Document:

EX-10.1

Exhibit 10.1

			
	 	 	 
	DELUXE 

CORPORATION
	 	CASH PERFORMANCE

AWARD AGREEMENT

	 	 	 	 	 	 	 	 	 
	 
	 	AWARDED TO	 	 	AWARD DATE	 	 	TARGET PERFORMANCE PAYMENT	 
	 	 	 	 	 	 	 

 

 	 	 
	 

	1.	 	The Award. Deluxe Corporation, a Minnesota corporation (“Deluxe”) hereby grants to you as of
the above Award Date the right to receive a payment or payments in cash (the “Performance
Payments”) under the terms and conditions contained in this Cash Performance Award Agreement
(this “Agreement”) and in the 2008 Stock Incentive Plan (the “Plan”). You will be assigned an
award percentage that will be used in calculating any Performance Payments made to you.
	 
	2.	 	Performance Period. The performance period for purposes of determining whether the
Performance Payments will be made shall be the two-year period commencing on January 1 of the
year in which this Award was granted (the “Performance Period”).
	 
	3.	 	Performance Goals. The performance goals for purposes of determining whether the Performance
Payments will be paid are set forth in the attached Performance Goals Schedule.
	 
	4.	 	Payment. The Performance Payments shall be made if and to the extent that performance goals
are achieved, as set forth in the attached Performance Goals Schedule and as determined and
certified by the Compensation Committee of the Board of Directors (the “Committee”) in
accordance with the Plan after the end of the Performance Period. In the event the Committee
determines that the Target performance goal has been achieved, fifty percent of the applicable
Performance Payment will be paid to you on or before March 15 of the year following completion
of the Performance Period and the remaining fifty percent will be paid to you on or before
March 15 of the second year following completion of the Performance Period. In the event that
the Committee determines that the Target performance goal was not achieved, but that the
Threshold performance goal was achieved, you will receive the applicable Performance Payment
in a lump sum on or before March 15 of the second year following completion of the Performance
Period. In the event that the Committee determines that the Threshold performance goal was
not achieved, you will receive a payment equal to the minimum retention payment (“Retention
Payment”), if any, specified on the Performance Goals Schedule on or before March 15 of the
second year following completion of the Performance Period. Performance Payments (but not
Retention Payments) may be adjusted by the Committee to the extent permitted by the Plan.
	 
	5.	 	Restrictions on Transfer. Neither the Performance Payments nor the Retention Payment, nor
any rights therein, may be assigned, transferred or pledged, other than by will or the laws of
descent and distribution, and any such attempted transfer shall be void.
	 
	6.	 	Forfeiture. Except as described in this Section, in the event your employment is terminated
prior to January 1 of the second year following the end of the Performance Period, the
Performance and Retention Payments, and your rights to receive them, shall be immediately and
irrevocably forfeited, unless your termination occurs on or after the one-year
anniversary of commencement of the Performance Period and is by reason of (a) involuntary
termination without Cause, (b) resignation for Good Reason, (c) death, (d) Disability, or (e)
Qualified Retirement (as those capitalized terms are defined in the Addendum to this
Agreement).
	 
	 	 	In the event your employment is terminated on or after the one-year anniversary of commencement
of the Performance Period and prior to the end of the Performance Period for any of the reasons
(a) through (e) in the first paragraph of this Section, you or your estate shall be entitled to
receive a pro-rata payment (based on the days elapsed in the Performance Period prior to the
employment termination date) of either (x) the Retention Payment, or (y) if greater, the
Performance Payment determined by the Committee upon completion of the Performance Period to be
paid, in its sole discretion, to holders of similar Award Agreements, based on the attached
Performance Goals Schedule. In the event your employment is terminated for any of the reasons
(a) through (e) in the first paragraph of this Section after completion of the Performance
Period but prior to a payment date, you or your estate shall be entitled to receive either the
Retention Payment or, if greater, the Performance Payment determined by the Committee upon
completion of the Performance Period to be paid, in its sole discretion, to holders of similar
Award Agreements, based on the attached Performance Goals Schedule. Such payments shall be made
at the same time that payments are made to active employees.
	 
