Document:

Exhibit 4.2

FORM OF
RIGHT CERTIFICATE

 

	
  Certificate No. R-

  	
         
  Rights

  

 

NOT EXERCISABLE AFTER SEPTEMBER 20, 2017, OR EARLIER
IF REDEMPTION OR EXCHANGE OCCURS.  THE
RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER RIGHT AND TO EXCHANGE ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT.

RIGHT CERTIFICATE

JOS. A. BANK CLOTHIERS, INC.

This certifies that                              
or registered assigns, is the registered owner of the number of Rights set
forth above, each of which entitles the owner thereof, subject to the terms,
provisions and conditions of the Rights Agreement, dated as of September 6,
2007 (the “Rights Agreement”), between Jos. A. Bank Clothiers, Inc., a Delaware
corporation (the “Company”), and Continental Stock Transfer & Trust Company
(the “Rights Agent”), to purchase from the Company at any time after the
Distribution Date (as such term is defined in the Rights Agreement) and prior
to 5:00 pm, New York City time, on September 20, 2017, at the office of the
Rights Agent designated for such purpose, or at the office of its successor as
Rights Agent, one one-hundredth of a fully paid non-assessable share of the
Company’s Series A Junior Participating Preferred Stock, par value $1.00
per share (the “Preferred Shares”), at a purchase price of $200.00 per one
one-hundredth of a Preferred Share (the “Purchase Price”), upon presentation
and surrender of this Right Certificate with the Form of Election to Purchase
duly executed.  The number of Rights
evidenced by this Right Certificate (and the number of one one-hundredths of a
Preferred Share which may be purchased upon exercise hereof) set forth above,
and the Purchase Price set forth above, are the number and Purchase Price as of
September 20, 2007 based on the Preferred Shares as constituted at such date.

From and after the time any Person becomes an
Acquiring Person (as such terms are defined in the Rights Agreement), if the
Rights evidenced by this Right Certificate are beneficially owned by
(i) an Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined in the Rights Agreement), (ii) a
transferee of any such Acquiring Person, Associate or Affiliate who becomes a
transferee after the Acquiring Person becomes such, or (iii) under certain
circumstances specified in the Rights Agreement, a transferee of any such
Acquiring Person, Associate or Affiliate who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such, such Rights shall become
null and void without any further action and no holder hereof shall have any
right with respect to such Rights from and after the time any Person becomes an
Acquiring Person.

As provided in the Rights Agreement, the Purchase
Price and the number of one one-hundredths of a Preferred Share which may be
purchased upon the exercise of the Rights

 

evidenced by this Right
Certificate are subject to modification and adjustment upon the happening of
certain events.

This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, as amended from time to
time, which terms, provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement reference is
hereby made for a full description of the rights, limitations of rights,
obligations, duties and immunities hereunder of the Rights Agent, the Company
and the holders of the Right Certificates. 
Copies of the Rights Agreement are on file at the Company’s principal
executive offices and at the Rights Agent’s offices located at 17 Battery
Place, New York, NY 10004.

This Right Certificate, with or without other Right
Certificates, upon surrender at the office of the Rights Agent designated for
such purpose, may be exchanged for another Right Certificate or Right
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of Preferred Shares as the Rights evidenced by
the Right Certificate or Right Certificates surrendered shall have entitled such
holder to purchase.  If this Right
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Right Certificate or Right Certificates for the
number of whole Rights not exercised.

Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (i) may be redeemed by the Company at a
redemption price of $0.01 per Right or (ii) may be exchanged in whole or in
part for shares of the Company’s Common Stock, par value $0.01 per share, or,
upon circumstances set forth in the Rights Agreement, cash, property or other
securities of the Company, including fractions of a share of Preferred Stock.

No fractional Preferred Shares will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which
are integral multiples of one one-hundredth of a Preferred Share, which may, at
the Company’s election, be evidenced by depositary receipts) but in lieu
thereof a cash payment will be made, as provided in the Rights Agreement.

No holder of this Right Certificate shall be entitled
to vote or receive dividends or be deemed for any purpose the holder of the
Preferred Shares or of any other securities of the Company which may at any
time be issuable on the exercise hereof, nor shall anything contained in the
Rights Agreement or herein be construed to confer upon the holder hereof, as
such, any of the rights of a stockholder of the Company or any right to vote
for the election of directors or upon any matter submitted to stockholders at
any meeting thereof, or to give or withhold consent to any corporate action, or
to receive notice of meetings or other actions affecting stockholders (except
as provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights Agreement.

This Right Certificate shall not be valid or
obligatory for any purpose until it shall have been countersigned by the Rights
Agent.

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WITNESS the facsimile signature of the proper
officers of the Company dated            ,
20   .

	
  ATTEST:

  	
   

  	
  JOS. A. BANK
  CLOTHIERS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
  Name:

  
	
  Title:

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  COUNTERSIGNED:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  CONTINENTAL
  STOCK TRANSFER & TRUST

  	
   

  	
   

  
	
  COMPANY, as Rights Agent

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  	
   

  
						

 

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Form of Reverse Side of Right Certificate

FORM OF ASSIGNMENT

(To be executed by the
registered holder if such

holder desires to transfer the Right Certificate.)

FOR VALUE RECEIVED _______________________________________
hereby sells, assigns and transfers unto

	
  

  
	
  (Please print
  name and address of transferee)

  

 

_________________________________________________________
this Right Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ______________________
Attorney, to transfer the within Right Certificate on the books of the
within-named Company, with full power of substitution.

	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
				

 

 

 

Signature Guaranteed:

SIGNATURES
must be guaranteed by an “Eligible Guarantor Institution” as defined in Rule
17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended.

The undersigned hereby
certifies that (1) the Rights evidenced by this Right Certificate are not
being sold, assigned or transferred by or on behalf of a Person who is or was
an Acquiring Person, an Interested Stockholder or an Affiliate or Associate
thereof (as such terms are defined in the Rights Agreement); and (2) after
due inquiry and to the best of the knowledge of the  undersigned, the undersigned did not acquire
the Rights evidenced by this Right Certificate from any Person who is or was an
Acquiring Person, an Interested Stockholder, or an Affiliate or Associate
thereof.

	
  

  	
   

  
	
   

  	
  Signature

  

 

 

FORM OF ELECTION TO PURCHASE

(To
be executed if holder desires to exercise

Rights represented by the Right Certificate.)

