THE SECURITY REPRESENTED BY THIS CERTIFICATE OR OTHERWISE CONTEMPLATED IN THIS
AGREEMENT HAS BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION
MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
STOCK BONUS AGREEMENT
THIS STOCK BONUS AGREEMENT ("Agreement") is entered into as of the 1st day of
June, 2001, by and between Accesspoint Corporation, a Nevada corporation
("Company"), and Xxxxxxx Xxxxx, an individual ("Employee"). Accesspoint and/or
the Employees are sometimes herein referred to individually as a "party" and
collectively as the "parties."
R E C I T A L S
A. WHEREAS, Employee is an employee of Processing Source International,
Inc. ("PSI");
B. WHEREAS, PSI is a wholly owned subsidiary of Accesspoint Corporation
("APC");
C. WHEREAS, on or about March 19, 1999 the Company adopted the Accesspoint
Corporation 1999 Stock Incentive Plan ("Plan"); and,
D. WHEREAS, the Board of Directors of the Company desire to grant to
Employee certain stock awards in the form of Preferred stock, Series A, pursuant
to the terms and conditions of this Agreement and the Plan.
NOW, THEREFORE, in consideration of the mutual promises contained herein, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto agree as follows:
ARTICLE 1.
GRANT OF PREFERRED SHARES
1.1. GRANT OF PREFERRED SHARES. For value received, the Corporation hereby
grants to Employee the number of shares of its Preferred Stock, Series A
("Shares"), set forth on Schedule 1, attached hereto and made a part hereof
("Award"). The Shares shall be made available from authorized and unissued
Preferred Stock, Series A, of the Company or from shares of Preferred Stock,
Series A, held by the Company as treasury stock. The foregoing Award is made
subject to the terms and conditions hereinafter set forth. The above Preferred
1
Stock, Series A, is subject to certain redemption, conversion and other rights
and restrictions set forth in a Certificate of Determination filed by the
Company. The Company shall not issue any Preferred Stock, Series A, unless and
until a Certificate of Determination is filed by the Company.
1.2. FAIR MARKET PRICE. The fair market price for the Shares shall be deemed
to be 3% of the closing price at which a share of the common stock of the
company shall have been valued on the date of the grant pursuant to Schedule 1.
1.3. PLAN. The Award set forth herein is made expressly subject to the terms
and conditions of the Plan. Notwithstanding the foregoing, APC may, in lieu of
awards by the Company under the Plan, or in coordination with awards by the
Company under the Plan, make stock bonus awards pursuant to a similar plan or
plans adopted by APC. It is the intent of the parties to provide Employee with
the benefit of ultimately being eligible for conversion of some stock or
security into Common Shares of the Company.
1.4. CONVERSION. The Shares shall, subject to the terms and conditions of
this Agreement, be convertible into fully paid non-assessable shares of Common
Stock upon the occurrence of the events set forth herein. Notwithstanding the
foregoing, the Shares may not be converted if the issuance of any shares of
Common Stock upon such conversion would constitute a violation of any applicable
federal or state securities or other law or regulation. As a condition to the
conversion of the Shares, the Company may require the Employee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation.
1.5. CONVERSION SCHEDULE. The Shares shall, subject to the terms and
conditions set forth in this Agreement, and subject to forfeiture as set forth
herein, be convertible into Common Shares upon the attainment of certain
earnings and revenue milestones by APC, as defined at Article 1, in accordance
with the conversion schedule set forth on Schedule 1.
1.6. TIME FOR ATTAINMENT OF REVENUE LEVELS. The revenue levels of APC
as milestones referenced above must be attained by APC within the time periods,
measured from the effective date of this Agreement as set forth on Schedule 1.
If the revenue levels are not so attained within the following times, the number
of Shares available for conversion hereunder shall decrease at a rate of ten
percent (10%) of the then remaining amount of Shares available for conversion
each calendar month, prorated on the basis of number of days in each calendar
month.
