First Data 2014 Annual Report Download - page 124

(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.
On November 12, 2014 the Committee adopted amendments to the plan which are effective on January 1, 2015. Under the new terms, the cash severance
payment for all eligible participants is equal to one year's base pay plus the prior year's cash bonus and a prorated portion of the prior year's cash bonus based
on time worked during the year of termination.
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All executive officers are also eligible to participate in the employee benefit plans and programs generally available to the Company’s employees, including
coverage under the Company’s medical, dental, life and disability insurance plans.
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On April 28, 2013, First Data and Holdings entered into an employment agreement with Mr. Bisignano (the Employment Agreement). A copy of the
Employment Agreement is reported on the Form 8-K. The Employment Agreement was included as Exhibit 10.1 to FDC’s Form 8-K filed with the United
States Securities and Exchange Commission on May 2, 2013. The Employment Agreement provides for an initial five-year term from the Commencement
Date and automatic one-year extensions after such time unless terminated by either party with prior written notice. Under the terms of the Employment
Agreement, Mr. Bisignano will earn an annual base salary of $1,500,000, which base salary may be increased but not decreased; and commencing with the
2014 fiscal year, be eligible to receive a discretionary annual incentive payment in such amount as determined in the sole discretion of the Compensation
Committee of the Board of Directors of First Data, based upon its assessment of Mr. Bisignano’s performance, payable in the form of cash, equity-based
awards or a combination thereof. Mr. Bisignano will be eligible to receive executive perquisites, fringe and other benefits consistent with what is provided to
executives.
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On August 5, 2014, First Data and Holdings entered into a separation agreement with Mr. Winborne, former Chief Financial Officer. The agreement provides
severance benefits equal to $1,475,000 paid semi-monthly over a twelve month period beginning October 1, 2014 and continued coverage under First Data
benefits during the same period. A prorated 2014 bonus of $600,000 was paid following termination on September 30, 2014. Mr. Winborne will continue
holding and earning vesting in all equity holdings through December 15, 2015. Following December 31, 2015, call rights on all vested equity holding will
be exercised at fair market value if no Liquidity Event has occurred prior to this date.
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During 2014, Internal Revenue Code Section 162(m) limitations on tax deductibility of compensation did not apply to FDC as the Company’s common
stock is not registered or publicly traded. The Committee has not considered Internal Revenue Code Section 162(m) deductibility limitations in the planning
of 2014 compensation since they do not apply.
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