Exhibit 10.5
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), effective as of May 1,
2004, by and between Global Payment Technologies, Inc., a Delaware corporation,
with executive offices at 000X Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx, 00000 (the
"Company"), and Xxxxxx XxXxxxx, residing at 00 Xxxxxx Xxxxx, Xxxxxxx, Xxx Xxxx
00000 (the "Executive").
WITNESSETH
WHEREAS, Executive is Vice President and Chief Financial Officer of the
Company;
WHEREAS, Executive is presently employed by the Company pursuant to
that certain Employment Agreement between the parties dated May 1, 2000 (the
"Old Employment Agreement"); and
WHEREAS, the Company and Executive desire to terminate the Old
Employment Agreement and enter into a new agreement based on the terms and
conditions set forth below;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the parties hereto agree as follows:
1. TERMINATION OF OLD EMPLOYMENT AGREEMENT
The Company and Executive agree that the Old Employment Agreement shall
be terminated concurrently with the execution of this Agreement and shall be of
no further force or effect. Each of the parties hereto waives and releases all
rights he or it may have under the Old Employment Agreement as of the date
hereof.
2. EMPLOYMENT
2.1 Subject to the terms and conditions of this Agreement, the Company
agrees to employ Executive as Vice President and Chief Financial Officer of the
Company with responsibility for the performance of such duties, consistent with
such positions and the By-Laws of the Company, as may be from time to time be
assigned to him by the Board of Directors of the Company (the "Board of
Directors") or its Chief Executive Officer. The Executive shall have the duties
and responsibilities normally inherent in such capacity in public corporations
of similar size and character. Executive hereby accepts such employment.
2.2 The term of this Agreement shall commence on the effective date of
this Agreement, and shall continue until the first anniversary of such date (the
"Initial Term"), unless earlier terminated as hereinafter provided. This
Agreement shall automatically renew for consecutive periods of one year (each,
an "Additional Term"), unless either party gives written notice of non-renewal
to the other party hereto 180 days prior to the termination of the Initial Term
or any Additional Term as the case may be. The period of Executive's employment
hereunder shall hereinafter be referred to as the "Employment Term."
1
Exhibit 10.5
2.3 Throughout the Employment Term, Executive shall devote his best
efforts and all of his business time, attention and skills to the business and
affairs of the Company.
3. SALARY
Effective on the commencement of the Employment Term, Executive shall
receive a Base Salary ("Base Salary") at the rate of $166,000 per year, less
applicable withholdings and deductions, payable in accordance with the Company's
regular payroll practices for senior executives of the Company. The Board of
Directors or the Compensation Committee thereof shall review such Base Salary,
upon the earlier to occur of: (i) generation by the Company of pre-tax monthly
profits of at least $100,000 (the "Required Profits") for a period of three (3)
consecutive months (the "Measuring Period"); or (ii) the one year anniversary of
the execution of this Agreement. For purposes of this Section 3, whether the
Company has generated the Required Profits for the Measuring Period shall be
determined by the Audit Committee of the Board of Directors (the "Audit
Committee") in accordance with generally accepted accounting principles ("GAAP")
consistently applied to the Company's financial statements for the fiscal year
ended September 30, 2003 unless a change in such principles is recommended by
the Company's independent certified public accountants as being required under
GAAP, upon written application by Executive. The Audit Committee shall render
its determination within a reasonable time following Executive's written
application. If the Audit Committee determines that the Company has generated
the Required Profits during the Measuring Period, the Board of Directors or the
Compensation Committee thereof shall determine whether and, if so, by how much
Executive's Base Salary shall increase as contemplated in this Section 3. Any
such increase shall be effective the first day of the first month following the
conclusion of the Measuring Period, but such Base Salary may not be decreased.
4. ANNUAL BONUS
During each year of the Employment Term, Executive shall be eligible to
receive a discretionary bonus (the "Discretionary Bonus"). Whether such
Discretionary Bonus shall be granted to the Executive, and, if granted, the
timing, amount and manner of payment of such Discretionary Bonus shall be
determined at the sole and absolute discretion of the Company's Board of
Directors or the Compensation Committee thereof.
5. INCENTIVE STOCK OPTION PLAN
During the Employment Term, Executive shall be eligible, in a manner
equal to that of the Company's other senior executives, to receive grants of
stock options to purchase shares of the Company's common stock. All of such
options shall be granted under one or more of the stock option plans of the
Company (the "Plan"). All of such options shall be subject to the terms and
conditions specified in the Plan and in any agreements entered into by the
Company and Executive with respect thereto.