1.7. SHARES AVAILABLE FOR CONVERSION. The Shares available for conversion
shall be reduced as a pool as set forth at, above. Should the pool of Shares
available for conversion be insufficient to provide for any level of conversion,
in full or part, at any time as set forth in this Agreement, the remaining
conversion schedule shall be of no further force or effect and all conversion
rights shall expire and terminate and no further Shares shall convert or be
subject to conversion.
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1.8. SERVICE ADJUSTMENTS. The Shares subject to the Award, whether converted
or unconverted, shall be forfeited to the Company if the employment of the
Employee by the Company or an Affiliate is terminated for cause, as set forth
herein. If such termination occurs prior to completion of 180 full working days
of continuous employment service, Employee shall forfeit one hundred percent
(100%) of the Shares, whether converted or unconverted. If such termination
occurs after completion of 180 full working days of continuous employment
service, but prior to completion of 270 full working days of continuous
employment service, Employee shall forfeit an amount of Shares, whether
converted or unconverted, equal to 8/9 of the total Award amount, prorated on
the basis of a 30 day month. Thereafter, for each 30 day period, or portion
thereof on a 30 day prorated basis, of complete full working days of continuous
employment service, Employee shall forfeit an amount of shares reduced by an
amount equal to 1/9 of the total Award amount, so that upon completion of 540
full working days of continuous employment, none of the Shares, whether
converted or unconverted, pursuant to the Award shall be subject to forfeiture.
All prorations shall be made on the basis of a 30 day month and a 360 day year.
1.9. SPECIAL CONVERSION OF DEATH OR FULL DISABILITY. Upon the death or full
disability of Employee, and subject to the service adjustments and forfeitures
as set forth above, ten percent (10%) of any Shares not then converted shall
automatically convert for the benefit of the Employee or the estate of Employee,
and the remainder of the conversion rights shall expire and terminate and any
then unconverted Shares shall be forfeited to the Company.
1.10. FULL DISABILITY OF EMPLOYEE. In the event Employee becomes mentally or
physically disabled to such an extent that Employee is unable to substantially
perform Employee's normal employment duties on behalf of the Company for a
period of thirty (30) consecutive days or more, the Company, at any time
thereafter, shall have the right, at its sole option, to declare Employee fully
disabled hereunder.
1.11. DEFINITION OF CAUSE. As used herein with regard to suspension or
discharge, cause shall consist of the following: (i) cause as defined pursuant
to any written employment agreement to which the Employee is a party; (ii) the
conviction of Employee by a court of competent jurisdiction (and to which no
further appeal can be taken) of a felony or any other crime involving moral
turpitude; (iii) the commission by Employee of an act of fraud or other act
materially evidencing bad faith or dishonesty; (iv) the misappropriation by
Employee of any funds or property or other rights of the Company; (v) the
suspension or removal or termination of Employee by or at the request or
requirement of any governmental authority having jurisdiction over the Company;
(vi) the willful refusal to follow any lawful directive of the Board of
Directors of Company; or (vii) the breach by Employee of any material terms of
this Agreement or any other agreement between Employee and the Company or any
affiliate of the Company. The foregoing definition shall be used for purposes of
this Agreement only and shall have no other effect, whether binding,
interpretive, illustrative, or otherwise, on any employment relationship,
whether at-will or pursuant to a written agreement employment agreement.
1.12. EXPIRATION OF CONVERSION RIGHTS. The conversion rights with regard to
any and all
3
Shares which do not become fully converted at the time set forth therefor shall
be deemed expired and such Shares shall no longer be subject to conversion in
accordance with the terms and conditions of this Agreement. Such Shares
unconverted Shares shall be forfeited to the Company.
1.13. REVENUE. Subject to adjustment as set forth at Section 1.13, below, the
term revenue as used herein shall mean the gross revenue of APC from sources as
follows: (i) all of the capital inflows of APC (or enhancements of assets) from
producing and delivering goods, rendering services, or other activities that
constitute the ongoing central business operations of APC; and (ii) gross
revenues from sales and licensing transaction made by APC with regard to the
services and products of APC for the account or benefit of APC pursuant to
transactions materially initiated by Employee or in which the Employee is or was
a direct and substantial influence. Subject to the definitions and adjustments
set forth herein, the term revenue shall be construed hereunder in a manner
consistent with generally accepted accounting principles.
