EXHIBIT 10.1
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") is made as of August
9, 2000, by and between Official Payments Corporation, a Delaware
corporation (the "Company"), and Xxxxxx X. XxXxxxx ("Executive").
WHEREAS, the Company desires to employ Executive to serve as its
Chief Financial Officer on the terms and conditions herein provided; and
WHEREAS, Executive desires to become an employee of the Company on
the terms and conditions herein provided.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Employment. Subject to the terms and conditions herein
provided, the Company hereby employs Executive as Chief Financial Officer
of the Company, reporting directly to the Chief Executive Officer. During
the Employment Period (as hereinafter defined), Executive shall faithfully
and diligently perform his duties under this Agreement and shall use his
best efforts to promote the interests of the Company.
2. Term. Subject to the terms and conditions hereof, the initial
term of employment of Executive by the Company under this Agreement shall
be for the period commencing on September 11, 2000 or other date mutually
agreed upon by the parties in writing (the "Commencement Date") and
expiring when terminated as provided in Section 8 hereof. For purposes
hereof, such period is referred to herein as the "Employment Period."
3. Executive's Obligations. Executive shall at all times comply
with and be subject to the Company's policies, procedures, directives and
regulations as established by the Company from time to time. Executive
accepts such employment, responsibility and authority and agrees to perform
the services of Chief Financial Officer of the Company and such other
services as shall from time to time be reasonably assigned to him and
agrees to devote all of his working time, skill and attention to such
services. Executive shall not engage in any other business activity.
Notwithstanding the foregoing, the parties agree that Executive may
continue any educational, charitable and community activities (including
membership on boards of educational, charitable or community organizations)
in which he is engaged on the date hereof and may engage in other
educational, charitable and community activities (including membership on
the boards of educational, charitable or community organizations) and serve
on the boards of directors of, or as an advisor to, other companies
(including Conek Systems, Inc. and Best Friends Pet Care, Inc., in the
latter case while such company is pursuing a sale or other recapitalization
transaction) that do not compete (in the sole discretion of the Company's
Board of Directors) with the Company, provided that such activities do not
materially interfere with the performance of his duties to the Company.
4. Executive's Compensation and Benefits. During the Employment
Period, as full compensation to the Executive for his performance of the
services hereunder and for his acceptance of the responsibilities described
herein, the Company agrees to pay the Executive, and the Executive agrees
to accept, the following salary and other benefits:
(a) Base Salary. From the Commencement Date, the Company
shall pay Executive a salary at the annual rate of $195,000 (as such may be
increased from time to time in the sole discretion of the Compensation
Committee of the Company's Board of Directors, the "Base Salary"). The Base
Salary shall be payable in accordance with the Company's standard payment
policy, less any amounts required to be withheld by the Company from such
Base Salary pursuant to the Other Benefit Plans (as hereinafter defined)
and applicable laws and regulations.
(b) Signing Bonus. On the Commencement Date, the Company
shall make a one-time payment to Executive of $60,000.
(c) Bonus. Executive shall be eligible to receive annual
bonuses of up to 50% of the Base Salary (each a "Bonus") at the discretion
of, in the amounts, at the times and based upon certain written performance
criteria determined by, the compensation committee of the Company's Board
of Directors (the "Compensation Committee"). Executive agrees that there
can be no assurance that the Compensation Committee will grant a Bonus in
any year; provided, however, that Executive shall receive a guaranteed
minimum Bonus for the year immediately following the Commencement Date of
not less than $35,000 (the "Minimum First Year Bonus"), which shall be paid
not later than the one-year anniversary of the Commencement Date.
