PROPOSAL 1

ELECTION OF DIRECTORS

At the Annual Meeting, shareholders will elect three Class A Directors for a term expiring at the Annual Meeting in 2013.Compensation Committee.  The Board’s nominees for election are Keith M. Kolerus, Robert A. Lauer, and Robert G. McCreary, III. Messrs. Kolerus, Lauer, and McCreary currently serve as DirectorsCompensation Committee held eleven meetings during fiscal year 2012. The purpose of the Company.

The proxyholders named in the accompanying proxy card, or their substitutes, will vote the Proxy at the Annual Meeting, or any adjournments of the Annual Meeting, for the election of the three Director nominees named above, unless,Compensation Committee is to enhance shareholder value by marking the appropriate space on the proxy card, the shareholder withholds authority for the proxyholder to vote. Each of the nominees has indicated willingness to serve as a Director, if elected. The accompanying proxy card will not be voted for more than three Director nominees or for anyone other than the Company’s three Director nominees.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE ELECTION OF ALL NOMINEES NAMED ABOVE. PROXY CARDS RECEIVED BY THE COMPANY WILL BE VOTED “FOR” THE ELECTION OF ALL NOMINEES NAMED ABOVE UNLESS THE SHAREHOLDER SPECIFIES OTHERWISE IN THE PROXY CARD.

For each of the current Director nominees and each of the other Directors who serve on the Board, the following biography sets forth each Director’s name, age, principal occupation, employment and directorships in other publicly-held companies for the past five years, the year during which service as a Director for the Company began and when their service as a Director will end, and, if applicable, arrangements under which a Director was appointedensuring that pay available to the Board. If applicable, information regarding any involvement in certain legal or administrative proceedings is also provided.

Additional information about the experiences, qualifications, attributes, or skills of each Director in support of his continued service on the Board, is set forth below. The Nominating and Corporate Governance Committee conducted an in depth skills assessment in December of 2008. The Committee will update the study periodically.

DIRECTOR NOMINEES

Class A Director Nominees (Term to Expire in 2013)

Retired Vice President, American Division, National Semiconductor, a producer of semiconductors and a leader in analog power management technology, from 1996 to February 1998. He served as Chairman of the Board of Directors, National Semiconductor Japan Ltd., from 1995 to 1998, and Chairman of the Board of Directors of ACI Electronics, LLC, from 2004 to 2008.

Mr. Kolerus has extensive experience in engineering, global operations, private and public companies, software and hardware technology companies, government contracting, capital markets, financial management, and the technology industry.

Robert A. Lauer		Age: 66		Director Since: 2001

Retired from Accenture, a consulting firm (formerly known as Andersen Consulting), in August 2000. Mr. Lauer held numerous operational positions covering regional, national, and global responsibilities during his 31-year career, most recently serving as Managing Partner Global Human Performance Services and Managing Partner Change Management Global Communications and High Tech Industries. Previously, Director of SumTotal Systems, Inc. (formerly Docent, Inc.).

Mr. Lauer’s career in the information technology industry provided him with extensive experience and qualifications in global business operations, corporate and organizational restructurings, management of professional services personnel, and the development and implementation of large-scale business application software solutions in numerous industry verticals.

Founder and currently a principal of CapitalWorks, LLC, a private equity group, since 1999. Mr. McCreary has served in numerous managing partner positions in investment banking firms and as a partner in a large regional corporate law firm.

Mr. McCreary has extensive experience and qualifications in law, corporate governance, financial strategy, capital markets, investment strategy and mergers and acquisitions, and governance of portfolio companies.

CONTINUING DIRECTORS

Continuing Class B Directors (Term Expires in 2011)

Retired President and Chief Operating Officer of The Sherwin-Williams Company, a manufacturer and distributor of paints and painting supplies, from June 1986 to March 1999, where he also served as a Director from 1980 until his retirement. Director of Applied Industrial Technologies, Inc., Pella Corporation, and The Cleveland Clinic Foundation, and previously Director of U-Store-It Trust.

As a former President, Chief Operating Officer, and Chief Financial Officer of a Fortune 300 company, Mr. Commes’ qualifications and experience include acquisitions, global business operations and administration, financial management and strategy, capital markets, and sales management and marketing. In addition, Mr. Commes has experience in executive compensation, having served as the Chair of the compensation committee of a NYSE-listed company.

Managing Director of MAK Capital Fund, L.P., a value-oriented hedge fund, since 2005. Portfolio manager and analyst at Green Cay Asset Management from 2002 to 2004.

As Managing Director of MAK Capital, the Company’s largest shareholder, Mr. Cueva is uniquely qualified to represent the interests of the Company’s shareholders. Additionally, Mr. Cueva’s qualifications and experience include capital markets, investment strategy, and financial management.

Retired Executive Vice President, Human Resource & Communications of TRW Inc., a provider of advanced technology products and services in the aerospace and automotive industries (prior to its acquisition by

Northrop Grumman), from 1995 through 2002. Executive Vice President, Human Resources, Communications and Information Systems at TRW Inc. from 1989 to 1995. Mr. Knicely also served as a Director of TRW Inc. from 2001 through 2002.

As a former Director and head of Human Resources and Communications at a Fortune 150 Company, Mr. Knicely has extensive qualifications and experience in compensation, talent management, organizational restructuring, global business operations, corporate governance, and communications.