1.14. ADJUSTMENT TO REVENUE.The term revenue as used herein shall be adjusted
to exclude contributions or distributions from the Company to APC or any of its
affiliated entities, contributed capital, equity inconvertments, tax credits,
and revenues, gains and/or increases in equity or assets from peripheral or
incidental transactions not otherwise specifically set forth at Section 1.10,
above.
1.15. RIGHTS AS SHAREHOLDER. Employee shall have all rights as a shareholder
of Preferred Stock, Series A, with respect to the Shares, except to the extent
that such rights as a share owner would cause the Plan not to comply with Rule
16b-3 under the Securities Exchange Act of 1934, as amended. Employee
acknowledges that the Preferred Stock, Series A, bear no voting rights.
ARTICLE 2.
ISSUANCE OF FULLY CONVERTED SHARES
2.1. ISSUANCE ON CONVERSION. Before any Shares may be converted into Common
Shares, the Employee must surrender the certificate or certificates evidencing
the Shares, duly endorsed in blank or accompanied by proper instruments of
transfer, at the office of the Company or any transfer agent for the Shares.
Employee shall give written notice to the Company at such office that the
Employee reasonably believes that that a certain number of Shares is then
subject to conversion as set forth herein. The notice shall also specify the
name or names in which the Employee the certificate or certificates for Common
Shares to be issued. If a name specified is not that of Employee, the notice
shall also state the address of the new holder and any other information
required by law. The Company shall have the right, in its sole discretion, to
decline to issue any such certificates in any name other than the name of
Employee appearing the surrendered certificates representing the Shares. The
Company shall, subject to the tax provisions set forth at Section 2.7, as soon
as practicable thereafter, issue and deliver at such office to the holder of the
Shares converted, or the that holder's
4
nominee or nominees, certificates for the number of full Common Shares to which
the holder shall be entitled, to receive together with a scrip certificate or
cash in lieu of any fraction of a share as provided herein, subject further to
an available exemption under the securities laws and general compliance with all
securities laws, rules and regulations. Notwithstanding the foregoing, the
Company shall not be obligated to deliver registered or qualified securities to
Employee, and the obligation of Accesspoint to issue Common Shares and/or
deliver stock certificates shall xxxxx unless and until an available exemption
from the requirement of registration or qualification under any applicable
securities laws is available and may be obtained and perfected.
2.2 CONVERSION DATE. Conversion hereunder shall be deemed to have been made
as of the date of surrender of the Shares to be converted, and the person or
persons entitled to receive the Common Shares issuable upon conversion shall be
treated for al purposes as the record holder or holders of such Common Shares on
that date.
2.3. COMPLIANCE WITH SECURITIES LAWS. All offers, sales, transfers and
Conversions of the Shares shall be made in compliance with all applicable
securities laws, rules and regulations, and pursuant to registration of
securities under the Securities Act (and qualification under General Corporation
Law of California) or pursuant to an exemption from registration under the
Securities Act (and qualification under General Corporation Law of California).
The Employee acknowledges that the Shares are subject to the restrictions on
transfer set forth in Rule 144 of the Rules promulgated under the Securities Act
of 1933 ("Act"). Any and all offers and sales, to the extent permitted
hereunder, by Employee after the restricted period shall be made only pursuant
to such a registration (and qualification) or to such exemption from
registration (and qualification). Employee shall comply with all policies and
procedures established by Accesspoint with regard to Rule 144 matters.
2.4. CHANGE IN STRUCTURE OF ACCESSPOINT. Upon the consummation of any sale
of substantially all of the assets of Accesspoint, or the merger, consolidation
or reorganization of Accesspoint in which Accesspoint is not the surviving
corporation, and directly pursuant to which Employee is materially prevented
from achieving any applicable revenue milestones as set forth herein, then all
conditionally converted Shares shall fully convert and Employee shall be granted
fully converted Shares as if the next applicable revenue milestone had then been
achieved. The remainder of any conversion rights pertaining to the Shares,
including, without limitation, conversion rights pertaining to conditionally
converted Shares, shall expire and terminate and the Shares shall no longer be
subject to conversion.
