-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DGdm8OlrLpTb9F+HGFarAHLnr0Qym5SQMd7ORJ/LvYluz2NYDa/8Mwr307EGcWNq rT53Ewaux+9CMyhSC8wg9w== 0001193125-07-140606.txt : 20070622 0001193125-07-140606.hdr.sgml : 20070622 20070622130929 ACCESSION NUMBER: 0001193125-07-140606 CONFORMED SUBMISSION TYPE: 425 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20070622 DATE AS OF CHANGE: 20070622 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Authorize.Net Holdings, Inc. CENTRAL INDEX KEY: 0001017172 STANDARD INDUSTRIAL CLASSIFICATION: RADIO TELEPHONE COMMUNICATIONS [4812] IRS NUMBER: 043065140 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 SEC ACT: 1934 Act SEC FILE NUMBER: 000-21319 FILM NUMBER: 07935928 BUSINESS ADDRESS: STREET 1: 293 BOSTON POST ROAD WEST CITY: MARLBOROUGH STATE: MA ZIP: 01752 BUSINESS PHONE: 5082293200 MAIL ADDRESS: STREET 1: 293 BOSTON POST ROAD WEST CITY: MARLBOROUGH STATE: MA ZIP: 01752 FORMER COMPANY: FORMER CONFORMED NAME: LIGHTBRIDGE INC DATE OF NAME CHANGE: 19960619 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CYBERSOURCE CORP CENTRAL INDEX KEY: 0000934280 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 770472961 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 425 BUSINESS ADDRESS: STREET 1: 1295 CHARLESTON ROAD CITY: MOUNTAIN VIEW STATE: CA ZIP: 94043 BUSINESS PHONE: 4085569100 MAIL ADDRESS: STREET 1: 1295 CHARLESTON ROAD STREET 2: NONE CITY: MOUNTAIN VIEW STATE: CA ZIP: 94043 425 1 d8k.htm FORM 8-K Form 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


FORM 8-K

 


CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 22, 2007 (June 17, 2007)

 


CyberSource Corporation

(Exact name of registrant as specified in its charter)

 


 

Delaware   000-26477   77-0472961

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

 

1295 Charleston Road, Mountain View, California   94043
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code (650) 965-6000

 

(Former name or former address, if changed since last report.)

 


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 



Item 7.01. Regulation FD Disclosure.

Please see penultimate paragraph under Item 8.01.

Item 8.01. Other Events.

On June 17, 2007, CyberSource Corporation, a Delaware corporation (“CyberSource”), entered into an Agreement and Plan of Reorganization (the “Merger Agreement”) by and among CyberSource, Congress Acquisition-Sub, Inc., a Delaware corporation and wholly owned subsidiary of CyberSource (“Merger Sub Corp.”), Congress Acquisition Sub 1, LLC, a Delaware limited liability company and wholly owned subsidiary of CyberSource (“Merger Sub LLC”), and Authorize.Net Holdings, Inc., a Delaware corporation (“Authorize.Net”). Pursuant to the Merger Agreement, Merger Sub Corp. shall be merged with and into Authorize.Net (the “Company Merger”), which shall be the surviving corporation (the “Company Surviving Corporation”) in the Company Merger, and the separate existence of Merger Sub Corp. shall thereupon cease. Next, the Company Surviving Corporation shall be merged with and into Merger Sub LLC (the “LLC Merger,” together with the Company Merger, the “Mergers”), which shall be the surviving limited liability company in the LLC Merger (the “Surviving LLC”) and the separate existence of Company Surviving Corporation shall thereupon cease.

As a condition to the consummation of the Mergers, CyberSource and Roy Banks entered into an Executive Employment Agreement, dated June 17, 2007 (the “Employment Agreement”), pursuant to which Mr. Banks would serve as the President of Surviving LLC conditioned upon and effective upon the close of the Mergers. Under the terms of the Employment Agreement, Mr. Banks will receive a yearly salary of $275,000 and will be provided with an option to purchase 395,000 shares of the common stock of CyberSource, which shall vest over a four-year period. Mr. Banks will not be eligible for consideration of additional stock option grants until January 2010. Mr. Banks shall also be eligible for variable compensation in the amount of $100,000 payable based on the achievement of targets established by CyberSource’s Board of Directors. Mr. Banks shall further be eligible for a bonus of $25,000 payable based on CyberSource’s overachievement of overall operating income plan targets as established by CyberSource’s Board of Directors.

In addition to the Employment Agreement, and conditioned upon and effective upon the close of the Mergers, CyberSource and Mr. Banks also entered into a Non-Competition and Non-Solicitation Agreement, dated June 17, 2007 (the “Non-Competition Agreement”). The Non-Competition Agreement extends for the term of Mr. Bank’s employment with CyberSource and for a period of one (1) year thereafter.

Mr. Banks has served as the President of the Payment Processing Services business unit of Authorize.Net, Authorize.Net Corp., since October 2004. From March 2004 until October 2004, he served as General Manager of Authorize.Net Corp. From June 2000 until March 2004, he served as General Manager of Authorize.Net, then a business unit of InfoSpace, Inc., a provider of online search and directory services. From August 1999 until June 2000, Mr. Banks served as the Vice President of Business Development at Authorize.Net, then a business unit of Go2Net, Inc., an internet infrastructure provider. Mr. Banks is 40 years old.

As an additional condition to the consummation of the Mergers, directors and certain officers of Authorize.Net shall enter into a form of Stock and Option Restriction Agreement (the “Restriction Agreement”) with CyberSource. Under its terms, the directors and officers of Authorize.Net who are a party to the Restriction Agreement may not sell, transfer (whether by gift, operation of law or otherwise), assign, pledge, hypothecate, encumber or otherwise transfer any restricted shares of Authorize.Net common stock or options to purchase common stock of Authorize.Net, or exercise any options to purchase common stock of Authorize.Net, until the earlier of the termination of the Merger Agreement or the effective date of the Mergers. Pursuant to the terms of the Merger Agreement and upon the consummation of the Mergers, such directors and officers shall have their options and restricted shares cancelled in exchange for the right to receive a cash payment. Robert Donahue, Eugene DiDonato, Roy Banks, Timothy O’Brien, Kathleen Harris, John Granara, Rachelle B. Chong, Kevin C. Melia, Gary E. Haroian and Andrew G. Mills are required to execute the Restriction Agreement as a condition to the consummation of the Mergers.


The foregoing description of the Employment Agreement, the Non-Competition Agreement and the Restriction Agreement does not purport to be complete and is qualified in its entirety by reference to the Employment Agreement, the Non-Competition Agreement and the Restriction Agreement, attached as Exhibit 99.1, 99.2 and 99.3 respectively and incorporated herein by reference.

Under the terms of the Merger Agreement, each issued and outstanding share of common stock (excluding the shares of common stock subject to the Restriction Agreements discussed above) of Authorize.Net immediately prior to the effective time of the Mergers shall be converted into the right to receive (i) 1.1611 shares of CyberSource common stock; (ii) a pro rata share of approximately $125 million in the form of a cash payment (the “Cash Consideration”); and (iii) cash in lieu of fractional shares. Based on the number of shares of Authorize.Net common stock outstanding as of June 15, 2007, each issued and outstanding share of common stock (excluding the shares of restricted common stock) of Authorize.Net would receive approximately $4.45 per share in Cash Consideration.

The preceding paragraph is the sole paragraph regarding communications related to the Mergers contained in this Form 8-K.

