Delaware
|
47-0772104 | |
(State or other jurisdiction
of
incorporation or organization) |
(I.R.S. Employer
Identification No.) |
|
120 Broadway, Suite 3350
New York, New York 10271 (Address of principal executive offices, including zip code) |
(646) 348-6700
(Registrants telephone number, including area code) |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o |
1
2
61
62
93
112
ITEM 1.
BUSINESS
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Retail banking, including debit and credit card issuers
Wholesale banking, including corporate cash management and
treasury management operations
Retailers
Initiate the initiation of payments through online
banking systems
Manage the management of a payment through its
lifecycle which we split into Retail Payment Engines, Back
Office Services and Wholesale Payment Engines
Secure the securing of payments against fraud and
money laundering
Operate the infrastructure needed to operate a
payments system
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ACI Enterprise Banker
is a comprehensive Internet-based
business banking product for financial institutions including
banks, brokerage firms and credit unions and can be flexibly
packaged for small, medium and large business customers. This
product provides these customers with electronic payment
initiation capability, information reporting, and numerous other
payment related services that allow the business customer to
manage all its banking needs via the Internet.
ACI Global Banker
provides single-window access to
corporate cash management, trade finance, FX services, reporting
and data exchange. Global Banker supports single-window, Single
Sign-On access to a banks corporate Internet banking
platform. This enterprise-wide, multi-country,
multi-language,
multi-currency solution allows banks of all sizes to uniquely
package products and services for different countries and
segments or even individual customers
from a single, flexible platform.
BASE24-eps
is an integrated electronic payments
processing product marketed to customers operating electronic
payment networks in the retail banking and retail industries.
The modular architecture of the product enables customers to
select the application and system components that are required
to operate their networks. BASE24-eps offers a broad range of
features and functions for electronic payment processing.
BASE24-eps allows customers to adapt to changing network needs
by supporting 12 different types of ATM and five different types
of point of sale (POS) terminals, 48 interchange
interfaces, and various authentication, authorization and
reporting options and with standardized acceptance formats
enabling processing of transactions from sources such as
internet banking, branch or mobile systems. BASE24-eps uses an
object-based architecture and languages such as C++ and Java to
offer a more flexible, open architecture for the processing of a
wide range of electronic payment transactions. BASE24-eps also
uses a scripting language to improve overall transaction
processing flexibility and improve time to market for new
services, reducing the need for traditional systems
modifications. BASE24-eps is licensed as a standalone electronic
payments solution for financial institutions, retailers and
electronic payment processors. BASE24-eps, which operates on IBM
System z, IBM System p, Hewlett-Packard Company (HP)
NonStop, HP-UX and Sun Solaris servers, provides flexible
integration points to other applications and data within
enterprises to support
24-hour
per
day access to money, services and information.
ACI Retail Commerce Server
is an integrated suite of
electronic payments products that facilitate a broad range of
capabilities, specifically focused on retailers. These
capabilities include debit and credit card processing, automated
clearing house (ACH) processing, electronic benefits
transfer, card issuance and management, check authorization,
customer loyalty programs and returned check collection. The
Retail Commerce Server product line operates on open systems
technologies such as Microsoft Windows, UNIX and Linux, with
most of the current installations deployed on the Microsoft
Windows platform.
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BASE24
is an integrated family of software products
marketed to customers operating electronic payment networks in
the retail banking and retail industries. A substantial portion
of ACIs revenues are derived from licensing the BASE24
family of products and providing related services and
maintenance as it has been the core of the ACI business since
the Companys inception.
ON/2
is an integrated electronic payments processing
system, exclusively designed for the Stratus VOS operating
environment. It authenticates, authorizes, routes and switches
transactions generated at ATMs and merchant POS sites.
OpeN/2
is an integrated electronic payments processing
system, designed for open-systems environments such as Microsoft
Windows, UNIX and Linux. It offers a wide range of electronic
payments processing capabilities for financial institutions,
retailers and electronic payment processors.
AS/X
a product acquired in the eps AG acquisition, is an
integrated electronic payments processing system designed for
open-systems environments such as UNIX. It supports a wide range
of electronic payments processing capabilities for financial
institutions and electronic payment processors in Germany and
Switzerland.
ACI Issuer
, acquired in the Essentis acquisition, is a
modern card and account management system. It has been developed
to support national, international, and global financial
institutions. The system has full multi-currency, multi-product,
multi-institution and
multi-language
capabilities. It manages card portfolios in different countries
and for different issuers on a single platform and has been
built to fully comply with EMV standards.
ACI Acquirer
, acquired in the Essentis acquisition,
supports the full life cycle of merchant portfolio management,
including merchant boarding, transaction acquisition,
interchange fee qualification, settlement and statement
generation. The system is enabled with the flexibility acquirers
require for complex merchant portfolios.
ACI Interchange
, acquired in the Essentis acquisition, is
the central monetary transaction manager, processing all
incoming customer transactions and maintaining a central
transactions database. ACI Interchange also manages the clearing
and settlement communication with the major international
payment schemes, ensuring compliance with Visa, MasterCard,
American Express and JCB. The module can easily be adapted to
manage clearing and settlement with additional networks such as
domestic payment schemes.
ACI Token Management
consists of the ANDiS suite of
products from ACIs partner Bell ID. The ANDiS Smart
Card & Application Management System provides for
central life-cycle management of smart cards and other tokens as
well as the management of the applications activated within the
scheme. The ANDiS Key
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Management System facilitates the implementation of security
concepts based on the generation, storage, recovery, import and
distribution of cryptographic keys. The keys are used for
encryption and decryption of data and for verification and
authorization of trusted parties using digital certificates.
ACI Payments Manager
is an integrated, modular software
solution that automates the processing, settlement and
reconciliation of electronic transactions, as well as provides
plastic card issuance and account management. This product is
now primarily marketed in North America.
ACI Card Management System
is a complete plastic card
system for issuing cards, maintaining account information,
tracking card usage and providing customer service.
ACI Smart Chip Manager
supports the deployment of
stored-value and other chip card applications used at smart
card-enabled devices.
ACI Dispute Management System
provides issuers the
ability to work retail discrepancies caused by processing
errors, disputes, charge backs and fraud.
ACI Proactive Risk Manager
(PRM).
PRM is a neural network-based
fraud detection system designed to help card issuers, merchants,
merchant acquirers and financial institutions combat fraud
schemes. The system combines the pattern recognition capability
of
neural-network
transaction scoring with custom risk models of expert
rules-based strategies and advanced client/server account
management software. PRM operates on IBM System z, HP NonStop,
Sun Solaris and Microsoft Windows servers. There are six
editions of PRM, each of which is tailored for specific industry
needs. The six editions are debit, credit, merchant, private
label, money laundering detection and enterprise.
ACI Automated Case Management System.
The ACI
Automated Case Management System offers customers the
flexibility to automate activities and processes across the
complete lifecycle of a case. Cases are created when fraud
officers checking an alert within ACI Proactive Risk Manager
identify fraud. The solution is a basic framework that defines
processes for researching and resolving cases, including
investigation resources, timeframes, escalation paths and
alerts. The Automated Case Management System also acts as a
central repository for case histories and resource activities to
provide organizations with centralized auditing capabilities.
ACI Automated Case Management System for Anti-Money
Laundering.
The ACI Automated Case Management
System for Anti-Money Laundering reduces the need for internal
resources to spend needless time on compliance requirements. The
Automated Case Management System allows customers to automate
the escalation and notification processing of potential
non-compliance exposure. Since all activities and tasks are
managed under the system from a process standpoint, it also
provides the centralized auditing and reporting needs required
for regulatory proof of compliance.
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ACI Communication Services
(formerly known as ICE) is a
set of products that enable applications to support legacy
protocols, such as SNA and X.25, running over TCP/IP networks.
It also supports hybrid networking environments such as
IBMs HPR/IP. This set of products run on HP NonStop, IBM
System z and Unix platforms.
ACI Communication Services Network Express
provides network communications and middleware capabilities
to support legacy systems integration and connectivity.
ACI Enterprise Security Services
(formerly known as
SafeTGate) is a suite of security solutions that secure access
to systems and resources. All of these products run on the HP
NonStop platform and were designed to take advantage of HP
NonStop fundamentals.
ACI Web Access Services
(formerly known as Webgate)
allows HP NonStop users to securely expose existing applications
to peer systems as well as PC clients and web browsers. Web
Access Services supports new GUI client development, standard
6530 and 3270E terminal emulation or automated data stream
transformation to give users a range of options for integrating
NonStop services across the enterprise.
ACI Monitoring and Management
(formerly known as ENGUARD)
is a proactive monitoring, alarm and dispatching software tool.
ACI DataWise
is a transactional data management solution
that allows high volumes of transactional data to be moved
between
Stratus
®
VOS systems, across different platforms and between
heterogeneous databases.
ACI Simulation Services for Enterprise Testing (ASSET)
is
a simulation and testing tool that allows companies involved in
electronic payments to simulate devices and transactions, and
perform application testing.
Oracle (for its GoldenGate product)
Ascert
ACE Software Solutions
Bell ID
8
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FairCom Corporation
Paragon Application Systems
Financial Software and Services
IBM
CB.Net
RDM Corporation
Intuit
Vasco Data Security
Metatomix
Accuity
RSA, The Security Division of EMC Corporation
iPay Technologies
Parsam Technologies
Implementation Services.
We utilize a standard
methodology to deliver customer project implementations across
all products lines. Within the process, we provide customers
with a variety of services, including
on-site
solution scoping reviews, project planning, training, site
preparation, installation, product configuration, product
customization, testing and go-live support, and project
management throughout the project life cycle. Implementation
services are offered for a fee that varies based on the level
and quantity of included services.
Technical Services.
The majority of our
technical services are provided to customers who have licensed
one or more of our software products. Services offered include
programming and programming support,
day-to-day
systems operations, network operations, help desk staffing,
quality assurance testing, problem resolution, system design,
and performance planning and review. Technical services are
typically priced on a weekly basis according to the level of
technical expertise required and the duration of the project.
