Executive Employment Agreement - Ace Cash Express Inc. and Jay B. Shipowitz
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement"), dated as of July 1, 2004 (the
"Effective Date"), is between Ace Cash Express, Inc., a Texas corporation (the
"Company"), and Jay B. Shipowitz, an individual resident of the State of Texas
("Executive"). The Company and Executive are collectively referred to in this
Agreement as the "Parties."
WHEREAS, the Company desires to continue to employ Executive, and Executive
desires to accept that continued employment, as set forth in this Agreement.
In consideration of the mutual covenants expressed below and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties agree as follows:
1. Employment. As of the Effective Date, Executive shall be employed by the
Company, and the Company shall employ Executive, on the terms and
conditions expressed in this Agreement.
(a) Duties. Executive's title and position shall be Chief Executive
Officer of the Company. Executive's duties shall be those that are
described in the Company's Bylaws in effect from time to time, those
customarily performed by an executive acting in that capacity, and
those that may be designated or assigned to him from time to time by
the Board of Directors of the Company (the "Board") consistent with
that title and position. Executive's office shall be at the
Company's principal place of business in the Dallas-Fort Worth
metropolitan area.
(b) Full-Time Employee. Executive shall devote his full business time
(except for permitted time off and absence for any illness or
disability), attention, skills, and best efforts to advance the
Company's business, interests, and affairs, subject to the direction
of the Board, and perform his duties under this Agreement. Executive
may, however, engage in civic, charitable, and professional or trade
activities and serve on the board of directors or board of managers
of other entities if (i) none of those activities or those other
entities' businesses is adverse to the Company's interest and (ii)
none of those activities or service materially interferes with the
performance of his duties under this Agreement and his other duties
to the Company and its shareholders.
2. Term. The term of Executive's employment under this Agreement (the "Term")
shall be as follows:
(a) Initial Term. The Term commences on the Execution Date and shall
expire at 11:59 p.m. (Central time) on the day preceding the date
that is the third anniversary of the Effective Date, subject to the
extension provided in Section 2(b), unless terminated earlier under
Section 5.
(b) Extended Term. Upon the expiration of each 12-month period during
the initial term described in Section 2(a) or upon the expiration of
each 12-month period during any subsequent extended term described
below in this Section 2(b), the Term shall be extended, without the
need for any action by either Party, for an
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additional consecutive 12 months, unless (i) terminated under
Section 5 or (ii) either Party gives written notice to the other, at
least 90 days before the end of that initial term or extended term,
that the notifying Party does not wish to extend the Term. If such a
notice of non-extension is timely given, the Term will expire at the
end of the initial term or extended term in effect at the time of
that notice (unless terminated earlier under Section 5).
3. Compensation.
(a) Base Salary. During the Term the Company shall pay Executive for his
services and performance of his obligations hereunder a base salary,
payable in accordance with the Company's normal payroll procedures,
at the annual rate of $450,000. Executive's base salary in effect
from time to time, exclusive of any other compensation under this
Agreement, is hereinafter called the "Base Salary." The Base Salary
will be adjusted from time to time during the Term as necessary to
reflect any increases in Base Salary that are determined by the
Compensation Committee of the Board (the "Committee") in its sole
discretion. The Committee will review the Base Salary at least
annually, no later than the beginning of each fiscal year of the
Company ("Fiscal Year"), during the Term.
(b) Annual Bonus Opportunity. The Company shall afford Executive an
opportunity to receive additional cash compensation, as an incentive
bonus, relating to Executive's employment under this Agreement for
each Fiscal Year during the Term ("Annual Bonus Opportunity"). The
Annual Bonus Opportunity will include a "target" bonus, based on
Executive's achievement of the objectives or goals established by
the Committee for the applicable Fiscal Year, of an amount equal to
75% of the Base Salary. The Committee will discuss proposed
performance objectives or goals with Executive, but may establish
those objectives or goals in its sole discretion. The additional
cash compensation, however, will not be guaranteed, and the amount
of additional cash compensation earned by Executive (if any) under
the terms of the Annual Bonus Opportunity will depend upon
Executive's level of performance, as determined by the Committee.
(c) Participation in Benefit Plans; Additional Benefit.