To Continental Stock Transfer &
Trust Company:

	
  

  
	
   

  	
  The undersigned hereby
  irrevocably elects to exercise

  	
   

  
	
  Rights represented by this Right Certificate to
  purchase the Preferred Shares issuable upon the exercise of such Rights and
  requests that certificates for such Preferred Shares be issued in the name
  of:

  

 

	
  Please insert social security

  
	
  or other identifying number:

  	
   

  	
   

  

 

	
   

  
	
  (Please print name and
  address)

  

 

	
   

  

 

If such number of
Rights shall not be all the Rights evidenced by this Right Certificate, a new
Right Certificate for the balance remaining of such Rights shall be registered
in the name of and delivered to:

	
  Please insert social security

  
	
  or other identifying number:

  	
   

  	
   

  

 

	
   

  
	
  (Please print name and
  address)

  

 

	
  

  

 

	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
				

 

 

Signature Guaranteed:

Signatures must be
guaranteed by an “Eligible Guarantor Institution” as defined in Rule 17Ad-15
promulgated under the Securities Exchange Act of 1934, as amended.

---------------------------------------------------------------

The undersigned hereby
certifies that (1) the Rights evidenced by this Right Certificate are not
beneficially owned by nor are they being exercised on behalf of an Acquiring
Person, an Interested Stockholder or an Affiliate or Associate thereof (as such
terms are defined in the Rights Agreement); and (2) after due inquiry and
to the best of the knowledge of the undersigned, the undersigned did not
acquire the Rights evidenced by this Right Certificate from any Person who is
or was an Acquiring Person, an Interested Stockholder, or an Affiliate or
Associate thereof.

	
  

  	
   

  
	
   

  	
  Signature

  

 

----------------------------------------------------------------

NOTICE

The signature in the Form
of Assignment or Form of Election to Purchase, as the case may be, must conform
to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.

In the event the
certification set forth above in the Form of Assignment or the Form of Election
to Purchase, as the case may be, is not completed, the Company and the Rights
Agent will deem the beneficial owner of the Rights evidenced by this Right
Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement) and such Assignment or Election to Purchase
will not be honored.Exhibit
10.1

FIRST
AMENDMENT TO EMPLOYMENT  AGREEMENT

This First
Amendment to Employment Agreement (“Amendment”) is made as of September
5, 2007, by and between ACI Worldwide, Inc., a Delaware corporation formerly
known as Transaction Systems Architects, Inc. (the “Company”), and Philip G.
Heasley (“Executive”).

WHEREAS, the
Company and Executive entered into that certain employment agreement dated as
of March 5, 2005 pertaining to the terms of the employment of Executive by the
Company (the “Employment Agreement”); and

WHEREAS, the
Company and Executive desire to amend the Employment Agreement as provided
herein.

NOW, THEREFORE, in
consideration of the mutual covenants contained herein and in the Employment
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

1.                                      Base
Salary. Section 4(a) of the Employment Agreement is amended by adding
the following sentence at the end of that section:

“Effective as of July 30, 2007, Executive’s Base Salary shall be
$550,000 per year.”

2.                                      Employment
Period.

Sections 5(a) and 5(b) of the Employment Agreement are amended by
replacing the references therein to “fourth anniversary” with “sixth
anniversary.”

3.                                      Change-In-Control
Agreement.

A.                                    The
change-in-control severance compensation agreement attached to the Employment
Agreement as Exhibit B is deleted in its entirety and replaced with the Change
In Control Employment Agreement attached hereto. References in the Employment
Agreement to the “Change-In-Control Agreement” hereinafter mean and refer to
the attached Change In Control Employment Agreement.

B.                                    Section 4(i) of the
Employment Agreement is deleted in its entirety.

C.                                    A new Section 5(d)
is added to the Employment Agreement as follows:

Notwithstanding anything herein to the contrary, this
Agreement and the Employment Period hereunder shall terminate immediately upon
the occurrence of the “Effective Date” defined in the Change-In-Control
Employment Agreement attached hereto as Exhibit B (the “Change in Control
Agreement”). Thereafter, Ex-

ecutive’s employment with the Company shall be
governed by the terms and conditions of the Change-In-Control Agreement.

4.                                      All
other terms and conditions of the Employment Agreement remain unchanged.

IN
WITNESS WHEREOF, the parties have executed this Amendment on
the day and year first above written.

	
  ACI Worldwide, Inc.

  	
  Philip G. Heasley

  
	
   

  	
   

  
	
  By:

  	
  /s/ Dennis P. Byrnes

  	
   

  	
  /s/ Philip G. Heasley

  
	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  Senior Vice President

  	
   

  	
   

  

 

Revised Exhibit B—Change In Control Employment Agreement

 2

CHANGE IN
CONTROL EMPLOYMENT AGREEMENT

AGREEMENT, dated
as of the 5th day of September, 2007  (this
“Agreement”), by and between ACI Worldwide, Inc., a Delaware corporation (the
“Company”), and Philip G. Heasley (the “Executive”).

WHEREAS, 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 the Executive,
notwithstanding the possibility, threat or occurrence of a Change in Control
(as defined herein). The Board believes it is imperative to diminish the
inevitable distraction of the Executive by virtue of the personal uncertainties
and risks created by a pending or threatened Change in Control and to encourage
the Executive’s full attention and dedication to the Company in the event of
any threatened or pending Change in Control, and to provide the Executive with
compensation and benefits arrangements upon a Change in Control that ensure
that the compensation and benefits expectations of the Executive will be
satisfied and that provide the Executive with compensation and benefits
arrangements that 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.

NOW, THEREFORE, IT
IS HEREBY AGREED AS FOLLOWS:

Section
1.              Certain Definitions.
(a) “Effective Date” means the first date during the Change in Control Period
(as defined herein) on which a Change in Control occurs. Notwithstanding
anything in this Agreement to the contrary, if a Change in Control occurs and
if the Executive’s employment with the Company is terminated within six months
prior to the date on which the Change in Control occurs, and if it is reasonably
demonstrated by the Executive that such termination of employment (1) was at
the request of a third party that has taken steps reasonably calculated to
effect a Change in Control or (2) otherwise arose in connection with or
anticipation of a Change in Control, then “Effective Date” means the date
immediately prior to the date of such termination of employment.

(b)           “Change in Control Period” means the
period commencing on the date hereof and ending on the second anniversary of
the date hereof; provided, however,
that, commencing on the date one year after the date hereof, and on each annual
anniversary of such date (such date and each annual anniversary thereof, the “Renewal
Date”), unless previously terminated, the Change in Control Period shall be
automatically extended so as to terminate two years from such Renewal Date,
unless, at least 60 days prior to the Renewal Date, the Company shall give
notice to the Executive that the Change in Control Period shall not be so extended.

(c)           “Affiliated Company” means any
company controlled by, controlling or under common control with the Company.

