Document:

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                                                                  EXHIBIT 10.36

                              EMPLOYMENT AGREEMENT

         This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of this 5th
day of October, 2001 (the "Effective Date"), by and between S1 Corporation, a
Delaware corporation (the "Company"), and Matthew Hale, an individual (the
"Executive").

         WHEREAS, the Executive is currently employed as the Vice President &
Global Controller of the Company;

         WHEREAS, the Company and the Executive desire to enter into this
Employment Agreement to set out the terms and conditions for the employment
relationship of the Executive with the Company from and after the Effective
Date; and

         WHEREAS, the board of directors of the Company (the "Board") has
approved and authorized the Company's execution, delivery and performance of
this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the parties hereto
agree as follows:

         1.       Employment Agreement. On the terms and conditions set forth
in this Agreement, the Company agrees to employ the Executive and the Executive
agrees to be employed by the Company for the Employment Period set forth in
Section 2 hereof and in the position and with the duties set forth in Section 3
hereof. Terms used herein with initial capitalization not otherwise defined are
defined in Section 20 below.

         2.       Term. The initial term of employment under this Agreement
shall be for a three-year period commencing on the Effective Date (the "Initial
Term"). The term of employment shall be automatically renewed for an additional
consecutive 12-month period (the "Extended Term") as of the first and every
subsequent anniversary of the Effective Date, unless and until either party
provides written notice to the other party in accordance with Section 10 hereof
not less than 90 days before such anniversary date that such party is
terminating the term of employment under this Agreement ("Non-Renewal"), which
termination shall be effective as of the end of such Initial Term or Extended
Term, as the case may be, or until such term of employment is otherwise sooner
terminated as hereinafter set forth. Such Initial Term and all such Extended
Terms are collectively referred to herein as the "Employment Period." A notice
of Non-Renewal given by either party to this Agreement shall not be deemed a
termination of the Executive's employment for purposes of Section 9 of this
Agreement unless otherwise expressly provided in

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such notice of Non-Renewal. The Company's obligations under Section 9 hereof
shall survive the expiration or termination of the Employment Period.

         3.       Position and Duties. The Executive shall serve as the Vice
President & Global Controller of the Company during the Employment Period. As
the Vice President & Global Controller, the Executive shall render executive,
policy and other management services to the Company of the type customarily
performed by persons serving in such capacity. The Executive shall report to
the Chief Financial Officer of the Company unless otherwise determined by the
Company. The Executive shall also perform such other duties with the Company
and with any Subsidiary as the Chief Financial Officer of the Company or the
Board may from time to time reasonably determine and assign to the Executive.
The Executive shall devote the Executive's reasonable best efforts and
substantially full business time to the performance of the Executive's duties
and the advancement of the business and affairs of the Company. The Executive
agrees that during the Employment Period he or she will not be entitled to
additional compensation for serving as a member of the board of directors of
the Company or any Subsidiary if he or she is elected to serve thereon.

         4.       Place of Performance. In connection with the Executive's
employment by the Company, the Executive shall be based at the offices of the
Company in Atlanta, Georgia, except as otherwise agreed by the Executive and
the Company and except for reasonable travel on Company business.

         5.       Compensation and Benefits; Stock Options.

                  (a)      Base Salary. During the Employment Period, the
Company shall pay to the Executive an annual base salary (the "Base Salary") at
the rate of $ 200,000 per year. The Base Salary shall be reviewed no less
frequently than annually and may be increased at the discretion of the Company.
The Base Salary shall be payable semi-monthly or in such other installments as
shall be consistent with the Company's payroll procedures.

                  (b)      Annual Bonus. The Executive will receive an annual
bonus, payable no later than the end of the first fiscal quarter of each
calendar year during the Employment Period (pro-rated for any period that is
less than 12 months) of up to $ 100,000 for such calendar year, based on the
attainment of specific Company performance targets as may be agreed upon by the
Executive and the Company annually. The annual bonus will be designed so that
upon meeting specified minimum thresholds, partial attainment of such targets
will result in the payment of a correspondingly reduced bonus amount.

                  (c)      Benefits. During the Employment Period, the
Executive will be entitled to participate in any retirement, deferred
compensation, fringe benefit or welfare benefit plan of the Company (on the
same terms as provided to senior executive officers of the Company), including
any plan providing for

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employee stock purchases, pension or retirement income, retirement savings,
employee stock ownership, deferred compensation or medical, prescription,
dental, disability, employee life, group life, accidental death or travel
accident insurance benefits that the Company may adopt for the benefit of
executive employees, in accordance with the terms of such plan. Nothing in this
Agreement shall restrict the right of the Company to change insurance carriers
and to adopt, amend, terminate or modify employee benefit plans and
arrangements at any time and without the consent of the Executive.

                  (d)      Stock Options. The Company may grant options to
purchase the stock of the Company to the Executive in accordance with the terms
of the Company's stock option plans.

                  (e)      Vacation; Holidays. The Executive shall be entitled
to all public holidays observed by the Company and to annual vacation for such
number of days as may be determined by the Company, and otherwise in accordance
with the applicable vacation policies for senior executives of the Company,
which shall be taken at a reasonable time or times.

                  (f)      Withholding Taxes and Other Deductions. To the
extent required by law, the Company shall withhold from any payments due
Executive under this Agreement any applicable federal, state or local taxes and
such other deductions as are prescribed by law or Company policy or are
otherwise authorized by the Executive.