Facilities Management.
We offer facilities
management services whereby we operate a customers
electronic payments system for multi-year periods. Pricing and
payment terms for facilities management services vary on a
case-by-case
basis giving consideration to the complexity of the facility or
system to be managed, the level and quantity of technical
services required, and other factors relevant to the facilities
management agreement.
ACI On Demand.
We offer a service whereby we
host a customers system for them as opposed to the
customer licensing and installing the system on their own site.
We offer several of our solutions in this manner, including our
retail and wholesale payment engines, risk management and online
banking products. Each customer gets a unique image of the
system that can be tailored to meet their needs. The product is
generally located on facilities and hardware that we provide.
Pricing and payment terms depend on which solutions the customer
requires and their transaction volumes. Generally, customers are
required to commit to a minimum contract of three to five years.
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General Maintenance.
After software
installation and project completion, we provide maintenance
services to customers for a monthly fee. Maintenance services
include:
24-hour
hotline for problem resolution
Customer account management support
Vendor-required mandates and updates
Product documentation
Hardware operating system compatibility
User group membership
Enhanced Support Program.
Under the extended
service option, referred to as the Enhanced Support Program,
each customer is assigned an experienced technician to work with
its system. The technician typically performs functions such as:
Install and test software fixes
Retrofit custom software modifications (CSMs) into
new software releases
Answer questions and resolve problems related to CSM code
Maintain a detailed CSM history
Monitor customer problems on HELP24 hotline database on a
priority basis
Supply
on-site
support, available upon demand
Perform an annual system review
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PTESA (Columbia)
PTESAVEN (Venezuela)
North Data (Uruguay)
Hewlett Packard Peru (Peru)
P.T. Abhimata Persada (Indonesia)
Financial Software and Systems (India)
Korea Computer & Systems (Korea)
DataOne Asia Co (Thailand)
Optimisa (Chile)
Simba Technology (Kenya)
Systems Builder (Saudi Arabia)
Syscom Computer Engineering (Taiwan)
Syscom Computer (Shenzhen) (China)
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60
President, Chief Executive Officer and Director
38
Senior Vice President, Chief Financial Officer, Controller and
Chief Accounting Officer
46
Senior Vice President and Chief Operating Officer
43
Senior Vice President, Treasurer and Chief Corporate Development
Officer
46
Senior Vice President, General Counsel and Secretary
52
Senior Vice President, Global Business Operations
52
Vice President, Chief Technology Officer
14
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ITEM 1A.
RISK
FACTORS
15
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timing and execution of plans and programs that may be subject
to local labor law requirements, including consultation with
appropriate work councils;
changes in assumptions related to severance and postretirement
costs;
risks associated with litigation for wrongful termination;
new business initiatives and changes in product roadmaps and
development efforts;
changes in employment levels and turnover rates; and
changes in product demand and the business environment.
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communications and information flow may be less efficient and
accurate as a consequence of the time, distance and language
differences between our primary development organization and the
foreign based activities, resulting in delays in development or
errors in the software developed;
in addition to the risk of misappropriation of intellectual
property from departing personnel, there is a general risk of
the potential for misappropriation of our intellectual property
that might not be readily discoverable;
the quality of the development efforts undertaken offshore may
not meet our requirements because of language, cultural and
experiential differences, resulting in potential product errors
and/or
delays;
potential disruption from the involvement of the United States
in political and military conflicts around the world; and
currency exchange rates could fluctuate and adversely impact the
cost advantages intended from maintaining these facilities.
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ITEM 1B.
UNRESOLVED
STAFF COMMENTS
ITEM 2.
PROPERTIES
ITEM 3.
LEGAL
PROCEEDINGS
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ITEM 4.
SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS
ITEM 5.
MARKET
FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
Year Ended
Year Ended
December 31, 2009
December 31, 2008
High
Low
High
Low
$
17.97
$
14.39
$
17.94
$
8.86
$
15.98
$
13.20
$
22.49
$
14.16
$
20.32
$
13.28
$
23.19
$
16.10
$
19.14
$
15.90
$
21.39
$
12.32
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ITEM 6.
SELECTED
FINANCIAL DATA
Three Months
Years Ended
Ended
December 31,
December 31,
Years Ended September 30,
2009
2008
2007
2007
2006
2005
(In thousands, except per share data)
$
405,755
$
417,653
$
101,282
$
366,218
$
347,902
$
313,237
$
19,626
$
10,582
$
(2,016
)
$
(9,131
)
$
55,365
$
43,099
$
0.57
$
0.31
$
(0.06
)
$
(0.25
)
$
1.48
$
1.14
$
0.57
$
0.30
$
(0.06
)
$
(0.25
)
$
1.45
$
1.12
34,368
34,498
35,700
36,933
37,369
37,682
34,554
34,795
35,700
36,933
38,237
38,507
As of December 31,
As of September 30,
2009
2008
2007
2007
2006
2005
$
78,662
$
80,280
$
39,585
$
17,358
$
67,932
$
120,594
590,043
552,842
570,458
506,741
539,365
363,700
2,165
77,408
76,014
75,911
76,546
78,093
905
236,063
213,841
241,039
225,012
267,212
217,438
(1)
We adopted FAS 123(R)(codified as ASC 718) using the
modified prospective transition method on October 1, 2005.
(2)
On September 29, 2006, we acquired P&H Solutions, Inc.
(P&H). The aggregate purchase price for
P&H was approximately $134 million, of which
$73 million was financed by long-term debt.
(3)
Debt (long-term portion) also includes long-term capital lease
obligations of $1.5 million, $1.0 million,
$0.9 million, $1.5 million, $3.1 million, and
$0.8 million as of December 31, 2009, 2008 and 2007,
and
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September 30, 2007, 2006, and 2005, respectively, which is
included in other noncurrent liabilities in the consolidated
balance sheets.
ITEM 7.
MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Global Financial Markets Uncertainty.
The
continuing uncertainty in the global financial markets has
negatively impacted general business conditions. It is possible
that a weakening economy could adversely affect our customers,
their purchasing plans, or even their solvency, but we cannot
predict whether or to what extent this will occur. We have
diversified counterparties and customers, but we continue to
monitor our counterparty and customer risks closely. While the
effects of the economic conditions in the future are not
predictable, we believe our global presence, the breadth and
diversity of our service offerings and our enhanced expense
management capabilities position us well in a slower economic
climate. Market analysts, such as Boston Consulting Group,
indicate that banks now recognize the importance of payments to
their business, so providing services for that aspect of the
business is of less risk than for other aspects of their
business.
Availability of Credit.
There have been
significant disruptions in the capital and credit markets during
the past two years and many lenders and financial institutions
have reduced or ceased to provide funding to borrowers. The
availability of credit, confidence in the entire financial
sector, and volatility in financial markets have been adversely
affected. These disruptions are likely to have some impact on
all institutions in
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the U.S. banking and financial industries, including our
lenders and the lenders of our customers. The Federal Reserve
Bank has been providing vast amounts of liquidity into the
banking system to compensate for weaknesses in short-term
borrowing markets and other capital markets. A reduction in the
Federal Reserves activities or capacity could reduce
liquidity in the markets, thereby increasing funding costs or
reducing the availability of funds to finance our existing
operations as well as those of our customers. We are not
currently dependent upon short-term funding, and the limited
availability of credit in the market has not affected our
revolving credit facility or our liquidity or materially
impacted our funding costs.
Increasing electronic payment transaction
volumes.
Electronic payment volumes continue to
increase around the world, taking market share from traditional
cash and check transactions. A Boston Consulting Group 2009
report predicts that payments globally will grow at 8% per annum
between 2008 and 2016, with varying growth rates based on the
type of payment and part of the world. We leverage the growth in
transaction volumes through the licensing of new systems to
customers whose older systems cannot handle increased volume and
through the licensing of capacity upgrades to existing customers.
Increasing competition.
The electronic
payments market is highly competitive and subject to rapid
change. Our competition comes from in-house information
technology departments, third-party electronic payment
processors and third-party software companies located both
within and outside of the United States. Many of these companies
are significantly larger than us and have significantly greater
financial, technical and marketing resources. As electronic
payment transaction volumes increase, third-party processors
tend to provide competition to our solutions, particularly among
customers that do not seek to differentiate their electronic
payment offerings. As consolidation in the financial services
industry continues, we anticipate that competition for those
customers will intensify.
Adoption of open systems technology.
In an
effort to leverage lower-cost computing technologies and current
technology staffing and resources, many financial institutions,
retailers and electronic payment processors are seeking to
transition their systems from proprietary technologies to open
technologies. Our continued investment in open systems
technologies is, in part, designed to address this demand.
Electronic payments fraud and compliance.
As
electronic payment transaction volumes increase, criminal
elements continue to find ways to commit a growing volume of
fraudulent transactions using a wide range of techniques.
Financial institutions, retailers and electronic payment
processors continue to seek ways to leverage new technologies to
identify and prevent fraudulent transactions. Due to concerns
with international terrorism and money laundering, financial
institutions in particular are being faced with increasing
scrutiny and regulatory pressures. We continue to see
opportunity to offer our fraud detection solutions to help
customers manage the growing levels of electronic payment fraud
and compliance activity.
Adoption of smartcard technology.
In many
markets, card issuers are being required to issue new cards with
embedded chip technology. Chip-based cards are more secure,
harder to copy and offer the opportunity for multiple functions
on one card (e.g. debit, credit, electronic purse,
identification, health records, etc.). The EMV standard for
issuing and processing debit and credit card transactions has
emerged as the global standard, with many regions throughout the
world working on EMV rollouts. The primary benefit of EMV
deployment is a reduction in electronic payment fraud, with the
additional benefit that the core infrastructure necessary for
multi-function chip cards is being put in place (e.g., chip card
readers in ATMs and POS devices) allowing the deployment of
other technologies like contactless. We are working with many
customers around the world to facilitate EMV deployments,
leveraging several of our solutions.