(d)           “Change in Control” means:

(1)           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”) 

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becomes the beneficial
owner (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 20% or more of either (A) the then-outstanding shares of common stock
of the Company (the “Outstanding Company Common Stock”) or (B) 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 Section 1(d), the following acquisitions shall not
constitute a Change in Control: (i) any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
Affiliated Company or (iv) any acquisition by any corporation pursuant to a
transaction that complies with Sections 1(d)(3)(A), 1(d)(3)(B) and 1(d)(3)(C);

(2)           Any time at which individuals who, as
of the date hereof, constitute the Board (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be considered
as though such individual were a member of the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office occurs
as a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board;

(3)           Consummation of a reorganization,
merger, statutory share exchange or consolidation or similar transaction
involving the Company or any of its subsidiaries, a sale or other disposition
of all or substantially all of the assets of the Company, or the acquisition of
assets or stock of another entity by the Company or any of its subsidiaries
(each, a “Business Combination”), in each case unless, following such Business
Combination, (A) all or substantially all of the individuals and entities that
were the beneficial owners of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock (or, for a non-corporate entity, equivalent
securities) and the combined voting power of the then-outstanding voting
securities entitled to vote generally in the election of directors (or, for a
non-corporate entity, equivalent governing body), as the case may be, of the
entity resulting from such Business Combination (including, without limitation,
an entity that, 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 the Outstanding Company Voting Securities, as the case may be,
(B) no Person (excluding any corporation resulting from such Business
Combination or any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of, respectively, the then-outstanding shares
of common stock of the corporation resulting from such Business Combination or
the combined voting power of the then-outstanding voting securities of such
corporation, except to the extent that such ownership existed prior to the Business
Combination, and (C) at least a majority of the members of the board of
directors (or, for a non-corporate entity, equivalent governing body) of the
entity resulting from such Business Combination were 

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members of the Incumbent
Board at the time of the execution of the initial agreement or of the action of
the Board providing for such Business Combination; or

(4)           Approval by the stockholders  of the Company of a complete liquidation or dissolution of
the Company.

Section
2.              Employment Period.
The Company hereby agrees to continue the Executive in its employ, subject to
the terms and conditions of this Agreement, for the period commencing on the
Effective Date and ending on the second anniversary of the Effective Date (the
“Employment Period”). The Employment Period shall terminate upon the
Executive’s termination of employment for any reason.

Section
3.              Terms of Employment.
(a) Position and Duties. (1) During the
Employment Period, (A) the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities
shall be at least commensurate in all material respects with the most
significant of those held, exercised and assigned at any time during the
120-day period immediately preceding the Effective Date and (B) the Executive’s
services shall be performed at the office where the Executive was employed
immediately preceding the Effective Date or at any other location less than 50
miles from such office.

(2)           During the Employment Period, and
excluding any periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote reasonable attention and time during
normal business hours to the business and affairs of the Company and, to the
extent necessary to discharge the responsibilities assigned to the Executive
hereunder, to use the Executive’s reasonable best efforts to perform faithfully
and efficiently such responsibilities. During the Employment Period, it shall
not be a violation of this Agreement for the Executive to (A) serve on corporate,
civic or charitable boards or committees, (B) deliver lectures, fulfill
speaking engagements or teach at educational institutions and (C) manage
personal investments, so long as such activities do not significantly interfere
with the performance of the Executive’s responsibilities as an employee of the
Company in accordance with this Agreement. It is expressly understood and
agreed that, to the extent that any such activities have been conducted by the
Executive prior to the Effective Date, the continued conduct of such activities
(or the conduct of activities similar in nature and scope thereto) subsequent
to the Effective Date shall not thereafter be deemed to interfere with the
performance of the Executive’s responsibilities to the Company.

(b)           Compensation.
(1) Base Salary. During the Employment
Period, the Executive shall receive an annual base salary (the “Annual Base
Salary”) at an annual rate at least equal to the highest annual rate of base
salary paid or payable, including any base salary that has been earned but
deferred, to the Executive by the Company and the Affiliated Companies in
respect of the 12-month period immediately preceding the month in which the
Effective Date occurs. The Annual Base Salary shall be paid at such intervals
as the Company pays executive salaries generally. During the Employment Period,
the Annual Base Salary shall be reviewed at least annually, beginning no more
than 12 months after the last salary increase awarded to the Executive prior to
the Effective Date. Any increase in the Annual Base Salary shall not serve to
limit or reduce any other obligation to the Executive under this Agreement. 

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The Annual Base Salary
shall not be reduced after any such increase and the term “Annual Base Salary”
shall refer to the Annual Base Salary as so increased.

(2)           Annual Bonus.
In addition to the Annual Base Salary, the Executive shall be awarded, for each
fiscal year ending during the Employment Period, total annual and quarterly
bonus opportunities in cash at least equal to the aggregate of the Executive’s
target annual and quarterly bonus opportunities for the year in which the
Effective Date occurs (the “Target Annual Bonus”) (if the Executive has not
been eligible to earn such a bonus for any period prior to the Effective Date
or no such Target Annual Bonus has been established for the fiscal year or
quarters (as applicable) in which the Effective Date occurs, the “Target Annual
Bonus” shall mean the Executive’s most recent target annual and quarterly bonus
opportunities as in effect for the year prior to the year in which the
Effective Date occurs); provided, however, that (i) the performance measures
applicable to such target bonus opportunities shall be comparable in terms of
difficulty of achievement to the measures in effect with respect to the Target
Annual Bonus prior to the Effective Date and (ii) in the determination of such
bonuses, the Executive shall be treated as favorably as similarly situated
executives of any acquiror of the Company. Each such annual bonus shall be paid
no later than two and a half months after the end of the fiscal year for which
the annual bonus is awarded, unless the Executive shall elect to defer the
receipt of such annual bonus pursuant to an arrangement that meets the
requirements of Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”).

(3)           Incentive, Savings and
Retirement Plans. During the Employment Period, the Executive
shall be entitled to participate in all cash incentive, equity incentive, savings
and retirement plans, practices, policies, and programs applicable generally to
other peer executives of the Company and the Affiliated Companies, but in no
event shall such plans, practices, policies and programs provide the Executive
with incentive opportunities (measured with respect to both regular and special
incentive opportunities, to the extent, if any, that such distinction is
applicable), savings opportunities and retirement benefit opportunities, in
each case, less favorable, in the aggregate, than the most favorable of those
provided by the Company and the Affiliated Companies for the Executive under
such plans, practices, policies and programs as in effect at any time during
the 120-day period immediately preceding the Effective Date or, if more favorable
to the Executive, those provided generally at any time after the Effective Date
to other peer executives of the Company and the Affiliated Companies.

