Exhibit 10.2
Xxxxx X. Xxxxxxx
00000 Xxxxxxxxx Xxxx., Xxxxx 000
Xxxxxx, XX 00000
December 13, 2004
Tier Technologies, Inc.
00000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx Xxxxx, General Counsel
Re: Cross-Collateralization Agreement
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Ladies and Gentlemen:
Reference is made to the following six promissory notes made by me payable
to Tier Technologies, Inc. ("Tier"): (1) Amended and Restated Full Recourse
Secured Promissory Note dated April 1,1998 in the principal amount of $1,218,800
("Note One"); (2) Amended and Restated Full Recourse Secured Promissory Note
dated April 1,1998 in the principal amount of $283,600 ("Note Two"); (3) Full
Recourse Promissory Note dated July 26, 2000 in the principal amount of $300,000
("Note Three"); (4) unsecured promissory note dated January 2, 1997 in the
principal amount of $161,652 ("Note Four"); (5) unsecured promissory note dated
May 31, 1997 in the principal amount of $25,000 ("Note Five"); and (6) unsecured
promissory note dated July 15, 1997 in the principal amount of $35,000 ("Note
Six"). These six notes together are referred to herein as the "Notes."
Reference is also made to the following three pledge agreements between
Tier and me pursuant to which I have pledged stock of Tier to secure certain of
the Notes: (1) Third Amended and Restated Pledge Agreement dated as of June 30,
1999, securing obligations under Note One ("Pledge One"); (2) Second Amended and
Restated Pledge Agreement dated as of June 30, 1999, securing obligations under
Note Two ("Pledge Two"); and (3) Pledge Agreement dated as of April 1, 2004,
securing obligations under Note Three ("Pledge Three"). These three pledge
agreements together are referred to herein as the "Pledge Agreements."
In exchange for valuable consideration, which is hereby acknowledged and
received, Tier has requested, and I have agreed, that the collateral pledged
under each of the Pledge Agreements shall serve as security for my obligations
under each of the Notes. Accordingly, I agree as follows:
1. Each of the Pledge Agreements secures the payment of all of my present
and future obligations, duties, and liabilities under each of the Notes and
under each of the Pledge Agreements (collectively, the "Obligations"). All
references to the "Obligations" contained in each of the Pledge Agreements shall
hereafter be deemed to refer to the Obligations as defined in this letter
agreement.
2. The Pledged Collateral under each of the Pledge Agreements shall
hereafter secure all of the Obligations.
3. All references to (1) the "April 1998 Note" or "Section 2 of the April
1998 Note" in Pledge One; (2) the "April 1998 Note" or "Section 2 of the April
1998 Note" in Pledge Two; and (3) the "Note" or "Section 2 of the Note" in
Pledge Three shall hereafter be deemed to be references to the Notes as defined
in this letter agreement. These include, without limitation, the references in
Sections 3(a), 6(a), 6(b), 8(a)(i), 8(a)(iv), 8(c), 10 and 12 of each of the
Pledge Agreements.
4. All references to (1) the "Second Amended and Restated Pledge Agreement"
in Note One and (2) the "Amended and Restated Pledge Agreement" in Note Two
shall hereafter be deemed to be references to the Pledge Agreements as defined
in this letter agreement.
5. Each Pledge Agreement is amended hereby to provide that the address for
notice to Tier set forth in Section 13 thereof shall hereafter be the address
set forth above, attention Chief Financial Officer.
6. Except as set forth in this letter agreement, all other terms and
provisions of each of the Notes and, as amended hereby, each of the Pledge
Agreements is confirmed to be in full force and effect.
7. I understand that Tier may, in consultation with its outside corporate
counsel, request that I execute a more formal agreement amending each of the
Pledge Agreements and/or each of the Notes to effectuate the intent of this
letter, and I agree to work with Tier in good faith to enter into such an
agreement and amendments if reasonably requested by Tier.
Very truly yours,
/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Acknowledged and Accepted:
TIER TECHNOLOGIES, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: CEO & Chairman
