Stock Ownership Guidelines, No Tax Gross-Ups Policy, Hedging & Pledging

TSYS® has adopted Stock Ownership Guidelines for members of the board and our executive officers. These guidelines require our executive officers to own shares of common stock with a certain value depending on their base salary, as follows: a value equal to six times base salary in the case of our Chairman and CEO; four times base salary in the case of our President (if a different person than the Chairman and CEO); and three times base salary for all other executive officers.

Each of our directors must own common stock having a value equal to at least three times their annual cash retainer, which is currently $70,000.

These ownership levels are calculated annually. Executive officers and directors have five years to meet the minimum level with certain ownership thresholds that must be met in the interim period.

Our board believes these Stock Ownership Guidelines substantially enhance shareholder value by materially aligning management's interest with those of shareholders.

TSYS has also adopted a No Tax Gross-Ups Policy for Senior Executives. This policy prohibits TSYS from making any tax gross-up payments to executive officers, except for gross-ups applicable to management employees generally, such as an expatriate tax equalization payment. The policy is applicable to new agreements or agreements that are materially amended subsequent to December 13, 2011.

TSYS has adopted an Insider Trading Policy which prohibits directors and executive officers from entering into speculative transactions in TSYS stock, including engaging in short sales of TSYS stock, trading in publicly traded options, puts, calls or other derivative securities related to TSYS stock and engaging in hedging transactions involving TSYS stock.

In addition, TSYS' Pledging Policy, which was implemented in January 2014, prohibits any future pledging of TSYS shares by directors and executive officers except in situations, and on conditions, pre-approved by the Corporate Governance and Nominating Committee of TSYS. Approvals will be based on the particular facts and circumstances of the request, including, but not limited to: (1) the percentage of the individual's equity holdings that are currently pledged and that would be pledged following the requested pledge; (2) the percentage the collective number of shares pledged by directors and executive officers represents of TSYS' outstanding shares; (3) the historical trading volume of TSYS' shares; (4) the financial ability of the individual to repay the loan without resort to the pledged shares; and (5) the purpose for which the individual is pledging the shares. In addition, the policy provides that shares of TSYS stock that are pledged by directors and executive officers are not included when calculating whether the individual is in compliance with director and executive officer stock ownership guidelines.

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