Single Euro Payments Area
(SEPA).
The SEPA, primarily focused
on the European Economic Community and the United Kingdom, is
designed to facilitate lower costs for cross-border payments and
reduce timeframes for settling electronic payment transactions.
Our retail and wholesale banking solutions facilitate key
functions that help financial institutions address these
mandated regulations.
Financial institution
consolidation.
Consolidation continues on a
national and international basis, as financial institutions seek
to add market share and increase overall efficiency. Such
consolidations have increased, and may continue to increase, in
their number, size and market impact as a result of the global
economic crisis and the financial crisis affecting the banking
and financial industries. There are several
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potential negative effects of increased consolidation activity.
Continuing consolidation of financial institutions may result in
a smaller number of existing and potential customers for our
products and services. Consolidation of two of our customers
could result in reduced revenues if the combined entity were to
negotiate greater volume discounts or discontinue use of certain
of our products. Additionally, if a non-customer and a customer
combine and the combined entity in turn decides to forego future
use of our products, our revenue would decline. Conversely, we
could benefit from the combination of a non-customer and a
customer when the combined entity continues use of our products
and, as a larger combined entity, increases its demand for our
products and services. We tend to focus on larger financial
institutions as customers, often resulting in our solutions
being the solutions that survive in the consolidated entity.
Electronic payments convergence.
As electronic
payment volumes grow and pressures to lower overall cost per
transaction increase, financial institutions are seeking methods
to consolidate their payment processing across the enterprise.
We believe that the strategy of using
service-oriented-architectures to allow for re-use of common
electronic payment functions such as authentication,
authorization, routing and settlement will become more common.
Using these techniques, financial institutions will be able to
reduce costs, increase overall service levels, enable
one-to-one
marketing in multiple bank channels, leverage volumes for
improved pricing and liquidity, and manage enterprise risk. Our
Agile Payments Solution strategy is, in part, focused on this
trend, by creating integrated payment functions that can be
re-used by multiple bank channels, across both the consumer and
wholesale bank. While this trend presents an opportunity for us,
it may also expand the competition from third-party electronic
payment technology and service providers specializing in other
forms of electronic payments. Many of these providers are larger
than us and have significantly greater financial, technical and
marketing resources.
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Maintenance fees are assumed to exist for the duration of the
license term for those contracts in which the committed
maintenance term is less than the committed license term.
License and facilities management arrangements are assumed to
renew at the end of their committed term at a rate consistent
with our historical experiences.
Non-recurring license arrangements are assumed to renew as
recurring revenue streams.
Foreign currency exchange rates are assumed to remain constant
over the
60-month
backlog period for those contracts stated in currencies other
than the U.S. dollar.
Our pricing policies and practices are assumed to remain
constant over the
60-month
backlog period.
Anticipated increases in transaction volumes in customer systems.
Optional annual uplifts or inflationary increases in recurring
fees.
Services engagements, other than facilities management, are not
assumed to renew over the
60-month
backlog period.
The potential impact of merger activity within our markets
and/or
customers.
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December 31,
September 30,
June 30,
March 31,
December 31,
2009
2009
2009
2009
2008
$
850
$
829
$
819
$
793
$
773
510
505
505
466
480
157
156
155
153
157
$
1,517
$
1,490
$
1,479
$
1,412
$
1,410
December 31, 2009
December 31, 2008
Monthly
Non-
Monthly
Non-
Recurring
Recurring
Total
Recurring
Recurring
Total
$
149
$
40
$
189
$
133
$
40
$
173
89
37
126
73
37
110
29
11
40
28
14
42
$
267
$
88
$
355
$
234
$
91
$
325
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Year Ended
Years Ended December 31,
September 30,
2009
2008
2007
% of Total
% of Total
% of Total
Amount
Revenue
Amount
Revenue
Amount
Revenue
$
83,321
20.5
%
$
94,999
22.7
%
$
87,341
23.8
%
73,148
18.0
%
74,211
17.8
%
62,144
17.0
%
156,469
38.6
%
169,210
40.5
%
149,485
40.8
%
136,737
33.7
%
130,015
31.1
%
121,233
33.1
%
112,549
27.7
%
118,428
28.4
%
95,500
26.1
%
405,755
100.0
%
417,653
100.0
%
366,218
100.0
%
14,754
3.6
%
12,846
3.1
%
9,145
2.5
%
112,893
27.8
%
117,087
28.0
%
95,691
26.1
%
77,506
19.1
%
75,850
18.2
%
78,950
21.6
%
61,799
15.2
%
73,236
17.5
%
69,957
19.1
%
79,244
19.5
%
100,272
24.0
%
94,762
25.9
%
17,989
4.4
%
16,649
4.0
%
15,294
4.2
%
364,185
89.8
%
395,940
94.8
%
363,799
99.3
%
41,570
10.2
%
21,713
5.2
%
2,419
0.7
%
1,042
0.3
%
2,609
0.6
%
4,082
1.1
%
(2,856
)
(0.7
)%
(5,013
)
(1.2
)%
(6,644
)
(1.8
)%
(6,648
)
(1.6
)%
8,247
2.0
%
(3,740
)
(1.0
)%
(8,462
)
(2.1
)%
5,843
1.4
%
(6,302
)
(1.7
)%
33,108
8.2
%
27,556
6.6
%
(3,883
)
(1.1
)%
13,482
3.3
%
16,974
4.1
%
5,248
1.4
%
$
19,626
4.8
%
$
10,582
2.5
%
$
(9,131
)
(2.5
)%
34
Table of Contents
35
Table of Contents
36
Table of Contents
37
Table of Contents
38
Table of Contents
39
Table of Contents
40
Table of Contents
41
Table of Contents
Years Ended
Year Ended
December 31,
September 30,
2009
2008
2007
$
222,952
$
207,350
$
195,775
137,061
169,046
133,776
45,742
41,257
36,667
$
405,755
$
417,653
$
366,218
$
42,091
$
21,714
$
14,578
7,210
2,140
(16,942
)
(7,731
)
(2,141
)
4,783
$
41,570
$
21,713
$
2,419
42
Table of Contents
Three Months Ended December 31,
2007
2006
% of Total
% of Total
Amount
Revenue
Amount
Revenue
$
30,274
29.9
%
$
25,948
27.8
%
15,992
15.8
%
15,237
16.3
%
46,266
45.6
%
41,185
44.1
%
32,167
31.8
%
28,729
30.8
%
22,849
22.6
%
23,375
25.1
%
101,282
100.0
%
93,289
100.0
%
2,483
2.5
%
1,865
2.0
%
23,530
23.2
%
23,614
25.3
%
22,945
22.7
%
18,637
20.0
%
20,587
20.3
%
18,078
19.4
%
25,011
24.7
%
22,514
24.1
%
3,874
3.8
%
3,616
3.9
%
98,430
97.2
%
88,324
94.7
%
2,852
2.8
%
4,965
5.3
%
763
0.8
%
885
0.9
%
(1,389
)
(1.4
)%
(1,460
)
(1.6
)%
(334
)
(0.3
)%
(293
)
(0.3
)%
(960
)
(0.9
)%
(868
)
(0.9
)%
1,892
1.9
%
4,097
4.4
%
3,908
3.9
%
1,476
1.6
%
$
(2,016
)
(2.0
)%
$
2,621
2.8
%
43
Table of Contents
44
Table of Contents
Three Months Ended
December 31,
2007
2006
$
49,618
$
47,134
43,094
37,555
8,570
8,600
$
101,282
$
93,289
$
2,883
$
2,622
403
697
(434
)
1,646
$
2,852
$
4,965
45
Table of Contents
46
Table of Contents
Year Ended
Years Ended December 31,
September 30,
2009
2008
2007
$
44,217
$
77,826
$
24,847
(23,367
)
(16,956
)
(25,964
)
(14,056
)
(27,687
)
(50,005
)
47
Table of Contents
48
Table of Contents
Three Months Ended
December 31,
2007
2006
$
12,123
$
611
)
5,898
(13,836
)
20,382
(6,085
)
49
Table of Contents
Payments due by Period
Less than
More than
Total
1 Year
1-3 Years
3-5 Years
5 Years
$
62,454
$
9,422
$
13,088
$
9,494
$
30,450
2,452
765
1,403
284
75,000
75,000
1,313
750
563
82,357
8,225
16,045
15,613
42,474
5,258
5,258
$
223,576
$
19,162
$
106,099
$
25,391
$
72,924
(1)
Based upon the interest rate in effect at December 31, 2009
of 1% excluding the effects of interest rate swaps.
(2)
Based upon the interest rates in effect at December 31,
2009.
Fair Value of Contracts at Period-End
Less than
More than
Total
1 Year
1-3 Years
3-5 Years
5 Years
$
5,271
$
5,271
$
$
$
$
5,271
$
5,271
$
$
$
(1)
Fair value of interest rate swaps at December 31, 2009 was
provided by the counter-party to the underlying contract.
50
Table of Contents
51
Table of Contents
52
Table of Contents
53
Table of Contents
54
Table of Contents
ITEM 7A.
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
55
Table of Contents
ITEM 8.
FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
ITEM 9.
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
ITEM 9A.
CONTROLS
AND PROCEDURES
a)
Evaluation
of Disclosure Controls and Procedures
b)
Managements
Report on Internal Control over Financial Reporting
c)
Changes
in Internal Control over Financial Reporting
56
Table of Contents
57
Table of Contents
58
Table of Contents
ITEM 9B.
OTHER
INFORMATION
ITEM 10.
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
ITEM 11.
EXECUTIVE
COMPENSATION
ITEM 12.
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
ITEM 13.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE
59
ITEM 14.
PRINCIPAL
ACCOUNTING FEES AND SERVICES
ITEM 15.