(i) Executive shall be entitled to participate in all employee
benefit plans and arrangements offered generally to active
senior executives of the Company as of the Effective Date, or
any other health and insurance, disability, and other welfare
benefit plans, or savings, deferred competition, retirement or
pension, or death benefit plans or arrangements provided or
available generally to active executives of the Company with
the title or position of at least Senior Vice President of the
Company in effect from time to time during the Term
(collectively, the "Benefit Plans"). Executive's participation
in any or all of the Benefit Plans, however, shall be subject
to the terms and conditions of the Benefit Plans as they may
hereafter be amended or restated (or replaced or discontinued)
by the Company, including his satisfaction of all applicable
eligibility
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requirements and vesting provisions of the Benefit Plans and
including the discretion of the Committee or other authorized
person or persons administering any of the Benefit Plans as to
the scope of Executive's participation; except that (A)
Executive's participation will be on terms no less favorable
than the participation of any other active executive officer
of the Company with the title or position of at least Senior
Vice President, other than as provided in the following
clauses (B) and (C), (B) the exercise of such discretion
cannot impair Executive's benefits described in clauses (1)
and (2) below, and (C) such discretion can extend even to
providing no benefit to Executive under any Benefit Plan
described in clause (3) below. The benefits to Executive under
the Benefit Plans shall include the following, or comparable
benefits, from the Company: (1) an annual automobile allowance
equal to $9,000, (2) the payment of all insurance premiums for
participation by Executive and his immediate family named as
dependents in the Company's medical, dental, vision,
disability, and life insurance Benefit Plans, which includes
one or more term life insurance policies covering Executive,
for the benefit of Executive's designated beneficiaries, in an
amount equal to three times Executive's Base Salary, and (3)
participation in the Company's equity-incentive plans for its
employees. Except as necessary for the Company to provide the
particular benefits described in the preceding sentence (or
comparable benefits), the Company shall not have any
obligation under this Agreement to continue any or all of the
Benefit Plans. Executive hereby acknowledges receipt of
written plan materials distributed to participants or
prospective participants in the currently effective Benefit
Plans.
(ii) Without duplication of the benefits to Executive under
subsection (i) of this Section 3(c), during the Term,
Executive shall also be entitled to the monthly payment of up
to $250 in dues for membership in or use of a local health or
social club selected by Executive, or a comparable personal
benefit from the Company.
(d) Special Restricted Stock Compensation.
(i) As of the Effective Date, the Parties are entering into a
Restricted Stock Agreement in accordance with and subject to
the terms of the Company's 1997 Stock Incentive Plan, as
amended (the "Plan"), under which the Company is issuing and
selling to Executive, for $0.01 per share, 50,000 shares of
the Company's Common Stock, $0.01 par value ("Common Stock"),
as a Restricted Stock Award (as defined in the Plan). That
Restricted Stock Agreement is generally in the form approved
by the Committee for annual incentive grants of Restricted
Stock Awards, and has the other terms described in subsection
(iii) of this Section 3(d).
(ii) Each time (if ever) during the Term that a Trading Price
Threshhold (as defined below) is first satisfied, the Company
will enter into a Restricted Stock Agreement in accordance
with and subject to the Plan, or any
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successor employee stock incentive plan (the "Successor
Plan"), under which the Company will issue and sell to
Executive, if Executive desires, for $0.01 per share, 40,000
shares of Common Stock as a Restricted Stock Award. Each such
Restricted Stock Agreement will generally be in the form
approved by the Committee for annual incentive grants of
Restricted Stock Awards and will have the other terms
described in subsection (iii) of this Section 3(d). For this
purpose, a "Trading Price Threshhold" means the closing price
of a share of Common Stock on The Nasdaq Stock Market (or on a
national securities exchange if the Common Stock is then so
listed) first remaining at or above each of $33.00, $39.00,
$45.00, $51.00, or $57.00 for any 30 consecutive trading days
or any 30 trading days within a 45-consecutive-trading-day
period. In addition, unless a Restricted Stock Award has
already been granted because the $57.00 Trading Price
Threshhold has been satisfied, upon the earlier of either (A)
a change in control or change of control of the Company as
defined in the Restricted Stock Agreement (a "Change of
Control"), or (B) the Company's entering into a binding
written agreement to effect a transaction that, when
consummated, would be a Change of Control (a "Control
Transaction Agreement"), an additional (i.e., the next)
Trading Pricing Threshhold shall be deemed to have been
satisfied for the purpose of the first sentence of this
subsection (ii) of this Section 3(d).