Continuing Class C Directors (Term Expires in 2012)

Principal and Chief Investment Officer with Arcadia Capital Advisors, LLC, an investment management company making active investments in public companies, since April 2008. President and Chief Executive Officer, and other executive officers enables us to attract and retain high-quality leadership and is consistent with our executive pay philosophy. As part of Engyro Corporation, an enterprise software company offering solutions in systems management, from January 2005its responsibility, the Compensation Committee oversees our pay plans and policies; annually reviews and determines all pay, including base salary, annual cash incentive, long-term equity incentive, and retirement and perquisite plans; administers our incentive programs, including establishing performance goals, determining the extent to August 2007. Principalwhich performance goals are achieved, and determining awards; administers our equity pay plans, including making grants to our executive officers; and regularly evaluates the effectiveness of Mitchell-Wright, LLC, a consulting firm, from April 2002the overall executive pay program and evaluates our incentive plans to December 2004. Directordetermine if the plans’ measures or goals encourage inappropriate risk-taking by our employees. A more complete description of NaviSite, Inc., and previously Director of Entrust, Inc. and I-many, Inc.

As a former President of a division of a publicly-held software company and as a Chief Executive Officer of a private software company, Mr. Dennedy has experiencethe Compensation Committee’s functions is found in the technology industry. In addition, Mr. Dennedy has extensive experienceCompensation Committee Charter.

Our Law and Human Resources Departments support the Compensation Committee in investment strategy, capital structure, financial strategy, mergersits work and, acquisitions, and significant public company board experience.

In June 2009, in connection with a Settlement Agreement with Ramius LLC, a shareholder of the Company, the Board appointed Mr. Dennedy to fill a vacancy created by the resignation of Mr. Steve Tepedino, who was initially appointed by Ramius LLC. Mr. Dennedy was recommended as a Director candidate by Ramius LLC and was re-elected by shareholders at the 2009 Annual Meeting.

President and Chief Executive Officer of the Company since October 2008. Executive Vice President and Chief Financial Officer of the Company from June 2005 to October 2008. Executive Vice President Corporate Development and Investor Relations of the Company from June 2003 to June 2005.

Mr. Ellis’ experiences at the Company have provided him with significant qualifications in performance measurement, restructuring, strategy, capital markets, capital structure and financial strategy, mergers, acquisitions and divestitures, and investor relations.

Chief Executive Officer of BeyondTrust, a security software company, since October 2008. Founder and a Managing Partner of MV Advisors, LLC, a strategic block investment firm that provides focused investment and strategic guidance to small and mid-cap technology companies, since 2006. In March 2003, Mr. Mutch was appointed to the Board of Directors of Peregrine Systems Inc., a global enterprise software provider, to assist Peregrine’s development of a plan of reorganization, which ultimately led to Peregrine’s emergence from bankruptcy. From August 2003 to December 2005, Mr. Mutch served as President and Chief Executive Officer of Peregrine, during which time he restructured and stabilized its business operations and led Peregrine through its acquisition by Hewlett-Packard. Director of Adaptec, Inc., and previously Director of Edgar Online, Inc., Aspyra, Inc., and Overland Storage, Inc.

Mr. Mutch has been an operating executive and investor in the technology industry for over 25 years and has a long, sustained track record of creating shareholder value through both activities. As a Chief Executive Officer of an IT company, Mr. Mutch has extensive experience in the technology industry, restructuring, financial management and strategy, capital markets, sales management, and marketing.

In March 2009, Mr. Mutch was appointed to the Company’s Board at the recommendation of Ramius LLC, a shareholder of the Company, in connection with a Settlement Agreement with Ramius.

CORPORATE GOVERNANCE AND RELATED MATTERS

Corporate Governance Guidelines

The Board has adopted Corporate Governance Guidelines (the “Guidelines”) that provide a sound framework to assist the Board in fulfilling its responsibilities to shareholders. Under the Guidelines, the Board exercises its role in overseeing the Company by electing qualified and competent officers, and by monitoring the performance of the Company. The Guidelines state that the Board and its Committees exercise oversight of chief executive officer and executive pay, Director compensation, succession planning, Director nomination, corporate governance, financial accounting and reporting, internal controls, strategic and operational issues, and compliance with laws and regulations. The Guidelines also state Board policy regarding eligibility for the Board, including Director independence and qualifications for Board candidates, events that require resignation from the Board, service on other public company boards, and stock ownership guidelines. The Nominating and Corporate Governance Committee annually reviews the Guidelines and makes recommendations for changes to the Board. The Guidelines are available on our website at www.agilysys.com.

Independence

The NASDAQ listing standards provide that at least a majority of the members of the Board must be independent, meaning free of any material relationship with the Company, other than his or her relationship as a Director. The Guidelines state that the Board should consist of a substantial majority of independent Directors. A Director is not independent if he fails to satisfy the standards for Director independence under NASDAQ listing standards, the rules of the SEC, and any other applicable laws, rules, and regulations. During the Board’s annual review of Director independence, the Board considers transactions, relationships, and arrangements, if any, between each Director or a Director’s immediate family member and the Company or its management.

In May 2010, the Board performed its annual Director independence review, andsome cases, as a result of such review determined thatdelegation of authority by the following Directors have been determinedCompensation Committee, fulfill various functions in administering our pay programs. In addition, the Compensation Committee has the authority to be independent:

Mr. Ellis is not consideredengage the services of outside consultants and advisers to be independent becauseassist it. In fiscal year 2012, the Compensation Committee relied on information provided by Towers Watson, its compensation consultant, regarding competitive market assessments of his position as our President and Chief Executive Officer.

Code of Ethics

We have adopted a Code of Business Conduct that applies to all Directors,compensation for the Company’s executive officers and employees ofnon-employee Directors.

While the Company. Previously, we had adopted a separate Code of Ethics for Senior Financial Officers applicable toCompensation Committee directly retained Towers Watson, in carrying out its assignments, Towers Watson also interacted with our executive officers when necessary and appropriate, including our Chief Executive Officer, Chief Financial Officer, and our General Counsel, who provided data and insight on our compensation programs and business strategies. These executive officers attend Compensation Committee meetings when executive compensation, Company performance, and individual performance are discussed and evaluated by Compensation Committee members, and they provide their thoughts and recommendations on executive pay issues during these meetings and provide updates on financial performance, industry status, and other factors that may impact executive compensation. Decisions regarding the Chief Executive Officer’s compensation were based solely on the Compensation Committee’s deliberations, while compensation decisions regarding other executive officers took into consideration recommendations from the Chief Executive Officer. Only Compensation Committee members make decisions on executive officer compensation and approve all outcomes.