(d) Long-Term Incentives. On the Commencement Date,
Executive will be granted options (the "Executive Options") to purchase
200,000 shares of the common stock, par value $.01 per share, of the
Company (the "Common Stock"), subject to (i) the terms and conditions set
forth in the forms of Option Agreement annexed hereto as Annexes A and B
(collectively, the "Option Agreements") and (ii) with respect to not more
than 35,000 of the aforementioned 200,000 shares underlying the Executive
Options, to the extent shares of Common Stock are not available for
issuance pursuant to the exercise of stock options under the Company's 1999
Stock Incentive Plan, the stockholders of the Company approving an
amendment to such plan increasing the number of shares of Common Stock
available for issuance under such plan (the "Option Plan Amendment"). In
connection with the foregoing, to the maximum extent permitted by Section
422 of the Internal Revenue Code of 1986, as amended, the Executive Options
shall be incentive stock options, and the remainder of the Executive
Options shall be non-qualified stock options. To the extent the Company's
stockholders do not approve the Option Plan Amendment and the Executive is
therefore unable to be granted a portion of the Executive Options, the
parties shall negotiate in good faith to formulate an alternative
compensation arrangement intended to provide Executive with substantially
equivalent future economic value as represented by the Executive Options
unable to be granted; provided, however, that in the event the parties are
not able to agree upon such an alternative compensation arrangement prior
to October 31, 2000, Executive may, prior to November 15, 2000, terminate
the Employment Period on account of such failure to agree and receive the
benefits described in Section 8(a) hereof (without duplication of benefits
if Executive terminates the Employment Period pursuant to the proviso in
the last sentence of Section 4(e) hereof), and notwithstanding anything in
this Agreement to the contrary, neither party shall have any other
obligations to the other hereunder upon and following such termination
(except for obligations pursuant to Sections 5, 6, 8(g) and 10 of this
Agreement).
(e) Additional Performance-Based Incentive Options. The
Company shall grant Executive options to purchase an additional 50,000
shares of Common Stock (the "Additional Options") on the earliest to occur
of the following dates (such earliest date, the "date of grant" for
purposes of the Option Agreements): (i) the one-year anniversary of the
Commencement Date (provided that Executive is still employed by the Company
on such date) or (ii) the date as of which the Compensation Committee, in
its sole discretion, shall have determined that Executive has satisfied the
specific performance goals established (for the purposes of this Section
4(e) and Executive's employment under this Agreement) by the Compensation
Committee (upon consultation with Executive) within 60 days of the
Commencement Date. Any options granted pursuant to the preceding sentence
shall (i) be subject to the terms and conditions of the Option Agreements
and the stockholders of the Company approving the Option Plan Amendment and
(ii) have an exercise price equal to the lower of (x) the exercise price of
the Executive Options and (y) the fair market value of the Common Stock on
the date on which the Additional Options are granted. In connection with
the foregoing, to the maximum extent permitted by Section 422 of the
Internal Revenue Code of 1986, as amended, the Additional Options shall be
incentive stock options, and the remainder of the Additional Options shall
be non-qualified stock options. To the extent the Company's stockholders do
not approve the Option Plan Amendment and the Executive is therefore unable
to be granted all or a portion of the Additional Options, the parties shall
negotiate in good faith to formulate an alternative compensation
arrangement intended to provide Executive with substantially equivalent
future economic value as represented by the Additional Options; provided,
however, that in the event the parties are not able to agree upon such an
alternative compensation arrangement prior to October 31, 2000, Executive
may, prior to November 15, 2000, terminate the Employment Period on account
of such failure to agree and receive the benefits described in Section 8(a)
hereof (without duplication of benefits if Executive terminates the
Employment Period pursuant to the proviso in the last sentence of Section
4(d) hereof), and notwithstanding anything in this Agreement to the
contrary, neither party shall have any other obligations to the other
hereunder upon and following such termination (except for obligations
pursuant to Sections 5, 6, 8(g) and 10 of this Agreement).
(f) Other Benefit Plans. Subject to eligibility
requirements, and to the extent permitted by law, Executive shall be
entitled to participate in any and all employee benefit plans (including,
but not limited to, retirement, life insurance, medical, dental, disability
and savings plans) established or maintained by the Company from time to
time for the benefit of its employees (or executives) in general
(collectively, the "Other Benefit Plans").
(g) Vacation. Executive shall be entitled to four weeks
paid vacation per annum.
5. Reasonable Expenses. The Company will reimburse Executive for
all reasonable business expenses, including travel and lodging, which are
properly incurred by him in the performance of his duties hereunder, upon
presentation of proper vouchers therefor and in accordance with such
limitations and reporting requirements established from time to time by the
Company for such reimbursements.