(iii) The Restricted Stock Agreements described above in this
Section 3(d) provide or will provide that (A) if entered into
before July 1, 2006, 15% of the shares subject to the
Restricted Stock Award will be released from forfeiture and
transfer restrictions under the Restricted Stock Agreement
("Vest") one month after the date of grant, and an additional
17% of those shares will Vest on each anniversary of the date
of grant so long as the conditions set forth therein are
satisfied, (B) if entered into on or after July 1, 2006, the
shares subject to the Restricted Stock Awards shall Vest in
equal installments on the date that is one month after the
date of grant and on each July 1 thereafter to (and including)
July 1, 2011 (except that if the date of grant is between June
2 and July 1, the Vesting will occur on the date that is one
month after the date of grant instead of the next July 1) (so
that, for example, if a Restricted Stock Award were granted on
September 1, 2008, 25% of the shares subject to the Restricted
Stock Award would Vest on October 1, 2008, and an additional
25% of those shares would Vest on each of July 1, 2009, 2010,
and 2011; and, for another example, if a Restricted Stock
Award were granted on June 15, 2009, 50% of the shares subject
to the Restricted Stock Award would Vest on July 15, 2009, and
an additional 25% of those shares would Vest on each of July
1, 2010 and 2011) so long as the conditions set forth in the
Restricted Stock Agreement are satisfied, (C) in addition to
any other events on which the shares subject to the Restricted
Stock Award will or may Vest, if a Change of Control occurs,
all of the shares subject thereto that have not yet Vested
shall Vest upon the occurrence of that Change of Control, (D)
if entered into upon a Change of Control in accordance with
clause (A) of the last sentence of subsection (ii) of this
Section 3(d), all of the shares subject to
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that Restricted Stock Award will Vest one month after the date
of grant, instead of the maximum five-year period of Vesting
that would otherwise apply, or (E) if entered into upon a
Control Transaction Agreement in accordance with clause (B) of
the last sentence of subsection (ii) of this Section 3(d), all
of the shares subject to that Restricted Stock Award will Vest
upon the occurrence of the Change of Control contemplated by
that Control Transaction Agreement (as originally entered into
or as may be amended or supplemented), instead of the maximum
five-year period of Vesting that would otherwise apply, but
all of the shares subject to that Restricted Stock Award will
be forfeited to the Company if the Change of Control
contemplated by that Control Transaction Agreement (as
originally entered into or as may be amended or supplemented)
does not occur within one year after the date of grant.
(iv) The Company will reserve the 200,000 shares of Common Stock
issuable under subsection (ii) of this Section 3(d) for
issuance as Restricted Stock Awards under the Plan or the
Successor Plan.
(v) The numbers of shares of Common Stock to be issued and sold as
one or more Restricted Stock Awards and the Trading Price
Threshholds shall be adjusted to reflect or correspond with
any changes in the Common Stock after the Effective Date by
stock split or subdivision, reverse stock split, or stock
combination.
(vi) Nothing in Section 3(c) or this Section 3(d) is intended to
limit the Company's right to grant options or Restricted Stock
Awards under the Plan or the Successor Plan to Executive. The
Committee or the Board may make such additional grants to
Executive under the Plan or the Successor Plan as it, in its
sole discretion, may determine.
(e) Paid Time Off. Executive shall be entitled to at least 20 business
days of paid vacation and time off, in accordance with the Company's
applicable policies, practices, and procedures in effect from time
to time during the Term ("PTO"), for each Fiscal Year. PTO shall,
however, be prorated in any Fiscal Year during which Executive is
employed under this Agreement for less than the entire Fiscal Year,
in accordance with the number of days in that Fiscal Year during
which Executive is so employed.
(f) Directors' and Officers' Liability Insurance. The Company will use
commercially reasonable efforts to maintain throughout the Term one
or more policies of directors' and officers' liability insurance, in
an amount of at least $10 million, that includes coverage of
Executive as an executive officer of the Company.
(g) Tax Withholding. The Company may deduct from any compensation or any
other amount payable to Executive under this Agreement social
security (FICA) taxes and all federal, state, municipal, or other
such taxes or governmental charges as may now be in effect or that
may hereafter be enacted or required.