2
Exhibit 10.5
6. TERMINATION UNDER CERTAIN CONDITIONS
Except as otherwise provided in Section 8 hereof, in the event that
Executive's employment is terminated by the Company other than for "Cause" (as
hereinafter defined) or Executive terminates his employment for "Good Reason"
(as hereinafter defined) prior to the end of the Employment Term, Executive
shall be entitled to receive in lieu of any and all other payments, a severance
payment in an aggregate amount equal to (1) Executive's yearly Base Salary in
effect on the date of his termination multiplied by .75 (i.e. for each $1.00 of
Base Salary Executive would receive $0.75) plus (2) an amount equal to the
Discretionary Bonus, if any, projected by the Board of Directors for the fiscal
year in which termination occurs (subject to the terms and conditions of Section
4), and, in the case of the Discretionary Bonus only, pro rated by a fraction,
the numerator of which shall be the actual number of days elapsed in the current
fiscal year and denominator of which shall be 365. If the Company notifies the
Executive of its intention not to renew this Agreement as provided in Section
2.2 and if Executive is still employed by the Company at the end of the
Employment Term, then Executive shall be entitled to receive in lieu of any and
all other payments, a severance payment in an aggregate amount equal to (1)
Executive's yearly Base Salary in effect on the date of his termination
multiplied by .4167 (i.e., for each $1.00 of Base Salary Executive would receive
$0.4167 plus (2) an amount equal to the Discretionary Bonus, if any, projected
by the Board of Directors for the fiscal year in which termination occurs
(subject to the terms and conditions of Section 4), and, in the case of the
Discretionary Bonus only, pro rated by a fraction, the numerator of which shall
be the actual number of days elapsed in the current fiscal year and denominator
of which shall be 365. Any payment provided to Executive under the terms of this
Section 6 is referred to herein as a "Severance Payment". The Severance Payment
shall be payable to Executive in equal installments in accordance with the
Company's normal payroll practices as if Executive were still employed by the
Company over a period of five (5) months without regard to who terminates the
Executive's employment or for what reason. In addition to the Severance Payment,
Executive shall be entitled to receive all benefits set forth in Section 7.1 on
terms and conditions no less favorable to the Executive than those in effect
immediately prior to the Executive's termination during the period that the
Severance Payment is payable to him.
7. CERTAIN EMPLOYEE BENEFITS
7.1 During the Employment Term, Executive shall be entitled to
participate, to the extent Executive is eligible under the terms and conditions
thereof, in any benefit plans which the Company may from time to time provide to
its senior executives during the Employment Term. Unless otherwise specifically
set forth herein, the Company shall be under no obligation to institute or
thereafter continue the existence of any such benefit plan.
7.2 The Company currently has directors and officers liability
insurance. The Company covenants that Executive shall be covered under such
policy through the Employment Term, and thereafter with respect to matters
occurring during the Employment Term.
7.3 Executive shall be entitled to four weeks of vacation per year, in
accordance with existing policies of the Company.
3
Exhibit 10.5
8. CHANGE OF CONTROL
8.1 For the purpose of this Agreement, a "Change of Control" shall
mean:
(a) The acquisition by 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") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more (on a fully diluted basis) of either (i)
the then outstanding shares of common stock of the Company, taking into
account as outstanding for this purpose such common stock issuable upon
the exercise of options or warrants, the conversion of convertible
stock or debt, and the exercise of any similar right to acquire such
common stock (the "Outstanding Company Common Stock") or (ii) the
combined voting power of the then outstanding voting securities of the
Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however, that for
purposes of this subsection (a), the following acquisitions shall not
constitute a Change of Control: (w) any acquisition by the Company or
any "affiliate" of the Company, within the meaning of 17 C.F.R. &
230.405 (an "Affiliate"), (x) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
Affiliate, (y) any acquisition by any corporation pursuant to a
transaction which complies with clauses (i), (ii) and (iii) of
subsection (c) of this Section 8.1, and (z) any acquisition by any
entity in which Executive has a direct or indirect equity interest; or
(b) Individuals who, as of the effective date hereof, constitute
the Board of Directors (the "Incumbent Board") ceasing for any reason
to constitute at least a majority of the Board of Directors; provided,
however, that any individual becoming a director subsequent to such
effective date whose election, or nomination for election by the
Company's shareholders, 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;
or
(c) Consummation of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all of the assets of
the Company (a "Business Combination"), in each case, unless, following
such Business Combination, (i) all or substantially all of the
individuals and entities who were the beneficial owners, respectively,
of the Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation resulting
from such Business Combination (including, without limitation, a
4
Exhibit 10.5
corporation which as a result of such transaction owns the Company or
all or substantially all of the Company's assets either directly or
though one or more subsidiaries) in substantially the same proportions
as their ownership of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, immediately
prior to such Business Combination, and (ii) no Person (excluding any
employee benefit plan (or related trust) sponsored or maintained by the
Company, any Affiliate of the Company, the corporation resulting from
such Business Combination or any Affiliate of such corporation)
beneficially owns, directly or indirectly, 20% or more (on a fully
diluted basis) of the then outstanding shares of common stock of the
corporation resulting from such Business Combination, taking into
account as outstanding for this purpose such common stock issuable upon
the exercise of options or warrants, the conversion of convertible
stock or debt, and the exercise of any similar right to acquire such
common stock, or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such
ownership existed prior to the Business Combination and (iii) at least
a majority of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of this Agreement or of the action
of the Board of Directors providing for such Business Combination; or
(d) Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.
