First Data 2013 Annual Report Download - page 137

within a short period of time. Information regarding applicable payments under such agreements for the named executive officers is provided in the Severance
Benefit table.
The Policy provides for the payment of benefits to executive officers upon severance from FDC and/or upon a change of control. The Policy is intended
to promote uniform treatment of senior executives who are involuntarily terminated other than for Cause or who voluntarily leave the Company for Good
Reason, as defined under the 2007 Equity Plan. Under the Policy, no benefits are provided based solely on a Change in Control. The Policy provides for
payment of benefits as described below:
(i) For executive officers appointed prior to May 1, 2011, or having 5 years or more service in such a position: total cash payments equal to the
executive officer’s base pay plus target bonus multiplied by 2.
For executive officers appointed on or after May 1, 2011 and having 2 to 5 years of service in such a position: total cash payments equal to the
executive officer’s base pay plus target bonus multiplied by 1.5.
For executive officers appointed on or after May 1, 2011 and having less than 2 years of service in such a position: total cash payments equal to
the executive officer’s base pay for one year.
(ii) A cash payment equal to the executive officer’s prorated bonus target for the year of termination.
(iii) Continuation of medical, dental and vision benefits coverage for the severance period, with a portion of the costs of the benefits paid by the
executive officer.
(iv) A “Gross-Up Payment” is made if it is determined that any Internal Revenue Code Section 280G parachute payments provided by the Company
to or, on behalf of, an eligible executive would be subject to the excise tax imposed by Internal Revenue Code Section 4999. The Gross-Up
Payment is an amount so that after payment of all taxes, the eligible executive retains an amount equal to the Excise Tax imposed by Internal
Revenue Code Section 4999. Executives are eligible for this benefit regardless of whether their employment is terminated following a Change in
Control.
As a condition to receiving severance benefits under the Policy, all employees are required to release FDC and its employees from all claims they may
have against them and agree to a number of restrictive covenants which are structured to protect the Company from potential loss of customers or employees
and to prohibit the release of confidential company information.
OTHER BENEFIT PLANS
All executive officers are also eligible to participate in the employee benefit plans and programs generally available to the Company’s employees,
including participation in the Company’s matching gift program (which was terminated at the end of 2013) and coverage under the Company’s medical,
dental, life and disability insurance plans.
EMPLOYMENT/ TRANSITION AND TERMINATION AGREEMENTS WITH FDC EXECUTIVES
Retention and Transition Agreement with Mr. Judge
Holdings and the Company entered into a Retention and Transition Agreement (the “Agreement”) with Mr. Judge (the “Executive”) on January 9, 2013
and a copy of this Agreement, in its entirety, was included in the Current Report on Form 8-K filed on January 11, 2013. Under the terms of the Agreement,
Mr. Judge’s current compensatory arrangement continued until January 31, 2013 (the “Effective Date”). Thereafter, subject to the conditions outlined in the
Agreement, the Company agrees to provide to Executive the following payments and benefits: (i) Executive will receive salary continuation for a period of 24
months, with the sum total of payments equal to 2 times his base pay plus target bonus; (ii) insurance coverage in accordance with COBRA paid for by the
Company and Company-funded health insurance until age 65 following the COBRA period; (iii) continued vesting in previously granted equity awards until
March 31, 2014; (iv) agreement not to exercise the Company’s Call Rights on Mr. Judge’s equity holdings without his mutual agreement; and (v) a cash
payment equal to financial planning benefits for two years following termination.
Pursuant to the terms of the Agreement, Mr. Judge is subject to covenants not to: (i) disparage FDC or interfere with existing or prospective business
relationships; (ii) disclose confidential information; (iii) solicit certain employees of FDC; and (iv) compete. In the event of an alleged material breach of the
covenant not to solicit certain employees of FDC, obtains employment, and/or not to compete, any unpaid severance amounts, including but not limited to the
items listed in the previous paragraph, will cease and future payments will be forfeited.
Employment Agreement with Mr. Labry
In connection with FDC’s merger with Concord EFS, Inc., on April 1, 2003 an employment agreement was entered into with Edward A. Labry III. The
agreement provided Mr. Labry’s compensation for the initial employment period and that he may be eligible for additional compensation under certain
Company plans or arrangements. Under the agreement, Mr. Labry agreed not to compete with the Company, or solicit any employees or customers of the
Company, during his employment with the Company and twelve
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