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4. Reimbursement. Executive shall be entitled to reimbursement from the
Company, in accordance with the Company's relevant policies, practices,
and procedures, for all reasonable business expenses incurred by Executive
in performing his duties under this Agreement.
5. Termination of Employment.
(a) Death. Executive's employment shall terminate, without the need for
any action by the Company, upon Executive's death.
(b) Disability. If a Disability (as defined below) of Executive occurs
during the Term, the Company may notify Executive of the Company's
termination of, or its intention to terminate, Executive's
employment under this Agreement for Disability. In that event, the
Executive's employment shall terminate effective on the date such
notice of termination is given to Executive or on any later date as
may be specified in such notice (the "Disability Effective Date").
In this Agreement "Disability" means:
(i) a long-term disability, as defined in the Company's applicable
Benefit Plan as then in effect; or
(ii) if the Company does not maintain or participate in a
disability plan or policy for the benefit of the Company's
employees, then Executive's inability reasonably to perform
his duties under this Agreement because of any medically
determinable physical or mental impairment that (A) can
reasonably be expected to result in death or (B) has lasted or
can reasonably be expected to last for at least 90 consecutive
days or for at least 90 days in any 120-consecutive-day
period. In this circumstance, the existence of a Disability
shall be determined by the Board, in its sole and absolute
discretion, upon receipt of competent medical advice from a
qualified physician selected by or acceptable to the Committee
or the Board. In this circumstance, Executive shall, if there
is any question about his Disability, submit to a physical
examination by a qualified physician selected by the Board.
(c) Termination by the Company for Cause. The Company may terminate
Executive's employment under this Agreement for Cause (as defined
below) as follows:
(i) Cause Defined. "Cause" means any of the following:
(A) Any material breach or violation by Executive of any of
his material obligations under this Agreement or any of
the Company's material policies (other than as described
below in clause (B), clause (C), or clause (D) of this
subsection (i) of Section 5(c) and other than because of
a Disability) if that breach or violation is not cured
or remedied within 30 days after the
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Board's written notice to Executive describing that
breach or violation;
(B) any act or omission by Executive, other than one that is
inadvertent, that, in the good-faith judgment of the
Board, has had or is having a material adverse impact on
the Company's business interests or reputation;
(C) Executive is convicted of, or pleads nolo contendere to
any allegation of, fraud, embezzlement, theft, or other
felony (excluding a traffic violation); or
(D) any material breach or violation by Executive of any of
his covenants in Sections 8, 9, and 10 (the "Restrictive
Covenants"); except that if the breach or violation is
or was of any covenant in Section 10, such breach or
violation is also not cured or remedied within 30 days
after the Board's written notice to Executive describing
that breach or violation.
"Cause" will not exist, however, solely because of the
Company's financial performance or results, any decrease in
the market price of the Common Stock, or any general
dissatisfaction on the Board's part with Executive's
performance.
(ii) Required Notice. A termination for Cause shall be effective
only if the Board gives Executive written notice of
termination for Cause, describing Executive's acts or
omissions that are believed to constitute Cause.
(d) Termination by the Company without Cause. The Company may terminate
Executive's employment under this Agreement without Cause, for any
or no reason, before the expiration of the Term. The expiration of
the Term because of the Company's written notice of non-extension of
the Term under Section 2(b) shall not be deemed a termination
without Cause.
(e) Termination by Executive. Executive may terminate his employment
under this Agreement, for any or no reason, before the expiration of
the Term; except that Executive may not terminate his employment
under this Section 5(e) under circumstances in which the Company:
(i) has given notice of termination of, or notice of its intention
to terminate, Executive's employment for Cause under Section
5(c), or
(ii) may give notice of termination of, or notice of its intention
to terminate, Executive's employment for Cause under Section
5(c), unless (for the purpose of this clause (ii) only) the
Company has not given such notice despite its having had, for
over 30 days, actual knowledge of facts or circumstances that
would entitle it to give such notice; provided, however, that
(A) the Company must give notice to Executive of the Company's
determination to exercise its rights under this clause (ii)
within ten days
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following Executive's notice to the Company of Executive's
termination of his employment under this Agreement, and (B) if
Executive challenges the right of the Company to terminate his
employment for Cause under this Agreement pursuant to this
clause (ii), then the Company shall have the burden of proof
to show that the Company only acquired the above actual
knowledge during the 30-day period preceding the date on which
Executive's notice of termination was given.