	 	 	If, in connection with or following a Change of Control (as defined in the Addendum to this
Agreement), your employment is terminated for any of the reasons (a) through (e) in the first
paragraph of this Section on or after the one-year anniversary of commencement of the
Performance Period and prior to the end of the Performance Period, you or your estate shall be
entitled to receive, on or before forty-five days after your employment termination, a pro-rata
payment based on an assumption that the performance goals have been achieved at Target level,
as set forth in the attached Performance Goals Schedule. If, in connection with or following a
Change of Control, your employment is terminated for any of the reasons (a) through (e) in the
first paragraph of this Section after the end of the Performance Period, you or
your estate shall be entitled to receive, on or before forty-five days after your employment
termination, the greater of the

ver. 2/09

 

 

	 	 	Retention Payment or the applicable Performance Payment based on
the attached Performance Schedule. Notwithstanding the foregoing, in the event you are a “key
employee” under Internal Revenue Code Section 409A and your employment termination following a
Change of Control constitutes a Qualified Retirement after the end of the Performance Period, no
Payment to you after such termination shall be made prior to six months after your date of
termination.
	 
	7.	 	Income Taxes. You are liable for any federal and state income or other taxes applicable
upon the receipt of the Performance Payments, and you acknowledge that you should consult with
your own tax advisor regarding the applicable tax consequences. Upon issuance of the Payments
by Deluxe, you shall promptly pay to Deluxe in cash, unless otherwise withheld by Deluxe under
applicable law, all applicable taxes required by Deluxe to be withheld or collected upon such
payment.
	 
	8.	 	Terms and Conditions. This Agreement does not guarantee your continued employment or
alter the right of Deluxe or its affiliates to terminate your employment at any time.
This Award is granted pursuant to the Plan and is subject to its terms. In the event of any
conflict between the provisions of this Agreement and the Plan, the provisions of the Plan
shall govern.

	 	 	 	 	 
	 	DELUXE CORPORATION

 	 
	 	BY:  	
 	 

 

 

	 	 	 	 	 

ADDENDUM TO

CASH PERFORMANCE AWARD AGREEMENT

For the purposes hereof the terms used herein shall have the following meanings:

“Affiliate” shall mean a company controlled directly or indirectly by Deluxe, where “control” shall
mean the right, either directly or indirectly, to elect a majority of the directors thereof without
the consent or acquiescence of any third party.

“Cause” shall mean (i) you have breached your obligations of confidentiality to Deluxe or any of
its Affiliates; (ii) you have otherwise failed to perform your employment duties and do not cure
such failure within thirty (30) days after receipt of written notice thereof; (iii) you commit an
act, or omit to take action, in bad faith which results in material detriment to Deluxe or any of
its Affiliates; (iv) you have had excessive absences unrelated to illness or vacation (“excessive”
shall be defined in accordance with local employment customs); (v) you have committed fraud,
misappropriation, embezzlement or other act of dishonesty in connection with Deluxe or any of its
Affiliates or its or their businesses; (vi) you have been convicted or have pleaded guilty or nolo
contendere to criminal misconduct constituting a felony or a gross misdemeanor, which gross
misdemeanor involves a breach of ethics, moral turpitude, or immoral or other conduct reflecting
adversely upon the reputation or interest of Deluxe or its Affiliates; (vii) your use of narcotics,
liquor or illicit drugs has had a detrimental effect on your performance of employment
responsibilities; or (viii) you are in material default under any agreement between you and Deluxe
or any of its Affiliates following any applicable notice and cure period.

“Change of Control” shall be deemed to have occurred if the conditions set forth in any one of the
following paragraphs shall have been satisfied:

	 	(I)	 	The date on which any one person, or more than one person acting as a group,
acquires ownership of stock of Deluxe that, together with stock held by such person or
group, constitutes more than 50% of the total fair market value or total voting power
of the stock of Deluxe. If any one person, or more than one person acting as a group,
is already considered to own more than 50% of the total fair market value or total
voting power of the stock of the Deluxe, the acquisition of additional stock by the
same person or persons is not considered to cause a Change in Control under this
paragraph or paragraph (II). An increase in the percentage of stock owned by any one
person, or persons acting as a group, as a result of a transaction in which Deluxe
acquires its stock in exchange for property will be treated as an acquisition of stock
for purposes of this paragraph. This paragraph applies only when there is a transfer or
issuance of stock of Deluxe and stock in Deluxe remains outstanding after the
transaction.
	 