2.5. EMPLOYMENT RELATIONSHIP. The parties acknowledge that any employment
relationship or relationships between the Employees and the Company or the
Employees and Accesspoint, if any, is set forth pursuant to the terms of a
separate written employment agreement and that nothing in this Agreement shall
affect in any manner whatsoever such employment relationships, if any, between
The Employees and such parties. This Agreement does not constitute an express or
implied promise of continued employment for the periods defined herein or any
other period or periods.
5
2.6. TAX MATTERS. If Accesspoint determines that it is required to withhold
federal, state or local tax as a result of the grant of the Award or conversion
of the Shares, then Employee, as a condition to the conversion of the Shares,
shall make arrangements satisfactory to Accesspoint to enable it to satisfy such
withholding requirements. Employee will pay when due and payable, any and all
federal and state taxes or fees that may be payable by Employee with respect to,
without limitation: (i) the grant of the Shares; (ii) the conversion of the
Shares; (iii) the issuance of any Common Shares or certificates therefor; and/or
(iv) the subsequent disposition, to the extent permitted hereunder, of any of
the Shares, Common Shares, or certificates issued to Employee upon conversion of
the Shares. The Employee understands that any of the foregoing references to
taxation are based on federal income tax laws and regulations now in effect, and
may not be applicable to the Employee under certain circumstances. The Employee
may also have adverse tax consequences under state or local law. The Employee
has reviewed with the Employee's own tax advisors the federal, state, local and
foreign tax consequences of the transactions contemplated by this Agreement. The
Employee is relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. The Employee understands
that the Employee (and not the Company) shall be responsible for the Employee's
own tax liability that may arise as a result of the transactions contemplated by
this Agreement.
2.7. INCIDENTAL REGISTRATION. Accesspoint shall give written notice to
Employee of any proposed registration under the Act of any of its securities of
the same class and series as the Common Shares issued to Employee pursuant to
conversion of the Shares. Accesspoint will use its best reasonable commercial
efforts to include in any such Registration Statement, at the cost of
Accesspoint and in accordance with the intended method or methods of
distribution, any of the Common Shares issued to Employee pursuant to conversion
of the Shares if Employee shall request inclusion within thirty (30) days after
the date of mailing of the above notice. Employee will cooperate with
Accesspoint, execute, acknowledge, notarize, and deliver reasonable documents
and instruments, and provide Accesspoint with all reasonable documents,
instruments and information reasonably required to prepare, complete and file
the Registration Statement. Employee represents that no such documents,
instruments and information shall contain any untrue statements of material fact
or omit to state any material facts required to be stated therein necessary to
make the statements therein not misleading in light of the circumstances then
existing. Notwithstanding the foregoing, Accesspoint may, but shall not be
required hereunder to, keep any such Registration Statement effective or prepare
or file any amendments or post-effective amendments to the Registration
Statement with regard to the shares of Employee or assist in any way with the
sale or distribution of the shares of Employee.
6
ARTICLE 3.
RESTRICTIONS ON TRANSFER
3.1. RESTRICTIONS. Notwithstanding anything herein to the contrary, Employee
understands and agrees that Employee shall not dispose of any of the Shares,
whether by sale, exchange, assignment, transfer, gift, devise, bequest,
mortgage, pledge, encumbrance or otherwise, except in accordance with the terms
and conditions of this Agreement, and Employee shall not take or omit any action
which will impair the absolute and unrestricted right, power, authority and
capacity of Employee to sell Shares in accordance with the terms and conditions
hereof
3.2. TRANSFERS VOID. Any purported transfer of Shares by Employee that
violates any provision of this Agreement shall be wholly void and ineffectual
and shall give to the Company or its designee the right to purchase from
Employee all but not less than all of the Shares then owned by Employee for a
period of 90 days from the date the Company first learns of the purported
transfer at the Agreement Price and on the Agreement Terms (as those terms are
defined in Sections 3.11 and 3.12, respectively, of this Article 3). If the
Shares are not purchased by the Company or its designee, the purported transfer
thereof shall remain void and ineffectual and they shall continue to be subject
to this Agreement. The Company shall not cause or permit the transfer of any
Shares to be made on its books except in accordance with the terms hereof.