(4)           Welfare Benefit Plans.
During the Employment Period, the Executive and/or the Executive’s family,
as the case may be, shall be eligible for participation in and shall receive
all benefits under welfare benefit plans, practices, policies and programs provided
by the Company and the Affiliated Companies (including, without limitation,
medical, prescription, dental, disability, employee life, group life,
accidental death and travel accident insurance plans and programs) to the
extent applicable generally to other peer executives of the Company and the
Affiliated Companies, but in no event shall such plans, practices, policies and
programs provide the Executive with benefits that are less favorable, in the
aggregate, than the most favorable of such plans, practices, policies and
programs in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the
Executive, 

 6
 

those provided generally
at any time after the Effective Date to other peer executives of the Company
and the Affiliated Companies.

(5)           Expenses. During
the Employment Period, the Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Executive in accordance
with the most favorable policies, practices and procedures of the Company and
the Affiliated Companies in effect for the Executive at any time during the
120-day period immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect generally at any time thereafter with respect to
other peer executives of the Company and the Affiliated Companies.

(6)           Office and Support Staff.
During the Employment Period, the Executive shall be entitled to an office
or offices of a size and with furnishings and other appointments, and to
exclusive personal secretarial and other assistance, at least equal to the most
favorable of the foregoing provided to the Executive by the Company and the
Affiliated Companies at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as
provided generally at any time thereafter with respect to other peer executives
of the Company and the Affiliated Companies.

(7)           Vacation. During
the Employment Period, the Executive shall be entitled to paid vacation in
accordance with the most favorable plans, policies, programs and practices of
the Company and the Affiliated Companies as in effect for the Executive at any
time during the 120-day period immediately preceding the Effective Date or, if
more favorable to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company and the Affiliated
Companies.

Section
4.              Termination of
Employment. (a) Death or Disability.
The Executive’s employment shall terminate automatically if the Executive dies
during the Employment Period. If the Company determines in good faith that the
Disability (as defined herein) of the Executive has occurred during the
Employment Period (pursuant to the definition of “Disability”), it may give to
the Executive written notice in accordance with Section 11(b) of its intention
to terminate the Executive’s employment. In such event, the Executive’s
employment with the Company shall terminate effective on the 30th day after
receipt of such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the
Executive shall not have returned to full-time performance of the Executive’s
duties. “Disability” means the absence of the Executive from the Executive’s
duties with the Company on a full-time basis for 180 consecutive business days
as a result of incapacity due to mental or physical illness that is determined
to be total and permanent by a physician selected by the Company or its
insurers and acceptable to the Executive or the Executive’s legal representative.

(b)           Cause. The
Company may terminate the Executive’s employment during the Employment Period
with or without Cause. “Cause” means:

(1)           the Executive’s
conviction of, or entry of a plea of guilty or no contest to, a felony or any
lesser crime of which fraud or dishonesty is an element,

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(2)           the Executive’s
willful misconduct or willful omission of duties (other than any such
misconduct or omission resulting from the Executive’s incapacity due to
physical or mental illness or following the Executive’s delivery of a Notice of
Termination for Good Reason) that is or could reasonably be expected to be
injurious to the Company other than in an immaterial manner, or

(3)           the Executive’s
violation of any provision of (A) the Company’s Code of Business Conduct and
Ethics, as the same may be amended from time to time, or (B) the Company’s Code
of Ethics for the Chief Executive Officer and Senior Financial Officers, as the
same may be amended from time to time (the “Code of Ethics”) that is, in each
case, materially and demonstrably injurious to the Company. For purposes of the
foregoing sentence, the Executive shall be deemed to be subject to the
provisions of the Code of Ethics regardless of whether the Executive is a
Senior Officer as defined in the Code of Ethics or otherwise subject to the
Code of Ethics.

For purposes of this
Section 4(b), no act, or failure to act, on the part of the Executive shall be
considered “willful” unless it is done, or omitted to be done, by the Executive
in bad faith or without reasonable belief that the Executive’s action or
omission was in the best interests of the Company. Any act, or failure to act,
based upon authority (A) given pursuant to a resolution duly adopted by the
Board, or if the Company is not the ultimate parent corporation of the
Affiliated Companies and is not publicly-traded, the board of directors of the
ultimate parent of the Company (the “Applicable Board”), (B) upon the
instructions of the Chief Executive Officer of the Company,
or (C) based upon the advice of counsel for the Company shall be conclusively
presumed to be done, or omitted to be done, by the Executive in good faith and
in the best interests of the Company. The cessation of employment of the Executive
shall not be deemed to be for Cause unless and until there shall have been delivered
to the Executive a copy of a resolution duly adopted by the affirmative vote of
not less than three-quarters of the entire membership of the Applicable Board
(excluding the Executive, if the Executive is a member of the Applicable Board)
at a meeting of the Applicable Board called and held for such purpose (after
reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel for the Executive, to be heard before the
Applicable Board), finding that, in the good faith opinion of the board, the
Executive is guilty of the conduct described in Section 4(b)(1), 4(b)(2) or
4(b)(3), and specifying the particulars thereof in detail.

(c)           Good Reason. The
Executive’s employment may be terminated by the Executive for Good Reason or by
the Executive voluntarily without Good Reason. “Good Reason” means:

(1)           the assignment to
the Executive of any duties inconsistent in any respect with the Executive’s
position (including status, offices, titles and reporting requirements),
authority, duties or responsibilities as contemplated by Section 3(a), or any
other diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent action
not taken in bad faith and that is remedied by the Company promptly after
receipt of notice thereof given by the Executive;

 8
 

(2)           any failure by the
Company to comply with any of the provisions of Section 3(b), other than an
isolated, insubstantial and inadvertent failure not occurring in bad faith and
that is remedied by the Company promptly after receipt of notice thereof given
by the Executive;

(3)           the Company’s
requiring the Executive (i) to be based at any office or location other than as
provided in Section 3(a)(1)(B), (ii) to be based at a location other than the
principal executive offices of the Company if the Executive was employed at
such location immediately preceding the Effective Date, or (iii) to travel on
Company business to a substantially greater extent than required immediately
prior to the Effective Date;

(4)           any purported
termination by the Company of the Executive’s employment otherwise than as
expressly permitted by this Agreement; or

(5)           any failure by the
Company to comply with and satisfy Section 10(c).

The Executive’s mental or
physical incapacity following the occurrence of an event described above in
clauses (1) through (5) shall not affect the Executive’s ability to terminate
employment for Good Reason. A termination by the Executive with Good Reason shall
be effective only if, within 180 days of the Executive’s first becoming aware
of the circumstances giving rise to Good Reason, the Executive delivers a
Notice of Termination for Good Reason by Executive to the Company, and, to the
extent such circumstances are curable, the Company within 30 days following its
receipt of such notification has failed to cure the circumstances giving rise
to Good Reason.

