Document:

Exhibit 10.1
 

TOTAL SYSTEM SERVICES, INC.

AMENDED AND REVISED STOCK OPTION AGREEMENT

 

	
             
 	
            [DATE]
 

 

THIS AGREEMENT ("Agreement"), dated as of the ___ day of _____________, 200__, by and between TOTAL SYSTEM SERVICES, INC. (the "Company"), a Georgia corporation having its principal office at 1600 First Avenue, Columbus, Georgia, and ___________________________ (the "Option Holder"), an employee of the Company or a Subsidiary of the Company.

 

W I T N E S S E T H:

 

WHEREAS, the Board of Directors of the Company has adopted the Total System Services, Inc. 2007 Omnibus Plan (the "Plan"); and

 

WHEREAS, the Company recognizes the value to it of the services of the Option Holder and intends to provide the Option Holder with added incentive and inducement to contribute to the success of the Company; and

 

WHEREAS, the Company recognizes the potential benefits of providing employees the opportunity to acquire an equity interest in the Company and to more closely align the personal interests of employees with those of other shareholders; and

 

WHEREAS, effective _____________, pursuant to the Plan, the Compensation Committee of the Board of Directors of the Company:  (a) granted to the Option Holder, pursuant to Section 6 of the Plan, an Option in respect of the number of shares herein below set forth, (b) designated the Option a Non-Qualified Stock Option, and (c) fixed and determined the Option price and exercise and termination dates as set forth below.

 

NOW THEREFORE, in consideration of the mutual promises and representations herein contained and other good and valuable consideration, it is agreed by and between the parties hereto as follows:

 

1.         The terms, provisions and definitions of the Plan are incorporated by reference and made a part hereof.  All capitalized terms in this Agreement shall have the same meanings given to such terms in the Plan except where otherwise noted.

 

2.         Subject to and in accordance with the provisions of the Plan, the Company hereby grants to the Option Holder a Non-Qualified Stock Option to purchase, on the terms and subject to the conditions hereinafter set forth, all or any part of an aggregate of NUMBER OF OPTIONS shares of the Common Stock ($.10 par value) of the Company at the purchase price of $____ per share, exercisable in the amounts and at the times set forth in this Paragraph 2, unless the Compensation Committee, in its sole and exclusive discretion, shall authorize the Option Holder to exercise all or part of the Option at an earlier date.

 

The Option may be exercised on or after ______________, as provided in the Plan.  

 

[OR]

 

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The Option may be exercised in accordance with the following schedule as provided in the Plan:

 

	
             
 	
            If employment
 	
            Percentage of
 

	
             
 	
            continues through
 	
            Option Exercisable
 

 

	
             
 	
            _____________, 20___
 	
            ____%
 

 

	
             
 	
            [or]
 

 

	
             
 	
            _____________, 20___
 	
            ____%
 

 

	
             
 	
            [or]
 

 

	
             
 	
            _____________, 20___
 	
            ____%
 

 

 

In the event of Option Holder’s death or total and permanent disability, Option Holder (or the legal representative of Option Holder’s estate or legatee under Option Holder’s will) shall be able to exercise the Option in full for the remainder of the Option’s term.

 

 [The Option may also be exercised in full for the remainder of the Option’s term in the event Option Holder’s employment with the Company terminates after the Option Holder has attained age 65.]

 

[In addition, the Option may be exercised in the event Option Holder’s employment with Company terminates after Option Holder has attained age 62 (or greater) with 15 or more years of service.]

 

 [The Option may also be exercised in full for the remainder of the Option’s term in the event the Option Holder’s employment is involuntarily terminated by the Company without Cause after Option Holder has attained 10 years of service.  For purposes of this Agreement, “Cause” shall mean (i) the willful and continued failure of Option Holder to perform substantially his or her duties with the Company or one of its subsidiaries; or (ii) the willful engaging by Option Holder in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.]