Forward-Looking Statements

This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding the timing of the closing of the Mergers. These forward-looking statements involve important factors that could cause actual results to differ materially from those in the forward-looking statements. Such important factors involve risks and uncertainties including, but not limited to, unanticipated delays and difficulties in obtaining regulatory approvals and stockholder approvals, unanticipated delays and difficulties in satisfying the closing conditions to the Mergers, and other risks that are described from time to time in CyberSource Corporation’s Securities and Exchange Commission reports, including, but not limited to, CyberSource Corporation’s Annual Report on Form 10-K filed with the SEC on March 13, 2007. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, CyberSource Corporation’s results could differ materially from CyberSource Corporation’s expectations in these statements. CyberSource Corporation assumes no obligation and does not intend to update these forward-looking statements.

Additional Information and Where to Find It

CyberSource Corporation and Authorize.Net Holdings, Inc. will file a joint proxy statement/prospectus with the SEC in connection with the proposed Mergers. Investors and security holders are urged to read the joint proxy statement/prospectus when it becomes available and any other relevant documents filed with the SEC because they will contain important information regarding CyberSource Corporation, Authorize.Net Holdings, Inc., the proposed Mergers, the persons soliciting proxies in connection with the proposed Mergers on behalf of CyberSource Corporation and Authorize.Net Holdings, Inc. and the interests of those persons in the proposed Mergers and related matters. CyberSource Corporation and Authorize.Net


Holdings, Inc. intend to mail the joint proxy statement/prospectus to their respective stockholders once such joint proxy statement/prospectus is declared effective by the SEC. Investors and security holders will be able to obtain a copy of the joint proxy statement/prospectus and other documents filed by CyberSource Corporation and Authorize.net with the SEC free of charge at the website maintained by the SEC at http://www.sec.gov. In addition, documents filed with the SEC by CyberSource Corporation are available free of charge by contacting CyberSource Corporation, Investor Relations, 1295 Charleston Road, Mountain View, California 94043, (650) 965-6000, and documents filed with the SEC by Authorize.Net Holdings, Inc. are available free of charge by contacting Authorize.Net Holdings, Inc., Investor Relations, 293 Boston Post Road West, Suite 220, Marlborough, Massachusetts 01752, (508) 229-3200.

Participants in Solicitation

CyberSource Corporation and Authorize.Net Holdings, Inc., and their respective directors, executive officers and employees may be deemed to be participants in the solicitation of proxies from the stockholders of CyberSource Corporation and Authorize.Net Holdings, Inc. in connection with the proposed Mergers and related items. Information regarding the directors and executive officers of Authorize.Net Holdings, Inc. is set forth in the proxy statement filed with the SEC on April 29, 2007, for Authorize.Net Holdings, Inc.’s Special Meeting in Lieu of 2007 Annual Meeting of Stockholders to be held June 29, 2007. Information regarding the directors and executive officers of CyberSource Corporation is set forth in CyberSource Corporation’s proxy statement for CyberSource Corporation’s 2007 annual meeting of stockholders. Investors may obtain additional information regarding the interests of those participants by reading the joint proxy statement/prospectus when it becomes available.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

The following exhibits are being filed with this Current Report on Form 8-K:

 

Exhibit

Number

 

Description

99.1   Executive Employment Agreement, dated as of June 17, 2007, by and between CyberSource Corporation and Roy Banks.
99.2   Non-Competition and Non-Solicitation Agreement, dated as of June 17, 2007, by and between CyberSource Corporation and Roy Banks.
99.3   Form of Stock and Option Restriction Agreement.

 


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

CyberSource Corporation

(Registrant)

Date: June 22, 2007  

/s/ Steven D. Pellizzer

  (Signature)
  Steven D. Pellizzer
  Chief Financial Officer


EXHIBIT INDEX

 

Exhibit

Number

 

Description

99.1   Executive Employment Agreement, dated as of June 17, 2007, by and between CyberSource Corporation and Roy Banks.
99.2   Non-Competition and Non-Solicitation Agreement, dated as of June 17, 2007, by and between CyberSource Corporation and Roy Banks.
99.3   Form of Stock and Option Restriction Agreement.
EX-99.1 2 dex991.htm EXECUTIVE EMPLOYMENT AGREEMENT Executive Employment Agreement

Exhibit 99.1

Executive Employment Agreement

This Executive Employment Agreement (this “Agreement”) is made as of this 17th day of June 2007, by and between CyberSource Corporation, a Delaware corporation (“Employer” or the “Parent”), and Roy Banks of 6174 Thornton Circle, Highland, Utah 84003 (the “Executive”) (collectively, the “parties”).

WHEREAS, Executive is currently employed by Authorize.Net Holdings, Inc. (“Company”); and,

WHEREAS, pursuant to an Agreement and Plan of Reorganization by and among the Parent, Congress Acquisition-Sub, Inc. (the “Merger Sub”), Congress Acquisition Sub 1 LLC (“Merger Sub LLC”), and the Company (the “Merger Agreement”), the Merger Sub and the Company will be merged and the resulting corporation will be merged with and into the Merger Sub LLC, with the Merger Sub LLC surviving as a wholly-owned subsidiary of the Parent; and

WHEREAS, the parties wish to provide for the Executive’s employment as President of Merger Sub LLC (or Authorize.Net LLC) with Employer following the Merger, beginning on the Effective Date as defined in the Merger Agreement;

NOW, THEREFORE, subject to the terms of the Merger Agreement and contingent upon the consummation of the Merger, the parties agree as follows:

1. Definition of Terms. As used herein, the following terms shall have the following respective meanings. All capitalized terms not defined herein shall have the meanings defined in the Merger Agreement.

(a) “Cause” shall mean: (i) Executive commits a crime involving dishonesty, breach of trust, or physical harm to any person; (ii) Executive willfully engages in conduct that is in bad faith and materially injurious to Employer, including but not limited to, misappropriation of trade secrets, fraud or embezzlement; (iii) Executive commits a material breach of this Agreement; (iv) Executive willfully refuses to implement or follow a lawful policy or directive of Employer; or (v) Executive engages in misfeasance or malfeasance demonstrated by a pattern of failure to perform job duties diligently and professionally. Employer may terminate Executive’s employment For Cause at any time, without any advance notice. Employer shall pay to Executive all compensation to which Executive is entitled up through the date of termination, subject to any other rights or remedies of Employer under law; and thereafter all obligations of Employer under this Agreement shall cease.

(b) “Effective Time” shall have the meaning set forth in the Merger Agreement.

(c) “Good Reason” shall mean (i) a reduction in the Executive’s annual base salary, as set forth in Section 3(a) below, or in Executive’s Variable Compensation or Annual Bonus targets as set forth in Section 3(c) and (d), except for across-the-board salary reductions similarly affecting all management personnel of the Company or Employer; or (ii) the relocation


of the primary office where the Executive is to perform his duties by more than 35 miles from its location on the Effective Date; or (iii) a significant diminution of duties of Executive such as the Executive no longer directing the activities of the Authorize.Net LLC sales team, or the Executive no longer primarily influencing the delivery of support, services, and features directed to, and associated with, Authorize.Net LLC customers; or (iv) Executive no longer reporting directly to the CEO of Employer.

(d) “Release” shall mean a release of claims by the Executive in favor of Employer and the other parties, in the form attached hereto as Exhibit A.