Nominating and Corporate Governance Committee.  The Nominating and Corporate Governance Committee (“Nominating Committee”) held five meetings during fiscal year 2012. The Nominating Committee assists the Board in finding and nominating qualified people for election to the Board; reviewing shareholder-recommended nominees; assessing and evaluating the Board’s effectiveness; and establishing, implementing, and

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overseeing our governance programs and policies. The Nominating Committee is responsible for reviewing the qualifications of, and recommending to the Board, individuals to be nominated for membership on the Board. The Board adopted Guidelines for Qualifications and Nomination of Director Candidates (“Nominating Guidelines”), and the Nominating Committee considers nominees using the criteria set forth in the Nominating Guidelines. At a minimum, a Director nominee must:

The Nominating Committee considers the foregoing factors, among others, in identifying nominees; however, there is no policy requiring the Nominating Committee to consider the impact of any one factor by itself. The Nominating Committee also will consider the Board’s current and anticipated needs in terms of number, diversity, specific qualities, expertise, skills, experience, and background. In addition, the Corporate Governance Guidelines state that the Board should have a balanced membership, with diverse representation of relevant areas of experience, expertise, and backgrounds. The Nominating Committee seeks nominees that collectively will build a capable, responsive, and effective Board, prepared to address strategic, oversight, and governance challenges. The Nominating Committee believes that the backgrounds and qualifications of the Directors as a group should provide a significant mix of experience, knowledge, and abilities that will enable the Board to fulfill its responsibilities.

The Nominating Committee will consider shareholder-recommended nominees for membership on the Board. For a shareholder to properly nominate a candidate for election as a Director at a meeting of the shareholders, the shareholder must be a shareholder of record at the time the notice of the nomination is given and at the time of the meeting, be entitled to vote at the meeting in the election of Directors, and have given timely written notice of the nomination to the Secretary. To be timely, notice must be received by the Secretary, in the case of an annual meeting, not less than 90 days nor more than 120 days prior to the anniversary of the previous year’s annual meeting; provided, however, that if the date of the annual meeting is advanced more than 30 days prior to or delayed by more than 30 days after the anniversary of the preceding year’s annual meeting, notice must be delivered not later than the close of business on the later of the 90^th day prior to such annual meeting or the 10^th calendar day following the day on which public disclosure of the date of such annual meeting is first made. In the case of a special meeting, timely notice must be received by the Secretary not later than the close of business on the 10^th day after the date of such meeting is first publicly disclosed. A shareholder’s notice must set forth, as to each candidate:

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The Nominating Committee may request additional information from such nominee to assist in its evaluation. The Nominating Committee will evaluate any shareholder-recommended nominees in the same way it evaluates nominees recommended by other sources, as described above.

Special Committee.  The Special Committee was formed during fiscal year 2011 and continued to serve during fiscal year 2012 to consider potential strategic alternatives for the Company. The Special Committee was comprised solely of independent Directors, and its objectives were to support the Board in a number of matters directly related to the execution of Agilysys’ strategic plan; evaluate a range of alternatives that maximize shareholder value; and review and provide recommendations to the Board on these matters for full Board consideration. The Special Committee held five meetings during fiscal year 2012 and was disbanded in May 2011.

Board Leadership

The Board determined that having an independent Director serve as Chairman of the Board is in the best interest of shareholders at this time. This structure has been particularly important as the Board considered strategic alternatives and direction and implemented changes in the executive management team. The structure ensures a greater role for our independent Directors in the oversight of the Company and any person performing a similar function. In January 2010, the Board approved our combiningactive participation in setting agendas and establishing priorities and procedures for the Code of Ethics for Senior Financial Officers with the Code of Business Conduct. The amended Code of Business Conduct includes all of the ethics standards previously established in the Code of Ethics for Senior Financial Officers to provide a unified, more comprehensive approach to conveying ethics expectations. The Code of Business Conduct is reviewed annually by the Audit Committee, and recommendations for change are submittedBoard. Pursuant to the Board for approval. The CodeBoard’s Corporate Governance Guidelines, it is our policy that the positions of Business Conduct is available on our website at www.agilysys.com.

The Company has in place a hotline available for use by all employees, as described in the Code of Business Conduct. Any employee can anonymously report potential violations of the Code of Business Conduct through the hotline, which is managed by an independent third party. Reported violations are promptly investigated and reported to the Audit Committee. Reported violations are addressed by the Company and, if related to accounting, internal accounting controls, or auditing matters, the Audit Committee.

Meetings of Board and Attendance at Annual Meeting

The Board held eight meetings during the last fiscal year, of which three were special meetings. During fiscal year 2010, no Director attended less than 75% of the aggregate of (i) the total number Board meetings held during the period he served as a Director and (ii) the total number of meetings held by CommitteesChairman of the Board on which he served, during the periods that he served. Independent Directors meet regularly in executive session at each Board meeting, and executive sessions are chairedChief Executive Officer be held by Mr. Kolerus, Chairman ofdifferent individuals, except as otherwise determined by the Board.

ItRisk Oversight

Management is responsible for the Board’s policy that allday-to-day management of its members attendrisks facing the Annual Meeting absent exceptional cause. All of the Directors were in attendance at the 2009 Annual Meeting.