	 	(II)	 	The date any one person, or more than one person acting as a group, acquires
(or has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of Deluxe possessing 30% or
more of the total voting power of the stock of such corporation. If any one person, or
more than one person acting as a group, is already considered to own more than 30% of
the total voting power of the stock of the Deluxe, the acquisition of additional stock
by the same person or persons is not considered to cause a Change in Control under this
paragraph.
	 
	 	(III)	 	The date a majority of members of Deluxe’s board of directors is replaced
during any 12-month period by directors whose appointment or election is not endorsed
by a majority of the members of the board of directors before the date of the
appointment or election.
	 
	 	(IV)	 	The date that any one person, or more than one person acting as a group,
acquires (or has acquired during the 12-month period ending on the date of the most
recent acquisition by such person or persons) assets from Deluxe that have a total
gross fair market value equal to or more than 40% of the total gross fair market value
of all of the assets of Deluxe immediately before such acquisition or acquisitions;
provided that a Change in Control shall not result from a transfer of assets by Deluxe
to (a) a shareholder of Deluxe (immediately prior to the transfer) in exchange for or
with respect to Deluxe’s stock, (b) an entity, 50% or more of the total value or voting
power of which is owned, directly or indirectly, by Deluxe immediately following the
transfer, (c) a person, or more than one person acting as a group, that owns, directly
or indirectly, 50% or more of the total value or voting power of all the outstanding
stock of Deluxe immediately following the transfer, or (d) an entity, at least 50% of
the total value or voting power of which is owned, directly or indirectly, by a person
or group of persons described in clause (c) For this purpose, gross fair market value
means the value of the assets of Deluxe, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets.

For purposes of determining whether a Change of Control has occurred, persons will not be
considered to be acting as a group solely because they purchase or own stock of the same
corporation at the same time, or as a result of the same public offering. However, persons will be
considered to be acting as a group if they are owners of a corporation that enters into a

 

 

merger, consolidation, purchase or acquisition of stock, or similar business transaction with
Deluxe. If a person, including an entity, owns stock in both corporations that enter into a merger,
consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is
considered to be acting as a group with other shareholders in a corporation only with respect to
the ownership in that corporation before the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.

This definition of Change of Control is intended to conform to the definition of a change in
control event as set forth in §409A of the Internal Revenue Code and Treas. Reg. §1.409A-3(i)(5),
and shall be so construed. A transaction shall not be considered to constitute a Change of Control
unless it also constitutes a change in control event for purposes of §409A, and any transaction
that constitutes a change in control event for purposes of § 409A shall be considered a Change of
Control.

“Company” shall mean Deluxe and its Affiliates, as herein defined.

“Disability” shall mean your medically determinable physical or mental impairment that can be
expected to result in death or to last for a continuous period of not less than twelve months and
you either have been receiving disability payments under any plan (including a short-term
disability plan or practice) of the Company for at least three months, or if you are not eligible
to participate in any disability plan, you are unable to engage in any substantial gainful
activity.

“Good Reason” shall mean (i) except with your written consent given in your discretion, (a) the
assignment to you of any position and/or duties which represent or otherwise entail a material
diminution in your position, authority, duties or responsibilities, or (b) any other action by the
Company which results in a material diminution in your position (or positions) with the Company,
excluding for this purposes an isolated, insubstantial or inadvertent action not taken in bad faith
and which is remedied by the Company promptly after receipt of written notice thereof given by you
and excluding any diminution attributable solely to the fact that Deluxe is no longer a public
company; (ii) any material reduction in your aggregate compensation and incentive opportunities, or
any failure by the Company to comply with any other written agreement between you and the Company,
other than an isolated, insubstantial or inadvertent failure not occurring in bad faith and which
is remedied by the Company promptly after receipt of written notice thereof given by you; (iii) the
Company’s requiring you to be based at any location more than 50 miles from your then current
location; (iv) any purported termination by the Company of your employment which is not effected
pursuant to a written notice of termination specifying the reasons for your termination and the
manner by which such reasons constitute “Cause” (as defined herein); or (v) any request or
requirement by the Company that you take any action or omit to take any action that is inconsistent
with or in violation of the Company’s ethical guidelines and policies as the same existed within
the 120-day period prior to the termination date or any professional ethical guidelines or
principles that may be applicable to you.

