First Data 2010 Annual Report Download - page 144

Table of Contents
If the option holder's employment is terminated voluntarily or for Cause (as defined in the 2007 Equity Plan), call rights may be exercised on vested
options at the lesser of the fair market value share price or the option exercise price. In this event, shares obtained through previous option exercises may be
called at the lesser of the fair market value share price or the option exercise price. This provision greatly enhances the retention of executives who participate
in the 2007 Equity Plan by eliminating all potential option gains for executives who voluntarily terminate prior to a Liquidity Event.
Shares of purchased stock held by executives may not be sold prior to the later of September 24, 2012 or a Liquidity Event. However, if a partial public
offering occurs before September 24, 2012, a pro rata portion of shares equal to the percentage of equity offered to the public will become unrestricted. If a
shareholder's employment is terminated voluntarily or due to Death, Disability, Good Reason or Not for Cause (as defined in the 2007 Equity Plan), call rights
may be exercised on purchased shares at the fair market value share price. In the event of Death or Disability, the shareholder has a put right to sell shares
back to Holdings at the fair market value share price.
If the shareholder's employment is terminated for Cause (as defined in the 2007 Equity Plan), call rights may be exercised on purchased shares at the
lesser of the fair market value share price or the original purchase price.
Grant Process
Equity grants made during 2010 under the 2007 Equity Plan were made at the then-current fair market value on the date of each grant respectively. Fair
market value was determined by the full Holdings Board at the time of grant. Equity grants were made on the date the grants were approved by the
Committee.
Perquisites
Reimbursement for relocation and moving expenses and an annual stipend for personal financial planning are offered to FDC's executive officers.
Executives are also authorized to use the corporate aircraft for personal purposes in limited instances.
FDC's relocation program is required to attract and retain top talent in a competitive environment. The program ensures a new or transferred executive
can transition into their new work location as quickly and efficiently as possible.
The financial planning benefit is provided as a fixed dollar benefit, grossed-up to cover taxes on the benefit. For the Chief Executive Officer, the benefit
is $20,000 per year. For all other executives, the benefit is $20,000 in their first year as an executive officer and $10,000 in each subsequent year.
Competitive analysis indicates that the relocation and financial planning benefits are comparable to what is offered by a majority of companies with
whom the Company competes for talent. The Committee reviews the appropriateness of perquisites provided to executive officers on an annual basis.
Retirement Plans
In 2010, all employees in the U.S., including executive officers, were eligible to participate in the First Data Corporation Incentive Savings Plan
("ISP"). The ISP is a qualified 401(k) plan designed to comply with Internal Revenue Service ("IRS") safe harbor rules. FDC maintains the ISP to allow
employees to save for their retirement on a pre-tax basis and provides company contributions to help employees build retirement savings. FDC offers the ISP
not only because it is a market competitive practice, but it is critical to provide a vehicle for its employees to save for retirement.
The Company matches 100% of employee deferrals up to 3% of eligible pay and 50% of employee deferrals on the next 1% of eligible pay. Eligible
pay includes base and incentive compensation and is capped by IRS limitations applicable to qualified plans. Company contributions become 100% vested
after 2 years of service and there is no service requirement to begin receiving company matching contributions.
FDC does not currently offer defined benefit plans to new employees, nor does it offer non-qualified retirement plans to its executive officers.
SEVERANCE AND CHANGE IN CONTROL AGREEMENTS
In general, FDC does not enter into employment agreements with employees, including the Company's executive officers, except in the case of
Mr. Judge and Mr. Labry. A description of these agreements, including the severance and Change-in-Control provisions applicable to Mr. Judge, is provided
below. All current executive officers serve at the will of the Board.
The Company believes that reasonable and appropriate severance and Change in Control benefits are necessary in order to be competitive in the
Company's executive attraction and retention efforts. The Company's severance benefits are equivalent to those typically found in other companies and reflect
the fact that it may be difficult for such executives to find comparable employment 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.
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