3.3. PERMITTED TRANSFERS. Employee may sell, assign or transfer any Shares
held by the Employee but only by complying with the provisions of Section 3.7.
Employee may sell, assign or transfer any Shares held by the Employee without
complying with the provisions of Section 3.7 by obtaining the prior written
consent of the Company as approved by a majority of the members of the Board of
Directors of the Company, provided that the transferee agrees in writing to be
bound by the provisions of this Agreement and the transfer is made in accordance
with any other restrictions or conditions contained in the written consent and
in accordance with applicable federal and state securities laws.
3.4. NO TRANSFER UPON DEATH. No Shares may be transferred upon the death of
Employee; the Shares shall be subject to the special conversion and forfeiture
provisions set forth hereinabove pertaining to the death or disability of
Employee.
3.5. NO PLEDGE. Unless a majority of the members of the Board of Directors
consent, Shares may not be pledged, mortgaged or otherwise encumbered to secure
indebtedness for money borrowed or any other obligation for which the Employee
is primarily or secondarily liable.
3.6. STOCK CERTIFICATE LEGEND. Each stock certificate for Shares issued to
the Employee shall have conspicuously written, printed, typed or stamped upon
the face thereof, or upon the reverse thereof with a conspicuous reference on
the face thereof, the following legend, in addition to any other legend or
legends deemed required or appropriate by counsel for the Company:
7
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED IN THE
ABSENCE OF REGISTRATION THEREUNDER OR AN APPLICABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SUCH ACT. SUCH SHARES MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED, OR OTHERWISE DISPOSED OF IN ANY MANNER EXCEPT IN ACCORDANCE WITH
AND SUBJECT TO THE TERMS OF THE STOCK BONUS AGREEMENT, A COPY OF WHICH IS ON
FILE AT THE PRINCIPAL OFFICE OF THE COMPANY. UNLESS A MAJORITY OF THE MEMBERS OF
THE BOARD OF DIRECTORS CONSENT, SUCH STOCK BONUS AGREEMENT PROHIBITS ANY PLEDGE,
MORTGAGE OR OTHER ENCUMBRANCE OF SUCH SHARES TO SECURE ANY OBLIGATION OF THE
HOLDER HEREOF. EVERY CREDITOR OF THE HOLDER HEREOF AND ANY PERSON ACQUIRING OR
PURPORTING TO ACQUIRE THE CERTIFICATE OR THE SHARES HEREBY EVIDENCED OR ANY
INTEREST THEREIN IS HEREBY NOTIFIED OF THE EXISTENCE OF SUCH STOCK BONUS
AGREEMENT, AND ANY ACQUISITION OR PURPORTED ACQUISITION OF THIS CERTIFICATE OR
THE SHARES HEREBY EVIDENCED OR ANY INTEREST THEREIN SHALL BE SUBJECT TO ALL
RIGHTS AND OBLIGATIONS OF THE PARTIES TO SUCH STOCK BONUS AGREEMENT AS THEREIN
SET FORTH.
3.7. SALES OF SHARES; RIGHT OF FIRST REFUSAL. The Company shall have a right
of first refusal with regard to any sale, assignment, transfer or other
disposition of any Shares held by Employee.
3.7.1. In the event that the Employee shall desire to sell, assign or
transfer any Shares held by the Employee to any other person (the "Offered
Shares") and shall be in receipt of a bona fide offer to purchase the Offered
Shares ("Offer"), the following procedure shall apply. The Employee shall give
to the Company written notice containing the terms and conditions of the Offer,
including, but not limited to: (i) the number of Offered Shares; (ii) the price
per Share; (iii) the method of payment; and (iv) the name(s) of the proposed
purchaser(s).