EXHIBITS,
FINANCIAL STATEMENT SCHEDULES
Page
64
65
66
67
68
69
70
Exhibit
3
.01(1)
Amended and Restated Certificate of Incorporation of the Company
3
.02(2)
Amended and Restated Bylaws of the Company
4
.01(3)
Form of Common Stock Certificate
10
.01(4)
*
Stock and Warrant Holders Agreement, dated as of
December 30, 1993
10
.02(5)
*
ACI Holding, Inc. 1994 Stock Option Plan, as amended
10
.03(6)
*
Transaction Systems Architects, Inc. 1996 Stock Option Plan, as
amended
10
.04(7)
*
ACI Worldwide, Inc. 1999 Stock Option Plan, as amended
10
.05(8)
*
ACI Worldwide, Inc. 1999 Employee Stock Purchase Plan, as amended
10
.06(9)
*
Transaction Systems Architects, Inc. 2000 Non-Employee Director
Stock Option Plan, as amended
10
.07(10)
*
Transaction Systems Architects, Inc. 2002 Non-Employee Director
Stock Option Plan, as amended
10
.8(11)
*
ACI Worldwide, Inc. 2005 Equity and Performance Incentive Plan,
as amended
10
.9
*
Form of Severance Compensation Agreement
(Change-in-Control)
between the Company and certain officers, including executive
officers (filed herewith)
10
.10
*
Form of Indemnification Agreement between the Company and
certain officers, including executive officers (filed herewith)
60
Table of Contents
Exhibit
10
.11(12)
Asset Purchase Agreement by and between S2 Systems, Inc. and the
Company dated June 29, 2005
10
.12(13)
*
Form of Stock Option Agreement for the Companys 1994 Stock
Option Plan
10
.13(14)
*
Form of Stock Option Agreement for the Companys 1996 Stock
Option Plan
10
.14(15)
*
Form of Stock Option Agreement for the Companys 1999 Stock
Option Plan
10
.15(16)
*
Form of Stock Option Agreement for the Companys 2000
Non-Employee Director Plan
10
.16(17)
*
Form of Stock Option Agreement for the Companys 2002
Non-Employee Director Plan
10
.17
*
Form of Nonqualified Stock Option Agreement
Non-Employee Director for the Companys 2005 Equity and
Performance Incentive Plan, as amended (filed herewith)
10
.18
*
Form of Nonqualified Stock Option Agreement Employee
for the Companys 2005 Equity and Performance Incentive
Plan, as amended (filed herewith)
10
.19(18)
*
Form of LTIP Performance Shares Agreement for the
Companys 2005 Equity and Performance Incentive Plan, as
amended
10
.20(19)
*
Amended and Restated Employment Agreement by and between the
Company and Philip G. Heasley, dated January 7, 2009
10
.21(20)
*
Stock Option Agreement by and between the Company and Philip G.
Heasley, dated March 9, 2005
10
.22(21)
Share Purchase Agreement dated as of May 11, 2006 by and
between Transaction Systems Architects, Inc.; PREIPO Bating- und
Beteiligungsgesellschaft mbH; RP Vermögensverwaltung GmbH;
Mr. Christian Jaron; Mr. Johann Praschinger; and eps
Electronic Payment Systems AG
10
.23(22)
Agreement and Plan of Merger dated August 28, 2006 by and
among Transaction Systems Architects, Inc., Parakeet MergerSub
Corp., and P&H Solutions, Inc.
10
.24(23)
Credit Agreement by and among Transaction Systems Architects,
Inc. and Wachovia Bank, National Association
10
.25(24)*
Separation, Non-Compete, Non-Solicitation and Non-Disclosure
Agreement and General Release with Anthony J. Parkinson dated
May 10, 2007
10
.26(25)*
Separation, Non-Compete, Nonsolicitation and Non-Disclosure
Agreement and General Release with Mark R. Vipond dated
August 11, 2008
10
.27(26)*
2008 Executive Management Incentive Compensation Plan
10
.28(27)*
2008 Form of
Change-in-Control
Employment Agreement between the Company and certain officers,
including executive officers
10
.29*
Form of Restricted Share Award Agreement for the Companys
2005 Equity and Performance Incentive Plan, as amended (filed
herewith)
10
.30(28)***
Master Alliance Agreement between ACI Worldwide, Inc. and
International Business Machines Corporation
10
.31(29)
Warrant Agreement between ACI Worldwide, Inc. and International
Business Machines Corporation
10
.32(30)
Warrant Agreement between ACI Worldwide, Inc. and International
Business Machines Corporation
10
.33(31)***
Master Services Agreement by and between ACI Worldwide, Inc. and
International Business Machines Corporation
21
.01
Subsidiaries of the Registrant (filed herewith)
23
.01
Consent of Independent Registered Public Accounting Firm (filed
herewith) - Deloitte & Touche LLP
23
.02
Consent of Independent Registered Public Accounting Firm (filed
herewith) KPMG LLP
31
.01
Certification of Chief Executive Officer pursuant to S.E.C.
Rule 13a-14,
as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 (filed herewith)
31
.02
Certification of Chief Financial Officer pursuant to S.E.C.
Rule 13a-14,
as adopted pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 (filed herewith)
Table of Contents
Exhibit
32
.01**
Certification of Chief Executive Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (furnished
herewith)
32
.02**
Certification of Chief Financial Officer pursuant to
18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 (furnished
herewith)
(1)
Incorporated herein by reference to registrants current
report on
Form 8-K
filed July 30, 2007.
(2)
Incorporated herein by reference to Exhibit 3.02 to the
registrants current report on
Form 8-K
filed December 18, 2008.
(3)
Incorporated herein by reference to Exhibit 4.01 to the
registrants Registration Statement
No. 33-88292
on
Form S-1.
(4)
Incorporated herein by reference to Exhibit 10.9 to the
registrants Registration Statement
No. 33-88292
on
Form S-1.
(5)
Incorporated herein by reference to Exhibit 10.1 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2006.
(6)
Incorporated herein by reference to Exhibit 10.2 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2006.
(7)
Incorporated herein by reference to Exhibit 10.4 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2006.
(8)
Incorporated herein by reference to Exhibit 4.1 to the
registrants Post-Effective Amendment No. 2 to
Registration Statement
No. 333-113550
on
Form S-8
filed June 11, 2008.
(9)
Incorporated herein by reference to Exhibit 10.6 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2006.
(10)
Incorporated herein by reference to Exhibit 10.7 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2006.
(11)
Incorporated herein by reference to Exhibit 10.2 to the
registrants quarterly report on
Form 10-Q
for the period ended March 31, 2007.
(12)
Incorporated herein by reference to Exhibit 2.1 to the
registrants current report on
Form 8-K
filed on July 1, 2005.
(13)
Incorporated herein by reference to Exhibit 10.18 to the
registrants annual report on
Form 10-K
for the fiscal year ended September 30, 2004.
(14)
Incorporated herein by reference to Exhibit 10.19 to the
registrants annual report on
Form 10-K
for the fiscal year ended September 30, 2004.
(15)
Incorporated herein by reference to Exhibit 10.2 to the
registrants quarterly report on
Form 10-Q
for the period ended June 30, 2007.
(16)
Incorporated herein by reference to Exhibit 10.22 to the
registrants annual report on
Form 10-K
for the fiscal year ended September 30, 2004.
(17)
Incorporated herein by reference to Exhibit 10.23 to the
registrants annual report on
Form 10-K
for the fiscal year ended September 30, 2004.
(18)
Incorporated herein by reference to Exhibit 10.1 to the
registrants current report on
Form 8-K
filed December 16, 2009.
(19)
Incorporated herein by reference to Exhibit 10.1 to the
registrants current report on
Form 8-K
filed on January 7, 2009.
(20)
Incorporated herein by reference to Exhibit 10.2 to the
registrants current report on
Form 8-K
filed on March 10, 2005.
(21)
Incorporated herein by reference to Exhibit 2.1 to the
registrants quarterly report on
Form 10-Q
for the period ended June 30, 2006.
Table of Contents
(22)
Incorporated herein by reference to Exhibit 2.1 to the
registrants current report on
Form 8-K
filed on September 1, 2006.
(23)
Incorporated herein by reference to Exhibit 10.33 to the
registrants annual report on
Form 10-K
for the fiscal year ended September 30, 2006.
(24)
Incorporated herein by reference to Exhibit 10.1 to the
registrants current report on
Form 8-K
filed May 16, 2007.
(25)
Incorporated herein by reference to Exhibit 10.1 the
registrants current report on
Form 8-K
filed August 15, 2008.
(26)
Incorporated herein by reference to Annex A to the
registrants Proxy Statement for its 2008 Annual Meeting
(File
No. 000-25346)
filed on April 21, 2008.
(27)
Incorporated herein by reference to Exhibit 10.1 the
registrants current report on
Form 8-K
filed January 7, 2009.
(28)
Incorporated herein by reference to Exhibit 10.1 to the
registrants quarterly report on
Form 10-Q
for the period ended June 30, 2009.
(29)
Incorporated herein by reference to Exhibit 10.2 to the
registrants quarterly report on
Form 10-Q
for the period ended December 31, 2007.
(30)
Incorporated herein by reference to Exhibit 10.3 to the
registrants quarterly report on
Form 10-Q
for the period ended December 31, 2007.
(31)
Incorporated herein by reference to Exhibit 10.2 to the
registrants quarterly report on
Form 10-Q
for the period ended June 30, 2009.
*
Denotes exhibit that constitutes a management contract, or
compensatory plan or arrangement.
**
This certification is not deemed filed for purposes
of Section 18 of the Securities Exchange Act of 1934, or
otherwise subject to the liability of that section. Such
certification will not be deemed to be incorporated by reference
into any filing under the Securities Act of 1933 or the
Securities Exchange Act of 1934, except to the extent that the
Company specifically incorporates it by reference.
***
Material has been omitted from this exhibit pursuant to a
request for confidential treatment pursuant to
Rule 24b-2
promulgated under the Securities and Exchange Act of 1934 and
such material has been filed separately with the Securities and
Exchange Commission.