(d)           Notice of Termination.
Any termination by the Company for Cause, or by the Executive for Good
Reason, shall be communicated by Notice of Termination to the other party
hereto given in accordance with Section 11(b). “Notice of Termination” means a
written notice that (1) indicates the specific termination provision in this
Agreement relied upon, (2) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination
of the Executive’s employment under the provision so indicated, and (3) if the
Date of Termination (as defined herein) is other than the date of receipt of
such notice, specifies the Date of Termination (which Date of Termination shall
be not more than 30 days after the giving of such notice). The failure by the Executive
or the Company to set forth in the Notice of Termination any fact or
circumstance that contributes to a showing of Good Reason or Cause shall not
waive any right of the Executive or the Company, respectively, hereunder or
preclude the Executive or the Company, respectively, from asserting such fact
or circumstance in enforcing the Executive’s or the Company’s respective rights
hereunder.

(e)           Date of Termination.
“Date of Termination” means (1) if the Executive’s employment is terminated
by the Company for Cause, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified in the Notice
of Termination, (which date shall not be more than 30 days after the giving of
such notice), as the case may be, (2) if the Executive’s employment is
terminated by the Company other than for Cause or Disability, the date on which
the Company notifies the Executive of such termination, (3) if the Executive
resigns without Good Reason, the date on which the Executive notifies the
Company 

 9
 

of such termination, and
(4) if the Executive’s employment is terminated by reason of death or
Disability, the date of death of the Executive or the Disability Effective
Date, as the case may be.

Section
5.              Obligations of the
Company upon Termination. (a) Good Reason; Other Than for Cause, Death
or Disability. If, during the Employment Period, the
Company terminates the Executive’s employment other than for Cause or
Disability or the Executive terminates employment for Good Reason:

(1)           the Company shall
pay to the Executive, in a lump sum in cash within 30 days after the Date of
Termination, the aggregate of the following amounts:

(A)          the sum of (i) the
Executive’s Annual Base Salary through the Date of Termination to the extent
not theretofore paid, (ii) the product of (x) the Target Annual Bonus and (y) a
fraction, the numerator of which is the number of days in the current fiscal
year through the Date of Termination and the denominator of which is 365 (the
“Pro-Rata Bonus”), and (iii) any accrued vacation pay to the extent not
theretofore paid (the sum of the amounts described in subclauses (i), (ii) and
(iii), the “Accrued Obligations”); and

(B)           the amount equal to
the product of (i) three and (ii) the sum of (x) the Executive’s Annual Base
Salary and (y) the Target Annual Bonus;

(2)           for three years
after the Executive’s Date of Termination, or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy (the
“Benefit Continuation Period”), the Company shall continue benefits to the Executive
and/or the Executive’s family at least equal to, and at the same after-tax cost
to the Executive and/or the Executive’s family, as those that would have been
provided to them in accordance with the plans, programs, practices and policies
described in Section 3(b)(4) (such benefits, the “Welfare Benefits”) if the
Executive’s employment had not been terminated or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to other
peer executives of the Company and the Affiliated Companies and their families;
provided, however,
that, the medical, dental, prescription drug and vision benefits provided
during the Benefit Continuation Period shall be provided in such a manner that
such benefits (and the costs and premiums thereof) are excluded from the
Executive’s income for federal income tax purposes (if the Company reasonably
determines that providing continued coverage under one or more of its welfare
plans contemplated herein could be taxable to the Executive, the Company shall
provide such benefits at the level required hereby through the purchase of individual
coverage); and, provided, further, that if the
Executive becomes reemployed with another employer and is eligible to receive
such benefits under another employer provided plan, the medical and other welfare
benefits described herein shall be secondary to those provided under such other
plan  during such applicable period
of eligibility. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for retiree benefits pursuant to
such plans, practices, programs and policies, the Executive shall be considered
to have remained employed until the end of the Benefit Continuation Period and
to have retired on the last day of such period;

 10
 

(3)           the Company shall,
at its sole expense as incurred, provide the Executive with outplacement
services the scope and provider of which shall be selected by the Executive in
the Executive’s sole discretion, provided that
the cost of such outplacement shall not exceed $50,000; and provided, further, that such outplacement benefits shall end
not later than the last day of the second calendar year that begins after the
Date of Termination; and

(4)           to the extent not
theretofore paid or provided, the Company shall timely pay or provide to the
Executive any Other Benefits (as defined in Section 6) in accordance with the
terms of the underlying plans or agreements.

Notwithstanding the
foregoing provisions of this Section 5(a), in the event that the Executive is a
“specified employee” within the meaning of Section 409A of the Code (as
determined in accordance with the methodology established by the Company as in
effect on the Date of Termination), amounts that would otherwise be payable
under this Section 5(a) during the six-month period immediately following the
Date of Termination (other than the amounts set forth in Sections 5(a)(1)(i)
and 5(a)(1)(iii)) shall instead be paid, with interest on any delayed payment
at the applicable federal rate provided for in Section 7872(f)(2)(A) of the
Code (“Interest”), on the first business day after the date that is six months
following the Executive’s “separation from service” within the meaning of
Section 409A of the Code (the “Delayed Payment Date”).

Notwithstanding the
foregoing provisions of this Section 5(a), the Welfare Benefits provided
pursuant to Section 5(a)(1)(2) that are not non-taxable medical benefits,
“disability pay” or “death benefit” plans within the meaning of Treasury
Regulation Section 1.409A-1(a)(5) shall be treated as follows: (i) the amount
of such benefits provided during one taxable year shall not affect the amount
of such benefits provided in any other taxable year, except that to the extent
such benefits consist of the reimbursement of expenses referred to in Section
105(b) of the Code, a limitation may be imposed on the amount of such
reimbursements over some or all of the Benefit Continuation Period, as
described in Treasury Regulation Section 1.409A-3(i)(iv)(B), (ii) to the extent
that any such benefits consist of reimbursement of eligible expenses, such
reimbursement must be made on or before the last day of the calendar year
following the calendar year in which the expense was incurred and (iii) no such
benefit may be liquidated or exchanged for another benefit.

(b)           Death. If
the Executive’s employment is terminated by reason of the Executive’s death
during the Employment Period, the Company shall provide the Executive’s estate
or beneficiaries with the Accrued Obligations and the timely payment or
delivery of the Other Benefits, and shall have no other severance obligations
under this Agreement. The Accrued Obligations shall be paid to the Executive’s
estate or beneficiary, as applicable, in a lump sum in cash within 30 days of
the Date of Termination. With respect to the provision of the Other Benefits,
the term “Other Benefits” as utilized in this Section 5(b) shall include,
without limitation, and the Executive’s estate and/or beneficiaries shall be
entitled to receive, benefits at least equal to the most favorable benefits
provided by the Company and the Affiliated Companies to the estates and
beneficiaries of peer executives of the Company and the Affiliated Companies
under such plans, programs, practices and policies relating to death benefits,
if any, as in effect with respect to other peer executives and their
beneficiaries at any time during the 120-day period 

 11
 

immediately preceding the
Effective Date or, if more favorable to the Executive’s estate and/or the
Executive’s beneficiaries, as in effect on the date of the Executive’s death
with respect to other peer executives of the Company and the Affiliated
Companies and their beneficiaries.