3.7.2. An offer shall not be deemed bona fide unless the Employee has
informed the prospective purchaser of the Employee's obligation under this
Agreement and the prospective purchaser has agreed to become a party hereunder
and to be bound hereby. The Company is entitled to take such steps as it
reasonably may deem necessary to determine the validity and bona fide nature of
the Offer.
3.7.3. Until 10 days after such notice is given, the Company or its
designee shall have the right to purchase all of the Offered Shares at the price
offered by the prospective purchaser and specified in such notice. Such purchase
shall be on the Agreement Terms, as defined in Sections 3.11 and 3.12.
3.8. FAILURE OF COMPANY OR ITS DESIGNEE TO PURCHASE OFFERED SHARES. If all
of the Offered Shares are not purchased by the Company and/or its designee
within the 10-day period
8
granted for such purchases, then any remaining Offered Shares may be sold,
assigned or transferred pursuant to the Offer; provided, that the Offered Shares
are so transferred within 15 days of the expiration of the 10-day period to the
person or persons named in, and under the terms and conditions of, the bona fide
Offer described in the notice to the Company; and provided further, that such
persons agree to execute and deliver to the Company a written agreement, in form
and content satisfactory to the Company, agreeing to be bound by the terms and
conditions of this Agreement.
3.9. MANNER OF EXERCISE. Any right to purchase hereunder shall be exercised
by giving written notice of election to the Employee, the Employee's personal
representative or any other selling person, as the case may be, prior to the
expiration of such right to purchase.
3.10. AGREEMENT PRICE. The "Agreement Price" shall be the higher of (i) the
fair market value of the Shares to be purchased determined in good faith by the
Board of Directors of the Company or (ii) the original exercise price of the
Shares to be purchased.
3.11. DELIVERY OF SHARES AND CLOSING DATE. At the closing, the Employee, the
Employee's personal representative or such other selling person, as the case may
be, shall deliver certificates representing the Shares, properly endorsed for
transfer, and with the necessary documentary and transfer tax stamps, if any,
affixed, to the purchaser of such Shares. Payment of the purchase price therefor
shall concurrently be made to the Employee, the Employee's personal
representative or such other selling person, as provided in subsection (ii) of
this Section 3.11. Such delivery and payment shall be made at the principal
office of the Company or at such other place as the parties mutually agree. The
foregoing may be herein referred to as the "Agreement Terms."
3.12. PAYMENT OF PURCHASE PRICE. The Company shall pay the purchase price to
the Employee at the closing. The purchase price payment terms shall be a part of
the "Agreement Terms."
3.13. RIGHT TO PURCHASE UPON CERTAIN OTHER EVENTS.The Company or its designee
shall have the right to purchase all, but not less than all, of the Shares held
by the Employee at the Agreement Price and on the Agreement Terms for a period
of 90 days after any of the following events:
3.13.1. Any attempt by a creditor to levy upon or sell any of the
Employee's Shares;
3.13.2. The filing of a petition by the Employee under the U.S.
Bankruptcy Code or any insolvency laws;
3.13.3. The filing of a petition against Employee under any insolvency
or bankruptcy laws by any creditor of the Employee if such petition is not
dismissed within 30 days of filing;
3.13.4. The entry of a decree of divorce between the Employee and the
Employee's spouse; or,
9
3.13.5. The termination of Employee's services as an employee or
consultant with the Company.
3.14. NOTICE OF EVENTS. The Employee shall provide the Company written
notice of the occurrence of any event set forth at Section 3.13 within 30 days
of the occurrence of such event.