 

 [In the event of Option Holder’s separation of employment for any reason other than the reasons listed above, Option Holder shall be able to exercise the Option to the extent the Option was exercisable at the time of such separation of employment for 90 days following the date of such separation of employment.]

 

Unless sooner terminated as provided in the Plan or in this Agreement, the Option shall terminate, and all rights of the Option Holder hereunder shall expire on _____________.  In no event may the Option be exercised after _____________.

 

3.          The Option or any part thereof, may, to the extent that it is exercisable, be exercised in the manner provided in the Plan.  Payment of the aggregate Option price for the number of shares purchased and any withholding taxes shall be made in the manner provided in the Plan.

 

4.          The Option or any part thereof may be exercised during the lifetime of the Option Holder only by the Option Holder and only while the Option Holder is in the employ of the Company, except as otherwise provided in the Plan.

 

5.          Unless otherwise designated by the Compensation Committee, the Option shall not be transferred, assigned, pledged or hypothecated in any way.  Upon any attempt to transfer, assign, pledge, 

 

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hypothecate or otherwise dispose of a nontransferable Option or any right or privilege confirmed hereby contrary to the provisions hereof, the Option and the rights and privileges confirmed hereby shall immediately become null and void.

 

6.          In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, or other change in corporate structure affecting the Company’s Stock, any necessary adjustment shall be made in accordance with the provisions of Section 4.4 of the Plan. 

 

7.          In the event of a Change of Control (as defined in Section 2.8 of the Plan) and Option Holder’s subsequent termination of employment within two years following the date of such Change of Control either (i) by the Company for any reason other than Cause or (ii) by the Option Holder for Good Reason (as the terms “Cause” and “Good Reason” are defined in the Company’s Change of Control Plan Document, the provisions of which are incorporated herein by reference), the Option may be immediately exercised in full as of the date of such employment termination and the Option may be exercised in full for the remainder of the Option’s term.

 

8.          Any notice to be given to the Company shall be addressed to the President of the Company at 1600 First Avenue, Columbus, Georgia 31901.

 

9.          Nothing herein contained shall affect the right of the Option Holder to participate in and receive benefits under and in accordance with the provisions of any pension, insurance or other benefit plan or program of the Company as in effect from time to time and for which the Option Holder is eligible. 

 

10.        Nothing herein contained shall affect the right of the Company, subject to the terms of any written contractual arrangement to the contrary, to terminate the Option Holder’s employment at any time for any reason whatsoever. 

 

11.        This Agreement shall be binding upon and inure to the benefit of the Option Holder, his personal representatives, heirs legatees, but neither this Agreement nor any rights hereunder shall be assignable or otherwise transferable by the Option Holder except as expressly set forth in this Agreement or in the Plan. 

 

Company has issued the Option with foregoing the terms and conditions in accordance with the provisions of the Plan.  You will be deemed to have agreed to the foregoing terms and conditions of the Option, unless you object by notifying the TSYS Compensation Department within 30 days after your receipt of this Agreement. 

 

 

3Exhibit 10.2

PERFORMANCE SHARE AGREEMENT

 

Total System Services, Inc. (“Company”) confirms that, on [grant date] (the “Grant Date”), it granted you, [name], [number] Performance Shares (your “Performance Shares”).  Your Performance Shares are subject to the terms and conditions of this Performance Agreement (this “Agreement”) and the Company’s 2007 Omnibus Plan (the “Plan”).

 

	
             
 	
            1.
 	
            Standard Performance Terms.
 

 

 (a)    The terms of this Section 1 shall be referred to as the "Standard Performance Terms" and will apply to your Performance Shares except in so far as Sections 2 (Change of Employment Status) or 3 (Change of Control) apply.

 

 (b)    The initial Performance Period for your Performance Shares (the "Initial Performance Period") will begin on the January 1 preceding the Grant Date and end on December 31 immediately following the Grant Date.  The secondary Performance Period for your Performance Shares (the "Secondary Performance Period") will begin on the January 1 preceding the date of grant and end on the December 31 immediately preceding the third anniversary of the beginning of the Secondary Performance Period.  After the conclusion of the Secondary Performance Period, the Committee shall certify in writing the number of Performance Shares payable in accordance with Section 1(c) (your "Final Performance Shares"), and your Final Performance Shares will be due and payable in Shares.