63
Table of Contents
64
Table of Contents
65
Table of Contents
66
Table of Contents
For the Years
For the Three
Ended
Months Ended
For the Year
December 31,
December 31,
Ended September 30,
2009
2008
2007
2007
(In thousands, except per share amounts)
$
156,469
$
169,210
$
46,266
$
149,485
136,737
130,015
32,167
121,233
112,549
118,428
22,849
95,500
405,755
417,653
101,282
366,218
14,754
12,846
2,483
9,145
112,893
117,087
23,530
95,691
77,506
75,850
22,945
78,950
61,799
73,236
20,587
69,957
79,244
100,272
25,011
94,762
17,989
16,649
3,874
15,294
364,185
395,940
98,430
363,799
41,570
21,713
2,852
2,419
1,042
2,609
763
4,082
(2,856
)
(5,013
)
(1,389
)
(6,644
)
(6,648
)
8,247
(334
)
(3,740
)
(8,462
)
5,843
(960
)
(6,302
)
33,108
27,556
1,892
(3,883
)
13,482
16,974
3,908
5,248
$
19,626
$
10,582
$
(2,016
)
$
(9,131
)
34,368
34,498
35,700
36,933
34,554
34,795
35,700
36,933
$
0.57
$
0.31
$
(0.06
)
$
(0.25
)
$
0.57
$
0.30
$
(0.06
)
$
(0.25
)
(1)
The cost of software license fees excludes charges for
depreciation but includes amortization of purchased and
developed software for resale. The cost of maintenance and
services excludes charges for depreciation.
67
Table of Contents
Accumulated
Other
Common
Additional
Comprehensive
Common
Stock
Treasury
Paid-in
Retained
Income
Stock
Warrants
Stock
Capital
Earnings
(Loss)
Total
(In thousands)
$
204
$
$
(94,313
)
$
307,553
$
62,357
$
(8,589
)
$
267,212
(9,131
)
(9,131
)
7,869
7,869
(1,262
)
(46,187
)
(46,187
)
160
(155
)
5
(3,399
)
(3,399
)
1,074
1,074
7,311
7,311
258
258
204
(140,340
)
312,642
53,226
(720
)
225,012
(2,016
)
(2,016
)
(1,122
)
(1,122
)
(3,138
)
(3,708
)
(3,708
)
2,165
(631
)
1,534
1,563
(953
)
610
(151
)
(151
)
206
206
(5
)
(5
)
24,003
24,003
(3,324
)
(3,324
)
$
204
$
24,003
$
(140,320
)
$
311,108
$
47,886
$
(1,842
)
$
241,039
10,582
10,582
(21,421
)
(21,421
)
(10,839
)
(30,063
)
(30,063
)
2,618
(1,141
)
1,477
7,854
(4,013
)
3,841
498
498
7,888
7,888
12,328
(12,328
)
(225
)
225
$
204
$
24,003
$
(147,808
)
$
302,237
$
58,468
$
(23,263
)
$
213,841
19,626
19,626
8,398
8,398
28,024
(15,000
)
(15,000
)
1,862
(793
)
1,069
3,688
(1,877
)
1,811
(705
)
(705
)
7,645
7,645
554
(554
)
(1,326
)
1,326
(622
)
(622
)
$
204
$
24,003
$
(158,652
)
$
307,279
$
78,094
$
(14,865
)
$
236,063
68
Table of Contents
For the Years
For the Three
For the Year
Ended
Months Ended
Ended
December 31,
December 31,
September 30,
2009
2008
2007
2007
(In thousands)
$
19,626
$
10,582
$
(2,016
)
$
(9,131
)
6,338
6,506
1,496
5,900
17,389
15,544
3,724
14,603
2,199
1,942
591
1,912
(6,562
)
4,739
(741
)
(6,832
)
336
336
84
336
(40
)
(949
)
(1,049
)
(219
)
(386
)
(404
)
56
290
17
(28
)
1,640
5,800
2,475
2,077
7,645
7,888
(5
)
7,569
114
357
97
1,043
(10,365
)
(5,401
)
(17,552
)
11,145
68
(187
)
(384
)
(1,659
)
1,387
617
(702
)
(2,293
)
(1,680
)
(2,494
)
2,799
(3,343
)
3,492
51
(73
)
(12,162
)
40,935
(8,412
)
(2,609
)
3,982
2,949
(8,450
)
6,029
2,130
2,443
(1,122
)
8,412
(7,012
)
16,171
20,738
(2,406
)
(1,020
)
103
1,999
44,217
77,826
12,123
24,847
(2,942
)
(7,021
)
(2,227
)
(7,784
)
(7,529
)
(4,936
)
(1,658
)
(1,107
)
(2,500
)
2,500
(6,899
)
(6,328
)
1,498
9,330
1,050
500
500
(7,047
)
(169
)
(47
)
(17,579
)
6
(23,367
)
(16,956
)
5,898
(25,964
)
1,243
1,704
279
24,003
1,811
3,841
610
40
88
142
109
31
(15,000
)
(30,063
)
(3,994
)
(46,707
)
(622
)
(1,576
)
(3,311
)
(625
)
(3,369
)
(14,056
)
(27,687
)
20,382
(50,005
)
6,157
(17,228
)
(2,186
)
1,768
12,951
15,955
36,217
(49,354
)
112,966
97,011
60,794
110,148
$
125,917
$
112,966
$
97,011
$
60,794
$
15,202
$
9,940
$
243
$
14,450
$
3,564
$
4,392
$
1,271
$
3,573
$
$
$
$
47
69
Table of Contents
1.
Nature of
Business and Summary of Significant Accounting
Policies
70
Table of Contents
71
Table of Contents
72
Table of Contents
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
13,905
$
18,212
$
2,576
$
9,792
5,273
6,494
1,101
4,440
6,513
11,131
1,317
4,568
$
25,691
$
35,837
$
4,994
$
18,800
73
Table of Contents
74
Table of Contents
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
1,920
$
1,723
$
2,041
$
2,110
339
1,171
564
215
373
(359
)
(367
)
(533
)
(781
)
$
2,732
$
1,920
$
1,723
$
2,041
75
Table of Contents
3-5 years
7 years
Lesser of useful life of improvement or remaining term of lease
4-5 years
76
Table of Contents
77
Table of Contents
78
Table of Contents
79
Table of Contents
80
Table of Contents
2.
Acquisitions
Weighted-Average
Amount
Useful Lives
$
668
302
1,539
2,758
5 years
1,999
9 years
276
5 years
7,542
(968
)
$
6,574
81
Table of Contents
Weighted-Average
Amount
Useful Lives
$
801
333
441
558
1,339
6.0 years
6,863
1,241
8.0 years
11,576
2,310
971
3,281
$
8,295
82
Table of Contents
Weighted-Average
Amount
Useful Lives
$
573
10
396
57
712
1,283
6.9 years
25
3,056
114
414
528
$
2,528
3.
Property
and Equipment
December 31,
2009
2008
$
32,633
$
31,057
10,558
11,284
6,624
6,335
135
258
49,950
48,934
(32,380
)
(29,513
)
$
17,570
$
19,421
(1)
Includes $2.6 and $1.2 million of computer and office
equipment under capital lease for the years ended
December 31, 2009 and 2008, respectively.
83
Table of Contents
4.
Goodwill
Americas
EMEA
Asia/Pacific
Total
$
187,153
$
49,606
$
17,443
$
254,202
(47,432
)
(47,432
)
139,721
49,606
17,443
206,770
(546
)
(6,223
)
(381
)
(7,150
)
155
155
211
211
139,330
43,383
17,273
199,986
479
1,924
449
2,852
473
473
1,539
1,539
$
139,809
$
46,846
$
18,195
$
204,850
(1)
Adjustment to S2 Systems, Inc. acquisition relates to
contingency payments made in accordance with the purchase
agreement.
(2)
Visual Web purchase accounting adjustment relates to an
adjustment to tax contingencies.
(3)
Adjustment to Stratasoft acquisition relates to earn out payment
made in accordance with the purchase agreement.
(4)
Addition relates to goodwill acquired during the acquisition of
Essentis.
84
Table of Contents
5.
Software
and Other Intangible Assets
December 31, 2009
December 31, 2008
Gross
Gross
Carrying
Accumulated
Net
Carrying
Accumulated
Net
Amount
Amortization
Balance
Amount
Amortization
Balance
$
41,636
$
(19,727
)
$
21,909
$
39,020
$
(15,333
)
$
23,687
11,179
(7,030
)
4,149
11,030
(5,081
)
5,949
2,526
(1,711
)
815
2,236
(1,592
)
644
74
(41
)
33
1,537
(1,470
)
67
$
55,415
$
(28,509
)
$
26,906
$
53,823
$
(23,476
)
$
30,347
85
Table of Contents
Software
Other Intangible
Amortization
Assets Amortization
$
12,405
$
6,347
9,035
5,993
6,489
4,922
1,759
4,667
349
2,864
2,113
$
30,037
$
26,906
6.
Debt
86
Table of Contents
7.
Derivative
Instruments and Hedging Activities
On July 18, 2007, the Company entered into an interest rate
swap with a commercial bank whereby the Company pays a fixed
rate of 5.375% and receives a floating rate indexed to the
3-month
LIBOR (5.36% at inception) from the counterparty on a notional
amount of $75 million with re-pricing of the variable rate
quarterly. The swap effective date was July 20, 2007 and
terminates on October 4, 2010. Net cash settlement payments
occurred quarterly on the 4th of each October, January, April
and July commencing October 4, 2007, through and including
the termination date. During the year ended December 31,
2009, the Company elected
1-month
LIBOR as the variable-rate benchmark for its revolving facility.
The Company also amended the interest rate swap on the
$75 million notional amount from the
3-month
LIBOR to
1-month
LIBOR. This basis swap did not impact the maturity date of or
the accounting for the interest rate swap. The fair value
liability at December 31, 2009 of this swap was
$2.3 million.