3.15. TERMINATION. The provisions of this Article 3 shall terminate and
all rights of each such party hereunder shall cease except for those which shall
have theretofore accrued upon the occurrence of any of the following events:
3.15.1. Cessation of the Company's business;
3.15.2. Bankruptcy, receivership or dissolution of the Company;
3.15.3. Ownership of all of the issued and outstanding shares of the
Company by a single shareholder of the Company;
3.15.4. Written consent or agreement of the shareholders of the
Company holding 50% of the then issued and outstanding shares Common Stock of
the Company (determined on a fully diluted basis);
3.15.5. Consent or agreement of a majority of the members of the Board
of Directors of the Company; or,
3.15.6. Registration of any class of equity securities of the Company
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended.
3.16. AMENDMENT. This Article 3 may be modified or amended in whole or in
part by a written instrument signed by shareholders of the Company holding 50%
of the outstanding shares of Common Stock (determined on a fully diluted basis)
or a majority of the members of the Board of Directors of the Company.
ARTICLE 4.
GENERAL PROVISIONS
4.1. RECITALS. The recitals set forth above are incorporated herein by this
reference and made a part of this Agreement.
4.2. ADVICE OF COUNSEL. Each party has been advised of and understands the
terms and conditions of this Agreement. This Agreement has been freely and
voluntarily entered into and executed by the parties, each of the parties hereto
being duly represented by counsel or having the benefit of advice of counsel.
10
4.3. AMENDMENTS. This Agreement may be amended only by written consent of
each of the parties hereto.
4.4. FURTHER ACTS. The parties hereto shall cooperate with each other and
execute such additional documents or instruments and perform such further acts
as may be reasonably necessary to affect the purpose and intent of the
Agreement.
4.5. NOTICES. Any and all notices,demands, requests, or other communications
required or permitted by this Agreement or by law to be served on, given to, or
delivered to any party hereto by any other party to this Agreement shall be in
writing and shall be deemed duly served, given, or delivered when personally
delivered to the party or to an officer of the party, or in lieu of such
personal delivery, when deposited in the United States mail, first-class postage
prepaid addressed as follows:
Accesspoint: Accesspoint Corporation
00 Xxxxxxxxx Xxxx
Xxxxx 000
Xxxxxx, XX 00000
Att: Xxx X. Xxxxxxxxx
Employee: [See Schedule 1]
4.6. EFFECT OF HEADINGS. The subject headings of the paragraphs and sub-
paragraphs of this Agreement are included for purposes of convenience only, and
shall not affect the construction or interpretation of any of its provisions.
4.7. ENTIRE AGREEMENT; MODIFICATION, WAIVER. This Agreement constitutes
the entire agreement between the parties pertaining to the conditional and final
converting of any Shares, and along with the Plan and the Trust, the entire
agreement between the parties pertaining to any other subject matter contained
herein. This Agreement supersedes all prior and contemporaneous agreement,
representations and understandings of the parties. No waiver of any of the
provisions of this Agreement shall be deemed, or shall constitute a waiver of
any other provision, whether or not similar, nor shall any waiver constitute a
continuing waiver. No waiver shall be binding unless executed in writing by the
party making the waiver.
4.8. SEVERABILITY. Should any provision or portion of this Agreement be held
or otherwise become unenforceable or invalid for any reason, the remaining
provisions and portions of this Agreement shall be unaffected by such
unenforceability or invalidity.
4.9. COUNTERPARTS. This Agreement may be executed simultaneously in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The exhibits attached
hereto and initialed by the parties are made a part hereof and incorporated
herein by this reference.
11
4.10. PARTIES IN INTEREST. Nothing in this Agreement, whether express or
implied, is intended to confer any rights or remedies under or by reason of this
Agreement on any persons other than the parties to it, and APC, and their and
its respective successors and assigns. APC is expressly declared to be a third
party beneficiary under this agreement with full rights of enforcement. Further,
nothing in this Agreement intended to relieve or discharge the obligation or
liability of any third party to this Agreement, nor shall any provision give any
third person except APC any right of subrogation or action over against any
party to this Agreement.
4.11. ASSIGNMENT. The Shares may be exercised only by Employee during his or
her lifetime, unless expressly agreed otherwise in writing by Accesspoint.