         6.       Expenses. The Executive is expected and is authorized to
incur reasonable expenses in the performance of his or her duties hereunder.
The Company shall reimburse the Executive for all such expenses promptly upon
periodic presentation by the Executive of an itemized account, including
reasonable substantiation, of such expenses.

         7.       Confidentiality, Non-Disclosure and Non-Competition
Agreement.

         Concurrently with the execution of this Agreement, the parties are
entering into a Confidentiality, Non-Disclosure and Non-Competition Agreement
(the "Related Agreement").

         8.       Termination of Employment.

                  (a)      Permitted Terminations. The Executive's employment
hereunder may be terminated during the Employment Period under the following
circumstances:

                           (i)      Death. The Executive's employment hereunder
shall terminate upon the Executive's death;

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                           (ii)     By the Company. The Company may terminate
the Executive's employment:

                                    (A)      If the Executive shall have been
substantially unable to perform the Executive's material duties hereunder by
reason of illness, physical or mental disability or other similar incapacity,
which inability shall continue for three consecutive months (provided, that
until such termination, the Executive shall continue to receive his or her
compensation and benefits hereunder, reduced by any benefits payable to him or
her under any disability insurance policy or plan applicable to him or her); or

                                    (B)      For Cause;

                           (iii)    By the Executive. The Executive may
terminate his or her employment for any reason or for no reason.

                  (b)      Termination. Any termination of the Executive's
employment by the Company or the Executive (other than because of the
Executive's death) shall be communicated by written Notice of Termination to
the other party hereto in accordance with Section 10 hereof. For purposes of
this Agreement, a "Notice of Termination" shall mean a notice which shall
indicate the specific termination provision in this Agreement relied upon, if
any, and shall set 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. Termination of the Executive's employment shall
take effect on the Date of Termination.

         9.       Compensation Upon Termination or Change in Control.

                  (a)      Death. If the Executive's employment is terminated
during the Employment Period as a result of the Executive's death, the Company
shall pay to the Executive's estate, or as may be directed by the legal
representatives of such estate, the Executive's Base Salary due through the
Date of Termination, a pro rata portion of the annual bonus that would have
been payable for the calendar year of termination if the Executive's employment
had not terminated (calculated based upon actual results through the Date of
Termination and based upon budget for the remainder of the period and pro rated
for the portion of the year during which the Executive was employed) and all
other unpaid amounts, if any, to which the Executive is entitled as of the Date
of Termination, at the time such payments are due, and the Company shall have
no further obligation to the Executive under this Agreement.

                  (b)      Disability. If the Company terminates the
Executive's employment during the Employment Period because of the Executive's
disability pursuant to Section 8(a)(ii)(A) hereof, the Company shall pay the
Executive the Executive's Base Salary due through the Date of Termination, a
pro rata portion of

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the annual bonus that would have been payable for the calendar year of
termination if the Executive's employment had not terminated (calculated based
upon actual results through the Date of Termination and based upon budget for
the remainder of the period and pro rated for the portion of the year during
which the Executive was employed) and all other unpaid amounts, if any, to
which the Executive is entitled as of the Date of Termination, at the time such
payments are due, and the Company shall have no further obligations to the
Executive under this Agreement; provided, that payments so made to the
Executive with respect to any period that the Executive is substantially unable
to perform the Executive's material duties hereunder by reason of illness,
physical or mental illness or other similar incapacity shall be reduced by the
sum of the amounts, if any, payable to the Executive by reason of such
disability, at or prior to the time of any such payment, under any disability
insurance policy or benefit plan and which amounts have not previously been
applied to reduce any such payment.

                  (c)      Termination by the Company for Cause or by the
Executive without Good Reason. If, during the Employment Period, the Company
terminates the Executive's employment for Cause pursuant to Section 8(a)(ii)(B)
hereof or the Executive terminates his or her employment without Good Reason,
the Company shall pay the Executive the Executive's Base Salary due through the
Date of Termination, and all other unpaid amounts, if any, to which the
Executive is entitled as of the Date of Termination, at the time such payments
are due, and the Company shall have no further obligations to the Executive
under this Agreement. In the event that the Company intends to terminate the
Executive for Cause, the Executive shall have a reasonable opportunity,
together with his or her counsel, to be heard before the Board of Directors of
the Company before such termination.

                  (d)      Termination by the Company without Cause or by the
Executive with Good Reason. Subject to Section 9(e) below, if the Company
terminates the Executive's employment during the Employment Period other than
for Cause, disability or death pursuant to Section 8(a)(i) or (ii) hereof or
the Executive terminates employment hereunder with Good Reason, the Company
shall (i) pay the Executive the Executive's Base Salary due through the Date of
Termination, a pro rata portion of the annual bonus that would have been
payable for the calendar year of termination if the Executive's employment had
not terminated (calculated based upon actual results through the Date of
Termination and based upon budget for the remainder of the period and pro rated
for the portion of the year during which the Executive was employed) and all
other unpaid amounts, if any, to which the Executive is entitled as of the Date
of Termination, at the time such payments are due, (ii) pay, during the
12-month period commencing on the Date of Termination (the "Severance Period"),
to the Executive an aggregate amount equal to Executive's Base Salary, payable
in equal installments on the Company's regular salary payment dates, (iii)
shall continue in effect during the Severance Period the employee benefits
provided to the Executive under Section 5(c) hereof immediately before the Date
of Termination (except to that, to the extent

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such benefits are provided pursuant to a qualified plan under Section 401(a) of
the Code, the Company shall provide a substantially equivalent nonqualified
benefit) and (iv) if such termination occurs within two years after a Change in
Control (or before a Change in Control has occurred, but after the Company has
commenced negotiations of a transaction that results in a Change in Control),
shall cause all of the outstanding options then held by the Executive to
purchase stock of the Company to be fully vested and exercisable; provided,
that no notice of Non-Renewal shall be deemed to be a termination of the
Executive's employment for such purposes unless otherwise expressly provided in
such notice of Non-Renewal. As a condition precedent to the receipt of the
foregoing payments and benefits, if requested by the Company, the Executive
shall enter into an agreement with the Company confirming the Company's right
to continued performance by the Executive of the Executive's obligations under
the Related Agreement during the period following termination of the
Executive's employment.