 

 (c)    The Committee will determine your Final Performance Shares by multiplying your Performance Shares by the "Performance Factor."  The Performance Factor means a percentage (from zero to 240%) which is the product of the Initial Performance Factor and the TSR multiplier as defined in (1) and (2) below, respectively.

 

 (1)    The first percentage (the "Initial Performance Factor") will be based on the Company's earnings per share performance during the Initial Performance Period and will range from zero to 200%.  Within 90 days after the beginning of the Initial Performance Period, the Committee will establish a performance goal for such calendar year based upon the Company's earnings per share (such goal is hereinafter referred to as the "Primary Performance Measure").  After the conclusion of the Initial Performance Period, the Committee will determine the amount of the Initial Performance Factor based upon whether the Primary Performance Measure was attained.

 

 (2)    The second percentage (the "TSR Multiplier") will range from 80% to 120% and will be based upon the Company's performance with respect to Total Shareholder Return relative to the other companies in the Standard and Poor's Technology Index determined in accordance with the table below.  For this 

purpose, "Total Shareholder Return" shall equal:  (a) the change in Company's stock price during the Secondary Performance Period plus dividends paid to the Company's shareholders during the Secondary Performance Period; divided by (b) the Company's initial share price at the beginning of the Secondary Performance Period.

 

                

	
            Company Rank in

3-Year TSR versus Peers
 	
             

Percentile*
 	
             

TSR Multiplier
 
	
             

Top 20%
 	
             

81st to 100th
 	
             

120%
 
	
            Next 20%
 	
            61st to 80th
 	
            110%
 
	
            Middle 20%
 	
            41st to 60th
 	
            100%
 
	
            Next 20%
 	
            21st to 40th
 	
            90%
 
	
            Bottom 20%
 	
            0th to 20th
 	
            80%

 
 
	
             

*There is no interpolation between percentiles.
 

 

2.       Change of Employment Status.  Except as otherwise provided in this Section 2 or Section 3, you must remain employed with the Company or an Affiliate through the Secondary Performance Period in order to be paid your Final Performance Shares.  For purposes of this Section 2, your transfer between the Company and an Affiliate, or among Affiliates, will not be a termination of employment.  In the event of a Change of Control, any applicable terms of Section 3 (Change of Control) will supersede the terms of this Section 2.

 

 (a)    Long-Term Disability.  In the event you qualify for long-term disability benefits under a plan or arrangement offered by the Company or an Affiliate for its employees, the Standard Performance Terms will continue to apply to your Performance Shares.  The amount paid to you at the end of the Secondary Performance Period will be prorated based on the ratio of number of months you were employed during the Secondary Performance Period to the total number of months in the Secondary Performance Period.  Partial months of employment will be counted as full months for purposes of this calculation.

 

 (b)    Death.  In the event that your employment with the Company or an Affiliate terminates due to your death, your Performance Shares will be immediately due and payable in Shares to your beneficiary and will be determined without regard to the Standard Performance Terms.

 

 (c)    Retirement.  If your employment with the Company or an Affiliate terminates on or after your early retirement date, which is defined as attainment of age 62 with 15 or more years of service, or your normal retirement date, which is defined as attainment of age 65, the Standard Performance Terms will continue to apply to your Performance Shares.  The amount paid to you at the end of the Secondary Performance Period will be prorated based on the ratio of number of months you were employed during the Secondary Performance Period to the total number of months in 

 

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the Secondary Performance Period.  Partial months of employment will be counted as full months for purposes of this calculation.

 

 (d)    Other Termination of Employment.  Unless the Committee determines otherwise, if no other provision in this Section 2 regarding change of employment status applies, including, for example, your voluntary termination of employment, or your involuntary termination by the Company or an Affiliate, your Performance Shares will be forfeited immediately.