On August 16, 2007, the Company entered into a forward
starting interest rate swap with a commercial bank whereby the
Company pays a fixed rate of 4.90% and receives a floating rate
indexed to the
3-month
LIBOR from the counterparty on a notional amount of forecasted
borrowings of $50 million with re-pricing of the variable
rate quarterly. The swap effective date was October 4, 2007
and terminates on October 4, 2010. Net cash settlement
payments occur quarterly on the 4th of each January, April, July
and October commencing January 4, 2008, through and
including the termination date. The fair value liability at
December 31, 2009 of this swap was $3.0 million.
Asset
(Liability)
$
(4,552
)
1,728
(5,800
)
(8,624
)
4,993
(1,640
)
$
(5,271
)
87
Table of Contents
8.
Fair
Value of Financial Instruments
Level 1 Inputs
Unadjusted quoted prices
in active markets for identical assets or liabilities that the
reporting entity has the ability to access at the measurement
date.
Level 2 Inputs
Inputs other than quoted
prices included in Level 1 that are observable for the
asset or liability, either directly or indirectly. These might
include quoted prices for similar assets or liabilities in
active markets, quoted prices for identical or similar assets or
liabilities in markets that are not active, inputs other than
quoted prices that are observable for the asset or liability
(such as interest rates, volatilities, prepayment speeds, credit
risks, etc.) or inputs that are derived principally from or
corroborated by market data by correlation or other means.
Level 3 Inputs
Unobservable inputs for
determining the fair values of assets or liabilities that
reflect an entitys own assumptions about the assumptions
that market participants would use in pricing the assets or
liabilities.
Fair Value Measurements at
Reporting Date Using
Quoted Prices
in Active
Significant
Markets for
Other
Significant
Identical
Observable
Unobservable
Assets
Inputs
Inputs
(Level 1)
(Level 2)
(Level 3)
$
$
8,624
$
$
$
8,624
$
$
$
5,271
$
$
$
5,271
$
88
Table of Contents
9.
Corporate
Restructuring and Other Reorganization Charges
Termination
Benefits
$
1,397
5,888
(4,697
)
(41
)
2,547
2,870
181
(5,155
)
(131
)
$
312
(1)
Other includes the impact of foreign currency translation.
89
Table of Contents
10.
Common
Stock, Treasury Stock and Earnings Per Share
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
34,368
34,498
35,700
36,933
186
297
34,554
34,795
35,700
36,933
90
Table of Contents
11.
Other
Income/Expense
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
(5,275
)
$
13,814
$
1,890
$
(1,915
)
(1,640
)
(5,800
)
(2,475
)
(2,077
)
1,049
219
386
404
(782
)
14
(135
)
(152
)
$
(6,648
)
$
8,247
$
(334
)
$
(3,740
)
12.
Segment
Information
91
Table of Contents
Three Months
Years Ended
Ended
Year Ended
December 31,
December 31,
September 30,
2009
2008
2007
2007
$
222,952
$
207,350
$
49,618
$
195,775
137,061
169,046
43,094
133,776
45,742
41,257
8,570
36,667
$
405,755
$
417,653
$
101,282
$
366,218
$
15,759
$
15,705
$
3,712
$
14,292
4,986
4,566
1,127
5,112
2,982
1,779
381
1,099
$
23,727
$
22,050
$
5,220
$
20,503
$
3,804
$
3,895
$
46
$
4,033
2,165
2,689
(46
)
2,759
1,676
1,304
(5
)
777
$
7,645
$
7,888
$
(5
)
$
7,569
$
42,344
$
21,714
$
2,883
$
14,578
6,963
2,140
403
(16,942
)
(7,737
)
(2,141
)
(434
)
4,783
$
41,570
$
21,713
$
2,852
$
2,419
December 31,
2009
2008
$
184,295
$
190,940
4,306
3,594
79,491
77,205
21,865
21,660
$
289,957
$
293,399
92
Table of Contents
December 31,
2009
2008
$
345,304
$
314,296
15,718
14,506
187,356
178,085
41,665
45,955
$
590,043
$
552,842
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
255,193
$
263,641
$
62,818
$
230,003
72,608
78,857
16,204
64,155
25,521
17,058
2,790
14,797
15,272
18,871
4,794
16,995
37,161
39,226
14,676
40,268
$
405,755
$
417,653
$
101,282
$
366,218
13.
Stock-Based
Compensation Plans
Table of Contents
94
Table of Contents
95
Table of Contents
Weighted-
Average
Weighted-
Remaining
Aggregate
Average
Contractual
Intrinsic Value
Number of
Exercise
Term
of In-the-Money
Shares
Price ($)
(Years)
Options ($)
3,459,090
$
18.24
901,496
33.99
(10,343
)
9.29
(129,126
)
30.58
(512,686
)
13.25
3,708,431
22.35
(51,160
)
10.75
(15,000
)
34.97
(51,946
)
25.20
3,590,325
22.43
551,700
17.46
(311,640
)
12.33
(307,866
)
31.58
(94,222
)
23.48
3,428,297
21.69
505,183
16.17
(150,134
)
12.06
(125,606
)
31.98
(100,867
)
29.82
3,556,873
$
20.72
6.12
$
5,536,213
2,104,477
$
20.68
5.01
$
4,821,818
96
Table of Contents
Year Ended
Years Ended December 31,
September 30,
2009
2008
2007
6.0
6.2
5.4
3.0
%
3.1
%
4.9
%
53.2
%
54.9
%
50.4
%
97
Table of Contents
98
Table of Contents
Number of
Weighted-
Shares at
Average
Expected
Grant Date
Attainment
Fair Value
219,150
$
28.99
174,947
34.25
(55,260
)
28.98
(26,720
)
28.91
312,117
31.95
(132,110
)
29.00
(5,060
)
29.10
174,947
34.25
(139,891
)
34.24
(35,056
)
34.30
216,150
16.52
216,150
$
16.52
99
Table of Contents
Number of
Restricted
Weighted-Average Grant
Share Awards
Date Fair Value
$
471,400
17.95
(9,000
)
17.17
462,400
17.97
23,500
16.65
(115,602
)
17.97
(55,750
)
17.54
314,548
$
17.94
14.
Employee
Benefit Plans
100
Table of Contents
15.
Income
Taxes
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
22,020
$
29,276
$
1,527
$
17,061
11,088
(1,720
)
365
(20,944
)
$
33,108
$
27,556
$
1,892
$
(3,883
)
101
Table of Contents
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
9,964
$
3,009
$
5,953
$
2,153
(3,259
)
6,712
(4,699
)
2,887
6,705
9,721
1,254
5,040
1,415
1,951
376
2,256
(2,356
)
(1,418
)
(201
)
(50
)
(941
)
533
175
2,206
6,465
4,489
1,959
(1,861
)
1,253
2,231
520
(137
)
7,718
6,720
2,479
(1,998
)
$
13,482
$
16,974
$
3,908
$
5,248
Three Months
Ended
Year Ended
Years Ended December 31,
December 31,
September 30,
2009
2008
2007
2007
$
11,588
$
9,645
$
662
$
(1,357
)
(293
)
241
29
1,434
(723
)
898
(83
)
(1,845
)
5,589
7,020
2,713
7,508
(587
)
(195
)
(49
)
(195
)
(70
)
(221
)
(376
)
(65
)
(2,359
)
488
(259
)
701
(227
)
$
13,482
$
16,974
$
3,908
$
5,248
102
Table of Contents
December 31,
2009
2008
$
$
4,754
204
310
4,255
6,053
4,397
1,608
1,779
1,418
2,098
6,494
3,618
577
805
18,953
19,417
(1,494
)
(2,412
)
$
17,459
$
17,005
$
8,849
$
2,869
1,926
2,817
39
2,156
8,641
7,410
6,511
7,759
3,235
7,326
3,805
1,176
9,236
7,972
1,103
1,103
279
967
47,145
38,034
(12,189
)
(16,939
)
(12,189
)
(16,939
)
(8,932
)
(10,287
)
$
26,024
$
10,808
103
Table of Contents
2009
2008
$
11,535
$
14,971
5,469
324
(4,327
)
(3,621
)
19
1,209
(299
)
(823
)
(1,602
)
(174
)
121
(351
)
$
10,916
$
11,535
104
Table of Contents
16.
Assets of
Businesses Transferred Under Contractual Arrangements
105
Table of Contents
17.
Commitments
and Contingencies
106
Table of Contents
Capital
Operating
Leases
Leases
Total
$
765
$
9,422
$
10,187
765
7,264
8,029
638
5,824
6,462
284
5,134
5,418
4,360
4,360
30,450
30,450
$
2,452
$
62,454
$
64,906
(315
)
$
2,137
107
Table of Contents
18.
International
Business Machines Corporation Alliance
108
Table of Contents
Alliance
Agreement
Liability
$
9,331
37,333
5,100
(8,242
)
43,522
(11,035
)
$
32,487
19.
International
Business Machines Corporation Information Technology Outsourcing
Agreement
109
Table of Contents
Termination
Benefits
$
1,836
(1,192
)
(179
)
465
(389
)
1
$
77
(1)
Includes the impact of foreign currency translation.
110
Table of Contents
20.
Quarterly
Financial Data
Quarter Ended
December 31,
September 30,
June 30,
March 31,
2009
2009
2009
2009
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
$
57,461
$
40,714
$
27,116
$
31,178
37,089
34,862
33,346
31,440
31,361
28,885
26,708
25,595
125,911
104,461
87,170
88,213
3,818
3,936
3,833
3,167
29,757
27,959
27,955
27,222
18,530
20,071
19,932
18,973
16,269
14,911
15,511
15,108
17,811
21,064
18,865
21,504
4,756
4,577
4,310
4,346
90,941
92,518
90,406
90,320
34,970
11,943
(3,236
)
(2,107
)
178
117
446
301
(1,073
)
(488
)
(526
)
(769
)
(1,929
)
16
(3,615
)
(1,120
)
(2,824
)
(355
)
(3,695
)
(1,588
)
32,146
11,588
(6,931
)
(3,695
)
12,585
3,829
(3,369
)
437
$
19,561
$
7,759
$
(3,562
)
$
(4,132
)
$
0.58
$
0.23
$
(0.10
)
$
(0.12
)
$
0.57
$
0.23
$
(0.10
)
$
(0.12
)
(1)
The cost of software license fees excludes charges for
depreciation but includes amortization of purchased and
developed software for resale. The cost of maintenance and
services excludes charges for depreciation.