                  (e)      Limitation on Parachute Payments. Notwithstanding
any other provision of this Agreement or of any other agreement, contract, or
understanding heretofore or hereafter entered into by the Executive with the
Company or any subsidiary or affiliate, except an agreement, contract, or
understanding hereafter entered into that expressly modifies or excludes
application of this paragraph (an "Other Agreement"), and notwithstanding any
formal or informal plan or other arrangement for the direct or indirect
provision of compensation to the Executive (including groups or classes of
participants or beneficiaries of which the Executive is a member), whether or
not such compensation is deferred, is in cash, or is in the form of a benefit
to or for the Executive (a "Benefit Arrangement"), if the Executive is a
"disqualified individual," as defined in Section 280G(c) of the Code, no
payment or benefit shall be made or provided to the Executive or become vested,
exercisable or payable, as applicable, (i) to the extent that such payment,
right to exercise, vesting, or other benefit, taking into account all other
payments, rights, or benefits to or for the Executive, or becoming vested,
exercisable or payable, as the case may be, under this Agreement, all Other
Agreements and all Benefit Arrangements, would cause any such payment, right to
exercise, vesting or other benefit to which the Executive is or would be
entitled under this Agreement to be considered a "parachute payment" within the
meaning of Section 280G(b)(2) of the Code as then in effect (a "Parachute
Payment") and (ii) if, as a result of receiving a Parachute Payment, the
aggregate after-tax amounts received by the Executive under this Agreement, all
Other Agreements, and all Benefit Arrangements would be less than the maximum
after-tax amount that could be received by the Executive without causing any
such payment, right to exercise, vesting or other benefit to be considered a
Parachute Payment. In the event that the receipt of any such payment, right to
exercise, vesting, or other benefit under this Agreement, in conjunction with
all other rights, payments, or benefits to or for the Executive under any Other
Agreement or any Benefit Arrangement would cause the Executive to be considered
to have received a Parachute Payment under this Agreement that would have the
effect of decreasing the after-tax amount received by

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the Executive as described in clause (ii) of the preceding sentence, then the
Executive shall have the right, in the Executive's sole discretion, to
designate those rights, payments or benefits (or the vesting or exercisability
thereof) under this Agreement, any Other Agreements and any Benefit
Arrangements that should be reduced or eliminated so as to avoid having the
right, payment or benefit to the Executive (or the vesting or exercisability
thereof) under this Agreement be deemed to be a Parachute Payment. All
determinations required to be made under this Section 9(e), including whether
and when a reduction in rights, payments or benefits (or the vesting or
exercisability thereof) is required and the amount of such reduction and the
assumptions to be utilized in arriving at such determination, shall be made by
PricewaterhouseCoopers LLP or such other certified public accounting firm
reasonably acceptable to the Company as may be designated by the Executive in
writing (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days of
the receipt of notice from the Executive or the Company. In the event that the
Accounting Firm is serving as accountant or auditor for the Company or any
individual, entity or group effecting a change in the ownership or effective
control of the Company (within the meaning of Section 280G of the Code), the
Executive shall appoint another nationally recognized accounting firm that is
reasonably acceptable to the Company 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.

                  (f)      Liquidated Damages. The parties acknowledge and
agree that damages which will result to the Executive for termination by the
Company without Cause or other breach of this Agreement by the Company shall be
extremely difficult or impossible to establish or prove, and agree that the
amounts payable to the Executive under Section 9(d) hereof (the "Severance
Payments") shall constitute liquidated damages for any breach of this Agreement
by the Company through the Date of Termination. The Executive agrees that,
except for such other payments and benefits to which the Executive may be
entitled as expressly provided by the terms of this Agreement or any applicable
benefit plan, such liquidated damages shall be in lieu of all other claims that
the Executive may make by reason of termination of his or her employment or any
such breach of this Agreement and that, as a condition to receiving the
Severance Payments, the Executive will execute a release of claims in a form
reasonably satisfactory to the Company.

         10.      Notices. All notices, demands, requests, or other
communications which may be or are required to be given, served, or sent by any
party to any other party pursuant to this Agreement shall be in writing and
shall be hand delivered, sent by overnight courier or mailed by first-class,
registered or

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certified mail, return receipt requested, postage prepaid, or transmitted by
telegram, telecopy or telex, addressed as follows:

                  (i)      If to the Company:

                           S1 Corporation
                           3390 Peachtree Road
                           Suite 1700
                           Atlanta, GA  30326
                           Fax:  404/812-6727
                           Attn:  Chief Legal Officer

                  with a copy (which shall not constitute notice) to:

                           Stuart G. Stein
                           Hogan & Hartson, L.L.P.
                           555 13th Street, N.W.
                           Washington, D.C.  20004-1190
                           Fax:  202/637-5910

                  (ii)     If to the Executive:

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

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

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

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

                           Fax:
                               ----------------------

         Each party may designate by notice in writing a new address to which
any notice, demand, request or communication may thereafter be so given, served
or sent. Each notice, demand, request, or communication which shall be hand
delivered, sent, mailed, telecopied or telexed in the manner described above,
or which shall be delivered to a telegraph company, shall be deemed
sufficiently given, served, sent, received or delivered for all purposes at
such time as it is delivered to the addressee (with the return receipt, the
delivery receipt, or (with respect to a telecopy or telex) the answerback being
deemed conclusive, but not exclusive, evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation.