(c)           Disability. If
the Executive’s employment is terminated by reason of the Executive’s
Disability during the Employment Period, the Company shall provide the
Executive with the Accrued Obligations and the timely payment or delivery of
the Other Benefits, and shall have no other severance obligations under this
Agreement. The Accrued Obligations shall be paid to the Executive in a lump sum
in cash within 30 days of the Date of Termination, provided, that in the event
the Executive is a “specified employee” within the meaning of Section 409A of
the Code, the Pro-Rata Bonus shall be paid, with Interest, to the Executive on
the Delayed Payment Date. With respect to the provision of the Other Benefits,
the term “Other Benefits” as utilized in this Section 5(c) shall include, and
the Executive shall be entitled after the Disability Effective Date to receive,
disability and other benefits at least equal to the most favorable of those
generally provided by the Company and the Affiliated Companies to disabled
executives and/or their families in accordance with such plans, programs,
practices and policies relating to disability, if any, as in effect generally
with respect to other peer executives and their families at any time during the
120-day period immediately preceding the Effective Date or, if more favorable
to the Executive and/or the Executive’s family, as in effect at any time
thereafter generally with respect to other peer executives of the Company and
the Affiliated Companies and their families.

(d)           Cause; Other Than for Good
Reason. If the Executive’s employment is terminated for Cause
during the Employment Period, the Company shall provide the Executive with the
Executive’s Annual Base Salary through the Date of Termination, and the timely
payment or delivery of the Other Benefits, and shall have no other severance
obligations under this Agreement. If the Executive voluntarily terminates
employment during the Employment Period, excluding a termination for Good
Reason, the Company shall provide to the Executive the Accrued Obligations and
the timely payment or delivery of the Other Benefits, and shall have no other
severance obligations under this Agreement. In such case, all the Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination, provided, that in the event the Executive is a
“specified employee” within the meaning of Section 409A of the Code, the
Pro-Rata Bonus shall be paid, with Interest on the Delayed Payment Date.

Section
6.              Non-exclusivity of
Rights. Nothing in this Agreement shall prevent or limit
the Executive’s continuing or future participation in any plan, program, policy
or practice provided by the Company or the Affiliated Companies and for which
the Executive may qualify, nor, subject to Section 11(f), shall anything herein
limit or otherwise affect such rights as the Executive may have under any other
contract or agreement with the Company or the Affiliated Companies. Amounts
that are vested benefits or that the Executive is otherwise entitled to receive
under any plan, policy, practice or program of or any other contract or
agreement with the Company or the Affiliated Companies at or subsequent to the
Date of Termination (“Other Benefits”) shall be payable in accordance with such
plan, policy, practice or program or contract or agreement, except as
explicitly modified by this Agreement. Without limiting the generality of the
foregoing, the Executive’s resignation under this Agreement with or without
Good Reason, shall in no way affect the Executive’s ability to terminate
employment by reason of the Executive’s “retirement” under any compensation and
benefits plans, programs or arrangements of 

 12
 

the Affiliated Companies,
including without limitation any retirement or pension plans or arrangements or
to be eligible to receive benefits under any compensation or benefit plans,
programs or arrangements of the Affiliated Companies, including without limitation
any retirement or pension plan or arrangement of the Affiliated Companies or
substitute plans adopted by the Company or its successors, and any termination
which otherwise qualifies as Good Reason shall be treated as such even if it is
also a “retirement” for purposes of any such plan. Notwithstanding the
foregoing, if the Executive receives payments and benefits pursuant to Section
5(a) of this Agreement, the Executive shall not be entitled to any severance
pay or benefits under any severance plan, program or policy of the Company and
the Affiliated Companies, unless otherwise specifically provided therein in a
specific reference to this Agreement.

Section
7.              Full Settlement.
The Company’s obligation to make the payments provided for in this Agreement
and otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense, or other claim, right or action
that the Company may have against the Executive or others. In no event shall
the Executive be obligated to seek other employment or take any other action by
way of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement, and such amounts shall not be reduced whether or
not the Executive obtains other employment. The Company agrees to pay as incurred
(within 10 days following the Company’s receipt of an invoice from the
Executive), at any time from the date of this Agreement through the Executive’s
remaining lifetime or, if longer, through the 20th anniversary of the Effective Date, to the full
extent permitted by law, all reasonable legal fees and expenses that the
Executive may incur as a result of any contest (regardless of the outcome
thereof) by the Company, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof (including as a result of any contest by the
Executive about the amount of any payment pursuant to this Agreement), plus, in
each case, Interest; provided that,
the Executive shall have submitted an invoice for such fees and expenses at
least 10 days before the end of the calendar year next following the calendar
year in which such fees and expenses were incurred.

Section
8.              Certain Additional
Payments by the Company.

(a)           Anything in this Agreement or any
other agreement by and between the Executive and the Company to the contrary
notwithstanding and except as set forth below, in the event it shall be
determined that any Payment would be subject to the Excise Tax, then the
Executive shall be entitled to receive an additional payment (the “Gross-Up
Payment”) in an amount such that, after payment by the Executive of all taxes
(and any interest or penalties imposed with respect to such taxes), including,
without limitation, any income taxes (and any interest and penalties imposed
with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, but
excluding any income taxes and penalties imposed pursuant to Section 409A of
the Code, the Executive retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions
of this Section 8(a), if it shall be determined that the Executive is entitled
to the Gross-Up Payment, but that the Parachute Value of all Payments does not
exceed 110% of the Safe Harbor Amount, then no Gross-Up Payment shall be made
to the Executive and the amounts payable under this Agreement shall be reduced
so that the Parachute Value of all Payments, in the aggregate, equals the Safe
Harbor Amount. The reduction of the amounts payable hereunder, if applicable,
shall be made by first 

 13
 

reducing the payments
under Section 5(a)(i)(B), unless an alternative method of reduction is elected by
the Executive, and in any event shall be made in such a manner as to maximize
the Value of all Payments actually made to the Executive. For purposes of
reducing the Payments to the Safe Harbor Amount, only amounts payable under
this Agreement (and no other Payments) shall be reduced. If the reduction of
the amount payable under this Agreement would not result in a reduction of the
Parachute Value of all Payments to the Safe Harbor Amount, no amounts payable
under the Agreement shall be reduced pursuant to this Section 8(a). The
Company’s obligation to make Gross-Up Payments under this Section 8 shall not
be conditioned upon the Executive’s termination of employment.