(e) “Term” shall mean the period commencing as of the Effective Time and continuing in effect through December 31, 2008; provided, however, that commencing on January 1, 2009, and on each January 1 thereafter, the Term shall be automatically extended for one additional year unless, not later than 180 days prior to the scheduled expiration of the Term (or any extension thereof), Employer shall have given the Executive written notice that the Term will not be extended.

2. Position and Responsibilities.

(a) Position. Subject to the consummation of the Merger, Employer shall employ the Executive as President of Authorize.net LLC reporting to Employer’s Chief Executive Officer. The Executive shall perform such duties and responsibilities as are normally related to such position in accordance with the standards of the industry and any additional duties now or hereafter assigned to the Executive by Employer. The Executive shall abide by the rules, regulations, and practices as adopted or modified from time to time in Employer’s sole discretion.

(b) Other Activities. Except upon the prior written consent of Employer, Executive will not, during the term of this Agreement, (i) accept any other employment, or (ii) engage, directly or indirectly, in any other business activity (whether or not pursued for pecuniary advantage) that might interfere with Executive’s duties and responsibilities hereunder or create a conflict of interest with Employer.

(c) No Conflict. The Executive represents and warrants that his execution of this Agreement, employment with Employer, and the performance of his proposed duties under this Agreement shall not violate any obligations he may have to any other employer, person or entity, including any obligations with respect to proprietary or confidential information of any other person or entity.

3. Compensation and Benefits.

(a) Base Salary. In consideration of the services to be rendered under this Agreement, Employer shall pay the Executive a salary at the rate of Two Hundred and Seventy-five Thousand Dollars ($275,000) per year (“Base Salary”). The Base Salary shall be paid in accordance with Employer’s regularly established payroll practice. The Executive’s Base Salary will be reviewed from time to time in accordance with the established procedures of Employer for adjusting salaries for similarly situated employees and may be adjusted in the sole discretion of Employer.

 

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(b) Stock Options. The Executive shall be provided with an option to purchase 395,000 shares of the Common Stock of the Employer (the “Employer Stock Options”), provided that Executive acknowledges and understands that Executive will not be eligible for consideration for additional option grants until 2010. The price per share of the Employer Stock Options shall be the closing price of the Employer’s common stock as listed on the NASDAQ Global Market on the Executive’s first day of employment by the Employer (which is anticipated to be the date on which the Effective Time takes place). The Executive’s entitlement to stock options is conditioned upon his signing of the applicable stock option agreement and is subject to its terms and the terms of the applicable stock option plan under which the options are granted. Among other things set forth in the stock option agreement, one quarter of the stock options will vest upon the first anniversary of the Executive’s employment with Employer, and, thereafter, the remaining unvested options will vest at a rate of 1/48 per month on the first day of each calendar month following the first anniversary.

(c) Variable Compensation. Executive shall be eligible for annual variable compensation of One Hundred Thousand Dollars ($100,000) (“Variable Compensation”), based on achievement of targets established by Employer’s Board of Directors, which targets may be amended at any time at the sole discretion of Employer’s Board of Directors or Compensation Committee. Such Variable Compensation shall be determined and payable on a quarterly basis.

(d) Bonus. Executive shall be eligible for an annual target incentive bonus equal to Twenty-Five Thousand Dollars ($25,000) (“Target Bonus”), based on Employer’s overachievement of overall operating income plan targets established by Employer’s Board of Directors, which targets may be amended at any time at the sole discretion of Employer’s Board of Directors or Compensation Committee.

(e) Benefits. The Executive shall be eligible to participate in the benefits made generally available by Employer to similarly-situated executives, in accordance with the benefit plans established by Employer, and as may be amended from time to time in Employer’s sole discretion, including paid vacation accruing at a rate of five weeks per year.

(f) Expenses. Employer shall reimburse the Executive for reasonable business expenses incurred in the performance of the Executive’s duties hereunder in accordance with Employer’s expense reimbursement guidelines.

4. At-Will Employment; Termination for Cause; Termination Without Cause.

(a) At-Will Termination. The Executive’s employment with Employer shall be “at-will” at all times. Either Employer or the Executive may terminate the employment relationship at any time, with or without cause or advance notice, notwithstanding anything to the contrary contained in or arising from any statements, policies or practices of Employer relating to the employment, discipline or termination of its employees. Upon and after such termination, all obligations of Employer under this Agreement shall cease, except as otherwise provided herein.

 

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(b) Termination for Cause. Employer may terminate Executive’s employment for Cause at any time, without any advance notice. Employer shall pay to Executive all compensation to which Executive is entitled up through the date of termination, subject to any other rights or remedies of Employer under law; and thereafter all obligations of Employer under this Agreement shall cease.

(c) Termination Without Cause; Good Reason.

i) In the event that, between the Effective Date and expiration of the Term on December 31, 2008, Employer terminates the Executive’s employment without Cause, or Executive terminates his employment with Employer for Good Reason, subject to the Executive’s execution of the Release and the provisions of Section (4)(c)(iii) below, (1) Employer shall pay the Executive in one lump sum payment an amount equal to one times his then-current Base Salary plus one times the Variable Compensation earned by the Executive in respect of the immediately preceding calendar year (or, if the Board of Directors or Compensation Committee has not yet made a determination regarding the amount of such Annual Bonus, one times 60% of the Executive’s target Variable Compensation) plus one times the Target Bonus earned by the Executive in respect of the immediately preceding calendar year (or, if the Board of Directors or Compensation Committee has not yet made a determination regarding the amount of such Target Bonus, one times 60% of the Executive’s Target Bonus); and (2) the Executive and his family members will be eligible to continue his group health insurance coverage in accordance with the federal COBRA law. The Executive shall not be entitled to any severance payments or benefits if Executive’s employment is terminated for Cause or due to Executive terminating his employment for other than Good Reason; or due to expiration or non-renewal of the Term.

ii) Should the Executive or any of his family members elect COBRA continuation coverage during the twelve-month period immediately following the Executive’s termination pursuant to Section 4(b)(i) hereof, Employer shall be responsible for paying the difference between the cost of COBRA continuation coverage and the premium contribution amount applicable to the Executive as of the date of such termination of employment, subject to any applicable rate adjustments by carrier or Employer. After such twelve-month period ends, if Executive or any of his family members elect to continue COBRA coverage, Executive will be responsible for all of the premium payments. Information about Executive’s rights under COBRA and forms for electing continuation coverage will be provided to Executive by a separate letter on or about the date of such termination of employment.

iii) Notwithstanding anything herein to the contrary, (a) in the event that the compensation payable to the Executive hereunder would constitute an excess parachute payment as defined in Section 280G of the Internal Revenue Code, Employee shall have the right to reduce such compensation to an amount that would avoid the application of said Section 280G, and (b) to the extent that Employer in good faith determines that amounts that are or may become payable to the Executive upon termination of employment hereunder are required to be suspended or delayed for a period of six months in order to satisfy the requirements of Internal Revenue Code Section 409A, then Employer shall so advise the Executive, any such payments shall be suspended and accrued for six months, whereupon said payments shall be paid to the Executive in a lump sum.

 

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5. Termination Obligations.

(a) Return of Property. The Executive agrees that all property (including without limitation all equipment, tangible proprietary information, documents, records, notes, contracts and computer-generated materials) furnished to or created or prepared by the Executive incident to the Executive’s employment belongs to Employer and shall be promptly returned to Employer upon termination of the Executive’s employment.