         11.      Severability. The invalidity or unenforceability of any one
or more provisions of this Agreement shall not affect the validity or
enforceability of the other provisions of this Agreement, which shall remain in
full force and effect.

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         12.      Survival. It is the express intention and agreement of the
parties hereto that the provisions of Sections 9, 10, 11, 13, 17 and 20 hereof
and this Section 12 shall survive the termination of employment of the
Executive. In addition, all obligations of the Company to make payments
hereunder shall survive any termination of this Agreement on the terms and
conditions set forth herein.

         13.      Assignment. The rights and obligations of the parties to this
Agreement shall not be assignable or delegable, except that (i) in the event of
the Executive's death, the personal representative or legatees or distributees
of the Executive's estate, as the case may be, shall have the right to receive
any amount owing and unpaid to the Executive hereunder and (ii) the rights and
obligations of the Company hereunder shall be assignable and delegable in
connection with any subsequent merger, consolidation, sale of all or
substantially all of the assets or stock of the Company or similar transaction
involving the Company or a successor corporation. The Company shall require any
successor to the Company to expressly assume 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.

         14.      Binding Effect. Subject to any provisions hereof restricting
assignment, this Agreement shall be binding upon the parties hereto and shall
inure to the benefit of the parties and their respective heirs, devisees,
executors, administrators, legal representatives, successors and assigns.

         15.      Amendment; Waiver. This Agreement shall not be amended,
altered or modified except by an instrument in writing duly executed by the
parties hereto. Neither the waiver by either of the parties hereto of a breach
of or a default under any of the provisions of this Agreement, nor the failure
of either of the parties, on one or more occasions, to enforce any of the
provisions of this Agreement or to exercise any right or privilege hereunder,
shall thereafter be construed as a waiver of any subsequent breach or default
of a similar nature, or as a waiver of any such provisions, rights or
privileges hereunder.

         16.      Headings. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way define
or affect the meaning, construction or scope of any of the provisions hereof.

         17.      Governing Law. This Agreement, the rights and obligations of
the parties hereto, and any claims or disputes relating thereto, shall be
governed by and construed in accordance with the laws of the State of Delaware
(but not including any choice of law rule thereof that would cause the laws of
another jurisdiction to apply).

<PAGE>

         18.      Entire Agreement. This Agreement constitutes the entire
agreement between the parties respecting the employment of the Executive, there
being no representations, warranties or commitments except as set forth herein.

         19.      Counterparts. This Agreement may be executed in two
counterparts, each of which shall be an original and all of which shall be
deemed to constitute one and the same instrument.

         20.      Definitions.

                  "Accounting Firm" is defined in Section 9(e) above.

                  "Agreement" means this Employment Agreement.

                  "Base Salary" is defined in Section 5(a) above.

                  "Benefit Arrangement" is defined in Section 9(e) above.

                  "Board" means the board of directors of the Company.

                  "Cause" means (i) the conviction of a felony or a crime
involving moral turpitude (excluding a traffic violation not involving any
period of incarceration) or the willful commission of any other act or omission
involving dishonesty or fraud with respect to, and materially adversely
affecting the business affairs of, the Company or any of its Subsidiaries or
any of their customers or suppliers, (ii) conduct tending to bring the Company
or any of its Subsidiaries into substantial public disgrace or disrepute that
causes substantial and material injury to the business and operations of the
Company or such Subsidiary, (iii) substantial and repeated failure to perform
duties of the office held by the Executive as reasonably directed by the
Company (other than any such failure resulting from the Executive's incapacity
due to injury or illness), and such failure is not cured within 30 days after
the Executive receives written notice thereof from the Company that
specifically identifies the manner in which the Company believes the Executive
has not substantially performed his or her duties, (iv) gross negligence or
willful misconduct with respect to the Company or any of its Subsidiaries that
causes substantial and material injury to the business and operations of the
Company or such Subsidiary or (v) any material breach of the Related Agreement.
For purposes of this provision, 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 given pursuant to a resolution
duly adopted by the Board or based upon 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.

<PAGE>

                  "Change in Control" means the earliest to occur of the
following: (i) any person (other than a corporation (a "Holding Company") all
of the common stock of which is owned, immediately after the transaction, by
persons who owned more than 50 percent of the voting shares of the Company
immediately before the transaction) becomes the beneficial owner of 50 percent
or more of the total number of voting shares of the Company; (ii) any person
(other than the persons named as proxies solicited on behalf of the Board)
holds revocable or irrevocable proxies, as to the election or removal of two or
more directors of the Company, for more than 50 percent of the total number of
voting shares of the Company; (iii) any person (other than a Holding Company)
has commenced a tender or exchange offer, or entered into an agreement or
received an option, to acquire beneficial ownership of more than 50 percent of
the total number of voting shares of the Company; (iv) there is a sale or other
transfer of all or substantially all of the assets of the Company other than to
a Holding Company or a corporation controlled by the Company or (v) as the
result of, or in connection with, any cash tender or exchange offer, merger, or
other business combination, sale of assets or contested election, or any
combination of the foregoing transactions, the persons who were directors of
the Company before such transaction shall cease to constitute at least a
majority of the Board or any successor corporation. In the event that the
Company (or any successor entity) becomes a subsidiary of a Holding Company,
references to the Company in the preceding sentence shall be deemed to be
references to the Holding Company. Notwithstanding the foregoing, a "Change in
Control" will not be deemed to have occurred under clauses (ii) or (iii) above
if within 30 days of such action, the Board (by a two-thirds affirmative vote
of the directors in office before such action occurred) makes a determination
that such action does not and is not likely to constitute a change in control
of the Company. For purposes of this definition, a "person" includes an
individual, corporation, partnership, trust, association, joint venture, pool,
syndicate, unincorporated organization, joint-stock company, or similar
organization or group acting in concert. A person for these purposes shall be
deemed to be a beneficial owner as that term is used in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended.

