EXHIBIT 10.12
FIRST DATA CORPORATION
1992 LONG-TERM INCENTIVE PLAN
PERFORMANCE GRANT AGREEMENT
(Award Period Beginning January 1, 2001)
This AGREEMENT is made by and between FIRST DATA CORPORATION, a Delaware
corporation (the "Company") and [Executive Name], an executive of the Company
(the "Executive"), as of January 1, 2001
RECITALS
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WHEREAS, the Board of Directors of the Company (The "Board") established
and the Company maintains the 1992 Long-Term Incentive Plan (The "Plan") which
authorizes the Compensation and Benefits Committee of the Board (the
"Committee") to award Performance Grants to eligible key employees of the
Company and its affiliates; and
WHEREAS, the Committee has determined to award a Performance Grant to
Executive on the terms and conditions set forth herein;
NOW THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto agree as follows:
AGREEMENT
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1. Defined Terms. All terms not otherwise defined herein shall have the
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meaning set forth in the Plan.
2. Award of Performance Grants. The Company hereby grants to Executive a
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Performance Grant (referred to hereinafter as the "Performance Grant")
subject to the terms and conditions set forth below.
3. Terms and Conditions of Performance Grants.
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(a) The value of the Performance Grant (the "Unit Value") shall be
determined by the Committee in accordance with the formula set forth
on Exhibit A attached hereto based upon the percentage increase in the
share price of the Company's common stock, $.01 par value per share
(the "Common Shares"), plus dividends paid, if any, during the period
beginning on January 1, 2001and ending on December 31, 2002(the "Award
Period") (the "Growth in Shareholder Value"), relative to the Growth
in Shareholder Value of those companies in the S&P 500 index whose
Growth in Shareholder Value during the Award Period would place such
companies above the fiftieth (50th) percentile of all companies in the
S&P 500 index ("Comparator Companies"); provided, however, that the
Growth in Shareholder Value is in excess of the fiftieth percentile of
the Comparator Companies and
the Threshold Rate as defined below. For purposes of this Agreement,
the share price of the Common Shares and the share price of the
Comparator Companies shall be the average of such share price for the
sixty (60) day period ending on the last Business Day preceding the
first day of the Award period and the last day of the Award Period,
respectively. For purposes of this Agreement, the Threshold Rate for
any Award Period shall mean the rate of return during the Award Period
of the average two-year treasury note for the sixty (60) day period
ending on the last Business Day preceding the first day of the Award
Period assuming that dividends with respect to such two-year treasury
note paid during the Award Period are reinvested at such two-year
treasury note rate. For purposes of this Agreement, the methodology
which shall be used to determine whether the Growth in Shareholder
Value of the Company's common shares during the Award Period exceeds
the 50th percentile shall be to rank each of the comparator companies
from one (1) to five hundred (500) based on its Growth in Shareholder
Value during the Award Period and then compare the Growth in
Shareholder Value of the Company with the Growth in Shareholder Value
of the Comparator Companies. If the Committee determines that a
Performance Grant has no Unit Value, such Performance Grant shall be
deemed to have been canceled.
(b) Subject to the conditions set forth in Subparagraph 3 (e) and
Paragraph 4 below, Executive shall have no vested or non-forfeitable
interest in the Unit Value of a Performance Grant, as determined by
the Committee, until the expiration of two fiscal years following the
end of the Award Period with respect to the Performance Grant (the
"Vesting Period"). For each fiscal year during the Vesting Period in
which the Company's net income (determined pursuant to the guidelines
previously approved by the Committee) before dividends divided by
stockholder's equity at the beginning of such fiscal year ("Return on
Equity Percentage") is a positive number, the Unit Value of the Award
shall increase in an amount equal to fifty (50%) percent of the Return
on Equity Percentage ("Adjusted Return on Equity Percentage"). For
each fiscal year during the Vesting Period in which the Return on
Equity Percentage is a negative number, the Unit Value of the Award
shall decrease by an amount equal to the Return on Equity Percentage.
(c) Subject to the terms and conditions set forth in Paragraph 4 below,
Executive shall be entitled to receive an amount equal to the Unit
Value of the Performance Grant, as adjusted pursuant to the Adjusted
Return on Equity Percentage or the Return on Equity Percentage, as the
case may be (the "Adjusted Unit Value") as determined as of the last
day of the Vesting Period applicable to the Performance Grant. Such
Adjusted Unit Value shall be payable solely in cash and shall be paid
to Executive within 90 days after the last day of such Vesting Period.
