EMPLOYEE CONFIDENTIAL
INFORMATION
This Employee
Confidential Information and Noncompetition Agreement is made and
entered into on this 16th day of March, 2007, by and between Robert
H.B. Baldwin, Jr., hereinafter “Employee,” and
Heartland Payment Systems, Inc., a Delaware corporation
(collectively with any and all current and future subsidiary and/or
affiliate companies, the “Company”).
WHEREAS ,
Employee has established an employment relationship with the
Company and has received, and may continue to receive, certain
benefits including stock grants and options; and
WHEREAS ,
by reason of employment by the Company, Employee has received, and
will continue to receive, the value and advantage of confidential
information and special training and skills, and the expert
knowledge and experience of the contacts with other Company
employees; and
WHEREAS ,
the future granting of stock grants and options represents an
advantage to Employee and was conditioned upon Employee entering
into this Agreement; and
WHEREAS,
the Company and Employee are parties to that certain
November 2001 Employee Confidential Information and
Noncompetition Agreement, as modified by a December 2002
supplement (collectively, the “Old Agreement”);
and
WHEREAS,
the Company and Employee desire to revoke and terminate the Old
Agreement and enter into this Agreement.
NOW
THEREFORE , in exchange for good and valuable consideration,
the sufficiency and receipt of which is hereby acknowledged, it is
agreed as follows:
Section 1. Scope of
Agreement.
(a) This
contract is not a contract of employment for any particular term.
Employee’s employment by the Company is at will, unless
otherwise agreed by the Company and Employee in writing.
(b) Severance
policies and procedures are as set forth in the Employee Policy
Manual of the Company; provided, that in the event of a conflict
between this Agreement and the Employee Policy Manual, this
Agreement shall govern.
Section 2. Severance and
Bonuses.
(a) In
consideration of the covenants by Employee contained below, in the
event of a termination of Employee’s employment by action of
the Company other than for Cause or Disability, the Employee will
receive severance pay, in an amount equal to the base salary that
would have been paid for a period of twelve (12) months
payable in accordance with the Company’s regular payroll
practices, plus medical benefits for such period; provided, that
the Employee shall not be eligible to receive such severance pay
unless such termination of employment occurs after the ninetieth
(90th) day of the Employee’s employment by the Company.
Medical benefit continuation during such severance period shall be
counted against the benefit continuation period required under
COBRA.
(b) In the
event of a termination of Employee’s employment by action of
the Company other than for Cause or in the event of termination of
Employee’s employment by death of Employee, the Employee
shall also be entitled to receive a pro rata portion (based on the
number of days of Employee’s employment during the fiscal
quarter in which the Employee’s employment is terminated) of
any bonus payment that would have been payable to him for that
fiscal quarter if the Employee had been in the employ of the
Company for the full fiscal quarter. If the Employee’s
compensation arrangement did not contemplate a bonus payable on a
quarterly basis, but instead contemplated a bonus paid on some
longer fiscal period (such as a half-year or full year), then the
pro rata bonus shall be computed based on the number of days of
Employee’s employment during such longer fiscal period in
which the Employee’s employment is terminated and the amount
of the bonus payment that would have been payable to him for such
longer fiscal period. No bonus will be payable to the Employee with
respect to any bonus period commencing after the bonus period in
which the Employee’s employment terminated.
(c) In the
event of a termination of Employee’s employment on or before
January 31, 2008, other than for Cause, the Employee shall
also be entitled to receive that portion of any unvested stock
options held by Employee (and that are subject to the terms of a
stock option agreement) on such date that would have vested on the
next anniversary date of any stock option award within twelve
(12) months following the termination date and shall vest
immediately upon such termination.
(d)
Cause . “Cause” means:
(i) The Employee
has breached the provisions of Section 4, Section 5,
Section 6, or Section 7 of this Agreement in any material
respect;
(ii) The Employee
has been convicted of, or plead guilty or no contest to,
(A) fraud, misappropriation or embezzlement in connection with
the Company’s business, or (B) a felony, and has failed
to submit a resignation in accordance with Section 2(f) below;
or
(iii) The Employee
has breached his or her duties hereunder or failed to perform his
or her duties as an officer or employee of the Company, if such
breach or failure has not been cured within thirty (30) days
after receipt of written notice from the Company of such breach or
failure.
5
Notwithstanding
the foregoing, the Employee shall not be deemed to have been
terminated for Cause pursuant to clause (i) above unless and
until there shall have been delivered to the Employee (A) a
notice of termination and (B) a copy of a resolution duly
adopted by the Board of Directors of the Company finding that,
after reasonable notice to the Employee and an opportunity to be
heard, in the good faith opinion of the Board of Directors of the
Company, the Employee has engaged in conduct constituting Cause for
termination hereunder.
(e)
Disability . “Disability” means any mental or
physical condition that renders the Employee unable to perform the
essential functions of his position, with or without reasonable
accommodation, for a period in excess of six
(6) months.
(f) If the
Employee is ever convicted of, or pleads guilty or no contest to,
any felony offense, then the Employee shall immediately tender a
resignation from each and every position the Employee then holds
with the Company (whether as officer, director, employee,
consultant or otherwise).
Section 3. Employees’
Acknowledgments.
(a) The
Employee understands and acknowledges that because of the
confidential and sensitive nature of the information to which the
Employee will have access during the course of his employment with
the Company, any unauthorized use, disclosure or misappropriation
of such information will cause irreparable damage to the
Company.
(b) The
Employee acknowledges that the Company has expended considerable
resources to develop the confidential information and the
relationships that the Company enjoys with its customers,
suppliers, employees, officers and other agents, and these assets
of the Company are critical to the business of the Company. The
Employee agrees that the restrictions set forth below are necessary
to prevent even the inadvertent disclosure of this confidential
information or the interference with these relationships and to
protect the legitimate business interests of the Company and are
reasonable in scope and content.
Section 4. Protection of
Information.
(a) The
Employee hereby covenants with Company that, throughout the term of
his employment by the Company, Employee will serve Company’s
best interests loyally and diligently. Throughout the course of
employment by Company and thereafter, Employee will not disclose to
any person, firm, corporation or entity (except when expressly
authorized in writing by Company) any information relating to
Company’s business, including, without limitation, merchant
application processing and credit underwriting software, merchant
information systems, sales compensation and sales force automation
software and systems, electronic payment transaction processing
software, fraud and risk analysis systems, human resources and time
and attendance information systems
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