                  "Code" means the Internal Revenue Code of 1986, as amended.

                  "Company" means S1 Corporation and its successors and
assigns.

                  "Date of Termination" means (i) if the Executive's employment
is terminated by the Executive's death, the date of the Executive's death; (ii)
if the Executive's employment is terminated because of the Executive's
disability pursuant to Section 8(a)(ii)(A) hereof, 30 days after Notice of
Termination, provided that the Executive shall not have returned to the
performance of the Executive's duties on a full-time basis during such 30-day
period; (iii) if the Executive's employment is terminated by the Company for
Cause pursuant to Section 8(a)(ii)(B) hereof or by the Executive pursuant to
Section 8(a)(iii) hereof, the date specified in

<PAGE>

the Notice of Termination; or (iv) if the Executive's employment is terminated
during the Employment Period other than pursuant to Section 8(a), the date on
which Notice of Termination is given.

                  "Effective Date" means October 5, 2001.

                  "Employment Period" is defined in Section 2 above.

                  "Executive" means Matthew Hale

                  "Good Reason" means (i) the Company's failure to perform or
observe any of the material terms or provisions of this Agreement, and the
continued failure of the Company to cure such default within 30 days after
written demand for performance has been given to the Company by the Executive,
which demand shall describe specifically the nature of such alleged failure to
perform or observe such material terms or provisions; (ii) a material reduction
in the scope of the Executive's duties (including, without limitation, any
merger, consolidation, reorganization, sale of stock or assets or other
transaction that results in the Executive reporting to anyone in a position
having less authority than the person to whom the Executive reported
immediately before such transaction, or any failure of the parent corporation
of any controlled group of corporations that includes the Company, if the
Company is not such parent corporation, to offer to the Executive a position
with such parent corporation involving the same or substantially equivalent
duties as the Executive's position with the Company under this Agreement)
without his or her written consent; (iii) any requirement by the Company
without the written consent of the Executive that the Executive relocate to a
place more than 50 miles from Atlanta, Georgia to perform his or her duties
hereunder; or (iv) the failure of the Company to obtain the assumption of the
Company's obligations under this Agreement by a successor as contemplated by
Section 13 of this Agreement.

                  "Initial Term" is defined in Section 2 above.

                  "Non-Renewal" is defined in Section 2 above.

                  "Notice of Termination" is defined in Section 8(b) above.

                  "Other Agreement" is defined in Section 9(e) above.

                  "Parachute Payment" is defined in Section 9(e) above.

                  "Related Agreement" is defined in Section 7 above.

                  "Severance Period" is defined in Section 9(d) above.

                  "Subsidiary" means any corporation of which the Company owns
securities having a majority of the ordinary voting power in electing the board
of

<PAGE>

directors directly or through one or more subsidiaries and any partnership,
limited liability company or other entity in which the Company or any
subsidiary owns a controlling interest.

         IN WITNESS WHEREOF, the undersigned have duly executed and delivered
this Agreement, or have caused this Agreement to be duly executed and delivered
on their behalf, as of the Effective Date.

                                             S1 CORPORATION

                                             By: /s/ Meigan Putnam
                                                -------------------------------
                                                Meigan Putnam
                                                -------------------------------
                                                SVP - Global Administration
                                                -------------------------------

                                             THE EXECUTIVE:

                                             /s/ Matthew Hale
                                             ----------------------------------<PAGE>
                                                                  EXHIBIT 10.37

                              SEPARATION AGREEMENT

         THIS SEPARATION AGREEMENT (this "Agreement") is made and dated as of
October 26, 2001, by and between S1 CORPORATION ("S1") and DANIEL H. DRECHSEL
("Employee").

         WHEREAS, Employee and S1 jointly agree that Employee shall resign from
all of his official positions with S1 and each subsidiary or affiliate of S1
effective as of March 31, 2002; and

         WHEREAS, Employee and S1 jointly agree that Employee shall terminate
his employment and service with S1 and each such subsidiary or affiliate
effective on the Last Day of Employment ("LDE"). LDE shall mean March 31, 2002;
and

         WHEREAS, Employee and S1 are parties to an employment agreement
entered into as of the 14th day of August 2000 ("Employment Agreement"); and

         WHEREAS, Employee and S1 intend for this Agreement to supercede and
replace all of Employee's rights and S1's obligations under the Employment
Agreement; and

         WHEREAS, Employee acknowledges that upon execution of this Agreement,
any right or entitlement of Employee to any severance benefits under the
Employment Agreement and/or S1's severance policies, or otherwise as a result
of Employee's resignation and the termination of his employment and service
hereunder will be and are superseded and replaced by this Agreement; and