(b) Resignation and Cooperation. Upon termination of the Executive’s employment, the Executive shall be deemed to have resigned from all offices and directorships then held with Employer. Following any termination of employment, the Executive shall cooperate with Employer in the winding up of pending work on behalf of Employer and the orderly transfer of work to other employees. The Executive shall also cooperate with Employer in the defense of any action brought by any third party against Employer that relates to the Executive’s employment by Employer.

6. Inventions and Proprietary Information; Prohibition on Third Party Information.

(a) Confidentiality Agreement. The Executive agrees to sign and be bound by the terms of Employer’s Agreement Regarding Confidentiality and Inventions, which is attached as Exhibit B (“Confidentiality Agreement”).

(b) Restrictive Covenants. The Executive acknowledges that because of his position in Employer, he will have access to material intellectual property and confidential information. The Executive agrees to sign and be bound by the terms of the Non-Competition and Non-Solicitation Agreement to be executed in connection with the Merger Agreement.

(c) Non-Disclosure of Third Party Information. The Executive represents and warrants and covenants that he shall not disclose to Employer, or use, or induce Employer to use, any proprietary information or trade secrets of third parties at any time; and the Executive acknowledges and agrees that any violation of this provision shall be grounds for immediate termination of his employment. The Executive further specifically and expressly acknowledges that no officer or other employee or representative of Employer has requested or instructed him to disclose or use any such third party proprietary information or trade secrets.

 

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7. Amendments; Waivers; Remedies. This Agreement may not be amended or waived except by a writing signed by the Executive and by a duly authorized representative of Employer other than the Executive. Failure to exercise any right under this Agreement shall not constitute a waiver of such right. Any waiver of any breach of this Agreement shall not operate as a waiver of any subsequent breaches. All rights or remedies specified for a party herein shall be cumulative and in addition to all other rights and remedies of the party hereunder or under applicable law.

8. Assignment. The performance of the Executive is personal hereunder, and the Executive agrees that he shall have no right to assign and shall not assign or purport to assign any rights or obligations under this Agreement. This Agreement may be assigned or transferred by Employer; and nothing in this Agreement shall prevent the consolidation, merger or sale of Employer or a sale of any or all or substantially all of its assets. This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors, and assigns.

9. Notices. All notices or other communications required or permitted hereunder shall be made in writing and shall be deemed to have been duly given if delivered: (a) by hand; (b) by a nationally recognized overnight courier service; or (c) by United States first class registered or certified mail, return receipt requested, to the principal address of the other party, as set forth below. The date of notice shall be deemed to be the earlier of (i) actual receipt of notice by any permitted means, or (ii) five business days following dispatch by overnight delivery service or the United States Mail. The Executive shall be obligated to notify Employer in writing of any change in his address. Notice of change of address shall be effective only when done in accordance with this paragraph.

Employer’s Notice Address:

CyberSource Corporation

1295 Charleston Road

Mountain View, CA 94043

ATTN: General Counsel

Executive’s Notice Address:

Roy Banks

6174 Thornton Circle

Highland, Utah 84003

10. Severability. If any provision of this Agreement shall be held by a court or arbitrator to be invalid, unenforceable, or void, such provision shall be enforced to the fullest extent permitted by law, and the remainder of this Agreement shall remain in full force and

 

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effect. In the event that the time period or scope of any provision is declared by a court or arbitrator of competent jurisdiction to exceed the maximum time period or scope that such court or arbitrator deems enforceable, then such court or arbitrator shall reduce the time period or scope to the maximum time period or scope permitted by law.

11. Taxes. All amounts paid under this Agreement shall be paid less all applicable state and federal tax withholdings (if any) and any other withholdings required by any applicable jurisdiction or authorized by the Executive.

Employer and any successor-in-interest shall have the authority to delay the payment of any amounts under this Agreement to the extent it deems necessary or appropriate to comply with Section 409A(a)(2)(B)(i) of the Internal Revenue Code; in such event, any payment to which the Executive would otherwise be entitled during the six (6) month period following the date of the Executive’s termination of employment will be payable on the first business day following the expiration of such six (6) month period.

12. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah.

13. Interpretation. This Agreement shall be construed as a whole, according to its fair meaning, and not in favor of or against any party. Sections and section headings contained in this Agreement are for reference purposes only, and shall not affect in any manner the meaning or interpretation of this Agreement. Whenever the context requires, references to the singular shall include the plural and the plural the singular.

14. Obligations Surviving Termination of Employment. The Executive agrees that his obligations under Sections 5 and 6 and Exhibit B of this Agreement, and under the Non-Competition and Non-Solicitation Agreement, shall survive the termination of employment and the termination of this Agreement.

15. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Agreement, but all of which together shall constitute one and the same instrument.

16. Entire Agreement. This Agreement is intended to be the final, complete, and exclusive statement of the terms of the Executive’s employment by Employer and may not be contradicted by evidence of any prior or contemporaneous statements or agreements, except for agreements specifically referenced herein (including the Confidentiality Agreement attached as Exhibit B and the Non-Competition and Non-Solicitation Agreement). To the extent that the practices, policies or procedures of Employer, now or in the future, apply to the Executive and are inconsistent with the terms of this Agreement, the provisions of this Agreement shall control. The parties acknowledge and agree that this Agreement supersedes and replaces in its entirety the Executive’s Executive Retention Agreement with the Company dated May 23, 2005.

 

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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first written above.

 

CYBERSOURCE CORPORATION

    ROY BANKS:

By:

 

/s/ William S. McKiernan

   

/s/ Roy Banks

  William S. McKiernan    
Title:   Chairman and CEO    

 

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Exhibit A

FORM OF GENERAL RELEASE OF CLAIMS

In exchange for the consideration from CyberSource Corporation (“Company”) described in Section 4(b) of the Executive Employment Agreement between you and CyberSource Corporation dated June 17, 2007 (the “Employment Agreement”), the sufficiency of which is hereby acknowledged, you, on your own behalf and on behalf of your heirs, personal representatives, and assigns, hereby voluntarily and irrevocably release, acquit and forever discharge Company, Employer, their respective parent, subsidiary, affiliated, related, predecessor, and successor entities, and their respective past, present and future officers, directors, agents, representatives, attorneys, servants, employees, predecessors, successors, and assigns (hereinafter the “Releasees”), from any and all claims, demands, liabilities, debts, judgments, damages, expenses (including attorneys’ fees and costs), actions, causes of action or suits of any kind whatsoever which you, your heirs, personal representatives and assigns, and each of them, may have had or may now have, whether known or unknown, including, but not limited to, common law claims, statutory claims, claims for wages, commissions, bonuses or earnings or benefits, claims for overtime, claims or causes of action under the Civil Rights Act, the Employee Retirement Income Security Act, the Fair Labor Standards Act, the Worker Adjustment and Retraining Notification Act (29 U.S.C. Section 2101 et seq.), the Americans with Disabilities Act, the Older Workers Benefit Protection Act, the Family and Medical Leave Act, the Age Discrimination in Employment Act, the Equal Pay Act, the Massachusetts Fair Employment Practices Act, the California Fair Employment and Housing Act and any equivalent state law, tort law, contract law, law of wrongful discharge, discrimination, harassment, fraud, misrepresentation, defamation, libel, emotional distress, breach of the implied covenant of good faith and fair dealing, any other federal, state or municipal statute or ordinance, and claims or causes of action under any other theory, which arise out of or are related in any way, directly or indirectly, to your employment or the termination of your employment.