6. Assistance. Executive shall make himself reasonably available,
upon the request of the Company, to testify or otherwise assist in
litigation, arbitration, or other disputes involving the Company, or any of
its officers, directors, employees, subsidiaries (whether or not in
existence on the date hereof, for all purposes of this Agreement) or
affiliates, during and after the Employment Period.
7. Covenant Not to Compete; Nonsolicitation.
(a) Non-Compete. During the Employment Period and for a
period of one year after the termination thereof (the "Non-Compete
Period"), except in the proper performance of his services as an officer
and employee of the Company, Executive shall not, either individually or as
a partner, joint venturer, consultant, shareholder, member or
Representative (as hereinafter defined) of another Person (as hereinafter
defined) or otherwise, directly or indirectly, participate in, engage in,
or have a financial or management interest in, promote or assist any other
Person in any business operation or enterprise if such business operation
or enterprise engages, or would engage, in a Restricted Business (as
hereinafter defined) in a Restricted Area (as hereinafter defined);
provided, however, that Executive may own up to one percent of the
outstanding equity securities of any Person.
For purposes of this Agreement:
"Person" means an individual, partnership, limited
liability company, joint venture, corporation, trust, unincorporated
organization or division or operating group of any of the foregoing, a
government or department or agency thereof, or any other entity.
"Representative" means any officer, director, principal,
agent, employee, consultant or other duly authorized representative of a
Person.
"Restricted Business" means any business involved in the
processing of payments to government entities or any other business in
which the Company is actively engaged on the date of termination of the
Employment Period.
"Restricted Area" means any country in which the Company
or a subsidiary of the Company conducts a Restricted Business on the date
of termination of the Employment Period.
(b) Non-Solicitation. During the Non-Compete Period,
Executive shall not, directly or indirectly (i) employ or seek to employ
any person who is at the date on which the Employment Period is terminated
(the "Termination Date"), an officer, general manager or director or
equivalent or more senior level employee of the Company, its subsidiaries
or affiliates, or otherwise solicit, encourage, cause or induce any such
employee of the Company, its subsidiaries or affiliates to terminate such
employee's employment with the Company, its subsidiaries or affiliates for
the employment of another entity (including for this purpose the
contracting with any Person who was an independent contractor (excluding
consultant) of the Company, its subsidiaries or affiliates) during such
period); or (ii) take any action that would interfere with the relationship
of the Company, its subsidiaries or its affiliates with their respective
clients, suppliers and franchisees, except to the extent permitted by the
Board of Directors.
(c) Enforcement. Executive agrees that all restrictions
and agreements contained in this Section 7 (including, without limitation,
those relating to duration and restricted territory) are necessary and
fundamental to the protection of the business of the Company and are
reasonable and valid. Executive agrees that the remedy at law for any
breach of this Agreement will be inadequate, and that the damages flowing
from such breach are not readily susceptible to being measured in monetary
terms. Accordingly, Executive agrees that upon breach of this Section 7,
the Company shall be entitled to immediate injunctive relief and may obtain
a temporary order restraining any threatened further breach. Nothing in
this Agreement shall be deemed to limit the Company's remedies at law or in
equity for any breach by Executive of any of the provisions of this
Agreement that may be pursued or availed of by the Company. Nothing
contained herein shall be construed as prohibiting the Company from
pursuing any other remedies available to it for such breach or threatened
breach, including the recovery of damages from Executive.
Although the restrictions contained in Sections 7(a) and
(b) are considered by the parties to be fair and reasonable under the
circumstances, it is recognized that restrictions of such nature may fail
for technical reasons, and accordingly, it is hereby agreed that if any of
such restrictions shall be adjudged by a court of competent jurisdiction to
be void or unenforceable for whatever reason, but would be valid if part of
the wording thereof were deleted, the period thereof reduced or the area
dealt with thereby reduced in scope, the restrictions contained in Sections
7(a) and (b) shall be enforced to the maximum extent permitted by law, and
the parties consent and agree that such scope or wording may be accordingly
judicially modified in any proceeding brought to enforce such restrictions.
Notwithstanding that Executive's employment hereunder may
be terminated as provided in Section 8, this Section 7 shall survive such
termination.