(b)           Subject to the provisions of Section
8(c), all determinations required to be made under this Section 8, including
whether and when a Gross-Up Payment is required, the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving at such determination,
shall be made by a nationally recognized certified public accounting firm (or a
professional services firm with experience in making such determinations), as
may be designated by the Executive (the “Accounting Firm”). The Accounting Firm
shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days of the receipt of notice from the Executive
that there has been a Payment or such earlier time as is requested by the
Company. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the Change in Control,
the Executive may appoint another nationally recognized accounting firm to make
the determinations required hereunder (which accounting firm shall then be
referred to as the Accounting Firm hereunder). All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a
result of the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments that will not have been made by the Company
should have been made (the “Underpayment”), consistent with the calculations
required to be made hereunder. In the event the Company exhausts its remedies
pursuant to Section 8(c) and the Executive thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall determine the amount of
the Underpayment that has occurred and any such Underpayment shall be promptly
paid by the Company to or for the benefit of the Executive.

(c)           The Executive shall notify the
Company in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of the Gross-Up Payment. Such
notification shall be given as soon as practicable, but no later than 10
business days after the Executive is informed in writing of such claim. The
Executive shall apprise the Company of the nature of such claim and the date on
which such claim is requested to be paid. The Executive shall not pay such
claim prior to the expiration of the 30-day period following the date on which
the Executive gives such notice to the Company (or such shorter period ending
on the date that any payment of taxes with respect to such claim is due). If
the Company notifies the Executive in writing prior to the expiration of such
period that the Company desires to contest such claim, the Executive shall:

(1)           give the Company any
information reasonably requested by the Company relating to such claim,

 14
 

(2)           take such action in
connection with contesting such claim as the Company shall reasonably request
in writing from time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably selected by
the Company,

(3)           cooperate with the
Company in good faith in order effectively to contest such claim, and

(4)           permit the Company
to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred in
connection with such contest, and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax (including interest
and penalties) imposed as a result of such representation and payment of costs
and expenses. Without limitation on the foregoing provisions of this Section
8(c), the Company shall control all proceedings taken in connection with such
contest, and, at its sole discretion, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the
applicable taxing authority in respect of such claim and may, at its sole
discretion, either pay the tax claimed to the appropriate taxing authority on
behalf of the Executive and direct the Executive to sue for a refund or contest
the claim in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however,
that, if the Company pays such claim and directs the Executive to sue for a
refund, the Company shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax (including interest or
penalties) imposed with respect to such payment or with respect to any imputed
income in connection with such payment; and provided, further, that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the Executive with respect
to which such contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company’s control of the contest shall be
limited to issues with respect to which the Gross-Up Payment would be payable
hereunder, and the Executive shall be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue Service or any
other taxing authority.

(d)           If, after the receipt by the
Executive of a Gross-Up Payment or payment by the Company of an amount on the
Executive’s behalf pursuant to Section 8(c), the Executive becomes entitled to
receive any refund with respect to the Excise Tax to which such Gross-Up Payment
relates or with respect to such claim, the Executive shall (subject to the
Company’s complying with the requirements of Section 8(c), if applicable)
promptly pay to the Company the amount of such refund (together with any
interest paid or credited thereon after taxes applicable thereto). If, after
payment by the Company of an amount on the Executive’s behalf pursuant to
Section 8(c), a determination is made that the Executive shall not be entitled
to any refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to
the expiration of 30 days after such determination, then the amount of such
payment shall offset, to the extent thereof, the amount of Gross-Up Payment required
to be paid.

 15
 

(e)           Any Gross-Up Payment, as determined
pursuant to this Section 8, shall be paid by the Company within five days of
the receipt of the Accounting Firm’s determination; provided that,
the Gross-Up Payment shall in all events be paid no later than the end of the Executive’s
taxable year next following the Executive’s taxable year in which the Excise
Tax (and any income or other related taxes or interest or penalties thereon) on
a Payment are remitted to the Internal Revenue Service or any other applicable
taxing authority or, in the case of amounts relating to a claim described in
Section 8(c) that does not result in the remittance of any federal, state,
local and foreign income, excise, social security and other taxes, the calendar
year in which the claim is finally settled or otherwise resolved. The Gross-Up
Payment shall be paid to the Executive; provided that,
the Company, in its sole discretion, may withhold and pay over to the Internal
Revenue Service or any other applicable taxing authority, for the benefit of
the Executive, all or any portion of any Gross-Up Payment, and the Executive
hereby consents to such withholding.

(f)            Definitions. The following
terms shall have the following meanings for purposes of this Section 8.

(i)            “Excise Tax” shall mean the excise
tax imposed by Section 4999 of the Code, together with any interest or
penalties imposed with respect to such excise tax.

(ii)           “Parachute Value” of a Payment shall
mean the present value as of the date of the change of control for purposes of
Section 280G of the Code of the portion of such Payment that constitutes a
“parachute payment” under Section 280G(b)(2), as determined by the Accounting
Firm for purposes of determining whether and to what extent the Excise Tax will
apply to such Payment.

(iii)          A “Payment” shall mean any payment or
distribution in the nature of compensation (within the meaning of Section
280G(b)(2) of the Code) to or for the benefit of the Executive, whether paid or
payable pursuant to this Agreement or otherwise.

(iv)          The “Safe Harbor Amount” means 2.99
times the Executive’s “base amount,” within the meaning of Section 280G(b)(3)
of the Code.

(v)           “Value” of a Payment shall mean the
economic present value of a Payment as of the date of the change of control for
purposes of Section 280G of the Code, as determined by the Accounting Firm
using the discount rate required by Section 280G(d)(4) of the Code.

Section
9.              Confidential
Information; Other Restrictive Covenants.

(a)           Confidential Information.
The Executive shall hold in a fiduciary capacity for the benefit of the Company
all secret or confidential information, knowledge or data relating to the
Company or the Affiliated Companies, and their respective businesses, which
information, knowledge or data shall have been obtained by the Executive during
the Executive’s employment by the Company or the Affiliated Companies and which
information, knowledge or data shall not be or become public knowledge (other
than by acts by the Executive or representatives 

 16
 

of the Executive in
violation of this Agreement). After termination of the Executive’s employment
with the Company, the Executive shall not, without the prior written consent of
the Company or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge or data to anyone other
than the Company and those persons designated by the Company. In no event shall
an asserted violation of the provisions of this Section 9 constitute a basis
for deferring or withholding any amounts otherwise payable to the Executive
under this Agreement.