You further agree that you will not bring any lawsuits or make any other demands against the Releasees, or pursue any lawsuits already brought, based on your employment by Company. You further represent that you have no current or pending actions, charges, lawsuits or complaints against Company. You acknowledge and understand that the consideration provided for in the Employment Agreement constitutes a full, fair and complete payment for the release and waiver of all your possible claims. You acknowledge and understand that Company does not owe you anything for your employment in addition to the consideration set forth in the Employment Agreement.

THIS MEANS THAT YOU MAY NOT SUE COMPANY OR THE OTHER RELEASEES FOR ANY CURRENT OR PRIOR CLAIMS ARISING OUT OF YOUR EMPLOYMENT OR TERMINATION.

In signing this Release, you acknowledge that you understand its provisions, that your agreement is knowing and voluntary, that you have been afforded a full and reasonable opportunity of at least 21 days to consider its terms and to consult with or seek advice from an attorney or any other person of your choosing, and that you have been advised by the Company to consult with an attorney prior to executing this Release.

 

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For a period of seven (7) days following your execution of this Release, you may revoke your signature, and this Release shall not become effective or enforceable until this seven (7) day revocation period has expired. No payments or benefits under Section 4(b) of the Employment Agreement will be made or provided until after this seven-day period has expired without your revoking this Release. You understand and acknowledge that the terms of your employment and the Company’s usual severance policies or practices (if any) would have provided you less severance pay and benefits than those provided to you under the Employment Agreement.

 

AGREED:

 

    DATED:
 

Roy Banks

   

 

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Exhibit B

AGREEMENT REGARDING CONFIDENTIALITY AND INVENTIONS

In consideration of CyberSource Corporation or its subsidiaries or affiliates (referred to separately or together as “Company”) employing me, compensating me and for other good and valuable consideration, the adequacy and sufficiency of which is hereby acknowledged, I (the “Employee”) understand and agree to the following provisions for the protection of Company property rights:

I. COMPANY CONFIDENTIAL INFORMATION AND MATERIALS. I acknowledge that the following information and materials in written, oral, machine-readable, photographic or other form and whether now existing or developed or created during my employment with the Company (the “Confidential Information”) are proprietary to Company and are highly sensitive in nature:

A. Information Marked Proprietary or Confidential. All data, documents, materials, drawings and information that I receive from Company in tangible form and marked “Proprietary” or “Confidential.”

B. Technology. Any and all Technology (as defined below) which is constructed, designed, improved, altered or used by Company and which is not generally known to the public or within the industries in which Company competes.

C. Business Procedures. Internal business procedures and business plans, including analytical methods and procedures, licensing techniques, manufacturing information and procedures such as formulations, processes and equipment, technical and engineering data, vendor names, other vendor information, purchasing information, financial information, service and operational manuals and documentation therefor, ideas for new products and services and other such information which relates to the way Company conducts its business and which is not generally known to the public.

D. Legal Rights. Patents, copyrights, mask work rights, trade secrets, trademarks, service marks, and the like.

E. Marketing Plans and Customer Lists. Any and all customer and marketing information and materials, such as (i) strategic data, including marketing and development plans, forecasts and forecast assumptions and volumes, and future plans and potential strategies of Company which have been or are being discussed; (ii) financial data, including price and cost objectives, price lists, pricing policies and procedures, and quoting policies and procedures; and (iii) customer data, including customer lists, names of existing, past or prospective customers and their representatives, data provided by or about prospective, existing or past customers, customer service information and materials, data about the terms, conditions and expiration dates of existing contracts with customers and the type, quantity and specifications of products and services purchased, leased or licensed by customers of Company.

 

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F. Third Party Information. Any and all information and materials in Company’s possession or under its control from any other person or entity which Company is obligated to treat as confidential or proprietary (“Third Party Information”).

G. Not Generally Known. Any and all information not generally known to the public or within the industries or trades in which Company competes.

II. NON-CONFIDENTIAL INFORMATION AND MATERIALS. The following information and materials shall not be considered Confidential Information.

A. General Skills and Knowledge. The general skills and experience that I gain during my employment, and information publicly available or generally known within the industries or trades in which Company competes.

B. Public Domain. Information which at the time of disclosure is in the public domain, or which later becomes part of the public domain by publication or otherwise through no breach by any party of any confidentiality obligation to Company.

C. Prior Possession. Information which I can demonstrate was in my possession prior to Company’s disclosure to me. Except as disclosed on Schedule A to this agreement, I have no knowledge of the Company’s Confidential Information, other than information I have learned from the Company in the course of being hired and employed.

D. Third Party. Information which is furnished to me by a third party, as a matter of right without restriction on disclosure, and which was not received directly or indirectly from Company, and which Company is not obligated to keep confidential.

E. Independent Development. Information which I can demonstrate that I independently developed outside the scope and course of my employment and without any reliance upon the Confidential Information.

III. MY OBLIGATIONS AS TO CONFIDENTIAL INFORMATION AND MATERIALS. During my employment, I will have access to the Confidential Information and will occupy a position of trust and confidence regarding Company’s affairs and business. I agree to take the following steps to preserve the confidential and proprietary nature of the Confidential Information.

A. Non-Disclosure. During and after my employment, I will not use, disclose or otherwise permit any person or entity access to any of the Confidential Information other than as required in the performance of my duties with Company, and I will take all reasonable precautions to prevent disclosure of the Confidential Information to unauthorized persons or entities. I understand that I am not allowed to sell, license or otherwise exploit any products or services which embody in whole or in part any Confidential Information.

B. Third Party Information. I will maintain the confidentiality of Third Party Information and will not use the information or disclose it to anyone (except as necessary in carrying out my work for the Company consistent with the Company’s agreement with such third party).

 

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C. Location and Reproduction. I agree to maintain at my workstation and/or any other place under my control only such Confidential Information that is necessary to carry out my responsibilities as an employee of the Company. I agree to return to the appropriate person or location or otherwise properly dispose of Confidential Information once that necessity no longer exists. I also agree not to make copies or otherwise reproduce Confidential Information except to the extent necessary to carry out my responsibilities as an employee of the Company.

IV. INVENTIONS

A. Definitions.

“Technology” comprises all materials, information, ideas and other subject matter, including, without limitation, works of authorship and other creations; inventions, invention disclosures, discoveries, developments and patent applications; know-how and trade secrets; plans, designs and concepts; drawings, diagrams and schematics; writings, reports, notebooks, and other documents; specifications, formulas, structures and other technical or engineering information; prototypes, systems, compositions, hardware, tools, equipment, instruments and other products, technology; processes, methods, techniques, procedures and work in process; computer programs (in source code, object code or any other format), applications, algorithms, protocols, data and databases, programmable logic and documentation; and any copies, extracts, portions, derivatives, improvements and enhancements thereof and modifications thereto.

“Inventions” means any and all Technology that (i) is created, made, conceived, invented, discovered, developed, reduced to practice or suggested by me, alone or together with others, at any time during my employment by the Company or, whether during or within a reasonable time after my employment with the Company, otherwise in connection with my activities as an employee of, or based upon any Confidential Information of, the Company, and (ii) relates in any manner to the actual or reasonably anticipated business, research, development or other activities of the Company, or were created, made, conceived, invented, discovered, developed, reduced to practice or suggested using the Company’s equipment, supplies, facilities, or Confidential Information. “Inventions” shall not include (a) Technology expressly set forth on Schedule A, and (b) other Technology to the extent that California Labor Code Section 2870 or any other mandatory and non-waivable applicable laws, prohibits the assignment thereof as set forth herein. I acknowledge and understand that Section 2870(a) provides as follows:

“Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the

 

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employer’s business, or actual or demonstrably anticipated research or development of the employer [or] (2) Result from any work performed by the employee for the employer.”

