial installment of which is
to be paid within 30 days after the event giving rise to the payout (except as provided below) in the event that Executive’s
employment is terminated for death of Executive. No Deferred Compensation shall be due if Executive’s estate receives continuation
of Base Salary payments at the time of his death as follows: the Company and/or a third party insurance company shall continue
to pay the Base Salary to the estate of Executive up to a maximum of 36 months minus the monthly Base Salary already paid to Executive
prior to his death pursuant to his disability. If such Base Salary payments cease before 36 months for any reason, the Company
shall pay Executive’s estate the Deferred Compensation minus Base Salary payments within 30 days.


 


(ii) Amount. The Deferred
Compensation shall be an amount equal to 2.95 times of Base Salary (as defined in Section 4(a) of the Agreement) (“Deferred
Compensation”). For the avoidance of doubt, Deferred Compensation shall not include amounts paid or accrued to Executive
for bonuses or Bonus Compensation, benefits or equity awards. Unpaid and unearned Bonus Compensation or Bonus Deferred Compensation
shall be forfeited.


 


The Deferred Compensation herein
shall be deemed liquidated damages resulting from the Company’s termination of this Agreement due to death of the Executive
and shall be the estate of the Executive’s sole and exclusive remedy for any such termination.


 



    1 


     

    




(iii)
Outstanding Equity Awards. All stock options issued to Executive and all restricted stock granted to Executive shall continue
on their vesting schedule without acceleration. Upon vesting of such stock options or restricted
stock, Company agrees to execute all documents and provide all legal opinions to the estate of the Executive as requested by the
authorized representative in order for the estate of the Executive to sell, register, collateralize, or transfer such stock.”


 


		b.	Section 4(c) of the Agreement is hereby amended solely with respect to Executive’s termination
as a result of disability as follows:



 


“(i)
When Due. Executive shall be entitled to the Deferred Compensation as calculated below the initial installment of which
is to be paid within 30 days after the event giving rise to the payout (except as provided below) in the event that Executive’s
employment is terminated for disability pursuant to Section 7(a).


 


(ii) Amount. The Deferred
Compensation shall be an amount equal to 36 monthly Base Salary payments (for the avoidance of doubt one monthly Base Salary payment
shall equal 1/12th of Executive’s Base Salary and Base Salary shall be the salary amount paid to Executive on
his last pay check before termination of the disability occurred) (“Deferred Compensation”) to be made monthly on a
continuing basis for up to 36 months by the Company and/or a third party insurance company. For the avoidance of doubt, Deferred
Compensation shall not include amounts paid or accrued to Executive for bonuses or Bonus Compensation, benefits or equity awards.
Unpaid and unearned Bonus Compensation or Bonus Deferred Compensation shall be forfeited.


 


(iii) Outstanding Equity
Awards. All stock options issued to Executive and all restricted stock granted to Executive shall continue on their vesting
schedule without acceleration. Upon vesting of such stock options or restricted stock, Company agrees to execute all documents
and provide all legal opinions to the estate of the Executive as requested by the authorized representative in order for the estate
of the Executive to sell, register, collateralize, or transfer such stock.”


 


6. This Sixth Amendment amends the
Agreement as set forth herein. All previously existing obligations under the Agreement are hereby reaffirmed in all respects.


 


 


[Signature Page
follows.]


 


 


 



    2 


     

    




In witness thereof, the parties hereto
have caused this Sixth Amendment to the Employment Agreement to be executed on the day and year first above written.


 


 


 





	 	Payment Data Systems, Inc.	 	Executive
	 	 	 	 	 	 
	 	By:	/s/ Peter
Kirby	 	By: 	/s/ Michael R. Long
	 	 	Name: Peter Kirby	 	 	Name:
Michael R. Long
	 	 	Title: Chairman of
the	 	 	 
	 	 	Compensation Committee	 	 	 
	 	 	 	 	 	 



 


 




 


 


 


 


 


 


 


 


 


3