(d) Executive may elect to defer receipt of cash in the amount of the
Adjusted Unit Value of a Performance Grant in accordance with the
terms and conditions of the First Data Corporation Salary Deferral
Plan.
(e) In the event that Executive's employment is terminated for any reason
prior to the end of the Award Period (with respect to a Performance
Grant), or for any reason other than Executive's death, Disability, or
early, normal or deferred retirement under an approved retirement plan
of the Company (or any such other plan or arrangement as may be
approved by the Committee in its discretion, for this purpose) after
the Award Period with respect to such Performance Grant but prior to
the end of the Vesting Period, any unpaid Unit Value shall not be paid
out and the Performance Grant shall be forfeited.
4. Committee Authority. The Committee has the sole and exclusive authority to
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interpret and apply any provision of this Agreement, and may reduce the
amount of any such award to be made hereunder (including a determination of
a lower Unit Value than that which the formula on Exhibit A would yield)
based on factors it selects in its discretion. The Board may, from time to
time, amend, modify or terminate, in whole or in part, any or all
provisions of the Plan; provided, that no such change or termination shall
in any way materially impair Executive's right under this Agreement without
the prior written consent of Executive. Notwithstanding anything in the
foregoing sentence to the contrary, the Committee may, in its sole
discretion, extend at any time the Vesting Period for any Performance Grant
for up to an additional two fiscal years (the "Extended Phase") provided
that (a) the Committee in its sole discretion may provide for the payment
to Executive during the Extended Phase of all or any portion of the Unit
Value of the Performance Grant, and (b) any action by the Committee in
extending the Vesting Period pursuant to this sentence shall be disregarded
for purposes of Paragraph 3 (e) of this Agreement.
5. Nontransferability. The Performance Grant shall not be transferred or
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assigned, hypothecated or encumbered in whole or in part either directly or
by operation of law or otherwise (except in the event of Executive's death)
including, but not by way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy or in any other manner.
6. No Employment Contract. Neither the Plan nor this Agreement shall
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constitute a contract of employment between the Company and Executive, and
the Company specifically reserves the right to terminate the employment of
or performance of services by the Executive at any time for any reason.
7. Compliance with Other Laws and Regulations. The Performance Grant shall be
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subject to all applicable federal and state laws, rules and regulation,
including those related to disclosure of financial and other information to
Executive, and to such approvals by any government or regulatory agency as
may be required.
8. Executive Bound by Plan. Executive hereby acknowledges a receipt of a copy
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of the Plan, and agrees to be bound by all the terms and provisions
thereof, which are incorporated herein by reference.
9. Acceptance. By executing this Agreement and accepting the Performance
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Grant, Executive (or any person acting on Executive's behalf or claiming
under or through Executive) shall be conclusively deemed to have indicated
his acceptance and ratification of, and consent to, any action taken under
the Plan by the Company, the Board or the Committee or its delegates.
10. Funding. The Plan shall be unfunded. The Company shall not be required to
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establish any special fund or to make any other segregation of assets to
assure the payment of the Adjusted Unit Value attributable to any
Performance Grant. Any rights to the payment of any such Adjusted Unit
Value shall be no greater than the right of the Company's general
creditors.
11. Notices. Any notice hereunder to the Company shall be addressed to:
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First Data Corporation
0000 Xxx Xxxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx, Executive Vice President and General
Counsel
and any notice hereunder to Executive shall be addressed to Executive at
Executive's last address on the records of the Company, subject to the
right of either party to designate at any time hereafter in writing some
other address. Any notice shall be deemed to have been duly given when
enclosed in a properly sealed envelope, addressed as set forth above, and
deposited (with first class postage prepaid) in the United States mail.
12. Counterparts. This Agreement may be executed in one or several
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counterparts, each of which shall constitute one and the same instrument.
13. Governing Law. The validity, construction, interpretation, administration
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and effect of the Plan and this Agreement, and of its and their rules and
regulations, and rights relating to the Plan and to the Performance Grants
granted under the Plan pursuant to this Agreement shall be governed by the
substantive laws, but not the choice of law rules, of the State of
Delaware.
14. Variation of Pronouns. All pronouns and any variations thereof contained
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herein shall be deemed to refer to masculine, feminine, neuter, singular or
plural, as the identity of the person or persons may require.
15. Shareholder Approval. This Agreement shall be void in the event the
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stockholders of the Company fail to approve either this Agreement or a plan
authorizing this Agreement prior to the payment of any amount to Executive
under this Agreement.
IN WITNESS WHEREOF, the Company and Executive has executed this Agreement
as of the date first written above.