Shareholder Communication with Directors

Shareholders and others who wish to communicate withCompany, while the Board, as a whole and through its Committees, is actively involved in the oversight of such risks. The Board’s role in risk oversight includes regular reports at Board and Audit Committee meetings from members of senior management on areas of material risk to the Company, including strategic, financial, operational, and legal and regulatory compliance risks. Management regularly identifies and updates, among other items, the population of possible risks for the Company, assigns risk ratings, prioritizes the risks, assesses likelihood of risk occurrence, develops risk mitigation plans for prioritized risks, and assigns roles and responsibilities to implement mitigation plans. Risks are ranked by evaluating each risk’s likelihood of occurrence and magnitude. Our Compensation Committee of the Board, in consultation with management, evaluates our incentive plans to determine if the plans’ measures or with any individual Director, may do sogoals encourage inappropriate risk-taking by sending a written communicationour employees. As part of its evaluation, our Compensation Committee determined that the performance measures and goals were tied to our business, financial, and strategic objectives. As such, Director(s) in carethe incentive plans are believed not to encourage risk-taking outside of the range of risks contemplated by the Company’s business plan.

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Compensation Committee Interlocks and Insider Participation

None of the members of the Compensation Committee during fiscal year 2012 or as of the date of this Proxy Statement is or has been an officer or employee of the Company, and none of our executive officers served on the compensation committee (or other committee serving an equivalent function) or board of any company that employed any member of our Compensation Committee or our Directors.

DIRECTOR COMPENSATION

Following the sale of the Company’s Technology Solutions Group (“TSG”) business unit in August of 2011, the Compensation Committee re-evaluated the Directors’ compensation structure in light of the smaller Company size and reviewed competitive market assessment data provided by Towers Watson in it analysis. As a result, the Compensation Committee recommended, and the Board approved, a reduced compensation structure for non-employee Directors. The following information and discussion summarize the compensation changes and our non-employee Directors’ fiscal year 2012 compensation:

Each member of the Special Committee received a cash retainer of $15,000, and the Chairman of the Special Committee received an additional cash retainer of $10,000. Each member also received a $5,000 cash bonus upon closing of the TSG sale, in recognition of their efforts. Additionally, Keith Kolerus, Chairman of the Board, received a $50,000 cash payment upon closing of the TSG sale, in recognition of his efforts and the successful closing of the sale.

The fiscal year 2012 equity award for each Director consisted of 9,434 restricted shares, based on a $7.42 grant date price, and was granted under the 2011 Stock Incentive Plan. The restricted shares vested on March 31, 2012 and provided for pro-rata vesting upon retirement prior to March 31, 2012. The grant was made in August 2011, after the closing of the TSG sale, to the specified Director(s).

Committeesthen current, non-employee Directors; however, Mr. Cueva declined the award given the significant ownership in the Company by his firm, MAK Capital. Our Directors are subject to share ownership guidelines that require ownership of either (i) three times the Director’s respective annual cash retainer within two years of service and six times the Director’s respective annual cash retainer within four years of service; or (ii) 15,000 shares within the first two years following the Director’s election to the Board and 45,000 shares within four years of election. We pay no additional fees for Board or Committee meeting attendance. Mr. Dennedy ceased receiving compensation for his service as a Director upon his appointment as an executive officer, and all compensation received by Mr. Dennedy thereafter was for his service as an executive officer, except for payments made for his service on the Special Committee prior to its disbandment. All compensation received by Mr. M. Ellis was for his service as an executive officer.

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Director Compensation for Fiscal Year 2012

Our executive compensation structure is designed to align executive pay and shareholders’ interests. Our.  The Company’s focus in fiscal year 20102012 on streamlining its businesses and restructuring its management team resulted in reduced compensation strategy reflected a significant focus on performance-basedcosts for key executive positions. During fiscal year 2012, key events effecting compensation immediately and for the new seniorfuture, streamlined Company included:

Performance Linked Compensation.Our Compensation Committee comprised of four independent Directors, set fiscal year 20102012 compensation, including financial and business targets for performance-based compensation, for our Named Executive Officers (except for Mr. Dennedy) after the closing of the TSG sale, to assure that compensation and goals reflected the Company as it would be for the majority of the fiscal year. In setting compensation targets and goals for the senior management team, the Committee continued to emphasize pay for performance for the new management team by:

Our Chief Executive Officer’s targeted pay was approximately 65% performance-based, and between 48% and 57% for each of our other active Named Executive Officer’s targeted pay was performance-based, tied directly to annual goals or long-term equity awards, the value of which is tied directly to an increase in share price. As discussed below, targeted annual goals were primarily based on improvements over fiscal year 2011 results for revenue and gross profit, for significant cash preservation, and, for business head executives, significant business unit improvements. Annual incentive payouts ranged from 73% to 112% of target for the Named Executive Officers.

Chief Executive Officer Compensation.  In May 2011, Mr. Dennedy became our Interim Chief FinancialExecutive Officer, and our next three highest paid executive officers (together, our “Named Executive Officers”)a one-year compensation package was set at that time in May 2009. Atanticipation of successfully closing the time targetsTSG sale and his leading the refocused Company through a successful fiscal year 2012. His compensation package reflected the Compensation Committee’s ongoing commitment to link pay to performance and reduced compensation costs, as evidence by the following for Mr. Dennedy:

In October, the Board removed “interim” from Mr. Dennedy’s title; however, the Compensation Committee did not anticipaterevise Mr. Dennedy’s compensation package or annual goals, determining that macroeconomic conditions would deteriorate to the degree realized by 2010 fiscal year-end, which resulted in a 12% decline in our total revenue. The decline in adjusted EBITDA excluding charges (defined as operating income plus depreciationlevel of compensation and amortization, excluding restructuring chargesgoals appropriately matched the Company’s current initiatives and asset impairment charges, and hereinafter referred to as “EBITDA”) of 58% was significantly softened due to significant cost savings initiatives commenced incompensation philosophy for fiscal year 20092012. References within this Compensation Discussion and continued in fiscal year 2010. As a result of economic factors, we did not achieve fiscal year 2010 profitability targets, however, we did significantly improve working capital efficiency. Consequently, annual incentive payoutsAnalysis and within our executive compensation tables below to our Named Executive Officers ranged from 15% to 53% of target, and the performance shares (as described below) earned pursuant to the long-term incentive plan ranged from 50% to 71% of target. Despite the poor economy and its negative impact on our revenues, shareholders realized an increase in the value of their Common Shares at 2010 fiscal year-end, up 160% from fiscal-year end 2009, and as of the Record Date, up 76% from fiscal year-end 2009.