8. Termination.
(a) Termination by the Company Without Cause. The Company
may immediately upon written notice to Executive terminate the Employment
Period for any reason other than the reasons specified in Sections 8(b),
8(c) and 8(d). Upon termination of the Employment Period pursuant to this
Section 8(a), neither then Company nor Executive, as the case may be, shall
have liability or obligation to the other in respect of this Agreement,
except as provided in Sections 8(g) and 11(m) and as set forth below:
(i) within seven days of the Termination Date,
the Company shall pay Executive a lump sum amount equal to the
Base Salary;
(ii) In the event the Termination Date occurs
prior to the first anniversary of the Commencement Date, within
seven days of the Termination Date, the Company shall pay
Executive the Minimum First Year Bonus;
(iii) For the one-year period following the
Termination Date, the Company shall continue Executive's
participation in the Other Benefits Plans (as hereinafter
defined), to the extent Executive had participated in such benefit
plans as of the Termination Date; provided, however, that to the
extent Executive's participation in the Other Benefit Plans after
the Termination Date is not permitted under the terms of such
plans, the Company shall (at its sole discretion) provide
Executive with equivalent benefits or cash payments in
consideration thereof; and
(iv) In the event the Termination Date occurs
prior to the first anniversary of the Commencement Date, that
number of the Executive Options shall immediately vest as equals
the number of options which otherwise would have vested on the
first anniversary of the Commencement Date under the terms of the
Option Agreements if Executive were still employed with the
Company and all other unvested Executive Options and the
Additional Options (if granted prior to the Termination Date)
shall be immediately cancelled and be of no further force and
effect; provided, however, that the foregoing shall take into
account the previous exercise by Executive of any non-qualified
options (deemed to be part of the Executive Options) for shares of
the Common Stock (such shares, "Non-Qualified Option Shares"), in
which case, upon the Termination Date the Company's right of
repurchase shall immediately lapse with respect to that number of
the Non-Qualified Option Shares as otherwise would have lapsed on
the first anniversary of the Commencement Date under the terms of
the applicable Option Agreement if the Executive were still
employed with the Company.
(b) Death. If Executive dies during the Employment
Period, the Employment Period shall automatically terminate and all
obligations of the parties hereunder shall terminate effective as of the
time of death, except for obligations under the Other Benefit Plans in
which Executive participates as of the time of death, for which the terms
of such plans shall govern, as the case may be.
(c) Disability. If Executive becomes Disabled (as
hereinafter defined) during the Employment Period, the Company shall be
entitled to terminate his employment and the Employment Period upon written
notice to Executive or a person acting on his behalf. In the event of such
termination, Executive shall be released from any duties hereunder (except
as otherwise provided in this Agreement), and for the one-year period
following such termination, the Company shall be required to pay Executive
the Base Salary then in effect (the "Salary Continuation Period"). In such
event, Executive shall continue to participate during the Salary
Continuation Period in the Other Benefit Plans in which he participates as
of the Termination Date. For the purposes of this Agreement, "Disabled"
means mental or physical impairment or incapacity rendering Executive
substantially unable to perform his duties under this Agreement for a
period of longer than 120 days out of any 360-day period during the
Employment Period. A determination of whether Executive is Disabled shall
be made by the Company in its sole discretion upon its own initiative after
obtaining certification from a duly licensed physician or upon request of
Executive or a person acting on his behalf.