8.2 The Company or its successor or purchaser shall notify Executive in
writing no later than 10 days prior to a Change of Control whether it desires
Executive to remain employed for a maximum of six months following the Change of
Control (the "Transition Period"). If Executive is notified that it is not
desired that he remain employed following the Change of Control, or if no such
notice is given or the notice references a transition period of more than six
months, Executive shall have the right to voluntarily terminate his employment
during the 60-day period following the Change of Control and, subject to Section
8.4 below, such termination shall be deemed to have occurred for Good Reason for
purposes of this Agreement.
8.3 If Executive is properly notified that the Company or its successor
or purchaser desires Executive to remain employed for a Transition Period, and
if Executive remains employed for the Transition Period, then Executive shall
have the right to voluntarily terminate his employment during the 60-day period
following the end of the Transition Period and, subject to Section 8.4 below,
such termination shall be deemed to have occurred for Good Reason for purposes
of this Agreement. Any termination of Executive's employment by Executive prior
to the end of the Transition Period shall not be considered termination for Good
Reason.
8.4 If, within one year following a Change of Control, Executive's
employment is terminated by the Company other than for Cause, or Executive
terminates his employment for Good Reason (including for this purpose under
circumstances described in Section 8.2 and 8.3), (i) if the price per share of
the Company's common stock paid to the Company's stockholders by the acquirer of
the Company is $4.00 or greater, Executive shall, in lieu of any amounts payable
to Executive under Section 6, receive an aggregate payment equal to (a)
Executive's yearly Base Salary in effect on the date of his termination (i.e.
for each $1.00 of Base Salary Executive would receive $1.00), plus (b) an amount
equal to the Discretionary Bonus paid to Executive for the fiscal year
immediately preceding the fiscal year in which termination occurs, and, in the
case of the Discretionary Bonus only, pro rated by a fraction, the numerator of
which shall be the actual number of days elapsed in the current fiscal year and
5
Exhibit 10.5
the denominator of which shall be 365 (the amount calculated under (b) shall be
referred to herein as the "Termination Bonus"), the aggregate of such payments
to be made to Executive in a lump sum no later than five days following his
termination; (ii) if the price per share of the Company's common stock paid to
the Company's stockholders by the acquirer of the Company is greater than $2.99
but less than $4.00, Executive shall, in lieu of any amounts payable to
Executive under Section 6, receive an aggregate payment equal to (a) Executive's
yearly Base Salary in effect on the date of his termination multiplied by .75
(i.e. for each $1.00 of Base Salary Executive would receive $.75) plus (b) the
Termination Bonus, the aggregate of such payments to be made to Executive in a
lump sum no later than five days following his termination; (iii) if the price
per share of the Company's common stock paid to the Company's stockholders by
the acquirer of the Company is $2.99 or less, Executive shall, in lieu of any
amounts payable to Executive under Section 6, receive an aggregate payment equal
to (a) Executive's yearly Base Salary in effect on the date of his termination
multiplied by .50 (i.e., for each $1.00 of Base Salary Executive would receive
$.50), plus (b) the Termination Bonus, the aggregate of such payments to be made
to Executive in a lump sum no later than five days following his termination;
and (iv) in the event that a Change of Control occurs other than by a Person
purchasing the shares of the Company's common stock from the Company's
stockholders, Executive shall, in lieu of any amounts payable to Executive under
Section 6, receive an aggregate payment equal to (a) Executive's yearly Base
Salary in effect on the date of his termination (i.e. for each $1.00 of Base
Salary Executive would receive $1.00) plus (b) the Termination Bonus, the
aggregate of such payments to be made to Executive in a lump sum no later than
five days following his termination. In addition to the payments provided in
this Section 8.4, Executive shall be entitled to receive all benefits set forth
in Section 7.1 for six, nine or twelve months following such termination, on
terms and conditions no less favorable to the Executive than those in effect
immediately prior to the Executive's termination, the duration of such benefits
to be twelve months if his Base Salary (as above provided) is multiplied by 1.0,
nine months if his Base Salary (as above provided) is multiplied by .75 or six
months otherwise.