Reduction in Compensation Costs and Programs.  During late fiscal year 2009 and early fiscal year 2010, significant reductions to compensation arrangements were made in response to 2009 performance and poor macroeconomic conditions, including:

Management Team.  All of our Named Executive Officers assumed their current roles in fiscal year 2009. In October 2008, Martin F. Ellis was promoted from Chief Financial Officer to President and Chief Executive Officer, and Kenneth J. Kossin, Jr.Compensation.  In October 2011, Mr. R. Ellis was promoted from Controllerappointed to Senior Vice President and Chief Financial Officer. At that time, Tina Stehle,His compensation package also reflected the headCompensation Committee’s ongoing commitment to link pay to performance and reduced compensation costs, as evidence by the following for Mr. R. Ellis:

Compensation Focus for Fiscal Year 2013.  In response to current executive compensation trends, and after considering the results of our Hospitality Solutions Group (“HSG”), was promoted2011 vote on Named Executive Officer compensation, which confirmed the Company’s philosophy and objectives relative to anour executive officer, as Senior Vice Presidentcompensation program, the Compensation Committee continued efforts to reduce compensation expense and General Manager, and Anthony Mellina, the head of our Technology Solutions Group (“TSG”), was promotedlink executive pay to an executive officer, as Senior Vice President and General Manager. Kathleen A. Weigand was hiredperformance by:

Compensation Philosophy, Objectives, and Structure

Our Compensation Committee adopted its pay philosophy, objectives, and structure for our Named Executive Officers to achieve financial and business goals and create long-term shareholder value. Following input from PM&P, the Compensation Committee’s executive compensation consultant, ourOur Compensation Committee reaffirmed the pay philosophy, objectives, and structure for fiscal year 2010.2012.

Compensation Philosophy and Objectives.  Our Compensation Committee’s pay philosophy is to pay a base salary and provide target annual cash incentives and long-term stockequity incentives, each at a minimum of the 50th percentile of industry specific market surveys,comparative peer group compensation, and to annually review these compensation components based on industry specific market surveyspeer group comparisons and tie compensation to our business strategy. The Compensation Committee’s objective is to establish an overall compensation package to:

Compensation Objectives and Structure.  Our compensation structure is comprised of:

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Compensation Key Considerations

Annual Goal Setting.  At the beginning of each fiscal year, writtenAnnual goals are established for our Named Executive Officers. These goalsOfficers are tied to our financial, strategic, and operational goals and include business specific financial targets relating to our goals. Each Named Executive Officer’s annual incentive goals are established by our Compensation Committee, with input from our Chief Executive Officer (other than for himself). At fiscal year-end, the Compensation Committee evaluates the performance of each Named Executive Officer and determines an appropriate award based on established goals, with input from our Chief Executive Officer (other than for himself). on individual goals. Our Compensation Committee establishes our Chief Executive Officer’s annual incentive goals and determines his appropriate award based on established goals. Performance levels used for fiscal year 2010 incentives involve some difficulty at the threshold level, increased difficulty at the 100% target level, and significant difficulty at the maximum level, in each case relative to future expectations at the time the levels were set.

Variable Pay at Risk.  Our philosophy drives the provision of greater at-risk pay to our Named Executive Officers, and variable pay at risk comprises more than 70%comprised approximately 65% of target annual compensation for our Chief Executive Officer and 50% or more than 50% for all other Named Executive Officers. Our Named Executive Officers have greatersignificant opportunities for long-term, equity-based incentive compensation, higher than for annual cash incentive compensation.compensation in most cases, as our philosophy is to tie a significant portion of compensation to the long-term performance of our common shares. As a result, greatersignificant emphasis is placed on long-term shareholder value creation, than annual financial performance thereby minimizing excessive risk taking by our executives.

Our

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Competitive Market Assessments.  During fiscal year 2012, Towers Watson provided the Compensation Committee with two competitive market assessments, one in consultation with management,March and one in August, which updated the March assessment to adjust for expected revenues of the smaller Company after the closing of the TSG sale. The assessments evaluated compensation levels for the Company’s top eight executive positions, including the Named Executive Officers. The assessments compared published survey compensation data for both general industry and the high technology services industry to current compensation levels for the Company’s executives. Competitive compensation levels in these industries were gathered for base salary, annual incentive, total cash compensation, long-term incentive, and total direct compensation. The purpose of the assessments was to compare current market data to our incentive planscurrent compensation, which was based on prior benchmarking performed by the Company, where compensation levels were benchmarked to determineseparate, defined peer group companies for corporate executives and each business unit executive. Towers advised that an assessment using the general and high technology services industries data provides more representative and relevant comparisons given the size of the Company. As further detailed below, the assessments showed that all elements of the Company’s overall compensation fell between the 25^th and 50^th percentiles within both the general and high technology services industries. Typically, an individual position is considered to be paid at market if it is within 15% (above or below) the plans’ measures or goals encourage inappropriate risk-taking by our employees. Our Compensation Committee determinedcompetitive median and the assessments showed that the performance measuresCompany had individuals above, within, and goals were tied to our business, financial, and strategic objectives. As such, the incentive plans are believed not to encourage risk-taking outside of the range of risks contemplated by the Company’s business plan.below that range.