(2)
The sum of the earnings per share by quarter does not agree to
the earnings per share for the year ended December 31, 2009
due to rounding.
111
Table of Contents
Quarter Ended
December 31,
September 30,
June 30,
March 31,
2008
2008
2008
2008
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
$
46,797
$
46,460
$
38,214
$
37,739
31,748
33,963
32,867
31,437
30,666
28,137
38,138
21,487
109,211
108,560
109,219
90,663
3,414
3,588
3,248
2,596
24,450
31,320
33,698
27,619
14,997
19,170
21,106
20,577
15,907
18,450
22,215
16,664
26,691
28,889
23,481
21,211
4,180
4,185
4,212
4,072
89,639
105,602
107,960
92,739
19,572
2,958
1,259
(2,076
)
678
635
703
593
(1,460
)
(1,149
)
(1,038
)
(1,366
)
5,172
932
2,333
(190
)
4,390
418
1,998
(963
)
23,962
3,376
3,257
(3,039
)
11,024
1,659
2,429
1,862
$
12,938
$
1,717
$
828
$
(4,901
)
$
0.38
$
0.05
$
0.02
$
(0.14
)
$
0.37
$
0.05
$
0.02
$
(0.14
)
Table of Contents
By:
President, Chief Executive Officer and Director
(principal executive officer)
February 26, 2010
Senior Vice President, Chief Financial Officer, Controller and
Chief Accounting Officer
(principal financial officer)
February 26, 2010
Chairman of the Board and Director
February 26, 2010
Director
February 26, 2010
Director
February 26, 2010
Director
February 26, 2010
Director
February 26, 2010
Director
February 26, 2010
Director
February 26, 2010
113
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3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
ACI WORLDWIDE, INC. | |||||||||||
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By: | ||||||||||
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Title: | ||||||||||
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EXECUTIVE: | |||||||||||
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ACI WORLDWIDE, INC. (formerly known as | ||||||||
Transaction Systems Architects, Inc.) | ||||||||
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By: | |||||||
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Name: | |||||||
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Title: |
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Address: |
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Elkhorn, Nebraska 68022 | |||||||
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AGREED TO AND ACCEPTED BY: | ||||||||
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Signature: | |||||||
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Name: | |||||||
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11
4.1. |
Time of Exercise of Option
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4.1.1. |
The Option shall become exercisable with respect to 100% of the Option Shares on the
earlier to occur of (i) the date which is one year following the Date of Grant and (ii)
the day immediately prior to the date of the next annual meeting of the stockholders of
the Corporation occurring following the Date of Grant.
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4.1.2. |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the Plan,
the Option granted under this Option Agreement shall become immediately exercisable
upon the occurrence of a Change in Control (as defined in Section 9 below) if the
Optionee holding such Option is a Non-Employee Director of the Corporation or a
Subsidiary of the Corporation on the date of the consummation of such Change in
Control.
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4.1.3 |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the
Plan, if the Optionee ceases to be a Non-Employee Director of the Corporation or a
Subsidiary of the Corporation by reason of Disability (as defined in Section 4.3.2
below), the unexercised portion of any Option held by such Optionee at that time will
become immediately vested and will be exercisable until terminated in accordance with
Section 4.3 below.
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4.1.4 |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the
Plan, if the Optionee dies while serving as a Non-Employee Director of the Corporation
or a Subsidiary of the Corporation (or dies within a period of one month after
termination of his service as a Non-Employee Director for any reason other than
Disability or within a period of one year after termination of his service as
Non-Employee Director by reason of Disability), the unexercised portion of any Option
held by such Optionee at the time of death will become immediately vested and will be
exercisable until terminated in accordance with Section 4.3 below.
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4.2. |
Limitations
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Page 2
4.3. |
Termination of Option
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4.3.1. |
90 calendar days from the date of the Optionees termination of service as a
Non-Employee Director of the Corporation or a Subsidiary of the Corporation for any
reason other than death or Disability (as defined below);
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4.3.2. |
one year after the Optionees permanent and total disability as defined in Section
22(e)(3) of the Code (Disability);
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4.3.3. |
one year after the Optionees death, if such death occurs (i) while the Optionee is
serving as a Non-Employee Director of the Corporation or a Subsidiary of the
Corporation, (ii) within the 90-day period following the Optionees termination of
service as a Non-Employee Director for any reason other than Disability; or (iii)
within the one-year period following the Optionees termination of service as a
Non-Employee Director by reason of the Optionees Disability; or
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4.3.4. |
ten years from the Date of Grant.
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4.4. |
Limitations on Exercise of Option
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Page 3
4.5. |
Method of Exercise of Option
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4.5.1. |
To the extent then exercisable, the Option may be exercised in whole or in part by
written notice to the Corporation stating the number of shares for which the Option is
being exercised and the intended manner of payment. The date of such notice shall be
the exercise date. Payment equal to the aggregate Exercise Price of the shares shall
be payable (i) in cash in the form of currency or check or other cash equivalent
acceptable to the Corporation, (ii) by actual or constructive transfer to the
Corporation of nonforfeitable, outstanding shares of Stock that have been owned by the
Optionee for at least six months prior to the date of exercise, (iii) by any
combination of the foregoing methods of payment, or (iv) in accordance with such other
method or manner as set forth below.
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Page 4
4.5.2. |
As soon as practicable upon the Corporations receipt of the Optionees notice of
exercise and payment, the Corporation shall direct the due issuance of the shares so
purchased.
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4.5.3. |
As a further condition precedent to the exercise of this Option in whole or in part,
the Optionee shall comply with all regulations and the requirements of any regulatory
authority having control of, or supervision over, the issuance of the shares of Stock
and in connection therewith shall execute any documents which the Board shall in its
sole discretion deem necessary or advisable.
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Page 5
(a) |
Any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the
Exchange
Act
)) (a
Person
) becomes the beneficial owner (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (1) the
then-outstanding shares of common stock of the Corporation (the
Outstanding
Corporation Common Stock
) or (2) the combined voting power of the then-outstanding
voting securities of the Corporation entitled to vote generally in the election of
directors (the
Outstanding Corporation Voting Securities
);
provided
,
however
,
that, for purposes of this definition of Change in Control, the following
acquisitions shall not constitute a Change in Control: (a) any acquisition directly
from the Corporation, (b) any acquisition by the Corporation, (c) any acquisition by
any employee benefit plan (or related trust) sponsored or maintained by the
Corporation or any company controlled by, controlling or under common control with
the Corporation, (d) any acquisition by any Person pursuant to a transaction that
complies with 9(c)(1) below; or (e) any acquisition of beneficial ownership of not
more than 25%
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Page 6
(b) |
Any time at which individuals who, as of the date hereof, constitute the Board
of Directors (the
Incumbent Board
) cease for any reason to constitute at
least a majority of the Board of Directors other than as a result of a Business
Combination that does not constitute a Change in Control under Sections 10(a) above
or 9(c)(1) below;
provided
,
however
, that any individual becoming a director subsequent
to the date hereof whose election, or nomination for election by the Corporations
stockholders, was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other actual
or threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors (an
Election Contest
);
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(c) |
Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar transaction involving the Corporation or any of its
subsidiaries, a sale or other disposition of all or substantially all of the assets of
the Corporation, or the acquisition of assets or stock of another entity by the
Corporation or any of its subsidiaries (each, a
Business Combination
), in
each case unless, following such Business Combination, (1) no Person (excluding any
corporation resulting from such Business Combination or any employee benefit plan (or
related trust) of the Corporation or such corporation resulting from such Business
Combination (the
Combined Corporation
)) beneficially owns, directly or
indirectly, such number of the then-Outstanding Corporation Voting Securities as would
constitute a Change in Control under 9(a) above, and at least one-half
of the members of the board of directors (or, for a non-corporate entity, equivalent
governing body) of the entity resulting from such Business Combination (the
Combined Corporation Board
) were members of the Incumbent Board at the
time of the execution of the initial agreement or of the action of the Board of
Directors providing for such Business Combination (the
Business Combination
Agreement
); or
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(d) |
Approval by the stockholders of the Corporation of a complete liquidation or
dissolution of the Corporation.
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Page 7
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Page 9
ACI Worldwide, Inc. | Optionee: | |||||||||
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By:
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By: | |||||||||
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[ ] | [ ] | ||||||||
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ADDRESS FOR NOTICE TO OPTIONEE: | ||||||||||
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Number Street Apt. | ||||||||||
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City State Zip Code | ||||||||||
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SS# Board Appointment Date | ||||||||||
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DESIGNATED BENEFICIARY : | ||||||||||
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Please Print Last Name, First Name MI | ||||||||||
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Beneficiarys Street Address | ||||||||||
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City State Zip Code | ||||||||||
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Beneficiarys Social Security Number |
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Options | $_____/Share Exercise Price |
4.1.1 |
The Option shall become exercisable with respect to the Option Shares only as
follows:
[
One-quarter
]
of the Option Shares ([
] Option Shares) shall become
exercisable on each of the first
[
four
]
anniversaries of the Date of Grant if the
Optionee shall have remained in the continuous employ of the Corporation or any of its
Subsidiaries as of each such date.
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4.1.2 |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the
Plan, if the Optionee ceases to be an employee of the Corporation or a Subsidiary of
the Corporation by reason of Disability (as defined in Section 4.3.2 below), the
unexercised portion of any Option held by such Optionee at that time will become
immediately vested and will be exercisable until terminated in accordance with Section
4.3 below.