9. TERMINATION FOR GOOD REASON
9.1 Executive may terminate his employment hereunder for Good Reason at
any time during the Employment Term, in which event Executive shall resign from
all of his positions with the Company. For purposes of this Agreement, "Good
Reason" shall mean the Executive's good faith determination that any of the
following has occurred (without Executive's express prior written consent).
(i) The assignment to Executive by the Company of duties
inconsistent with those of a Vice President and Chief Financial Officer
(including status, titles, offices and lines of reporting), except in
connection with the termination of Executive's employment for Cause (in
accordance with Section 10 hereof), disability (as defined in Section
10.2(c) below), or as a result of Executive's death or termination by
Executive other than for Good Reason;
6
Exhibit 10.5
(ii) The taking of any action by the Company which would deprive
Executive of any material fringe benefit enjoyed by Executive at any time
during the Employment Term as set forth in Section 6; or
(iii) Any material breach by the Company of any provision of this
Agreement.
10. DISCHARGE FOR CAUSE
10.1 The Company shall have the right to terminate the employment of
Executive during the Employment Term. If the Company terminates the employment
of Executive other than for Cause, the provisions of Section 6 and, if
applicable, Section 8 shall apply. If the Company terminates the employment of
Executive for Cause, its obligation under this Agreement to make any further
payments to Executive shall thereupon cease and terminate except for any
obligations accrued but which remain unpaid.
10.2 As used herein, the term "Cause" shall be limited to (a) action by
Executive involving willful malfeasance or gross negligence having an adverse
effect on the Company, or (b) failure to act by Executive involving material
malfeasance or gross negligence having an adverse effect on the Company provided
that any action or failure to act by Executive shall not constitute "Cause" if,
in good faith, Executive believed such action or failure to act to be in or not
opposed to the best interests of the Company, or if Executive shall be entitled,
under applicable law or the Certificate of Incorporation or By-Laws of the
Company, to be indemnified with respect to such action or failure to act, (c) in
the event Employer makes a good faith determination that Executive is so
disabled, for mental or physical reasons, that Executive is unable to
satisfactorily perform his duties hereunder for an aggregate of 180 days during
any period of 12 consecutive months, or (d) the death of Executive.
10.3 Termination of Executive for Cause pursuant to this Section 10
shall be communicated by a notice of termination.
11. EXPENSES
The Company shall reimburse Executive for reasonable expenses incurred
by him in connection with the performance of his duties hereunder upon
presentation to it by Executive from time to time of an itemized account of such
expenditures in accordance with the Company's procedures as in effect from time
to time.
12. NONDISCLOSURE; NON-COMPETE; INVENTIONS
12.1 "Confidential Information" Defined. As used in this Section 12,
the term "Confidential Information" shall mean any and all information (verbal
and written) relating to the Company, any of its subsidiaries or any of its
activities, other than such information which can be shown by Executive to be in
the public domain (such information not being deemed to be in the public domain
merely because it is embraced by more general information which is in the public
7
Exhibit 10.5
domain) other than as the result of a breach of the provisions of Section 12.2
below, including, but not limited to, information relating to: technology;
research; test procedures and results; machinery and equipment; manufacturing
processes; financial information; products; identity and description of raw
materials and services used; purchasing; costs; pricing; engineering; customers
and prospects; marketing; and selling and servicing.
12.2. Nondisclosure of Confidential Information. Executive shall not,
at any time during the term of his employment by the Company (other than as may
be required in connection with the performance by him of his duties hereunder)
or thereafter directly or indirectly, use, communicate, disclose or disseminate
any Confidential Information in any manner whatsoever.
