UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF PENNSYLVANIA

CARD CONNECT, LLC,

Plaintiff,

v.
SHIFT4 PAYMENTS, LLC,

Defendant.

Case No. 2:18-cv-03989-MAK

DECLARATION OF JARED ISAACMAN
IN SUPPORT OF SHIFT4 PAYMENTS,
LLC’S OPPOSITION TO PLAINTIFF’S
MOTION FOR PRELIMINARY
INJUNCTION

I, Jared Isaacman, declare the following under
penalty of perjury pursuant to 28 U.S.C. § 1746:
1. I am over the age of 18 and am competent to
testify to the matters set forth in this Declaration.
2. I am the Chief Executive Officer of Shift4
Payments, LLC (“Shift4”). If called as a witness, I
could and would testify competently to the facts
stated in this Declaration, all of which are based on
my personal knowledge, on information I learned in
my capacity as CEO of Shift4, and on my review of
documents kept in the ordinary course of business
at Shift4.

I. Background on Shift4, Harbortouch, and
Lighthouse.

3.  Through the various entities that comprise
Shift4, we provide secure payment processing
services, including merchant acquiring, payment
gateway, point-of-sale (“POS”), and other related
services to merchants directly and through our
reseller partners. Shift4’s services include tokenization,
point-to-point encryption (“P2PE”), EMV, and other
fraud prevention and data security technologies.

4. One of our go-to-market strategies is to provide
our merchants with a complete, all-in-one payment
solution. Our Lighthouse Business Management
System (“Lighthouse”) permits our merchants to,
among other things: (a) manage their employee
schedules and employee profiles, including hours
worked and tip reporting; (b) view transactions
processed, including customer information and
the status of such transactions; (c) view online
reputational data, such as Yelp and TripAdvisor
reviews, as well as social media data from Facebook
and Twitter; and (d) create and manage customer
engagement programs and communications.
Exhibit A hereto is a true and correct copy of our
online brochure discussing our Lighthouse Business
Management System product.

5. We also own the Harbortouch brand of POS
systems. Our Harbortouch-branded POS systems
are primarily utilized by merchants in the restaurant
and hospitality industries. We market those
complete POS systems to our merchants as a way to
increase efficiency and improve their profitability.
6. The Lighthouse platform serves as a “back
office” portal for the Harbortouch POS system,
and we also provide the Lighthouse capabilities to
merchants who do not use our Harbortouch POS
system.

7. I submit this Declaration in support of Shift4’s
opposition to the preliminary injunction motion
brought by Card Connect, LLC. Card Connect, LLC
is a wholly-owned subsidiary of First Data
Corporation. I refer to Card Connect, LLC and First
Data Corporation together herein as either “Card
Connect” or “Plaintiff.”

II. Background on Card Connect’s Acquisition
of Shift4’s Reseller Portfolio.

8.  Shift4 has two primary strategies for going to
market. We sell our payment processing services to
merchants directly. We also sell our services through
resellers, who act on our behalf to signup merchants
in exchange for a portion of the merchant revenue.
This litigation concerns our former reseller
relationship with Card Connect.

9. I have been involved in the payment processing
business for nearly 20 years. I initially operated as
a reseller, signing up merchants for payment
processors. I then expanded my operations to also
provide gateway and other value-added services
directly to merchants. In that time, I do not recall
ever entering into an agreement that restricted my
ability to compete.

10. In 2014, Shift4 through one of its subsidiaries
sold its portfolio of reseller accounts to Card Connect,
while retaining our direct merchant relationships. At
the time of this transaction, Shift4 had approximately
130 reseller partners representing approximately
16,000 merchant accounts.
11. In connection with this sale, on September 29,
2014, Shift4 Corporation entered into an Asset
Purchase Agreement with Card Connect, LLC. A true
and correct copy of that Asset Purchase Agreement is
attached hereto as Exhibit B.

12. At the same time, the parties also entered into a
Reseller Portfolio Purchase and Sale Agreement with
Card Connect, LLC. A true and correct copy of that
Reseller Portfolio Purchase and Sale Agreement is
attached hereto as Exhibit C.

13. Both agreements were negotiated by our counsel
at the time. I recall that when we initially agreed to
sell our reseller portfolio that the parties did not
contemplate entering into a non-compete agreement.
I recall instructing our attorneys that we would not
agree to include a non-compete restriction.

14. During negotiations, the parties agreed to
include certain non-solicit provisions, but there was
no non-compete. At all times, Shift4 retained its
direct merchant business that it had before, during
and after the sale of the reseller portfolio.
15. In the course of the negotiation, Card Connect
made certain proposals concerning the potential
hiring of our employees and the referral of business
opportunities. Such proposals were often included
in emails and reflected in text messages between
myself, Jeff Shanahan (Card Connect’s CEO at the time),
and Angelo Grecco (Card Connect’s Chief
Technology Officer).

16. On September 17, 2014, I emailed Mr. Shanahan
and Mr. Grecco concerning the payment of referral
fees for potential deals. We exchanged the following
text messages concerning that email:

10:57 AM

Jeff Shannahan:
Got it! What about the employees? Can
you send a list of 10 with compensation?

Me:
I think that list creates
unnecessary risk. We
should avoid writing
anything down and
follow my direction to
Mike and Jay

Jeff Shannahan:
Agree.

Me:
On the referral comp
think about me making
those intros for you.
Saas, oracle, etc.
Would it be 5% up front
and how would you do
ongoing?

Jeff Shannahan:
We would need detail
around the customers in
order to determine economics

Me:
Ok. We'll work through
it

jeff Shannahan:
We talked earlier about
your time being up in 5
years. Do you have an
interest in year 6 and
beyond? I think there
could be something more
strategic

Me:
Yes open to it. I think
the 5 year term
contemplating
continued comp is too
long. I think the overall.

Page: 5

deal terms are great
except this and will
likely discourage me
from staying motivated
after the sale. I think 5.5
to 6 is right and should
get us to close today.

Me:
Any thoughts on the
referral deals? Think I
said too much too so
can’t speak freely.

17. I do not recall the specifics concerning the
comment “I think I said too much too so can’t speak
freely.” I believe I was referring to our overall deal
discussions. However, I do recall that the entire
deal was nearly called off based on our discussions
with Card Connect concerning restrictions it wanted
to impose on our ability to do business and the
potential hiring of our then-current employees.
18. At all times, Shift4 maintained existing
relationships with thousands of merchants that we
signed directly to our services and with whom Card
Connect had no relationship. This fact was
communicated consistently to Card Connect
throughout the parties’ relationship.
III.    Card Connect Has Always Been Aware of Shift4’s Relationships
19. At various points after close of the transaction,
Card Connect personnel inquired about my direct merchant business.

20. For example, as reflected in the June 15, 2018
email chain attached as Exhibit E, I advised Brian
O’Connell from Card Connect that “our Harbortouch
program (for example) is a direct to merchant offering
that began in 2012.” I also stated “we don't have agent residuals.
we have a direct P&L for the product...”.
This conversation confirms that, at the time we entered
the Agreements, we retained our direct relationships and it
was viewed differently than the agent residual business
model.

21. As reflected on the July 19, 2017 email chain
attached as Exhibit F, I discussed my direct business
with Chuck Fillinger. I noted that there was no
issue because “my relationship with this customer
pre-dates our deal.”