EX-10.1



 





EXHIBIT 10.1




PAYCHEX, INC.

2002 STOCK INCENTIVE PLAN

(as amended and restated effective October 12, 2005)




2007 MASTER RESTRICTED STOCK UNIT AGREEMENT




     1. Grant of Restricted Stock Units. This 2007 Master Restricted Stock Unit Award
Agreement (this “Award Agreement”) sets forth the terms and conditions of the Restricted Stock
Units (the “Award”) granted to you by the Compensation and Governance Committee (the “Committee”)
of the Board of Directors of Paychex, Inc. (the “Company”) under the Company’s 2002 Stock Incentive
Plan, as amended and restated effective October 12, 2005 (the “Plan”), as described on your Award
Notice. The Award is subject to all of the provisions of the Plan, which is hereby incorporated by
reference and made a part of this Award Agreement. The capitalized terms used in this Award
Agreement are defined in the Plan.



     2. Restriction and Vesting. Subject to the terms set forth in this Award Agreement
and the Plan, and provided that you are still an employee of the Company at that time, 20 percent
of the Shares represented by the Award will vest on each of the first, second, third, fourth and
fifth anniversaries of the date of grant set forth on your Award Notice (each, a “Vesting Date”).
If your employment terminates before a Vesting Date, including, but not limited to, Retirement,
then the unvested portion of the Award shall be forfeited and cancelled immediately. If your
employment terminates due to death or Disability, your Award shall immediately become 100% vested.



     3. Nature of Units. The Units represent book-keeping entries only, and constitute the
Company’s unfunded and unsecured promise to issue shares of Common Stock to you on a future date.
As a holder of Units, you have no rights other than the rights of a general creditor of the
Company.



     4. Issuance of Shares. The Company shall, provided that the conditions to vesting
specified in Section 2 of this Award Agreement are satisfied, issue a certificate or certificates
for Shares representing the vested portion of the Award as promptly as practicable following each
Vesting Date.



     5. Rights as a Stockholder. Prior to the Vesting Date, you will not have any of the
rights of a stockholder with respect to the Shares to be issued on vesting of the Units, including,
but not limited to, the right to receive such cash dividends, if any, as may be declared on such
shares from time to time and the right to vote (in person or by proxy) such shares at any meeting
of stockholders of the Company.



     6. Restrictions on Transfer of Shares. Units awarded under the Plan, may not, except
as otherwise provided in the Plan, be sold, assigned, transferred, pledged or encumbered in any way
prior to the Vesting Date or the date the Shares are issued, whichever is later, whether by
operation of law or otherwise, except by will or the laws of descent and distribution. After



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the Vesting Date, the Shares may be issued during your lifetime only to you, or after your
death to your designated beneficiary, or, in the absence of such beneficiary, to your duly
qualified personal representative.



     7. Restrictions on Issuance of Shares. If at any time the Company determines that
listing, registration or qualification of the Shares covered by the Award upon any securities
exchange or under any state or federal law, or the approval of any governmental agency, is
necessary or advisable as a condition to the Award or the issuance of certificate(s) for Shares
hereunder, such Award or issuance may not be made in whole or in part unless and until such
listing, registration, qualification or approval shall have been effected or obtained free of any
conditions not acceptable to the Company.



     8. Withholding. The vesting of the Award is conditioned upon your making arrangements
satisfactory to the Company for the payment to the Company of the amount of all taxes required by
any governmental authority to be withheld and paid over by the Company or any Affiliate to the
governmental authority on account of such vesting. The payment of such withholding taxes to the
Company may be made (i) by you in cash or by check, (ii) subject to the consent of the Company and
in accordance with any guidelines established by the Committee, by the Company retaining the number
of the Shares that would otherwise be delivered to you upon vesting that have an aggregate Fair
Market Value (at the time retained by the Company) equal to the amount of withholding taxes (using
your minimum required tax withholding rate or such other rate that the Company determines will not
trigger a negative accounting impact to the Company) required to be paid, or (iii) by the Company
or any Affiliate withholding such taxes from any other compensation owed to you by the Company or
any Affiliate. Unless you make arrangements prior to vesting to pay withholdings taxes in cash or
by check, or to have such withholding taxes withheld from other compensation owed to you by the
Company or any Affiliate, then at the time of vesting, the Company shall have the right to retain
the number of the Shares that would otherwise be delivered to you upon vesting that have an
aggregate Fair Market Value (at the time retained by the Company) equal to the amount of
withholding taxes (using your minimum required tax withholding rate or such other rate that the
Company determines will not trigger a negative accounting impact to the Company) required to be
paid.



     9. Limitation of Rights. Neither the Plan, the granting of the Award, the Award
Notice nor this Award Agreement gives you any right to remain in the employment of the Company or
any Affiliate.



     10. Rights of Company and Affiliates. This Award Agreement does not affect the right
of the Company or any Affiliate to take any corporate action whatsoever, including without
limitation its right to recapitalize, reorganize or make other changes in its capital structure or
business, merge or consolidate, issue bonds, notes, Shares or other securities, including preferred
stock, or options therefor, dissolve or liquidate, or sell or transfer any part of its assets or
business.



     11. Plan Controls. In the event of any conflict among the provisions of the Plan and
this Award Agreement, the provisions of the Plan will be controlling and determinative.



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     12. Amendment. Except as otherwise provided by the Plan, the Company may only alter,
amend or terminate the Award with your consent.



     13. Governing Law. This Award Agreement shall be governed by and construed in
accordance with the laws of the State of New York, except as superseded by applicable federal law,
without giving effect to its conflicts of law provisions.



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