(b)           Covenants Following Termination of
Employment. For a period of one (1) year following the termination of the
Executive’s employment during the Employment Period, the Executive will not:

(1)           enter into or engage in any business
that competes with the Company’s Business within the Restricted Territory (as
defined in Section 9(c));

(2)           solicit customers with whom the
Executive had any contact or for which the Executive had any responsibility
(either direct or supervisory) at the Date of Termination or at any time during
the one (1) year prior to such Date of Termination, whether within or outside
of the Restricted Territory, or solicit business, patronage or orders for, or
sell, any products and services in competition with, or for any business that
competes with the Company’s Business within the Restricted Territory;

(3)           divert, entice or otherwise take away
any customers, business, patronage or orders of the Company within the
Restricted Territory, or attempt to do so;

(4)           promote or assist, financially or
otherwise, any person, firm, association, partnership, corporation or other
entity engaged in any business that competes with the Company’s Business within
the Restricted Territory; or

(5)           solicit or induce or attempt to
solicit or induce any employee(s), sales representative(s), agent(s) or consultant(s)
of the Company and/or its affiliated companies to terminate their employment,
representation or other association with the Company and/or its affiliated
companies, provided that the foregoing shall not apply to general advertising
not specifically targeted at employees, sales representatives, agents or
consultants of the Company and/or its affiliated companies.

Notwithstanding the foregoing, it shall not be a violation of this
Section 9(b) for the Executive to join a division or business line of a commercial enterprise with
multiple divisions or business lines if such division or business line is not
competitive with the Company’s Business, provided that the Executive performs
services solely for such non-competitive division or business line, and
performs no functions on behalf of (and has no involvement with or direct or
indirect responsibilities with respect to) businesses competitive with the Company’s
Business. Nothing in this Section 9(b) shall prohibit the Executive from
being a passive owner of not more than 4.9% of the outstanding equity interest
in any entity which is publicly traded, so long as the Executive has no active
participation in the business of such corporation.

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(c)           Restricted Territory. For the
purposes of Section 9(b), the Restricted Territory shall be defined as and limited
to the geographic area(s) within a 100 mile radius of any and all areas in
which the Company was located immediately prior to the Effective Date in, to,
or for which Executive worked, to which Executive was assigned or had any
responsibility (either direct or supervisory) at the Date of Termination and at
any time during the one (1) year prior to the Date of Termination.

(d)           Company’s Business. For
purposes of Section 9(b), the Company’s Business is defined to be the development
and sale of software products that facilitate electronic payments, as further
described in any and all manufacturing, marketing and sales manuals and materials
of the Company in effect immediately prior to the Effective Date, or of any
other products or services substantially similar to or readily suitable for any
such described products.

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

(b)           This Agreement shall inure to the
benefit of and be binding upon the Company and its successors and assigns.
Except as provided in Section 10(c), without the prior written consent of the
Executive this Agreement shall not be assignable by the Company.

(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. “Company” means the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid that assumes and
agrees to perform this Agreement by operation of law or otherwise.

Section
11.            Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware, without reference to principles of conflict of
laws. The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect. This Agreement may not be amended or modified
other than by a written agreement executed by the parties hereto or their respective
successors and legal representatives.

(b)           All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

if to the Executive:

At the most recent address on file at the Company.

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if to the Company:

ACI Worldwide, Inc.

224 South 108th Avenue

Omaha, NE 68154

Attention: General Counsel

or to such other address
as either party shall have furnished to the other in writing in accordance
herewith. Notice and communications shall be effective when actually received
by the addressee.

(c)           In the event of a Change in Control,
all stock-based awards shall vest in full, in each case immediately prior to the
occurrence of such Change in Control, and any applicable performance-based
vesting goals with respect to such stock-based awards granted to the Executive
shall be deemed satisfied at the target level; provided,
however, that (i) any LTIP Performance Shares awarded under the
Company’s 2005 Equity and Performance Incentive Plan and (ii) any stock options
which vest upon the attainment of a certain per-share transaction price in
connection with a Change in Control granted under the Company’s 2005 Equity and
Performance Incentive Plan, will, in each case, vest pursuant to the terms of
the applicable award agreement, notwithstanding the provision of any award
agreement requiring that market conditions exist for a specified duration of
time. For purpose of this Section 11(c), stock-based awards shall include stock
options, restricted shares, restricted units and any other equity-based
compensation awards. Notwithstanding the definition of “change in control” or
“change of control” in any agreement, plan or arrangement governing such
stock-based awards, the definition of Change in Control in this Agreement shall
supersede such definitions in all respects with respect to such stock-based
awards.

(d)           The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement.

(e)           The Company may withhold from any
amounts payable under this Agreement such United States federal, state or local
or foreign taxes as shall be required to be withheld pursuant to any applicable
law or regulation.

(f)            The Executive’s or the Company’s
failure to insist upon strict compliance with any provision of this Agreement
or the failure to assert any right the Executive or the Company may have
hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason pursuant to Sections 4(c)(1) through
4(c)(5), shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.

(g)           The Executive and the Company
acknowledge that, except as may otherwise be provided under any other written
agreement between the Executive and the Company, the employment of the
Executive by the Company is “at will” and, subject to Section 1(a), prior to
the Effective Date, the Executive’s employment may be terminated by either the
Executive or the Company at any time prior to the Effective Date, in which case
the Executive shall have no further rights under this Agreement. From and after
the Effective Date, except as specifically provided herein, this Agreement
shall supersede any other agreement between the parties with respect to the subject
matter hereof

 19
 

(h)           Within the time period permitted by the applicable Department of
Treasury Regulations, the Company may, in consultation with the Executive,
modify the Agreement, in the least restrictive manner necessary and without any
diminution in the value of the payments to the Executive.

(i)            No later than 10 days  prior to the Effective Date, the Company shall deliver
cash, in an amount equal to the sum of (A) the aggregate of the cash amounts
that could be payable under Section 5(a) (plus any estimated Interest), (B) the
estimated Gross-Up Payment, if any, as determined by the Accounting Firm and
(C) the aggregate of the cash value of any amounts deferred by the Executive
under any “nonqualified deferred compensation plan” within the meaning of
Section 409A of the Code, to a “rabbi trust” (the “Trust”) to be established
by the Company prior to such delivery of cash with a nationally recognized
financial institution as trustee (the “Trustee”) to be held by the
Trustee pursuant to the terms of the trust agreement entered into between the
Company and the Trustee prior to the Effective Date; provided, however,
that the Trust shall not be funded if the funding thereof would result in
taxable income to the Executive by reason of Section 409A(b) of the Code. The
Company shall be responsible for any fees and expenses of the Trustee.

IN WITNESS WHEREOF, the Executive has
hereunto set the Executive’s hand and, pursuant to the authorization from the
Board, the Company has caused these presents to be executed in its name on its
behalf, all as of the day and year first above written.

	
  By:

  	
  /s/ Dennis P.
  Byrnes

  	
   

  	
  /s/ Philip G. Heasley

  
	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  Senior Vice
  President

  	
   

  	
   

  

 

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