 

3.       Change of Control.  In the event of a Change of Control (as defined in Section 2.8 of the Plan) and your subsequent termination of employment within two years following the date of such Change of Control either (i) by the Company for any reason other than Cause or (ii) by you for Good Reason (as the terms "Cause" and "Good Reason" are defined in the Company's Change of Control Plan Document, the provisions of which are incorporated herein by reference), you will receive shares calculated as follows:

 

 (a)    if the termination of employment occurs during the Initial Performance Period, you will receive Shares equal to the number of Performance Shares determined without regard to the Standard Performance Terms; or

 

 (b)    if the termination of employment occurs during the Secondary Performance Period, but after the Initial Performance Period, you will receive Shares based on the product of the Performance Shares multiplied by the Initial Performance Factor without regard to the TSR Multiplier.

 

4.       Nontransferability of Awards.  Except as provided in Section 5 or as otherwise permitted by the Committee, you may not sell, transfer, pledge, assign or otherwise alienate or hypothecate any of your Performance Shares, and all rights with respect to your Performance Shares are exercisable during your lifetime only by you.

 

5.       Beneficiary Designation.  You may name any beneficiary or beneficiaries (who may be named contingently or successively) who may then exercise any right under this Agreement in the event of your death.  Each beneficiary designation for such purpose will revoke all such prior designations.  Beneficiary designations must be properly completed on a form prescribed by the Committee and must be filed with the Company during your lifetime.  If you have not designated a beneficiary, your rights under this Agreement will pass to and may be exercised by your estate.

 

6.       Tax Withholding.  The Company will withhold from payment made under this Agreement an amount sufficient to satisfy the minimum statutory Federal, state, and local tax withholding requirements relating to payment on account of your Performance Shares.

 

7.       Adjustments.  In accordance with Section 4.4 of the Plan, the Committee will make appropriate adjustments in the terms and conditions of your Performance 

 

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Shares in recognition of a corporate event or transaction affecting the Company (such as a common stock dividend, common stock split, recapitalization, payment of an extraordinary dividend, merger, consolidation, combination, spin-off, distribution of assets to stockholders other than ordinary cash dividends, exchange of shares, or other similar corporate change), to prevent unintended dilution or enlargement of the potential benefits of your Performance Shares.  The Committee's determinations in this regard will be conclusive.

 

	
             
 	
            8.
 	
            Timing of Payment.
 

 

 (a)    This Agreement is intended to comply with Code Section 409A and shall be interpreted accordingly.  If Shares are to be paid to you, you will receive evidence of ownership of those Shares.

 

 (b)    If payment is due and payable under Section 2(b), it will be made as soon as practicable following your death.

 

 (c)    If payment is due and payable under Section 2(d), it will be made six (6) months after the termination of your employment (or six (6) months after your "separation from service" under Code Section 409A, if that is a different date).

 

 (d)    If payment is due and payable under Section 3, and the Change of Control that causes payment to be due and payable is a "change of control" as defined under Code Section 409A, such sum shall be paid to you within thirty (30) days of your separation of employment.  If payment is due and payable under Section 3, and the Change of Control that causes payment to be due and payable is not a "change of control" as defined under code Section 409A, such sum shall be paid to you six (6) months after the termination of your employment (or six (6) months after your "separation from service" under Code Section 409A, if that is a different date).

 

 (e)    If payment is due and payable under the Standard Performance Terms, payment will be made as soon as practicable in the calendar year after the end of the Secondary Performance Period.