12.3 Non-compete Covenant. Executive shall not, during the period of
his employment by the Company and, unless Executive has terminated this
Agreement for Good Reason, for a period of 12 months thereafter, directly or
indirectly (a) engage in any business (whether as owner, manager, operator,
lender, partner, shareholder, licensor, licensee, joint venturer, employee,
consultant or otherwise) in which the Company or any of its then subsidiaries is
or has been engaged (or is actively considering engaging) during the term of
Executive's employment by the Company in any geographic area in which the
Company or any of its respective subsidiaries is so engaged or is actively
considering engaging, or (b) take any other action which constitutes an
interference with or a disruption of the activities of the Company or any of its
subsidiaries. Notwithstanding the foregoing, Executive shall be permitted to own
(as a passive investment) not more than 1% of any class of securities which is
registered under the Securities Exchange Act of 1934, as amended: provided,
however, that said 1% limitation shall apply to the aggregate holdings of
Executive and all other persons and entities with whom Executive has agreed to
act for the purpose of acquiring, holding, voting or disposing of such
securities.
12.4 Certain Activities. For purposes of clarification, but not of
limitation, Executive hereby acknowledges and agrees that the provisions of
Section 12.3 shall serve as a prohibition against him, during the period
referred to therein, directly or indirectly, hiring, offering to hire, enticing
away or in any other manner persuading or attempting to persuade any officer,
employee, agent, lessor, lessee, licensor, licensee, customer, prospective
customer or supplier of the Company or any of its subsidiaries to discontinue or
alter his, her or its relationship with the Company or any of its subsidiaries.
12.5 Inventions. Executive shall assign, transfer, convey and deliver
to the Company, and hereby does assign, transfer, convey and deliver to the
Company, all right, title and interest in and to all ideas, concepts,
inventions, devices and improvements which pertain to methods, apparatus,
designs, products, processes, devices or services sold, leased, used under
consideration or development by the Company or any of subsidiaries, or which
otherwise relate or pertain to the business, functions or operations of the
Company or any of its subsidiaries, whether or not patentable or copyrightable
(collectively called "Inventions"), and in and to any and all patents,
copyrights, trademarks and other protection with respect thereto and
applications therefor (including continuations, continuations-in-part,
divisions, reissues, renewals and extensions) for all countries relating to such
8
Exhibit 10.5
Inventions, that Executive, either alone or with others, may make, conceive or
reduce to practice during the term of Executive's employment by the Company (it
being agreed that any Invention disclosed by Executive within one year following
the termination of Executive's employment by the Company shall be deemed to fall
within the provisions of this Section 12.5 unless proved by Executive to have
been first conceived, made and reduced to practice following the termination of
his employment by the Company). Executive shall (i) promptly communicate and
disclose to the Company all information, data and details concerning all
Inventions, and (ii) during the term of Executive's employment by the Company
and at any time thereafter, execute all papers and perform all acts, and
cooperate with the Company and its counsel in any other way which, in the sole
view of the Company, is necessary and proper to more fully effectuate the
provisions of this Section 12.5. All expenses in connection with the obligations
of Executive under this Section 12.5 shall be borne by the Company or its
nominee.
12.6 Records. During the period of his employment by the Company,
Executive shall make and maintain adequate and current written records of all
Inventions, in the form of notes, sketches, drawings and/or reports relating
thereto, which records shall be and shall remain the property of the Company and
shall be available to the Company at all times. Upon termination of the
Executive's employment for any reason whatsoever, all documents, records,
notebooks and other materials which refer or relate to any aspect of the
business which are in the possession of Executive, including all copies thereof,
shall be promptly returned to the Company.
12.7 Injunctive Relief, etc. The parties hereto hereby acknowledge and
agree that (i) the Company would be irreparably injured in the event of a breach
by Executive of any of his obligations under this Section 12, (ii) monetary
damages would not be an adequate remedy for any such breach, and (iii) the
Company shall be entitled to injunctive relief, in addition to any other remedy
which it may have, in the event of any such breach. It is hereby also agreed
that the existence of any claims which Executive may have against the Company or
its subsidiaries, whether under this Agreement or otherwise, shall not be a
defense to the enforcement by the Company of any of its rights under this
Section 12.