(d) Termination by the Company With Cause. The Company
may terminate the Employment Period effective immediately upon written
notice to Executive in the event of any of the following:
(i) Executive's material breach of any material term or
condition of this Agreement, such breach continuing unremedied for
30 days after written notice thereof from the Company describing
the acts constituting the breach and requesting that they be
remedied;
(ii) Executive's (A) personal dishonesty, fraud,
misappropriation, willful misconduct or breach of fiduciary duty,
in each such case materially harmful to the Company's property,
personnel or business operations, or materially damaging to the
Company's relationships with its customers, clients, suppliers or
employees or materially detrimental to the goodwill of the
Company; or (B) failure to perform substantially the duties of his
employment or his other obligations hereunder, or any continuing
action by Executive materially detrimental to the goodwill of the
Company or materially damaging to the Company's relationships with
its customers, clients, suppliers or employees, which
non-performance or actions remain unremedied for 30 days after
written notice thereof from the Company describing in reasonable
detail the non-performance or actions and requesting that they be
remedied;
(iii) Executive's pleading guilty or no-contest to, or
conviction of, a felony or a crime involving moral turpitude or
fraud;
(iv) Executive's misappropriation (or attempted
misappropriation) of the Company's funds or property or of a
business opportunity of the Company, including, without
limitation, attempting to secure or securing any personal profit
in connection with any transaction entered into on behalf of the
Company;
(v) Executive's conviction of any criminal offense
involving dishonesty or breach of trust or money laundering, or
Executive's agreement to enter into a pretrial diversion or
similar program in connection with a prosecution for such offense;
(vi) Executive's excessive drunkenness, sale or use of
illegal drugs or abuse of any controlled substance; or
(vii) Executive's excessive absenteeism not related to
Executive's illness, which absenteeism remains unremedied for 30
days after written notice by the Company requesting that it be
remedied.
Upon termination of the Employment Period pursuant to this Section
8(d), the Company will not have any liability to Executive in respect of
this Agreement, including, without limitation, claims for damages or
liability to the Company by Executive for compensation, severance payments
and other benefits which otherwise would have accrued to Executive
hereunder after termination; provided, however, that all compensation,
benefits and reimbursements accrued through the Termination Date shall be
paid to Executive at the times normally paid by the Company.
(e) Executive's Voluntary Termination. Executive may
terminate the Employment Period upon 30 days written notice to the Company,
and upon such termination, the provisions of the last paragraph of Section
8(d) shall apply. Upon termination of the Employment Period pursuant to
this Section 8(e), the Company will not have any liability to Executive in
respect of this Agreement, including, without limitation, claims for
damages or liability to the Company by Executive for compensation,
severance payments and other benefits which otherwise would have accrued to
Executive hereunder after termination; provided, however, that all
compensation, benefits and reimbursements accrued through the Termination
Date shall be paid to Executive at the times normally paid by the Company.
Executive agrees, in connection with the termination of the Employment
Period pursuant to this Section 8(e), not to disclose publically his intent
to resign.
(f) Termination by Executive for Good Reason. Executive
may terminate the Employment Period at any time for Good Reason (as
hereinafter defined). For the purposes hereof, "Good Reason" shall mean (i)
a material diminution of Executive's authority, duties and responsibilities
as provided in Section 3, (ii) a reduction in or failure to pay timely the
Base Salary, (iii) the appointment of any person to a superior executive
position in the Company's finance department or a change in Executive's
direct reporting status to an officer of the Company other than the Chief
Executive Officer (or equivalent), (iv) any relocation of the Company's
corporate headquarters to a place 90 miles or more outside New York City,
(v) the Company's breach of any material term or condition of this
Agreement, and (vi) any termination of the Employment Period within the
thirty days immediately following the expiration of the three-month period
following a Change of Control (as hereinafter defined); provided, however,
that each of the reasons set forth in clauses (i) through (vi) above shall
be identified in written notice thereof delivered by Executive to the
Company specifying the nature of the reason and the Company shall have been
afforded a period of 30 days to respond to such notice and cure the
condition set forth in such notice if capable of being cured. If Executive
terminates this Agreement for Good Reason, the provisions of Section 8(a)
shall apply.