FIRST DATA CORPORATION
By: ______________________________
Title: _____________________________
EXECUTIVE
__________________________________
EXHIBIT A
(To Chief Executive Officer Agreement)
UNIT VALUE
ANNUAL GROWTH IN TARGET UNIT
SHAREHOLDER VALUE VALUE
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*** ***
Threshold
Rate
Exceeds Comparator Company at 50% level $ 660,000
Exceeds Comparator Company at 55% level 1,200,000
Exceeds Comparator Company at 60% level 1,800,000
Exceeds Comparator Company at 65% level 2,400,000
Exceeds Comparator Company at 70% level 3,000,000
Exceeds Comparator Company at 75% level (Maximum) 3,600,000
If the Company's Growth in Shareholder Value exceeds a Comparator Company at a
level above 50% and below 75%, the Target Value will be interpolated to the
nearest whole percent based on the scale above.
*** For purposes of this Agreement, the Threshold Rate for any Award Period
shall mean the rate of the return during the Award Period of the average two-
year treasury note for the sixty (60) day period ending on the last Business Day
preceding the first day of the Award Period assuming that interest with respect
to such two-year treasury note paid during the Award Period is reinvested at
such Threshold Rate. If the Growth in Shareholder Value for the Award Period is
less than the Threshold Rate, then regardless of the Growth in Shareholder
Value, the Committee shall assign no Unit Value to the Performance Grant. For
example, if Growth in Shareholder Value exceeds that of the Comparator Company
at the seventy-fifth percent (75%) level but that Growth in Shareholder Value is
less than the Threshold Rate, no Unit Value shall be assigned.
EXHIBIT A
(To EVP Agreements)
UNIT VALUE
ANNUAL GROWTH IN TARGET UNIT
SHAREHOLDER VALUE VALUE
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*** ***
Threshold
Rate
Exceeds Comparator Company at 50% level $250,000
Exceeds Comparator Company at 55% level 350,000
Exceeds Comparator Company at 60% level 450,000
Exceeds Comparator Company at 65% level 550,000
Exceeds Comparator Company at 70% level 650,000
Exceeds Comparator Company at 75% level (Maximum) 750,000
If the Company's Growth in Shareholder Value exceeds a Comparator Company at a
level above 50% and below 75%, the Target Unit Value will be interpolated to the
nearest whole percent based on the scale above.
*** For purposes of this Agreement, the Threshold Rate for any Award Period
shall mean the rate of the return during the Award Period of the average two-
year treasury note for the sixty (60) day period ending on the last Business Day
preceding the first day of the Award Period assuming that interest with respect
to such two-year treasury note paid during the Award Period is reinvested at
such Threshold Rate. If the Growth in Shareholder Value for the Award Period is
less than the Threshold Rate, then regardless of the Growth in Shareholder
Value, no Unit Value shall be assigned to the Performance Grant by the
Committee. For example, if Growth in Shareholder Value exceeds that of the
Comparator Company at the seventy-fifth percent (75%) level but that Growth in
Shareholder Value is less than the Threshold Rate, no Unit Value shall be
assigned.
EXHIBIT A
(To Chief Operating Officer Agreement)
UNIT VALUE
ANNUAL GROWTH IN TARGET UNIT
SHAREHOLDER VALUE VALUE
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*** ***
Threshold
Rate
Exceeds Comparator Company at 50% level $ 500,000
Exceeds Comparator Company at 55% level 800,000
Exceeds Comparator Company at 60% level 1,100,000
Exceeds Comparator Company at 65% level 1,400,000
Exceeds Comparator Company at 70% level 1,700,000
Exceeds Comparator Company at 75% level (Maximum) 2,000,000
If the Company's Growth in Shareholder Value exceeds a Comparator Company at a
level above 50% and below 75%, the Target Unit Value will be interpolated to the
nearest whole percent based on the scale above.
*** For purposes of this Agreement, the Threshold Rate for any Award Period
shall mean the rate of the return during the Award Period of the average two-
year treasury note for the sixty (60) day period ending on the last Business Day
preceding the first day of the Award Period assuming that interest with respect
to such two-year treasury note paid during the Award Period is reinvested at
such Threshold Rate. If the Growth in Shareholder Value for the Award Period is
less than the Threshold Rate, then regardless of the Growth in Shareholder
Value, no Unit Value shall be assigned to the Performance Grant by the
Committee. For example, if Growth in Shareholder Value exceeds that of the
Comparator Company at the seventy-fifth percent (75%) level but that Growth in
Shareholder Value is less than the Threshold Rate, no Unit Value shall be
assigned.