12.8 Scope of Restriction. It is the intent of the parties hereto that
the covenants contained in this Section 12 shall be enforced to the fullest
extent permissible under the laws and public policies of each jurisdiction in
which enforcement is sought (Executive hereby acknowledging that said
restrictions are reasonably necessary for the protection of the Company).
Accordingly, it is hereby agreed that if any of the provisions of this Section
12 shall be adjudicated to be invalid or unenforceable for any reason
whatsoever, said provision shall be (only with respect to the operation thereof
in the particular jurisdiction in which such adjudication is made) construed by
limiting and reducing it so as to be enforceable to the extent permissible,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of said provision in any other jurisdiction.
12.9 Nonexclusivity. The undertakings of Executive contained in this
Section 12 shall be in addition to, and not in lieu of, any obligations which he
may have with respect to the subject matter hereof, whether by contract, as a
matter of law or otherwise.
9
Exhibit 10.5
13. CAPACITY, ETC.
Executive hereby represents and warrants to the Company that: (a)
Executive has full power, authority and capacity to execute and deliver this
Agreement, and to perform Executive's obligations hereunder, (b) said execution,
delivery and performance will not (and with the giving of notice or lapse of
time or both would not) result in the breach of any agreements or other
obligations to which he is a party or otherwise bound, and (c) this Agreement is
his valid and binding obligation in accordance with its terms.
14. NOTICES.
All notices or communications hereunder shall be in writing addressed
as follows:
To the Company:
000X Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
To Executive:
00 Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Any such notice or communication shall be sent certified or registered
mail, return receipt requested, postage prepaid, addressed as above (or to such
other address as such party may designate in writing from time to time), and the
actual date of receipt, as shown by the receipt therefor, shall determine the
time at which notice was given.
15. SEPARABILITY, LEGAL FEES
If any provision of this Agreement shall be declared to be invalid or
unenforceable, in whole or in part, such invalidity or unenforceability shall
not affect the remaining provisions hereof which shall remain in full force and
effect. The Company shall pay all legal fees and other fees and expenses which
Executive may incur in entering into this Agreement, if executed (provided the
amount of such legal fees shall not exceed $1,000), or in obtaining, or
attempting to obtain compensation or other benefits under this Agreement.
16. INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive from and
against any and all damage, loss, liability or expense (including reasonable
attorneys' fees which shall be advanced by the Company) arising out of or with
respect to the performance of his duties hereunder in his capacity as an officer
and employee of the Company (or any subsidiary or affiliate thereof) to the
maximum extent permitted by law. The Executive shall notify the Company of any
claim by any third party coming to his attention which could result in any
liability on the Company's part. The Company shall have the right to conduct the
10
Exhibit 10.5
defense against any such claim with counsel of its selection. The obligations of
the Company under this Section 16 shall continue following the termination of
this Agreement and/or the termination of employment of the Executive with the
Company.
17. BINDING EFFECT, ASSIGNMENT
(a) This Agreement shall be binding upon and inure to the benefit
of the heirs and representatives of Executive and the assigns and
successors of the Company, but neither this Agreement nor any rights
hereunder shall be assignable or otherwise subject to hypothecation by
Executive or by the Company. The Company shall not assign this Agreement to
any successor or assign of the Company without the written consent of
Executive.
(b) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
the Company as hereinbefore defined and any successor to its business
and/or assets which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
18. GOVERNING LAW
This Agreement shall be construed, interpreted, and governed in
accordance with the laws of the state of New York (without giving effect to
those laws which would require the application of the substantive law of another
jurisdiction).
19. ARBITRATION
Any controversy or claim arising out of or relating to this Agreement,
or the breach thereof, shall be settled by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association in New
York, New York and judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof.
20. ENTIRE AGREEMENT
This Agreement represents the entire agreement of the parties and shall
supersede any and all previous contracts, arrangements or understanding between
the Company and Executive with respect to the subject matter hereof. This
Agreement may be amended at any time by mutual written agreement of the parties
hereto. This Agreement shall supersede the employment agreement dated as of May
1, 2000 between the Company and the Executive.
11
Exhibit 10.5
21. HEADINGS
The headings contained herein are for the sole purpose of convenience
of reference, and shall not in any way limit or affect the meaning or
interpretation of any of the terms or provisions of this Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and Executive has hereunto set his hand effective as of the date set
forth above.
GLOBAL PAYMENT TECHNOLOGIES, INC.
By:_____________________________
Name:
Title:
________________________________
Xxxxxx XxXxxxx