Tally Sheets.  Our Compensation Committee analyzes tally sheets at the beginning of the fiscal year to review overall compensation and pay mix for each Named Executive Officer. Tally sheets include a year-over-year comparisonthree-year look-back of salary,total compensation, including annual cash compensation, long-term incentive awards granted and long-term incentives, equity grants,earned, and personal benefits earned.and perquisites. Tally sheets also include a year-over-year comparisoncumulative inventory of equity grants by fiscal year, including the value of Named Executive Officers’outstanding equity holdingsat the Company’s current stock price and Mr. Ellis’ retirement lump-sum benefits to indicate wealth accumulation. Tallythe value received for prior vesting and exercises of equity. The tally sheets bring together, in one place, all elements of Named Executive Officers’ actual compensation and information about wealth accumulation so that our Compensation Committee can analyze both the individual elements and mix of compensation and the aggregate total amount of actualannual and accumulated compensation. Tally sheets are also used by the Compensation Committee to evaluate internal pay equity among the Named Executive Officers and to determine the impact of employment termination or change of control events. In support of the philosophy of rewarding future performance, the Compensation Committee does not consider prior pay outcomes in setting future pay levels. Rather, tally sheets are used by the Compensation Committee to review compensation as compared to expectations, and our Compensation Committee determined that annual compensation set for our Named Executive Officers for fiscal year 20102012 was consistent with expectations and with the established compensation philosophy and the pay mix guidelines driven by that philosophy.

Fiscal Year 20102012 Compensation – Alignment with Performance

Salary.  For each Named Executive Officer,fiscal year 2012, salary is based on the individual’s position, performance, and relation to pay levels in the competing market, as well as changes in salaries in the overall general market. Salaries are reviewed annually by our Compensation Committee, and changes in salary are based on these factors as well as input fromcomprised 35% of total target compensation for our Chief Executive Officer and between 43% and 52% for our other thanNamed Executive Officers (who were granted annual and long-term incentives). The Compensation Committee considered the competitive market assessments provided by Towers Watson in determining fiscal year 2012 salaries for himself. Nonethe Named Executive Officers. For purposes of the factors, however, are weighted accordingassessments, incumbents were matched to any specific formula. Newsurvey benchmarks based upon responsibilities, and market-competitive salaries generally are based onwere determined by regressing each benchmark to each Named Executive Officer’s respective revenue responsibilities, which placed those with corporate responsibilities in one grouping and the Compensation Committee’s discretion and judgment but may be based on input from PM&P,business unit heads in certain situations. Messrs. Ellis’ and Kossin’s salary increases in connection withtheir own respective category relative their respective promotionsunit’s revenue. As noted above, the assessment was reevaluated after the TSG sale in October 2008 were based on survey analysis and recommendations from PM&P.

To control costs and in lightconsideration of the challenging economy, our Compensation Committee determined, uponcontinuing, smaller revenue, Company.

The survey data included values at the recommendation25^th, 50^th (market median), and 75^th percentiles. While overall fiscal year 2012 salaries were evaluated as part of the initial assessment early in the fiscal year, except for our Chief Executive Officer, final salary determinations were not made until the TSG sale was approved and, as such, no salary changes were considered for Messrs. M. Ellis and Mellina, as neither executive continued with the Company after the TSG sale. The Committee set Mr. Dennedy’s salary at the time of his appointment to freeze the salaries of our Named Executive Officers for fiscal year 2010 consistent with treatment of all employees. Additionally, the Compensation CommitteeInterim

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President and Chief Executive Officer, and his salary increases in connection with executive promotions for allwas set significantly lower than the median due to the interim nature of his position, the equal value of, and thus higher emphasis on, his annual and long-term incentives, and the overall fairness of his compensation level. Regarding the remainder of the Named Executive Officers, exceptexcluding Mr. R. Ellis, current salaries ranged between 8% below and 17% above median, which was considered competitive. As such, salary increases were made based on individual responsibilities and performance, and increases averaged 2.5%, ranging from 0% to 5.4%, with Ms. Weigand receiving the highest increase in consideration of a 15% premium applied to the top legal benchmark for her additional human resources responsibilities that are not typical in her position. For Mr. R. Ellis, who joined the Company justin October 2011, the second assessment, which adjusted benchmarks for the reduced size of the Company, was considered as well as his previous salary level and prior experience in setting his salary, which was set within the competitive range of the median for his position.

Annual Incentives.  For fiscal year 2012, annual goals were set after shareholders approved the TSG sale to reflect the smaller, refocused Company going forward. In prior years, goals were set at the beginning of the fiscal year; however, at the beginning of fiscal year 2010.2011 the eventual size and scope of the Company was uncertain, and thus goals were established when the TSG sale was approved but the outcome of such fiscal year was still substantially uncertain. As such, no awards were granted to Messrs. M. Ellis and Melina. The discussion below, which specifically relates to the table below under “Fiscal Year 2012 Payouts,” provides details regarding fiscal year 2012 annual incentive performance metrics, levels, and payouts for the other Named Executive Officers.

Performance Metrics.  The Compensation Committee also considered the newness ofset corporate performance metrics, applicable to Messrs. Dennedy, Ellis, Bond, and Kossin in their roles. ForStout and Ms. Weigand, for fiscal year 2012 annual incentives to require target level improvements over fiscal year 2011 results of 7.2% for gross profit and 5.8% for revenue. These levels were set based on the Compensation Committee considered her previous salary level, her prior experienceCompany’s overall operating plan and expected growth and operating improvements in the roletwo continuing business units, Hospitality Solutions Group (“HSG”), for which Ms. Stehle managed development and operations, and Retail Solutions Group (“RSG”), for which Mr. Civils manages all aspects. Target level improvements for HSG, applicable to Ms. Stehle, were set at 3.4% for revenue and 5.7% for gross profit and for RSG, applicable to Mr. Civils, were set at 9.6% for revenue and 10.6% for gross profit. Gross profit was selected as General Counsel, and her additional responsibilities as Senior Vice President – Human Resources, in setting her salary upon joining the Company. The Compensation Committee considers the role, responsibilities, and experiencean annual goal component for all Named Executive Officers in setting compensation.