For purposes of this Agreement, "Change of Control" shall
mean: (i) the sale, lease, transfer, conveyance or other disposition (other
than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and
subsidiaries, taken as a whole to any Person other than to the Company or
one of its wholly-owned subsidiaries; (ii) the Company consolidates with or
merges into another Person (other than a subsidiary) or any Person (other
than a subsidiary) consolidates with, or merges into, the Company, in any
such event pursuant to a transaction in which the outstanding shares of
common stock of the Company are changed into or exchanged for cash,
securities or other property, other than any such transaction where the
holders of the shares of common stock of the Company immediately prior to
such transaction own, directly or indirectly, not less than a controlling
interest in the voting equity of the surviving or resulting Person
immediately after such transaction; (iii) the consummation of any
transaction or series of transactions (including. without limitation, any
merger or consolidation), as a result of which any Person (other than a
subsidiary of the Company) becomes the beneficial owner (as such term is
defined in Rule l3d-3 and Rule l3d-5 under the Securities Exchange Act of
1934, as amended), directly or indirectly, of fifty percent (50%) or more
of the voting equity of the Company; or (iv) a change in the composition of
the Company's Board of Directors, as a result of which fewer than a
majority of the incumbent directors are directors who either (A) had been
directors of the Company on the Commencement Date or the date 24 months
prior to the date of the event that may constitute a Change of Control (the
"original directors") or (B) were elected, or nominated for election, to
the Company's Board of Directors with the affirmative votes of at least a
majority of the aggregate of the original directors who were still in
office at the time of the election or nomination and the directors whose
election or nomination was previously so approved. Notwithstanding the
foregoing, the term "Change of Control" shall not include any transaction
or series of transactions with or to (i) any affiliate of the Company, (ii)
any entity or successor entity in which the Company holds at least a
majority of the total voting power of such entity or successor entity (or
retains the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the members of the board of
directors or other governing body of such entity or successor entity),
(iii) any entity or successor entity in which no person or entity holds a
greater percentage of the total voting power of such entity or successor
entity than the Company's percentage voting interest in such entity or
successor entity or (iv) any entity formed at the direction of the Company
in connection with obtaining financing for the Company or any of its
subsidiaries under an arrangement that provides the Company with an option
to reacquire its assets or other properties or other similar financing
arrangement.
(g) Applicability of Section 7. Executive acknowledges
and agrees that in the event the Employment Period is terminated pursuant
to Section 4(d), 4(e) or 8 (other than Section 8(b)), and notwithstanding
the termination of this Agreement in connection therewith, he shall
continue to be subject to the provisions of Section 7 of this Agreement.
9. Insurance. The Company will have the right at its own cost and
expense to apply for and secure in its own name, or otherwise, life, health
or accident insurance or any or all of them covering Executive, and
Executive agrees to submit to the usual and customary medical examination
and otherwise to cooperate with the Company in connection with the
procurement of any such insurance, and any claims thereunder.
10. Confidentiality; Books and Records; Company Property. Except
in accordance with the provisions of this Agreement, during the Employment
Period and thereafter, Executive shall keep secret and retain in strictest
confidence, and shall not use for the benefit of Executive or others, all
confidential matters and affairs relating to the Company. Upon any
termination of this Agreement, Executive shall promptly deliver to the
Company all confidential information theretofore supplied to him, and each
copy thereof, whether in his possession or otherwise available to him, and
shall certify in writing to the Company that all analyses, studies and
other documents that discuss or analyze the business of the Company have
been destroyed. All papers, books and records of every kind and description
relating to the business and affairs of the Company, whether or not
prepared by Executive, and all property owned by the Company shall be the
sole and exclusive property of the Company and Executive shall surrender
them to the Company upon request, during and after the Employment Period.
11. Miscellaneous.
(a) Notices. All notices, requests, demands and other
communications which are required to be or may be given under this
Agreement to any of the other parties shall be in writing and shall be
deemed to have been duly given (i) upon delivery in person, (ii) the day
following dispatch by a recognized overnight courier service (such as
Federal Express or UPS, etc.), (iii) upon facsimile transmission (with
written confirmation and copy by first class mail), or (iv) five days after
dispatch by certified or registered first class mail, postage prepaid,
return receipt requested, to the party to whom the same is so given or
made:
If to the Company, addressed to:
Official Payments Corporation
Three Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
If to Executive, addressed to:
Xxxxxx X. Xxxxxxx
0 Xxxxxx Xxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
(b) Amendments. This Agreement cannot be altered or
otherwise amended except pursuant to an instrument in writing signed by
each of the parties.
(c) Assignment. Executive acknowledges that the services
required of Executive hereunder are personal and that Executive may not
assign this Agreement or any rights or duties under this Agreement. The
Company may not assign or otherwise transfer this Agreement to any other
entity without the prior written consent of Executive, which consent shall
not be unreasonably withheld.
(d) Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the transactions contemplated
herein and supersedes all previous written or oral negotiations,
commitments and understandings.