“Qualified Retirement” shall mean any termination of employment that the Compensation Committee of
Deluxe’s Board of Directors approves as a qualified retirement, provided (i) you have at least
twenty years of service with Deluxe and/or its Affiliates (“Service Years”), and (ii) the sum of
your age and Service Years equals or exceeds seventy-five.

Addendum

Page 2 of 2EX-10.2

Exhibit 10.2

	 	 	 
	DELUXE 

CORPORATION

	 	NON-QUALIFIED STOCK OPTION AGREEMENT

	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	GRANT	 	 	# OF DELUXE CORP	 	 	OPTION PRICE	 
	 	GRANTED TO	 	 	DATE	 	 	COMMON SHARES	 	 	PER SHARE	 
	 	 

	 	 	 

                        
              

EXPIRATION DATE

 

 	 	 	 	 	 	 	 
	 

	1.	 	GRANT
	 
	 	 	Deluxe Corporation (“Deluxe”) hereby grants to you the right to purchase the above stated number of
shares of its common stock, par value $1.00 per share, at the price stated above (the “Option”).
	 
	2.	 	DURATION AND EXERCISABILITY
	 
	 	 	You may not exercise any portion of this Option prior to one year from the date of grant set forth
above (the “Grant Date”), and the Option expires seven years after the Grant Date (the “Expiration
Date”). Commencing one year after the Grant Date you may exercise this Option in cumulative
installments of 33-1/3 percent on and after the first, second, and third anniversaries of the Grant
Date. This entire Option will vest earlier and become exercisable upon your Qualified Retirement,
Disability, death, or termination without Cause. “Qualified Retirement,” “Disability,” and “Cause”
are defined in the Addendum to this Agreement.
	 
	3.	 	RETIREMENT, DISABILITY, DEATH OR TERMINATION
	 
	 	 	Upon your Qualified Retirement from Deluxe or an Affiliate (collectively, the “Company”), you will
have three years from the date of your retirement to exercise this Option. If you die while
employed, the representative of your estate or your heirs will have one year from the date of your
death to exercise this Option. If your employment terminates due to Disability, you will have one
year from the date of your termination to exercise this Option. If your employment is terminated by
the Company without Cause, you will have three months from the date of your termination to exercise
this Option. If you resign or otherwise voluntarily terminate your employment with the Company,
you will have three months from the date of your termination to exercise this Option, to the extent
the Option had vested as of your termination date. In no case, however, may this Option be
exercised after the Expiration Date. If your employment with the Company is terminated for Cause,
the entire unexercised portion of this Option will be canceled as of your last date of employment.
	 
	4.	 	ACCELERATION OF EXERCISABILITY UPON CHANGE OF CONTROL

	 	(a)	 	Notwithstanding any installment or delayed exercise provision contained in this Agreement that
would result in this Option becoming exercisable in full or in part at a later date, if, in
connection with any “Change of Control” (as defined in the Addendum), the acquiring Person,
surviving or acquiring corporation or entity, or an affiliate of such corporation or entity, elects
to continue this Option in effect and to replace the shares of common stock issuable upon exercise
of this Option with other equity securities that are registered under the Securities Act of 1933
and are freely transferable under all applicable federal and state securities laws and regulations,
this Option shall become exercisable in full if, within twelve months of the date of the Change of
Control,

	 	(i)	 	Your employment with the Company (or any successor company or affiliated entity with which
you are then employed) is terminated by the Company or such other employer without Cause,
	 
	 	(ii)	 	Your employment with the Company (or any successor company or affiliated entity with
which you are then employed) is terminated by you for “Good Reason” (as defined in the Addendum),
or
	 
	 	(iii)	 	Any earlier date provided under this Agreement.