B. Ownership of Inventions. I agree and acknowledge that all right, title and interest with respect to all Inventions shall solely vest in, inure to the sole benefit of, and be the sole property of, the Company without any limitations. I agree and acknowledge that all Inventions shall be considered works made for hire and works produced in the service of the Company within the scope of my employment.

C. Assignment of Inventions. I agree to assign and transfer to the Company, without further consideration, my entire right, title and interest (throughout the United States and in all other countries or jurisdictions), free and clear of all liens and encumbrances, in and to all Inventions. Such assignment and transfer to the Company shall be continuous during my employment as of the relevant time of development of each such Invention. The Company may, in its sole discretion, agree to provide consideration for certain Inventions through a written agreement between the Company and the undersigned which specifically provides for such consideration; in all other cases, no consideration shall be paid. The Inventions shall be the sole property of the Company, whether or not copyrightable or patentable or in a commercial stage of development. In addition, I agree to maintain adequate and current written records on the development of all Inventions, which shall also remain the sole property of the Company. I also agree that all Inventions shall be considered works made for hire and works produced in the service of the Company within the scope of my employment.

D. Moral Rights. To the extent allowed by law, this assignment of inventions includes all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as “moral rights,” “artist’s rights,” “droit moral,” or the like (collectively “Moral Rights”). To the extent I retain any such Moral Rights under applicable law, I hereby ratify and consent to any action that may be taken with respect to such Moral Rights by or authorized by the Company and agree not to assert any Moral Rights with respect thereto. I will confirm any such ratifications, consents and agreements from time to time as requested by the Company.

E. License for Other Inventions. If, in the course of my employment with the Company, I incorporate into Company property an invention owned by me or in which I have an interest, the Company is hereby granted a nonexclusive, royalty-free, irrevocable, perpetual and transferable license throughout the universe to make, use, import, sell, copy, distribute, display, perform (whether or not publicly) such invention as part of and in connection with the Company property.

F. Assist With Registration. In the event any Invention shall be deemed by the Company to be copyrightable or patentable or otherwise registrable, I will assist the Company (at its expense) in obtaining and maintaining letters patent or other applicable registrations and in vesting the Company with full title. Should the Company be unable to secure my signature on any document necessary to apply for, prosecute, obtain, or enforce any patent, copyright, or other right or protection relating to any Invention, due to my incapacity or any other cause, I hereby

 

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irrevocably designate and appoint the Company and each of its duly authorized officers and agents as my agent and attorney-in-fact to do all lawfully permitted acts to further the prosecution, issuance, and enforcement of patents, copyrights, or other rights or protection with the same force and effect as if executed and delivered by me.

G. Disclosure. I agree to disclose promptly to the Company all Inventions and relevant records. I further agree to promptly disclose to the Company any idea that I do not believe to be an Invention, but is conceived, developed, or reduced to practice by me (alone or with others) while I am employed by the Company or during the one-year period following termination of my employment. I will disclose the idea, along with all information and records pertaining to the idea, and the Company will examine the disclosure in confidence to determine if in fact it is an Invention subject to this Agreement.

V. FORMER OR CONFLICTING AGREEMENTS

A. Former Agreements. I represent and warrant that my performance of the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me prior to my employment by the Company. I have listed in Schedule A all other agreements concerning proprietary information or inventions to which I am a party and attached copies of any agreements in my possession. To the best of my knowledge, there is no other contract between me and any other person or entity that is in conflict with this agreement or concerns proprietary information, inventions or assignment of ideas.

B. Prohibition On Use Of Third Party Information. I represent and warrant and covenant that I will not disclose to the Company, or use, or induce the Company to use, any proprietary information or trade secrets of others at any time, including but not limited to any proprietary information or trade secrets of any former employer, if any. I acknowledge and agree that any violation of this provision shall be grounds for my immediate termination and could subject me to substantial civil liabilities and criminal penalties. I further specifically and expressly acknowledge that no officer or other employee or representative of the Company has requested or instructed me to disclose or use any such third party proprietary information or trade secrets.

VI. TERMINATION

A. Return of the Company’s Property. I agree to promptly return to the Company upon termination of my employment all Confidential Information and all personal property furnished to or prepared by me in the course of or incident to my employment. Following my termination, I will not retain any written or other tangible material containing any Confidential Information or other information pertaining to any Inventions.

B. Termination Certificate. In the event of the termination of my employment, I agree, if requested by the Company, to sign and deliver the Termination Certificate attached as Schedule B.

 

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C. Subsequent Employers. I agree that after the termination of my employment with the Company, I will not enter into any agreement that would cause me to violate any of my obligations under this agreement and will inform any subsequent employers of my obligations under this agreement.

D. Survival. The terms and conditions of this agreement and my obligations hereunder shall survive any termination of my employment with the company and any expiration or termination of any employment or other agreement between the Company and me, and such terms and conditions shall remain in full force and effect as set forth herein.

VII. ENFORCEMENT. I acknowledge that monetary damages will not be sufficient to avoid or compensate for the unauthorized use or disclosure of any Confidential Information and that injunctive relief would be appropriate to prevent any actual or threatened use or disclosure of such Confidential Information. I further understand that Company may waive some of the requirements expressed in this Agreement, but to make such a waiver effective it must be made in writing by the Company and such a waiver should not in any way be deemed a waiver of Company’s right to enforce any other requirements of this Agreement. I agree that each of my obligations specified above is a separate and independent covenant and that the unenforceability of any of them shall not preclude the enforcement of the rest of them or of any other covenants in this Agreement.

VIII. REMEDIES. No remedy conferred on Company by any of the specific provisions of this Agreement is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given or now or later existing at law or in equity or by statute or otherwise. The election of one or more remedies by Company or me shall not constitute a waiver of the right to pursue other available remedies.

IX. AT-WILL RETENTION. Although I understand that my employment is contingent on the acceptance and observance of this Agreement, this Agreement shall not be construed to make my employment other than terminable at will at anytime by me or Company at our sole discretion, with or without cause.

X. MISCELLANEOUS PROVISIONS.

A. Prior Disclosures. I agree this Agreement shall apply to any Confidential Information that Company may have provided me prior to the effective date hereof.

B. Construction and Validity. This Agreement shall be governed by the laws of the State of California, excluding its conflict of law principles, and any disputes which cannot be resolved between the parties shall be submitted to the courts within California for resolution. If any provision of this Agreement is held to be void, invalid, or inoperative, such event shall not affect any other provisions, which shall continue and remain in full force and effect as though such void, invalid or inoperative provisions had not been a part of this Agreement.

 

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C. Amendments. This Agreement shall not be modified, amended or in any way altered except by an instrument in writing signed by an officer of the Company and me.

D. Entire and Sole Agreement. This Agreement constitutes the entire understanding and agreement between the Company and me regarding the subject matter of this Agreement and supersedes any and all prior or contemporaneous oral or written communications regarding it.