         WHEREAS, S1 is willing to make certain payments to Employee and to
provide him with certain benefits after termination of his employment; in
accordance with the provisions of this Agreement; and

         WHEREAS, Employee is willing to forego any claim relating to the
remaining term of employment specified in his employment agreement, forego any
claim to certain compensation involved in said agreement in the form of pay,
bonus, company options and options in S1's European subsidiary, cancel certain
option contracts, and work to ensure a transition with minimal disruption to
the business and personnel involved therein; and

         WHEREAS, concurrently with the execution of this Agreement, Employee
and S1 are entering into a General Release, and a Confidentiality,
Non-Disclosure and Non-Competition Agreement (the "Confidentiality Agreement"),
which the parties desire to continue in effect after termination of Employee's
employment; and

         WHEREAS, Employee and S1 desire to set forth herein the terms and
conditions of their joint agreements regarding the resignation of Employee and
the

<PAGE>

termination of Employee's employment, including the effect of such termination,
subject to Employee's right to revoke this Agreement within seven days of
signing it, as provided herein; and

         WHEREAS, S1 denies any wrongdoing of any kind, including without
limitation any breach of the Employment Agreement or any other agreement
(whether oral, written or otherwise), promise, representation, or covenant.

         NOW, THEREFORE, in consideration of the mutual promises contained
herein, the receipt and adequacy of which are hereby acknowledged, the parties
hereto, intending to be legally bound, agree as follows:

         1.       Resignation and Termination of Employment. S1 and Employee
agree that the LDE shall be Employee's last day of employment with S1. Employee
hereby resigns from all of his official offices and positions with S1 and each
of its subsidiaries and affiliates, including without limitation, his position
as Chief Executive Officer of EMEA, effective upon the LDE. Employee shall take
no official action on behalf of S1 or any of its subsidiaries or affiliates nor
have any authority to bind S1 or any of its subsidiaries or affiliates after
the LDE. Employee agrees to execute and deliver to S1 and its subsidiaries and
affiliates such documents concerning his resignation and termination as may be
reasonably requested by S1 or any of its subsidiaries or affiliates from time
to time. S1 shall promptly take all actions necessary to notify any
governmental (both domestic and foreign) agencies that Employee no longer
serves as an officer, director or other official position of S1 or its
subsidiaries and affiliates. S1 shall continue Officers and Directors insurance
coverage for Employee with respect to each officer and director position he
holds at least until the LDE and, further, until such time as S1 takes the
action necessary to remove him from those positions and notifies all government
agencies, as set forth above and until such time as he is actually removed from
such positions. Employee agrees that he will, on or before the LDE, return to
S1 all equipment, supplies, documents and any other material or property
belonging to or leased by S1.

         2.       Severance Payments and Benefits; Options.

                  (a)      S1 will pay to Employee all accrued and unpaid
salary owed to him as of the LDE. S1 will also pay Employee for his accumulated
but unused vacation time, in accordance with its normal policies applicable to
executive employees. Employee will be eligible to earn an incentive bonus for
the period from the date of this Agreement through the LDE at the sole
discretion of S1's CEO.

                  (b)      Provided that Employee does not revoke this
Agreement as provided in Section 12 below, and so long as Employee is not in
material breach of the Confidentiality Agreement, upon the expiration of seven
days after Employee delivers to S1 a general release of claims dated as of the
LDE in the form of Exhibit

<PAGE>

A attached hereto and incorporated herein, without Employee having revoked such
release ("Seven Days After the LDE"):

                           (1)      S1 will pay to Employee severance payments
in the amount of (i) Twenty Three Thousand Four Hundred Eight Dollars and
Thirty Three Cents ($23,408.33) per month, less lawful withholdings, for a
period of twelve months following the LDE in accordance with S1's normal pay
periods, and (ii) an amount equal to one twelfth (1/12) of the the average
annual bonus paid to Employee during the preceding twenty four (24) months of
his Employment, less lawful withholdings, for a period of twelve (12) months
following the LDE in accordance with S1's normal pay periods; and

                           (2)      except with respect to the options
described in this paragraph, all unvested options held by Employee to purchase
common stock of the Company shall accelerate and be vested as of the LDE and
shall be exercisable to the extent and for the period provided in the option
agreements with respect to such options; provided, Employee agrees to surrender
to S1 for cancellation the 100,000 options to purchase common stock of S1
(including both vested and unvested options) issued on December 1, 1999 under
the S1 1997 Stock Option Plan, and having a strike price of $48.75. In
connection with such surrender and cancellation, Employee will execute and
deliver to S1 such documents as are requested by S1; and

                           (3)      S1 will reimburse Employee the actual cost
of repatriation of Employee and his immediate family from England to a location
of Employee's choice in the United States at Employee's written request;
provided that such repatriation occurs within six (6) months of the LDE, and
provided that such repatriation shall include the cost of packing and physical
move of Employee's home possessions from Employee's residence in England to a
location of Employee's choice in the United States, and the cost of coach air
travel from London, England to a location of Employee's choice in the United
States for Employee and his immediate family.

                           (4)      Notwithstanding any other provisions of
this Agreement, including without limitation the provisions of subparagraphs
2(b) (1), (2) and (3) above, if a claim is asserted against S1 or any
subsidiary or affiliate of S1 under or related to the guarantee of lease
payment made by S1 respecting the Tenancy by Employee of North House 5
Sandringham Park, Cobham, Surrey KT11 2EQ, S1 may offset amounts otherwise owed
under this Agreement against the amount of such claims.