	 	 	 	In the event of any such Change of Control, the number of replacement equity securities issuable
upon exercise of this Option shall be determined by multiplying the exchange ratio used in
connection with the Change of Control for determining the number of replacement equity securities
issuable for the outstanding shares of Deluxe’s common stock, or if there is no such ratio, an
exchange ratio established or accepted by the Continuing Directors (as defined in the Addendum),
and the exercise price per share of replacement equity security shall be adjusted by such exchange
ratio so as to preserve the same economic value in this Option as existed prior to the Change of
Control. In the event of any such Change of Control, all references herein to the common stock
shall thereafter be deemed to refer to the replacement equity securities issuable upon exercise of
this Option, references to Deluxe shall thereafter be deemed to refer to the issuer of such
replacement equity securities, and all other terms of this Option shall continue in effect except
as and to the extent modified by this subparagraph.
	 
	 	(b)	 	If the Change of Control does not meet the continuation or replacement criteria specified in
subparagraph (a) above, this Option shall become exercisable in full immediately upon the Change of
Control.

			
	 	 	 
	NQSO 2009
	 	Ver. 2/09

 

 

	5.	 	FORFEITURE OF OPTION AND OPTION GAIN RESULTING FROM CERTAIN ACTIVITIES

	 	(a)	 	If, at any time within 12 months after the date that you have exercised any portion of this
Option, you engage in any Forfeiture Activity (as defined below) then (i) the Option shall
immediately terminate effective as of the date any such activity first occurred, and (ii) any gain
received by you pursuant to the exercise of the Option must be paid to Deluxe within 30 days of
demand by Deluxe. For purposes hereof, the gain on any exercise of the Option shall be determined
by multiplying the number of shares purchased pursuant to the Option times the excess of the
closing price on the New York Stock Exchange of a share of Deluxe’s common stock on the date of
exercise (without regard to any subsequent increase or decrease in the fair market value of such
shares) over the exercise price.
	 
	 	(b)	 	As used herein, you shall be deemed to have engaged in a Forfeiture Activity if you (i)
directly or indirectly, engage in any business activity on your own behalf or as a partner,
stockholder, director, trustee, principal, agent, employee, consultant or otherwise of any person
or entity which is in any respect in competition with or competitive with the Company or you
solicit, entice or induce any employee or representative of the Company to engage in any such
activity, (ii) directly or indirectly solicit, entice or induce (or assist any other person or
entity in soliciting, enticing or inducing) any customer or potential customer (or agent, employee
or consultant of any customer or potential customer) with whom you had contact in the course of
your employment with the Company to deal with a competitor of the Company, (iii) fail to hold in a
fiduciary capacity for the benefit of the Company all confidential information, knowledge and data,
including customer lists and information, business plans and business strategy (“Confidential
Data”) relating in any way to the business of the Company for so long as such Confidential Data
remains confidential, or (iv) are terminated by the Company for Cause.
	 
	 	(c)	 	If any court of competent jurisdiction shall determine that the foregoing forfeiture provisions
are invalid in any respect, the court so holding may limit such provisions in any manner which the
court determines such that the provisions shall be enforceable against you.
	 
	 	(d)	 	By accepting this Agreement, you consent to a deduction from any amounts Company owes you from
time to time (including amounts owed to you as wages or other compensation, fringe benefits, or
vacation pay, as well as any other amounts owed to you by Company), to the extent of the amounts
you owe Company under the foregoing provisions. Whether or not Company elects to make any set-off
in whole or in part, if Company does not recover by means of set-off the full amount you owe,
calculated as set forth above, you agree to pay immediately the unpaid balance to Company.
	 
	 	(e)	 	You will be released from the forfeiture provisions of subparagraph (b)(i) in the event your
employment with the Company has been involuntarily terminated without Cause due to a job
elimination or other reduction in force. Otherwise, you may be released from the foregoing
forfeiture provisions only if the Compensation Committee of the Deluxe Board (or its duly appointed
agent) determines in its sole discretion that such action is in the best interests of Company.