 

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I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND ITS TERMS. I HAVE COMPLETELY NOTED ON SCHEDULE A TO THIS AGREEMENT ANY CONFIDENTIAL OR PROPRIETARY INFORMATION, IDEAS, PROCESSES, INVENTIONS, TECHNOLOGY, WRITINGS, PROGRAMS, DESIGNS, FORMULAS, DISCOVERIES, PATENTS, COPYRIGHTS, OR TRADEMARKS, OR IMPROVEMENTS, RIGHTS, OR CLAIMS RELATING TO THE FOREGOING, THAT I DESIRE TO EXCLUDE FROM THIS AGREEMENT.

 

EMPLOYEE:

   

WITNESS:

COMPANY

 

 

    By:  

 

 

Signature

       

 

    Name:    

Name (Please Print)

       

 

    Title:    

Social Security Number

       

Date:

   

Date:

 

 

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SCHEDULE A

EMPLOYEE’S DISCLOSURE

 

1.

   Confidential Information. Except as set forth below, I acknowledge that at this time I know nothing about the business or Confidential Information of Company (the “Company”), other than information I have learned from the Company in the course of being hired:
  

 

  

 

  

 

2.

   Prior Inventions. Except as set forth below, there are no ideas, concepts, inventions, discoveries, developments, know-how, structures, designs, formulas, algorithms, methods, products, processes, systems and technologies in any stage of development that are conceived, developed or reduced to practice by me alone or with others; any patents, patents pending, copyrights, moral rights, trademarks and any other intellectual property rights therein; or any improvements, modifications, derivative works from, other rights in and claims related to any of the foregoing under the laws of any jurisdiction, that I wish to exclude from the operation of this Agreement:
  

 

  

 

  

 

3.

   Prior Agreements. Except as set forth below, I am aware of no prior agreements between me and any other person or entity concerning proprietary information or inventions (attach copies of all agreements in your possession):
  

 

  

 

  

 

Date:

 

Employee Name

Employee Signature

 

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SCHEDULE B

TERMINATION CERTIFICATE CONCERNING

COMPANY CONFIDENTIAL INFORMATION

This is to certify that I have returned all property of CyberSource (the “Company”), including, without limitation, all source code listings, books, manuals, records, models, drawings, reports, notes, contracts, lists, blueprints, and other documents and materials, Confidential Information, and equipment furnished to or prepared by me in the course of or incident to my employment with the Company, and that I did not make or distribute any copies of the foregoing.

I further certify that I have reviewed the Company’s Agreement Regarding Confidentiality and Inventions (“Agreement”) signed by me and that I have complied with and will continue to comply with each and all of its terms and conditions, including without limitation: (i) the reporting of any and all ideas, concepts, inventions, discoveries, developments, know-how, structures, designs, formulas, algorithms, methods, products, processes, systems and technologies; any and all patents, patents pending, copyrights, moral rights, trademarks and any other intellectual property rights therein; and any and all improvements, modifications, derivative works from, other rights in and claims related to any of the foregoing under the laws of any jurisdiction, conceived or developed by me alone or with others and covered by the Agreement and (ii) the preservation as confidential all Confidential Information pertaining to the Company. This certificate in no manner limits my responsibilities or the Company’s rights under the Agreement.

On termination of my employment with the Company, I will be employed by                                                               [Name of New Employer] [in the                                  division] and I will be working in connection with the following projects:

[generally describe the projects]

 

    
    

Date:                     

 

 

 

Employee Name

 

 

 

Employee Signature

 

 

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EX-99.2 3 dex992.htm NON-COMPETITION AND NON-SOLICITATION AGREEMENT Non-Competition and Non-Solicitation Agreement

Exhibit 99.2

Non-Competition and Non-Solicitation Agreement

This Non-Competition and Non-Solicitation Agreement (this “Agreement”) is made as of this 17th day of June 2007, by and between CyberSource Corporation, a Delaware corporation (the “Parent”), and Roy Banks of 6174 Thornton Circle, Highland, Utah 84003 (the “Executive”) (collectively, the “parties”).

WHEREAS, the Executive is a key executive of Authorize.Net Holdings, Inc. (the “Company”); and

WHEREAS, pursuant to an Agreement and Plan of Reorganization by and among the Parent, Congress Acquisition-Sub, Inc. (the “Merger Sub”), Congress Acquisition Sub 1 LLC (“Merger Sub LLC”), and the Company (the “Merger Agreement”), the Merger Sub and the Company will be merged and the resulting corporation will be merged with and into the Merger Sub LLC, with the Merger Sub LLC surviving as a wholly-owned subsidiary of the Parent; and

WHEREAS, the Executive is a holder of options in and shares of capital stock of Company and consequently will receive substantial consideration as a result of the consummation of the Merger, which consideration reflects the goodwill associated with the Company’s business; and

WHEREAS, a material condition to the Parent’s obligation to consummate the Merger and to preserve the value of the assets being acquired by the Parent, the Merger Agreement requires, among other things, that the Executive enter into this Agreement at or prior to the closing of the Merger; and

WHEREAS, the Executive has accepted employment with the Parent in connection with the Merger;

NOW, THEREFORE, subject to the terms of the Merger Agreement and contingent upon the consummation of the Merger, the parties agree as follows:

1. Covenant Not To Compete or Solicit. The Executive acknowledges that one of the material conditions precedent to the consummation of the Merger is the Executive’s agreement to be bound by the restrictions set forth in this Section 1. The Executive further acknowledges and agrees that he has unique knowledge and experience regarding the Company’s business, and further acknowledges that, as a result of the Parent’s acquisition of the Company’s business, the only method of preserving and protecting the assets, business and goodwill acquired by the Company is by restricting the ability of the Executive to engage in certain competitive business activities in the manner set forth in this Section 1. Accordingly, for as long as Executive is employed by Parent and for a period of one (1) year thereafter (the “Noncompetition Period”), the Executive agrees that he will not, either directly or indirectly:

(a) Engage in any business activity (whether as an employee, consultant, proprietor, partner, director or otherwise) that is competitive, in whole or in part, with the Parent or the Company (or with any Affiliated Entity, which is defined to mean any corporation or other


business entity or entities that directly or indirectly controls, is controlled by, or is under common control with the Parent or the Company), including but not limited to developing, selling, marketing, manufacturing, licensing, or distributing products or services that are competitive with the products and services being developed, sold, marketed, manufactured, licensed, or distributed by the Parent or the Company; or have any ownership interest in, or participate in the financing, operation, management, or control of, any person, firm, corporation or business whose products, activities, or services compete in whole or in part with those of the Parent or the Company (or of any Affiliated Entity), provided, however, that nothing contained in this Section 1(a) shall be construed to prohibit the Executive from purchasing and owning (directly or indirectly) up to one percent (1%) of the capital stock or other securities of any corporation or other entity whose stock or securities are traded on any national or regional securities exchange or the national over-the-counter market and such ownership shall not constitute a violation of this Section 1(a);

(b) Divert or attempt to divert from the Parent or the Company (or any Affiliated Entity) any business of any kind in which it is engaged, including, without limitation, the solicitation of any past, present, or prospective supplier, partner, or customer, or the interference with or disruption of its business relations with its past, present, or prospective suppliers, partners or customers;

(c) Solicit, hire, recruit, employ or retain any person or entity who is employed by or has a contractual relationship with the Parent or the Company (or any Affiliated Entity), or encourage any person or entity who is employed by or has a contractual relationship with the Parent or the Company (or any Affiliated Entity) to terminate their employment or contractual relationship with the Parent or the Company (or any Affiliated Entity).