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4.1.3 |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the
Plan, if the Optionee dies while employed by the Corporation or a Subsidiary of the
Corporation (or dies within a period of one month after ceasing to be an employee for
any reason other than Disability or within a period of one year after ceasing to be an
employee by reason of Disability), the unexercised portion of any Option held by such
Optionee at the time of death will become immediately vested and will be exercisable
until terminated in accordance with Section 4.3 below.
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[ 4.1.4 |
Notwithstanding Section 4.1.1 above, in accordance with the provisions of the Plan,
the Option granted under this Option Agreement shall become immediately exercisable
upon the occurrence, after the Date of Grant, of a Change in Control (as defined in
Section 10 below) if the Optionee is an employee of the Corporation or any Subsidiary
on the date of the consummation of such Change in Control.
]
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Page 2
4.3.1 |
90 calendar days from the date of the Optionees termination of employment
with the Corporation or a Subsidiary for any reason other than death or Disability (as
defined below);
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4.3.2 |
one year after the Optionees permanent and total disability as defined in
Section 22(e)(3) of the Code (Disability);
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4.3.3 |
one year after the Optionees death, if such death occurs (i) while the
Optionee is employed by the Corporation or a Subsidiary, (ii) within the 90-day period
following the Optionees termination of employment for any reason other than
Disability; or (iii) within the one-year period following the Optionees termination of
employment by reason of the Optionees Disability; or
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4.3.4 |
ten years from the Date of Grant.
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Page 3
4.5.1 |
To the extent then exercisable, the Option may be exercised in whole or in
part by written notice to the Corporation stating the number of shares for which the
Option is being exercised and the intended manner of payment. The date of such notice
shall be the exercise date. Payment equal to the aggregate Exercise Price of the
shares shall be payable (i) in cash in the form of currency or check or other cash
equivalent acceptable to the Corporation, (ii) by actual or constructive transfer to
the Corporation of nonforfeitable, outstanding shares of Stock that have been owned by
the Optionee for at least six months prior to the date of exercise, (iii) by any
combination of the foregoing methods of payment or (iv) in accordance with such other
method or manner as set forth below.
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Page 4
4.5.2 |
As soon as practicable upon the Corporations receipt of the Optionees notice
of exercise and payment, the Corporation shall direct the due issuance of the shares so
purchased.
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4.5.3 |
As a further condition precedent to the exercise of this Option in whole or in
part, the Optionee shall comply with all regulations and the requirements of any
regulatory authority having control of, or supervision over, the issuance of the shares
of Stock and in connection therewith shall execute any documents which the Board shall
in its sole discretion deem necessary or advisable.
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Page 5
Page 6
(a) |
Any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the
Exchange
Act
)) (a
Person
) becomes the beneficial owner (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (1) the
then-outstanding shares of common stock of the Corporation (the
Outstanding
Corporation Common Stock
) or (2) the combined voting power of the then-outstanding
voting securities of the Corporation entitled to vote generally in the election of
directors (the
Outstanding Corporation Voting Securities
);
provided
,
however
,
that, for purposes of this definition of Change in Control, the following acquisitions
shall not constitute a Change in Control: (a) any acquisition directly from the
Corporation, (b) any acquisition by the Corporation, (c) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Corporation or
any company controlled by, controlling or under common control with the Corporation,
(d) any acquisition by any Person pursuant to a transaction that complies with 10(c)(1)
below; or (e) any acquisition of beneficial ownership of not more than 25% of the
Outstanding Corporation Voting Securities by any Person that is entitled to and does
report such beneficial ownership on Schedule 13G under the Exchange Act (a
13G
Filer
),
provided
,
however
, that this clause (v) shall cease to apply when a Person
who is a Schedule 13G Filer becomes required to file a Schedule 13D under the Exchange
Act with respect to beneficial ownership of 20% or more of the Outstanding Corporation
Common Stock or Outstanding Corporation Voting Securities. Notwithstanding any other
provision hereof, if a Business Combination (as defined below) is completed during the
Performance Period and the Outstanding Corporation Voting Securities are converted into
voting securities of the Combined Corporation (as defined below), but such Business
Combination does not constitute a Change in Control under 10(c) below, Outstanding
Corporation Voting Securities shall thereafter mean voting securities of the Combined
Corporation entitled to vote generally in the election of the members of the Combined
Corporation Board.
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Page 7
(b) |
Any time at which individuals who, as of the date hereof, constitute the Board
of Directors (the
Incumbent Board
) cease for any reason to constitute at
least a majority of the Board of Directors other than as a result of a Business
Combination that does not constitute a Change in Control under Sections 10(a) above
or 10(c)(1) below;
provided
,
however
, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election by the
Corporations stockholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this purpose, any
such individual whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board of Directors (an
Election Contest
);
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(c) |
Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar transaction involving the Corporation or any of its
subsidiaries, a sale or other disposition of all or substantially all of the assets of
the Corporation, or the acquisition of assets or stock of another entity by the
Corporation or any of its subsidiaries (each, a
Business Combination
), in
each case unless, following such Business Combination, (1) no Person (excluding any
corporation resulting from such Business Combination or any employee benefit plan (or
related trust) of the Corporation or such corporation resulting from such Business
Combination (the
Combined Corporation
)) beneficially owns, directly or
indirectly, such number of the then-Outstanding Corporation Voting Securities as would
constitute a Change in Control under 10(a) above, and at least one-half of the
members of the board of directors (or, for a non-corporate entity, equivalent governing
body) of the entity resulting from such Business Combination (the
Combined
Corporation Board
) were members of the Incumbent Board at the time of the
execution of the initial agreement or of the action of the Board of Directors providing
for such Business Combination (the
Business Combination Agreement
); or
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(d) |
Approval by the stockholders of the Corporation of a complete liquidation or
dissolution of the Corporation.
]
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Page 8
Page 9
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SIGNATURE | DATE |
Options
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$ /Share Exercise Price |
(i) |
the Grantee shall not be entitled to delivery of the stock
certificate for any Shares until the expiration of the Restricted Period as to
such Shares;
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(ii) |
none of the Restricted Shares may be sold, assigned,
transferred, pledged, hypothecated or otherwise encumbered or disposed of
during the Restricted Period as to such Shares; and
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(iii) |
except as otherwise determined by the Committee at or after the grant of the Award
hereunder, if the Grantees employment with the Corporation or any Subsidiary is terminated at
any time for any reason, any of the Restricted Shares as to which the Restricted Period has
not expired shall be forfeited, and all rights of the Grantee to such Shares shall terminate,
without further obligation on the part of the Corporation and ownership of all such forfeited
Restricted Shares shall be transferred back to the Corporation.
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(i) |
termination of the Grantees employment with the Corporation or
a Subsidiary which results from the Grantees death or Disability (as defined
in Section 22(e)(3) of the Code); or
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[ (ii) |
the occurrence after the Grant Date of a Change in Control as
defined in
Exhibit A
attached hereto and incorporated by reference.
]
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ACI Worldwide, Inc. | Grantee: | |||||||||||
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By:
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By: | |||||||||||
[ ] | [Name] | |||||||||||
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ADDRESS FOR NOTICE TO GRANTEE: | ||||||||||||
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Number | Street | Apt. | |||||||||
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City | State | Zip Code | |||||||||
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SS# | Hire Date |
<Number> Restricted Shares
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<Date> |
8
9
10
ACI Worldwide de Argentina S.A.
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Argentina | |
ACI Worldwide (Pacific) Pty. Ltd.
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Australia | |
Insession Labs, Pty. Ltd.
|
Australia | |
ACI Worldwide (Brasil) Ltda.
|
Brazil | |
ACI Worldwide (Canada), Inc.
|
Canada | |
ACI Worldwide (Shanghai) Co. Ltd.
|
China | |
ACI Worldwide France S.A.R.L.
|
France | |
Applied Communications Holding GmbH
|
Germany | |
Applied Communications Verwaltungs GmbH
|
Germany | |
ACI Worldwide (Germany) GmbH & Co. KG
|
Germany | |
ACI Worldwide (eps) AG
|
Germany | |
ACI Worldwide (Hellas) EPE
|
Greece | |
Applied Communications (Hong Kong) Limited
|
Hong Kong | |
ACI Worldwide Solutions Pvt. Ltd.
|
India | |
Applied Communications GPC Limited
|
Ireland | |
Applied Communications (Ireland) Limited
|
Ireland | |
ACI Worldwide (Italia) S.R.L.
|
Italy | |
ACI Worldwide (Japan) K.K.
|
Japan | |
ACI Worldwide Korea Yuhan Hoesa
|
Korea | |
ACI Worldwide (Malaysia) Sdn. Bhd.
|
Malaysia | |
ACI Worldwide (Mexico) S.A. de C.V.
|
Mexico | |
ACI Worldwide Corp.
|
Nebraska | |
ACI Worldwide GPC (US) LLC
|
Nebraska | |
ACI Worldwide B.V.
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Netherlands | |
ACI Worldwide (New Zealand) Limited
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New Zealand | |
eps NZ Limited
|
New Zealand | |
Applied Communications Worldwide (Norway) A.S.
|
Norway | |
ACI Worldwide Philippine Islands, Inc.
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Philippines | |
ACI Worldwide (Eastern Europe Development) S.R.L.
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Romania | |
ACI Worldwide (Asia) Pte. Ltd.
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Singapore | |
ACI Worldwide (South Africa) (Pty.) Ltd.
|
South Africa | |
ACI Worldwide Cornastone (Pty) Ltd.
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South Africa | |
ACI Worldwide Iberica S.L.
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Spain | |
ACI Soluciones, S.L.
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Spain | |
ACI Worldwide (Nordic) AB
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Sweden | |
ACI Worldwide Schweiz GmbH
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Switzerland | |
ACI Worldwide (UK Development) Limited
|
United Kingdom | |
Electronic Payment Systems Limited
|
United Kingdom | |
Applied Communications Inc. U.K. Holding Limited
|
United Kingdom | |
Applied Communications Inc. (CIS) Limited
|
United Kingdom | |
ACI Worldwide (EMEA) Limited
|
United Kingdom |