Annual Incentives.  In May 2009,given the desire to balance sales and margins, as both are manageable by our Compensation Committee set the performance measures, objectives, and weighting for each Named Executive Officer’s fiscal year 2010 incentive awardOfficers. For the corporate Named Executive Officers, including Messrs. Dennedy, R. Ellis, Bond, and Stout and Ms. Weigand, gross profit goals related to the consolidated Company results, and for the business unit heads, gross profit goals related to their respective business units. The higher percentage for gross profit applicable to the corporate executives was the results of an additional, business specific metric being included as set fortha component (as discussed below) in each business unit head’s mix of metrics for which they each have more direct control. Revenue was also selected as an annual goal component for all Named Executive Officers, as revenue growth has heightened importance in the chart below. Fiscal year 2010 target annual incentives were setsmaller, refocused Company. For Ms. Stehle, revenue as a percentage of salaryher overall goal was less than for each Named Executive Officer. Mr. Ellis had a greater percentage of salary as target incentive as compared to the other Named Executive Officers due to his greaterher direct responsibilities over operations and expense management within HSG, as discussed below. While she does not have direct control over revenue, her responsibilities influence revenue.

The cash component metric was added for fiscal year 2012 to promote cash utilization in accordance with the Company’s operating plan. After the TSG sale, the Company stated that its top priorities included improving operating performance and financial results, profitably growing the business, and returning capital to shareholders. To that end, the Company aimed to use its cash, including the proceeds from the TSG sale, to fund working capital needs, make select investments in the businesses, execute its share repurchase plan, and return excess cash to shareholders as prudently as possible. Achieving these objectives required tighter management of operating expenses and focusing investments on growth opportunities with the highest return. The Compensation Committee determined that setting a goal for the fiscal year-end cash balance would promote these objectives. The level of year-end cash applicable to all Named Executive Officers was determined by budgeting fiscal year working capital needs of each business under the operating plan and projecting the targeted level of remaining cash. The importance of achieving this goal at the corporate level made this component the highest weighted for

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the corporate executives, while the business unit heads had a lower weighting for corporate cash due to emphasis on other business unit specific goals as discussed below and their reduced ability to influence corporate cash.

After the TSG sale, all assets and liabilities, results of operations, and cash flows of TSG were classified as discontinued operations within the Company’s financial performance. Thestatements. As a result, an EBITDA metric for the consolidated Company was determined to be less predictable, incentivizing, and pertinent to the operating plan than the revenue, gross profit, and cash goals selected for the fiscal year 2010 target percentagesmetrics. EBITDA within the discreet RSG business unit, however, is within Mr. Civils control, as general manager of salary were the same percentages as set for fiscal year 2009, except for Ms. Weigand, who did not have a fiscal year 2009 annual incentive award, having joined theRSG. The Company just prior to the beginning of fiscal year 2010.

The Compensation Committee selected EBITDA as the main component of annual goals becausebelieves RSG EBITDA is a profitability measure, and a key driver of shareholder value, and the management of EBITDA is manageable by our Named Executive Officers. The balance between the performance measures of EBITDA dollars (“EBITDA $”) and EBITDA as a percentage of revenues (“EBITDA %”) was selected to base goalsfocusing on sales, product mix, margins, and expense management. WhileAs such Mr. Civil’s heaviest weighted component was RSG EBITDA, $ helps drive stock pricetargeted at 105% improvement over fiscal year 2011 RSG EBITDA. Due to Ms. Stehle’s direct responsibilities for operating expenses with HSG, and shareholder value, including EBITDA % as a component resultsonly indirect influence over revenue, the Compensation Committee determined that the most critical goal for Ms. Stehle in a higher payout whenrelation to the overall achievement of the Company’s operating plan was the expense management within HSG, and as such, control of cash operating expenses was Ms. Stehle’s heaviest weighted component. As with the corporate cash component, the targeted EBITDA $ is the resultlevel of selling more of our proprietary solutions, which typically produces relatively higher margins, aligning goals with our overall strategic business objective to sell a higher mix of proprietary solutions as a percent of total revenue and manage costs effectively. Full annual incentive payout is achieved only if this strategy is effected.

Improvement in days’ sales outstanding (“DSO”) and dollar days’ sales outstanding (“DDSO”) were selected as components of annual goals becauseexpense was determined by budgeting fiscal year working capital management also drives improvementsneeds with the greater operating plan.

Performance percentages for payouts (with proportionate payouts between the target and maximum achievement levels) were based on varying levels of achievement of fiscal year 2012 budgeted results, as set forth below. Additional detail about threshold and maximum incentives are disclosed in cash flow and shareholder value and is manageable by our Named Executive Officers. Accounts receivable represents the largest asset on our balance sheet, and the managementGrants of accounts receivable to ensure timely collection and high quality receivables is important to overall working capital management. Plan-Based Awards for Fiscal Year 2012 table.

The Compensation Committee included both DSObelieved that the plan involved moderate difficulty at the threshold level, a high degree of difficulty at the 100% target level, given continuing competition and DDSO (using an averagepricing pressure in the market, and significant difficulty at the maximum level, requiring significant improvement over fiscal year 2011 results, in each case relative to future expectations at the time the levels were set, and significant preservation of cash. Threshold levels were based on achievement necessary to successfully execute a minimum level of the improvement of the two as theoperating plan.

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MBO’s.  In addition to objective performance measurement) as equal components to balance quantity and quality of receivables. DSO measures the average number of days we take to collect payment after a sale is made and is calculated as: (net accounts receivable ÷ total sales) x 365. DDSO is the number of days a receivable is outstanding multiplied by the dollar weighted average of that receivable to all receivables. DSO relates to the dollar value of receivables relative to sales, and DDSO relates to the quality of receivables by weighting the dollar value of the receivables by the period of time the receivables remain uncollected.