Employee may not transfer or assign, or purport to transfer or assign, the
Shares without the prior written consent of Accesspoint. To the extent that
Accesspoint may consent to any such assignment, this Agreement shall be binding
on, and shall inure to the benefit of, the heirs, legal representatives,
successors and assigns of Employee. Accesspoint may assign this Agreement to any
entity which purchases substantially all of the assets of Accesspoint, or is the
surviving entity in any merger, consolidation or reorganization of Accesspoint.
4.12. SPECIFIC PERFORMANCE. Each party's obligations under this Agreement are
unique. If any party should default in its obligations under this Agreement, the
parties each acknowledge that it would be extremely impracticable to measure the
resulting damages; accordingly, the nondefaulting party, in addition to any
other available rights or remedies, may xxx in equity for specific performance
without the necessity of posting a bond or other security, and the parties each
expressly waive the defense that a remedy in damages will be adequate.
4.13. RECOVERY OF LITIGATION COSTS. If any legal action or any arbitration or
other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default or misrepresentation in connection with any
of the provisions of this Agreement, the successful or prevailing party or
parties shall be entitled to recover as an element of their damages, reasonable
attorneys' fees and other costs incurred in that action or proceeding, in
addition to any other relief to which they may be entitled.
4.14. SURVIVAL OF REPRESENTATIONS AND OBLIGATIONS. All representations,
warranties and agreements of the parties contained in this Agreement, or in any
instrument, certificate, opinion or other writing provided for in it, shall
survive the dissolution of the Partnership.
4.15. GENDER; NUMBER. Whenever the context of this Agreement requires, the
masculine gender includes the feminine or neuter gender, and the singular number
includes the plural.
4.16. GOVERNING LAW. This Agreement shall be construed in accordance with,
and governed by, the laws of the State of California.
4.17. VENUE. This Agreement is to be performed at Orange County, California.
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Therefore, venue for any action brought regarding the interpretation or
enforcement of this Agreement shall lie exclusively in Orange County,
California.
IN WITNESS WHEREOF, this Agreement is executed on the date first set forth above
at Orange County, California.
COMPANY:
Accesspoint Corporation, a Nevada corporation
By: /s/Xx Xxxxxx
----------------------------------
Xx Xxxxxx, Office of the President
EMPLOYEE:
By: /s/Xxxxxxx Xxxxx
----------------------------------
Xxxxxxx Xxxxx
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SCHEDULE 1
NUMBER OF PREFERRED SHARES, SERIES A, CONDITIONALLY AWARDED:
(1) After completion of a minimum of twelve (12) months of employment
with PSI: 150,000 shares
CONDITIONAL CONVERSION SCHEDULE:
The following conversion schedule shall outline various business development
goals under the direct influence and responsibility of Employee and shall
require achievement, in accordance with the terms and conditions of this
Agreement, of those milestones outlined below.
Milestone 1. The Employee shall have the right to convert 150,000
Preferred Shares upon attaining the following business
development goals for PSI:
(a) Employee shall be responsible for overseeing all duties of
operations of risk and underwriting division as Vice President
of Operations for Processing Source International, exercising
all due diligence and expertise in the discharge of the
aforementioned duties.
(b) Employee shall perform aforementioned duties and
responsibilities sufficient to allow PSI to achieve its
estimated twelve month new account and revenue projection
totals of a minimum of twenty thousand (20,000) new accounts
and seventeen million four hundred thousand ($17,400,000)
dollars in gross revenues. Furthermore, the business
development division shall continue to grow its book of
business and the underwriting division shall maintain its
ability to keep up with account services for a period of
thirty (30) days after the achievement of the above described
milestones.
The time attainment requirements for Employee's achievement of
the foregoing business development goals and objectives shall
be twenty four (24) months from the effective date of this
Agreement.
ADDRESS OF EMPLOYEE FOR PURPOSE OF NOTICE AND OTHERWISE:
Xxxxxxx Xxxxx
0000 Xxxxxxx Xxxxxx #000
Xxxx Xxxxxxxxx, XX 00000
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