2. Equitable Relief. The Parent and the Executive agree and acknowledge that, in the event the Executive breaches or threatens to breach this Agreement, the damage to the Parent will be substantial and incapable of calculation in money damages, and that the remedy at law for any breach of this Agreement is and will be inadequate. Therefore, in the event of a breach or threatened breach by the Executive of the provisions of this Agreement, the Parent shall be entitled to equitable remedies without the obligation to post bond or other security in seeking such relief, including, but not limited to, specific performance or temporary, preliminary or permanent injunctive relief restraining the Executive from violating the provisions of this Agreement. Nothing contained in this Agreement shall be construed as prohibiting the Parent from pursuing any other remedies available to it for such breach or threatened breach, including, without limitation, the recovery of damages from the Executive.

3. Enforceability. If any court determines that any of the non-competition or non-solicitation covenants set forth herein (the “Covenants”), or any parts thereof, are invalid or unenforceable, the other Covenants and the remainder of any of the Covenants so impaired shall not thereby be affected and shall be given full effect, without regard to the invalid portions. If any court determines that any of the Covenants, or any parts thereof, are unenforceable because of the duration or geographic scope thereof, the parties agree that the duration or geographic scope of such Covenants, or any parts thereof, shall be the maximum duration or geographic scope, as the case may be, provided by law, of such Covenants, and, in such reduced form, such

 

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Covenants shall then be enforceable. It is the intention of the parties that the Covenants contained in Section 1 shall be enforced to the greatest extent in time, area, and degree of participation as is permitted by the laws of the jurisdiction in which enforcement is sought.

4. Amendments; Waivers; Remedies. This Agreement may not be amended or waived except by a writing signed by the Executive and by a duly authorized representative of the Parent other than the Executive. Failure to exercise any right under this Agreement shall not constitute a waiver of such right. Any waiver of any breach of this Agreement shall not operate as a waiver of any subsequent breaches. All rights or remedies specified for a party herein shall be cumulative and in addition to all other rights and remedies of the party hereunder or under applicable law.

5. Assignment. The performance of the Executive is personal hereunder, and the Executive agrees that he shall have no right to assign and shall not assign or purport to assign any rights or obligations under this Agreement. This Agreement may be assigned or transferred by the Parent; and nothing in this Agreement shall prevent the consolidation, merger or sale of the Parent or a sale of any or all or substantially all of its assets. This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors, and assigns.

6. Entire Agreement. This Agreement is intended to be the final, complete, and exclusive statement of the parties’ agreement concerning its subject matter, and may not be contradicted by evidence of any prior or contemporaneous statements or agreements, except for agreements specifically referenced herein. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative or other legal proceeding involving this Agreement.

7. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Utah.

8. Acknowledgment. The Executive acknowledges (a) that he has been advised by independent counsel of his own choice concerning this Agreement and has been advised to do so by the Parent, and (b) that he has read and understands the Agreement, is fully aware of its legal effect, and has entered into it freely based on his own judgment.

9. Attorneys’ Fees. If any legal action or other legal proceeding relating to this Agreement or the enforcement of any term of this Agreement is brought against any party hereto, the prevailing party shall be entitled to recover reasonable attorneys’ fees, costs and disbursements (in addition to any other relief to which the prevailing party may be entitled).

10. Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original and all of which, when taken together, will be deemed to constitute one and the same.

 

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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first written above.

 

CYBERSOURCE CORPORATION:     ROY BANKS:

By:

 

/s/ William S. McKiernan

   

/s/ Roy Banks

  William S. McKiernan    

Title:

  Chairman and Chief Executive Officer    

 

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EX-99.3 4 dex993.htm FORM OF STOCK AND OPTION RESTRICTION AGREEMENT Form of Stock and Option Restriction Agreement

Exhibit 99.3

STOCK AND OPTION RESTRICTION AGREEMENT

THIS STOCK AND OPTION RESTRICTION AGREEMENT (this “Agreement”) is made as of June     , 2007, by and among CyberSource Corporation, a Delaware corporation (“CyberSource”) and each of the Stockholders (as defined below).

WHEREAS, certain individuals (the “Stockholders”) hold shares of common stock, including any shares of common stock subject to restrictions and conditions, of Authorize.Net Holdings, Inc., a Delaware corporation (“ANET,” and such shares, the “Common Stock”) or options to purchase shares of Common Stock (the “Options,” and together with the Common Stock, the “Shares”).

WHEREAS, CyberSource and ANET are parties to that certain Agreement and Plan of Reorganization dated as of June 17, 2007 (the “Merger Agreement”).

WHEREAS, the terms of the Merger Agreement provide that Stockholders will receive certain cash payments in exchange for all Options held by such Stockholders, and such cash payments are conditioned, among other things, upon the execution and delivery of this Agreement by the Stockholders.

WHEREAS, the obligations of CyberSource are conditioned, among other things, upon the execution and delivery of this Agreement by the Stockholders.

NOW, THEREFORE, in consideration for the mutual promises and covenants set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. Restrictions on Transfer and Exercise. Except as provided in the Merger Agreement or in Section 2 below, the Stockholders may not to sell, transfer (whether by gift, operation of law or otherwise), assign, pledge, hypothecate, encumber or otherwise transfer, dispose of or encumber any Shares, or exercise any Options until this Agreement is terminated pursuant to Section 3 hereof.

2. Permitted Transfers. To the extent not prohibited by the listing requirements of The NASDAQ Stock Market LLC (or other established stock exchange or national market system on which the Common Stock is traded) and applicable law, Stockholder may transfer or surrender shares of Common Stock to the Company in satisfaction of any tax withholding obligations incident to the exercise or vesting of such Stockholder’s Common Stock.

3. Termination. This Agreement shall terminate upon the earlier to occur of: (i) the Effective Time (as defined in the Merger Agreement) or (ii) upon the termination of the Merger Agreement.


4. Miscellaneous.

4.1 Counterparts. This Agreement may be executed in counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

4.2 Governing Law; Venue. This Agreement is to be construed in accordance with and governed by the internal laws of the State of Delaware without giving effect to any choice of law rule that would cause the application of laws of any jurisdiction other than the internal laws of the State of California to the rights and duties of the parties. All disputes and controversies arising out of or in connection with this Agreement shall be resolved exclusively by the state and federal courts located in Santa Clara County in the State of California, and each party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts.

4.3 Amendment. Any provision of this Agreement may be amended or the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of CyberSource and each Stockholder. Any amendment or waiver effected in accordance with this Section 4.3 shall be binding upon the CyberSource and each Stockholder.

4.4 Entire Agreement. This Agreement and the documents referred to herein constitute the entire agreement among the parties with respect to the subject matter hereof and no party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except as specifically set forth herein or therein.

[SIGNATURE PAGES FOLLOW]


IN WITNESS WHEREOF, the parties hereto have executed this Stock Restriction and Vesting Agreement as of the date first above written.

 

CYBERSOURCE CORPORATION

By:

 

 

  William S McKiernan
  Chairman and Chief Executive Officer


STOCKHOLDER:

Robert Donahue

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Eugene DiDonato

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Roy Banks

By:

 

 

Address:

 

 

 

 

 

 


STOCKHOLDER:

Timothy O’Brien

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Kathleen Harris

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

John Granara

By:

 

 

Address:

 

 

 

 

 

 


STOCKHOLDER:

Rachelle B. Chong

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Kevin C. Melia

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Gary E. Haroian

By:

 

 

Address:

 

 

 

 

 

 

 

STOCKHOLDER:

Andrew G. Mills

By:

 

 

Address:

 

 

 

 

 

 

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