 

9.       Dividend Equivalents.  [After the Initial Performance Period,] [(T)he Performance Shares will be credited with dividend equivalents equal to amount of cash dividend payments that would have otherwise been paid if the shares of the Company's common stock represented by the Performance Shares (including deemed reinvested additional shares attributable to the Performance Shares pursuant to this paragraph) were actually outstanding multiplied by 80% (the "Dividend Equivalents").  These Dividend Equivalents will be deemed to be reinvested in additional shares of the Company's common stock determined by dividing the deemed cash dividend amount by the Fair Market Value (as defined in the Plan) of a share of the Company's common stock on the
applicable dividend payment date.  Such credited amounts will be added to the Performance Shares and will vest or be forfeited in accordance with Section 2 based on the vesting or forfeiture of the initial Performance Shares to which they are 

 

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attributable.  In addition, the Performance Shares will be credited with any dividends or distributions that are paid in shares of the Company's common stock represented by the Performance Shares and will otherwise be adjusted by the Committee for other capital or corporate events as provided for in the Plan.]  [(T)he Company will pay you a cash amount equal to the number of Performance Shares [times 80%] [times the Initial Performance Factor] times the per share quarterly dividend payments made to shareholders of the Company's common stock, with such dividend equivalent payments to be made reasonably promptly after the payment date of each quarterly dividend.]

 

10.     No Guarantee of Employment.  This Agreement is not a contract of employment and it is not a guarantee of employment for life or any period of time.  Nothing in this Agreement interferes with or limits in any way the right of the Company or an Affiliates to terminate your employment at any time.  This Agreement does not give you any right to continue in the employ of the Company or an Affiliate.

 

11.     Governing Law; Choice of Forum.  This Agreement will be construed in accordance with and governed by the laws of the State of Georgia, regardless of the law that might be applied under principles of conflict of laws.  Any action to enforce this Agreement or any action otherwise regarding this Agreement must be brought in a court in the State of Georgia, to which jurisdiction the Company and you consent.

 

12.     Miscellaneous.  For purposes of this Agreement, "Committee" includes any direct or indirect delegate of the  Committee as defined in the Plan and the word "Section" refers to a Section in this Agreement.  Any other capitalized word used in this Agreement and not defined in this Agreement, including each form of that word, is defined in the Plan.  Any determination or interpretation by the Committee pursuant to this Agreement will be final and conclusive.  In the event of a conflict between any term of this Agreement and the terms of the Plan, the terms of the Plan control.  This Agreement and the Plan represent the entire agreement between you and the Company, and you and all Affiliates, regarding your Performance Shares.  No promises, terms, or
agreements of any kind regarding your Performance Shares that are not set forth, or referred to, in this Agreement or in the Plan are part of this Agreement.  In the event any provision of this Agreement is held illegal or invalid, the rest of this Agreement will remain enforceable.  If you are an Employee of an Affiliate, your Performance Shares are being provided to you by the Company on behalf of that Affiliate, and the value of your Performance Shares will be considered a compensation obligation of that Affiliate.  Your Performance Shares are not Shares and do not give you the rights of a holder of Shares.  The issuance of Shares pursuant to your Performance Shares is subject to all applicable laws, rules and regulations, and to any approvals by any governmental agencies or national securities exchanges as may be required.  No Shares will be issued if that issuance would result in a violation of applicable law, including the federal securities laws and any applicable state or
foreign securities laws.

 

13.     Amendments.  The Committee has the exclusive right to amend this Agreement as long as the amendment does not adversely affect any of your previously-

 

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granted Awards in any material way (without your written consent) and is otherwise consistent with the Plan.  The Company will give written notice to you (or, in the event of your death, to your beneficiary or estate) of any amendment as promptly as practicable after its adoption.

 

IN WITNESS WHEREOF, the Company has caused its duly authorized officer to execute this Agreement, and you have executed this Agreement as set forth below.

 

	
            TOTAL SYSTEM SERVICES, INC.
 	
            EXECUTIVE
 

 

	
             
 	
            [name]
 

 

	
            By:
 	
            ________________________
 	
            _______________________________
 

	
             
 	
            Signature
 

	
            Title:
 	
            ________________________
 

 

	
            Date:
 	
            ________________________
 	
            Date:
 	
            __________________________
 

 

 

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