                  (c)      Except as provided in this paragraph and except with
respect to health, dental and prescription drug insurance continuation coverage
that Employee is eligible for and timely elects to receive pursuant to the
provisions (commonly referred to as "COBRA") of Sections 601-609 of the
Employee Retirement

<PAGE>

Income Security Act of 1974, as amended ("ERISA"), Employee will not be
entitled to continued coverage under any employee benefit plan (as defined in
ERISA) or any other fringe benefit plan or arrangement during the Severance
Period and for all purposes of such plans and arrangements, Employee's
employment shall be considered to have terminated on the LDE. Upon submission
of paid receipts therefor S1 agrees to reimburse Employee for the actual cost
of (1) COBRA coverage for a period of twelve (12) months from the LDE, and (2)
the life insurance conversion premium for the base life insurance provided by
S1 for a period of twelve (12) months from the LDE.

                  (d)      Employee acknowledges that Employee is not otherwise
entitled to receive the payments of money provided for in this Agreement and
acknowledges that such payment of money is no admission of liability on the
part of the Company that it has done anything wrong. Employee agrees that
Employee will not seek anything further from the Company.

                  (e)      Amounts payable to or on behalf of Employee
hereunder will be treated as taxable income to him for tax purposes and, if
required by applicable law, S1 will withhold applicable federal, state and
local income taxes and social security and Medicare taxes, as applicable. For
all amounts paid to Employee prior to the earlier of (1) his repatriation (i.e.
while still resident in the UK) or (2) July 1, 2002, Company shall pay Employee
an additional amount so that, on an after-tax basis, the compensation and
benefits received by the Employee under this agreement will not be less than
the corresponding after tax amount that the Employee would have received if
such payments had not been subject to taxes other than United States federal,
state and local taxes. This tax equalization protection extends for so long as
any expatriate-related compensation items appear on any form W-2 or 1099 issued
to Employee for the period set forth above. Specifically, it includes all
amounts paid to the employee related to his employment prior to the LDE and
such amounts as are paid to the Employee during the severance period while the
Employee is still a UK resident, subject to the following: If the Employee has
not repatriated to the United Sates prior to July 1, 2002, then only those
amounts paid prior to this date shall have tax equalization applied. Except for
the foregoing, Employee shall be solely responsible for the payment of taxes
with respect to any amount received by Employee under this Agreement.

                  (f)      S1 will provide the Employee reasonable assistance
in preparing any filings required by the Employee with Governmental Agencies
that are related to his employment or former employment with S1. This
specifically includes an S1 appointed tax consultant which S1 will retain, at
its expense, to provide tax preparation for the year's applicable to Employee's
period of residence in the United Kingdom while employed at S1, through
calendar year 2002.

<PAGE>

         3.       Release by Employee.

                  (a)      Release of Claims. Employee, on behalf of himself
and his heirs, executors, administrators, successors and assigns, forever
releases and discharges S1 and its subsidiaries and affiliates, and S1's and
its subsidiaries' and affiliates' respective agents, officers, employees and
directors, from and against any and all claims, damages and liabilities
whatsoever, whether known or unknown, absolute or contingent, accrued or
unaccrued, including but not limited to all claims arising from or in any way
connected with Employee's employment by S1 and the termination of Employee's
employment with S1, but excluding any claims, damages or liabilities associated
with (i) benefits payable under the express terms of any employee benefit plan
maintained by S1 or its subsidiaries or affiliates or (ii) any breach by S1 of
the terms of this Agreement. This release includes, but is not limited to,
claims of: (1) wrongful discharge, including claims of retaliatory discharge;
(2) breach of contract; (3) discrimination on account of race, color, religion,
sex, national origin, age, disability or other illegal basis, including but not
limited to the Age Discrimination in Employment Act of 1967, as amended; (4)
violation of ERISA and (5) any claim based upon tort, equity or any violation
of any state or federal statute or municipal employment law, regulation,
executive order or other requirement. This release covers both claims Employee
knows about and those he may not know about, but does not waive or release any
claims or rights Employee may have that arise after Employee executes this
Agreement. Employee also agrees not to file any claim or lawsuit seeking
monetary recovery and asserting any claims that are released in this Section
3(a). Employee further hereby irrevocably and unconditionally waives any and
all rights to receive any relief or damages concerning any claims that are
released in this Section 3(a).

                  (b)      Employee's Acknowledgements. Employee acknowledges
that he has been advised to, and has had an opportunity to, consult with an
attorney of his choosing and at his expense before executing this Agreement,
that he has had a sufficient opportunity to read and understand the terms of
this Agreement, that he has read and does understand such terms and that he is
executing this Agreement voluntarily and without coercion. Employee further
acknowledges that he has been offered a period of at least 21 days (through
October 27, 2001) to consider this Agreement, but has voluntarily decided to
execute this Agreement before the end of such 21-day period and that this
Agreement shall become irrevocable following the seven-day period described in
Section 12 below. The parties agree that nothing contained in this Agreement
shall constitute or be treated as an admission of liability or wrongdoing by S1
or Employee.

         4.       Confidentiality and Nondisparagement. Employee agrees that he
has not provided and will not in the future provide, directly or indirectly, to
any person or entity any information that concerns or relates to the
negotiation of or the terms and conditions hereof except (i) to the extent that
such disclosure is specifically required by law or legal process or is
authorized in writing by S1; (ii) to his tax

<PAGE>

advisors as may be necessary for the preparation of tax returns or other
reports required by law; (iii) to his attorneys as may be necessary to secure
advice concerning this Agreement; or (iv) to members of his immediate family.
Employee agrees that before disclosing such information under parts (ii), (iii)
or (iv) of this Section 4, he will inform the recipients that they are bound by
the limitations of this Section. Employee further agrees that subsequent
disclosure of such information by any such recipients shall be deemed to be a
disclosure by him in breach of this Agreement. Employee agrees not to make any
defamatory or derogatory statements concerning any of the persons released in
Section 3(a) hereof. Employer agrees not to make any defamatory or derogatory
statements concerning the Employee.