	6.	 	TERMS AND CONDITIONS
	 
	 	 	This Option Agreement does not guarantee your continued employment or, subject to the provisions of
any other written agreement between you and Deluxe or its Affiliates, alter the right of Deluxe or
its Affiliates to terminate your employment at any time. You have no rights in the shares subject
to this Option until such shares are received upon exercise of this Option. This Option is issued
pursuant to the Deluxe Corporation 2008 Stock Incentive Plan (the “Plan”), and is subject to its
terms. In the event of any conflict between the provisions of the Plan and this Option Agreement
(which includes the Addendum to this Agreement), the provisions of the Plan shall prevail.

By your acceptance of this option award, you acknowledge receipt of a copy of the Prospectus for
the Plan and your agreement to the terms and conditions of the Plan and this Option Agreement.

	 	 	 	 	 
	 	DELUXE CORPORATION

 	 
	 	By  	
 	 
	 

RETAIN THIS DOCUMENT FOR YOUR RECORDS

 

 

ADDENDUM TO

NON-QUALIFIED STOCK OPTION AGREEMENT

For the purposes hereof the terms used herein shall have the following meanings:

“Affiliate” shall mean a company controlled directly or indirectly by Deluxe, where “control” shall
mean the right, either directly or indirectly, to elect a majority of the directors thereof without
the consent or acquiescence of any third party.

“Beneficial Owner” shall have the meaning defined in Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended.

“Cause” shall mean (i) you have breached your obligations of confidentiality to Deluxe or any of
its Affiliates; (ii) you have otherwise failed to perform your employment duties and do not cure
such failure within thirty (30) days after receipt of written notice thereof; (iii) you commit an
act, or omit to take action, in bad faith which results in material detriment to Deluxe or any of
its Affiliates; (iv) you have had excessive absences unrelated to illness or vacation (“excessive”
shall be defined in accordance with local employment customs); (v) you have committed fraud,
misappropriation, embezzlement or other act of dishonesty in connection with Deluxe or any of its
Affiliates or its or their businesses; (vi) you have been convicted or have pleaded guilty or nolo
contendere to criminal misconduct constituting a felony or a gross misdemeanor, which gross
misdemeanor involves a breach of ethics, moral turpitude, or immoral or other conduct reflecting
adversely upon the reputation or interest of Deluxe or its Affiliates; (vii) your use of narcotics,
liquor or illicit drugs has had a detrimental effect on your performance of employment
responsibilities; or you are in material default under any agreement between you and Deluxe or any
of its Affiliates following any applicable notice and cure period.

“Change of Control” shall be deemed to have occurred on the date that the conditions set forth
in any one of the following paragraphs shall have been satisfied:

	 	(I)	 	The date on which any one person, or more than one person acting as a group,
acquires ownership of stock of Deluxe that, together with stock held by such person or
group, constitutes more than 50% of the total fair market value or total voting power
of the stock of Deluxe. If any one person, or more than one person acting as a group,
is already considered to own more than 50% of the total fair market value or total
voting power of the stock of the Deluxe, the acquisition of additional stock by the
same person or persons is not considered to cause a Change in Control under this
paragraph or paragraph (II). An increase in the percentage of stock owned by any one
person, or persons acting as a group, as a result of a transaction in which Deluxe
acquires its stock in exchange for property will be treated as an acquisition of stock
for purposes of this paragraph. This paragraph applies only when there is a transfer or
issuance of stock of Deluxe and stock in Deluxe remains outstanding after the
transaction.
	 
	 	(II)	 	The date any one person, or more than one person acting as a group, acquires
(or has acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of Deluxe possessing 30% or
more of the total voting power of the stock of such corporation. If any one person, or
more than one person acting as a group, is already considered to own more than 30% of
the total voting power of the stock of the Deluxe, the acquisition of additional stock
by the same person or persons is not considered to cause a Change in Control under this
paragraph.
	 
	 	(III)	 	The date a majority of members of Deluxe’s board of directors is replaced
during any 12-month period by directors whose appointment or election is not endorsed
by a majority of the members of the board of directors before the date of the
appointment or election.
	 