(e) Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same instrument.
(f) Headings. All headings are inserted for convenience
of reference only and shall not affect the meaning or interpretation of any
such provisions or of this Agreement, taken as an entirety.
(g) Severability. If and to the extent that any court of
competent jurisdiction holds any provision (or any part thereof) of this
agreement to be invalid or unenforceable, such holding shall in no way
affect the validity or enforceability of the remainder of this Agreement,
but shall be confined in its operation to the jurisdiction in which made
and to the provisions of this Agreement directly involved in the
controversy in which such judgment shall have been rendered.
(h) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
reference to the conflicts of laws principles thereof.
(i) Binding Effects. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors, legal representatives and assigns.
(j) Acquisitions, Mergers, Etc. Nothing herein contained
shall be construed to prevent or limit any acquisition, merger,
consolidation, reorganization or other transaction affecting the structure
of the Company.
(k) Representations, Warranties and Covenants. Executive
hereby covenants, warrants and represents that (i) the execution of this
Agreement and the discharge of his obligations hereunder will not breach or
conflict with any other contract, agreement or understanding between
Executive and any other party or parties; (ii) there are no agreements or
arrangements, whether written or oral, in effect which would prevent
Executive from rendering services to the Company during the term of this
Agreement; (iii) Executive has not made and will not make any commitment to
do any act in conflict with this Agreement; (iv) upon due execution and
delivery of this Agreement by the Company, this Agreement constitutes a
valid and legally binding obligation of Executive, enforceable against him
in accordance with its terms, subject to (A) the effect of bankruptcy,
insolvency, fraudulent conveyance and other similar laws relating to or
affecting creditors' rights generally or (B) the availability of equitable
remedies; and (v) the terms of this Agreement have been fully explained to
him, that he understands the nature and extent of the rights and
obligations provided under this Agreement, and that he has been given the
opportunity to be represented by legal counsel in the negotiation and
preparation of this Agreement. Executive understands and agrees that any
breach of the representations or warranties in the preceding sentence that
results in Executive being prohibited from performing his duties under this
Agreement will constitute a material breach for purposes of Section 8(d)(i)
of this Agreement, and on or at any time after it is determined that
Executive is so prohibited, the Company will be permitted to terminate
Executive's employment pursuant to Section 8(d).
The Company hereby covenants, warrants and represents
that (i) the execution of this Agreement and the discharge of its
obligations hereunder will not breach or conflict with any other contract,
agreement or understanding between the Company and any other party or
parties, (ii) the execution and delivery of this Agreement have been duly
and validly authorized by the Company; and (iii) upon due execution and
delivery of this Agreement by Executive, this Agreement constitutes a valid
and legally binding obligation of the Company, enforceable against it in
accordance with its terms, subject to (A) the effect of bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and other
similar laws relating to or affecting creditors' rights generally or (B)
the availability of equitable remedies.
(l) Waiver. No consent or waiver, express or implied, by
any party to or of any breach or default by another party in performance by
the breaching party of its obligations under this Agreement shall be deemed
or construed to be a consent or waiver to or of any breach or default by
the breaching party in the performance by such breaching party of any other
obligations of such breaching party under this Agreement. Failure on the
part of any party to object to or complain of any act or failure to act of
any of the other parties or to declare any of the other parties in default
shall not constitute a waiver of any right or remedy or the ability to
object or complain or to declare any default at any time in the future.
(m) Survival. The provisions of Sections 5, 6, 7, 8, 10
and 11 shall survive termination of this Agreement.
(n) Legal Fees. Each party hereto will be responsible for
its own legal fees and costs of counsel in connection with negotiation and
preparation of this Agreement, or any proceedings resulting herefrom.
(o) Withholding Taxes. The Company may directly or
indirectly withhold from any payments under this Agreement all federal,
state, municipal or other taxes that shall be required pursuant to any law
or governmental regulation.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
OFFICIAL PAYMENTS CORPORATION
By: /s/ Xxxxxx X. Xxxxx
_______________________________________
Xxxxxx X. Xxxxx
Chairman and Chief Executive Officer
/s/ Xxxxxx X. XxXxxxx
___________________________________________
Xxxxxx X. XxXxxxx
