PERFORMANCE SHARE
AGREEMENT
Total System
Services, Inc. (“Company”) confirms that, effective
[
] , you, [
] , were awarded the opportunity to receive Performance
Shares with an initial economic value of one-half of [XXX%]
of your base salary on [December 31, 20XX] , subject to
adjustment based on specified performance measures for the period
[20XX-20XX (the “20XX – 20XX Performance
Opportunity”)] . The [20XX-20XX Performance
Opportunity] will be converted into Performance Shares pursuant
to the provisions of Section 1 below. The Performance Shares
that you receive in connection with this [20XX – 20XX
Performance Opportunity] , if any, are subject to the terms and
conditions of this Performance Share Agreement (this
“Agreement”) and the Company’s [2008] [2007]
Omnibus Plan (the “Plan”). Any other capitalized word
used in this Agreement and not defined in this Agreement, including
each form of that word, is defined in the Plan.
1.
Standard Performance Terms .
(a) The
terms of this Section 1 shall be referred to as the
“Standard Performance Terms” and will apply to your
Performance Shares except in so far as Sections 2 (Change of
Employment Status) or 3 (Change of Control) apply.
(b)
Two Performance Periods . The number of Performance Shares
you receive in connection with this [20XX-20XX Performance
Opportunity] will be determined on the basis of the
Company’s performance during two periods. The initial
performance period for your Performance Shares (the “Initial
Performance Period”) will begin on [January 1, 20XX
and end on December 31, 20XX] . The secondary performance
period for your Performance Shares (the “Secondary
Performance Period”) will begin on [January 1, 20XX
and end on December 31, 20XX] .
(c)
EPS Performance Measure for Initial Performance Period . The
[20XX-20XX Performance Opportunity] shall be adjusted after
the end of the Initial Performance Period based on the
Company’s earnings per share growth during the Initial
Performance Period. Within 90 days after the beginning of the
Initial Performance Period, the Committee will establish a schedule
of multipliers ranging from zero to 200% of the [20XX –
20XX Performance Opportunity] based upon the Company’s
earnings per share goals for [20XX] . After the end of the
Initial Performance Period, the Committee will certify a multiplier
(the “Multiplier”) based on the actual change in
earnings per share and the schedule established by the Committee;
provided, however, that the Committee has the right to exercise
downward discretion and reduce the Multiplier below the percentage
established in the schedule. You will receive an initial number of
Performance Shares (your “Initial Performance Shares”)
determined as follows: (1) the product of the [20XX-20XX
Performance Opportunity] and the Multiplier, divided by
(2) the closing price of the Company’s Shares on the New
York Stock Exchange on the date the Committee certifies the
Multiplier.
(d)
TSR Performance Measure for Secondary Performance Period .
Your Initial Performance Shares will be adjusted after the end of
the Secondary Performance Period based on the Company’s Total
Shareholder Return (“TSR”) relative to other companies
in the Standard and Poor’s Technology Index determined in
accordance with the table below. For this purpose, TSR shall equal:
(a) the change in Company’s stock price during the
Secondary Performance Period plus dividends paid to the
Company’s shareholders during the Secondary Performance
Period; divided by (b) the Company’s Share price at the
beginning of the Secondary Performance Period.
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Company Rank
in
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3-Year TSR
versus Peers
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Percentile*
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TSR Multiplier
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81 st to
100 th
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120
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%
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61 st to
80 th
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110
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%
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41 st to
60 th
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100
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%
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21 st to
40 th
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90
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%
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0 th to
20 th
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80
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%
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*
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There is no
interpolation between percentiles.
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After the end
of the Secondary Performance Period, the Committee will certify a
percentage adjustment (the “TSR Multiplier”) in
accordance with the table, and you will receive a final number of
Performance Shares (your “Final Performance Shares”)
determined as follows: the product of (1) the Initial Performance
Shares, and (2) the TSR Multiplier.
Your Final
Performance Shares will be due and payable in Shares as soon as
administratively practical following the date the Committee
certifies the TSR Multiplier.
2.
Change of Employment Status . Except as otherwise
provided in this Section 2 or Section 3, you must remain
employed with the Company or an Affiliate through the Secondary
Performance Period in order to be fully vested in your Final
Performance Shares. For purposes of this Section 2, your
transfer between the Company and an Affiliate, or among Affiliates,
will not be a termination of employment. In the event of a Change
of Control, any applicable terms of Section 3 (Change of
Control) will supersede the terms of this
Section 2.
(a)
Long-Term Disability . In the event you qualify for
long-term disability benefits under a plan or arrangement offered
by the Company or an Affiliate for its employees, the Standard
Performance Terms will continue to apply to your Performance
Shares. The amount paid to you at the end of the Secondary
Performance Period will be prorated based on the ratio of number of
months you were employed during the Secondary Performance Period to
the total number of months in the Secondary Performance Period.
Partial months of employment will be counted as full months for
purposes of this calculation.
2
(b)
Death . In the event that your employment with the Company
or an Affiliate terminates due to your death during the Initial
Performance Period, then your beneficiary shall receive a cash
payment determined in accordance with Section 3(a) below. In the
event that your employment with the Company or an Affiliate
terminates due to your death during the Secondary Performance
Period, then your beneficiary will receive Shares calculated in
accordance with Section 3(b) below.
(c)
Retirement . If your employment with the Company or an
Affiliate terminates on or after your early retirement date, which
is defined as attainment of age 62 with 15 or more years of
service, or your normal retirement date, which is defined as
attainment of age 65, the Standard Performance Terms will continue
to apply to your Performance Shares. The amount paid to you at the
end of the Secondary Performance Period will be prorated based on
the ratio of number of months you were employed during the
Secondary Performance Period to the total number of months in the
Secondary Performance Period. Partial months of employment will be
counted as full months for purposes of this calculation.
(d)
Other Termination of Employment . Unless th
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