	 	(IV)	 	The date that any one person, or more than one person acting as a group,
acquires (or has acquired during the 12-month period ending on the date of the most
recent acquisition by such person or persons) assets from Deluxe that have a total
gross fair market value equal to or more than 40% of the total gross fair market value
of all of the assets of Deluxe immediately before
such acquisition or acquisitions; provided that a Change in Control shall not result
from a transfer of assets by Deluxe to (a) a shareholder of Deluxe (immediately prior
to the transfer) in exchange for or with respect to Deluxe’s stock, (b) an entity,
50% or more of the total value or voting power of which is owned, directly or
indirectly, by Deluxe immediately following the transfer, (c) a person, or more than
one person acting as a group, that owns, directly or indirectly, 50% or more of the
total value or voting power of all the outstanding stock of Deluxe immediately
following the transfer, or (d) an entity, at least 50% of the total value or

 

 

	 	 	 	voting
power of which is owned, directly or indirectly, by a person or group of persons
described in clause (c) For this purpose, gross fair market value means the value of
the assets of Deluxe, or the value of the assets being disposed of, determined
without regard to any liabilities associated with such assets.

For purposes of determining whether a Change of Control has occurred, persons will not be
considered to be acting as a group solely because they purchase or own stock of the same
corporation at the same time, or as a result of the same public offering. However, persons will be
considered to be acting as a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction with Deluxe. If a
person, including an entity, owns stock in both corporations that enter into a merger,
consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is
considered to be acting as a group with other shareholders in a corporation only with respect to
the ownership in that corporation before the transaction giving rise to the change and not with
respect to the ownership interest in the other corporation.

“Disability” shall mean your permanent disability as defined by the provisions of the long term
disability plan of Deluxe or any Affiliate by which you are employed at the time of such
disability. In the event that any such Affiliate does not have a long term disability plan in
effect at such time, you shall be deemed disabled for the purposes hereof if you would have
qualified for long term disability payments under Deluxe’s long term disability plan had you then
been an employee of Deluxe.

“Good Reason” shall mean (i) except with your written consent given in your discretion, (a) the
assignment to you of any position and/or duties which represent or otherwise entail a material
diminution in your position, authority, duties or responsibilities, or (b) any other action by the
Company which results in a material diminution in your position (or positions) with the Company,
excluding for this purposes an isolated, insubstantial or inadvertent action not taken in bad faith
and which is remedied by the Company promptly after receipt of written notice thereof given by you
and excluding any diminution attributable solely to the fact that Deluxe is no longer a public
company; (ii) any material reduction in your aggregate compensation and incentive opportunities, or
any failure by the Company to comply with any other written agreement between you and the Company,
other than an isolated, insubstantial or inadvertent failure not occurring in bad faith and which
is remedied by the Company promptly after receipt of written notice thereof given by you; (iii) the
Company’s requiring you to be based at any location more than 50 miles from your then current
location; (iv) any purported termination by the Company of your employment which is not effected
pursuant to a written notice of termination specifying the reasons for your termination and the
manner by which such reasons constitute “Cause” (as defined herein); or (v) any request or
requirement by the Company that you take any action or omit to take any action that is inconsistent
with or in violation of the Company’s ethical guidelines and policies as the same existed within
the 120-day period prior to the termination date or any professional ethical guidelines or
principles that may be applicable to you.

“Person” shall have the meaning defined in Sections 3(a)(9) and 13(d) of the Securities Exchange
Act of 1934, as amended, except that such term shall not include (i) Deluxe or any of its
subsidiaries, (ii) a trustee or other fiduciary holding securities under an employee benefit plan
of Deluxe or any of its Affiliates, (iii) an underwriter temporarily holding securities pursuant to
an offering of such securities, or (iv) a corporation owned, directly or indirectly, by the
shareholders of Deluxe in substantially the same proportions as their ownership of stock of Deluxe.

“Qualified Retirement” shall mean any termination of your employment that the Compensation
Committee of Deluxe’s Board of Directors approves as a qualified retirement, provided (i) you have
at least twenty years of service with Deluxe and/or its Affiliates (“Service Years”), and (ii) the
sum of your age and Service Years equals or exceeds seventy-five.

Addendum

Page 2 of 2

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