         5.       Amendment; Modification; Waiver. No amendments or additions
to this Agreement shall be binding unless in writing and signed by both of the
parties hereto. No delay or failure at any time on the part of any party in
exercising any right, power or privilege under this Agreement, or in enforcing
any provision of this Agreement, shall impair any such right, power, or
privilege, or be construed as a waiver of any default or as any acquiescence
therein, or shall affect the right of such party thereafter to enforce each and
every provision of this Agreement in accordance with its terms.

         6.       Section Headings. The section headings used in this Agreement
are included solely for convenience and shall not affect, or be used in
connection with, the interpretation of this Agreement.

         7.       Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability of the other provisions hereof.

         8.       Notices. All notices, demands, requests, or other
communications which may be or are required to be given, served, or sent by any
party to any other party pursuant to this Agreement shall be in writing and
shall be hand delivered, sent by overnight courier or mailed by first-class,
registered or certified mail, return receipt requested, postage prepaid, or
transmitted by telegram, telecopy or telex, addressed as follows:

<PAGE>

                  If to S1:

                           S1 Corporation
                           3500 Lenox Road
                           Suite 200
                           Atlanta, GA  30326 USA
                           Fax:  +1. 404.923.6717
                           Attn: General Counsel

                  If to Employee:

                           Daniel H. Drechsel
                           17922 SW 77th Court
                           Miami, Florida 33157

                           And:

                           Jim Tenney
                           Merrit & Tenney
                           Suite 500
                           200 Galleria Parkway, NW
                           Atlanta, Georgia 30339

         Each party may designate by notice in writing a new address, to which
any notice, demand, request or communication may thereafter be so given, served
or sent. Each notice, demand, request, or communication which shall be hand
delivered, sent, mailed, telecopied or telexed in the manner described above,
or which shall be delivered to a telegraph company, shall be deemed
sufficiently given, served, sent, received or delivered for all purposes at
such time as it is delivered to the addressee (with the return receipt, the
delivery receipt, or (with respect to a telecopy or telex) the answerback being
deemed conclusive, but not exclusive, evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation.

         9.       Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto, and supersedes all prior oral or written
agreements, commitments or understandings, with respect to the matters provided
for herein, except that Employee's obligations under the Confidentiality
Agreement shall continue in full force and effect.

<PAGE>

         10.      Governing Law. This Agreement shall be governed by the laws
of the State of Georgia, USA applicable to contracts entered into and performed
wholly within its borders. Any action to enforce this Agreement shall be
brought in the State or Federal Courts sitting in Atlanta, Georgia USA and the
parties hereby consent to the jurisdiction thereof.

         11.      No Assignments. This Agreement is personal to each of the
parties hereto. Neither party may assign or delegate any rights or obligations
hereunder without first obtaining the written consent of the other party
hereto.

         12.      Employee's Right to Revoke within Seven Days. Employee may
revoke this Agreement by delivering a written notice of revocation to S1 in
accordance with Section 8 hereof not later than 11:59 p.m. Atlanta, Georgia
time on the seventh day after he signs and delivers this Agreement to S1 and
this Agreement shall not become effective or enforceable until such revocation
period has expired.

<PAGE>

         13.      Cooperation. In consideration for the compensation, stock
option vesting and other benefits provided by S1 to Employee pursuant to the
terms of this Agreement, from and after the date hereof through the fifth
anniversary of the LDE, Employee will (i) cooperate in all reasonable respects
with S1 and its affiliates and their respective directors, officers, attorneys
and experts in connection with the conduct of any action, proceeding,
investigation or litigation involving S1 or any of its affiliates, including
without limitation, that certain litigation entitled In Re S1 Corporation
Securities Litigation, Civil Action File No. 1:00-CV-1156-BBM, United States
District Court, Northern District of Georgia, Atlanta Division, and any such
action, proceeding, investigation or litigation in which Employee is called to
testify relating to matters involving facts or events relating to S1 or its
affiliates that arose during Employee's employment with S1, and (ii) promptly
respond to all reasonable requests by S1 and its affiliates relating to
information concerning S1 of which Employee may have knowledge or of which may
be in Employee's possession. S1 will, as a condition to Employee's obligations
under this Section 13, reimburse Employee for any reasonable out of pocket
expenses incurred as a result of such cooperation, provided that such expenses
have been approved in writing in advance by the Chief Executive Officer or the
Chief Financial Officer of S1. In the event that S1 and Employee agree in
writing that Employee will be required to expend a substantial amount of time
in the fulfillment of his obligations under this Section 13, S1 shall pay
Employee the sum of $1,600 per day as compensation for the devotion of such
time.

         THE PARTIES HERETO have caused this Agreement to be duly executed and
delivered in their name and on their behalf as of the date first above written.

EMPLOYEE                            S1 CORPORATION

/s/ Daniel H. Drechsel              /s/ Meigan Putnam
----------------------------        -------------------------------------------
Daniel H. Drechsel                  Name:   Meigan Putnam
                                    -------------------------------------------
                                    Title:   SVP - Global Administration
                                    -------------------------------------------

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