The EBITDA performance measures are weighted heavier than the DSO/DDSO performance measure because the Compensation Committee believes that improvements in EBITDA results in a larger impact on shareholder value than working capital management and because shareholder value is more sensitive to changes in EBITDA than changes in working capital. For Messrs. Ellis and Kossin and Ms. Weigand, the performance measures of EBITDA $ and EBITDA % relate to the consolidated Company (referred to as AGYS in the chart below). The performance measure of the average of DSO and DDSO for these Named Executive Officers also relates to the consolidated Company. For Mr. Mellina and Ms. Stehle, performance measures of EBITDA $, EBITDA %, and DSO/DDSO relate to their respective business segments. Additionally, Mr. Mellina and Ms. Stehle had performance measures of EBITDA $ relating to the consolidated Company.

For each Named Executive Officer,metrics, management by objectivesobjective goals (“MBOs”) are establishedcomprise 25% of the Named Executive Officer’s annual incentive and represent individual performance-based goals, with both quantitative and qualitative measures, relative to individual responsibilities. MBOs emphasize the importance of specific tasks and corporate-wide initiatives that must be

achieved on a timely basis,company-wide initiatives; however, MBOs receive a lesser weighting than EBITDAthe combined performance metric goals due to their indirect and lesser impact on shareholder value. The Compensation Committee has discretion in deciding whether each MBO was achieved and in determining the level of achievement, and thus payout, for the MBO components. Achievement of MBOs results in a payout ranging from the target MBO amount to 150% for maximum achievement, and Named Executive Officers are eligible for proportionate payouts between the target and maximum achievement levels, except there is no payout for MBOs below target achievement level. Consistent with the other elements of compensation, MBOs were established after the TSG sale was approved. Fiscal year 2012 MBO goals and payout allocations for the active Name Executive Officers were as follows:

Weight differences between initiatives among the Named Executive Officers corresponded to importance of each initiative in respect of the overall Company operating plan. For Mr. Kossin, the higher weighting for MBOs reflects the critical importance of the implementation of the new Oracle ERP system, which represents 35% of his target incentive, with the balance of his MBOs based on business segment interface each quarter. For Mr. EllisBond and Ms. Weigand, MBOs were focused on the weightings reflect critical objectives relatingCompany’s successful transition and relocation of corporate services and operational improvements similar to leadershipthe other Named Executive Officers, and development criteriadue to their departure in their respective new positions.October, MBO goals were not executed on, and thus neither received payment for MBOs.

Annual Incentive Levels.  For all Named Executive Officers, fiscal year 2012 target annual incentives were set as a percentage of salary, with the percentage correlating to the overall competitive total target compensation level for each executive. Our Chief Executive Officer’s percentage was set at 100% of his salary, as opposed to approximately 50-60% of salary for other executives, to increase the performance-base nature of his total compensation. Annual incentives comprised 35% of total target compensation for Mr. Dennedy, due to his greater ability to influence corporate goals and initiatives and to directly link a significant portion of his pay, when combined with long-term incentives, to performance. Annual incentive comprised between 22% and 26% for our other Named Executive Officers (who were granted annual and long-term incentives). As with salaries, the Compensation Committee considered the competitive market assessments provided by Towers Watson in evaluating current annual incentive levels and for determining fiscal year 2012 levels. Target levels were based on survey data from companies of comparable revenue and were interpolated for each executive based on calculated competitive salaries, as described above.

The survey data included values at the 25^th, 50^th (market median), and 75^th percentiles and, on average, current target annual incentive percentages of salary were aligned with market median, and total target cash

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compensation (salary and annual incentive) was in the competitive range for the positions evaluated, ranging from 8% below to 19% above market median. As such, increased annual incentive opportunities were a factor of increased salary, as discussed above, as annual incentives as a percentage of salary approximated current levels. For Mr. R. Ellis, MBOs include the on-time, on-budget Oracle ERP system implementation, acquisition integrations, visibilitysecond (August) assessment was considered, and communicationshis annual incentive as a percentage of salary was set higher than market median to key constituents, risk management reviewlink a greater percentage of his compensation to performance, given his ability to influence corporate goals and initiatives, and to set his total target cash compensation in line with market median and his current level of compensation. As with his salary, Mr. Dennedy’s annual incentive level was set at the Board, strategic planning process,time of his appointment to heavily weight performance.

Fiscal Year 2012 Payouts.  The chart below sets forth the fiscal year 2012 annual incentive opportunity for each participating Named Executive and personal development in his new role. For Ms. Weigand, MBOs arethe components, weightings, and actual annual incentive payouts based on the effectivenessCompensation Committee’s review of the legal and human resources departments, which accounts for 20% of her target incentive, and 5% for business segment interface each quarter. For Mr. Mellina and Ms. Stehle, MBOs are based on their support for the implementation of the new Oracle ERP system, resulting in a lesser overall weighting for MBOs.

The Compensation Committee reviewed the achievement of the performance measuresmeasures. At the corporate level, a threshold level of revenue and target levels of gross profit and cash goals were achieved, resulting in corresponding payouts for those components. At the business segment level, Ms. Stehle achieved threshold levels of revenue and gross profit and near target level of cash operating expenses goals, resulting in corresponding payouts for achievement of those goals within HSG. Mr. Civils achieved target levels of revenue and gross profit and a threshold level of EBITDA, resulting in corresponding payouts for achievement of those goals within RSG. Ms. Stehle and M. Civils also earned a payout for the corporate target level achievement of cash goal. The attainment by each Named Executive Officer to determine actual annual incentive payouts, as set forthof their respective MBOs is reflected in the charttable below. These payouts are also set forth in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table.

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