Also, the expiration of the Term because of Executive's written
notice of non-extension of the Term under Section 2(b) shall not be
deemed a termination under this Section 5(e). A termination by
Executive under this Section 5(e) is an "Executive Termination."
(f) Notice of Termination. Any termination of the Executive's employment
under this Agreement by the Company or by Executive (other than a
termination under Section 5(a) or a notice of non-extension under
Section 2(b)) shall be communicated by a written notice to the other
Party which, in addition to complying with any other applicable
requirement in this Section 5, indicates the specific termination
provision in this Agreement relied upon and specifies the Employment
Termination Date (as defined in Section 5(g)).
(g) Employment Termination Date. "Employment Termination Date" means the
effective date of termination of the Executive's employment under
this Agreement, which shall be (i) if Executive's employment is
terminated by his death, the date of his death, (ii) if the
Executive's employment is terminated because of his Disability, the
Disability Effective Date, (iii) if Executive's employment is
terminated by the Company, the date specified in the notice of
termination, which may in no event be earlier than the date such
notice is given, (iv) if Executive's employment is terminated by an
Executive Termination, the date specified in the notice of
termination, which may not be later than 60 days after the date on
which the notice of termination is given, and (v) if Executive's
employment is terminated by expiration of the Term because of a
notice of non-extension under Section 2(b), the date on which the
Term expires.
(h) Deemed Resignation of Other Positions. Executive agrees that if,
upon termination of his employment under this Agreement, he is a
member of the Board or an officer or a director of any of the
Company's subsidiaries, he will, unless the Parties otherwise agree,
be deemed to have resigned from any or all such other positions
effective as of the Employment Termination Date.
6. Rights and Obligations upon Termination of Employment.
(a) Termination for Cause. If the Executive's employment under this
Agreement is terminated by the Company for Cause, then Executive
shall be entitled only to the following:
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(i) Any amounts payable to Executive under the terms of any of the
applicable Benefit Plans in effect on the Employment
Termination Date; and
(ii) any amounts due but not yet paid to Executive under this
Agreement by the Company.
(b) Termination without Cause; Death; Disability. If Executive's
employment is terminated by (x) the Company without Cause or as the
result of Executive's Disability, or (y) Executive's death, then if
Executive is not entitled to payments or benefits under the
Change-in-Control Severance Agreement (as defined below in Section
6(d)), Executive (or in the case of his death, his estate, heirs, or
legatees) shall be entitled to the following:
(i) The continued payment of an amount equal to Executive's Base
Salary as of the date immediately preceding the Employment
Termination Date for 24 consecutive months following the
Employment Termination Date, payable in accordance with the
Company's normal payroll procedures;
(ii) an amount equal to the annual bonus for the Fiscal Year in
which the employment-termination occurs that the Committee in
good faith determines or estimates (based on Executive's
performance during the Fiscal Year up to the Employment
Termination Date and other factors) that Executive would have
earned (under his Annual Bonus Opportunity), if any, if he had
remained employed for the entire Fiscal Year, prorated for the
number of days in the Fiscal Year during which Executive was
employed, with such amount to be paid to Executive on the date
that the annual bonus would have otherwise been payable if
Executive had remained employed by the Company;
(iii) either:
(A) except in the case of Executive's death, if Executive
elects and maintains continued coverage under the
Consolidated Omnibus Benefits Reconciliation Act of 1985
and corresponding regulations ("COBRA"), then amounts
equal to the premiums paid or payable by Executive for
coverage under COBRA for himself and his eligible
covered dependents (if any) for up to 18 consecutive
months after the Employment Termination Date and,
thereafter, the continued coverage of Executive under
the Company's group health or medical plan, or similar
coverage arranged for by the Company, for an additional
six consecutive months; except that these payments and
additional coverage shall expire or terminate
immediately upon Executive's becoming eligible for
coverage under another employer's benefits plan or
policy; or
(B) in the case of Executive's death, if Executive's
eligible covered dependents (if any) who are qualified
beneficiaries as the result of
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his death elect and maintain continued coverage under
COBRA, then amounts equal to the premiums paid or
payable by those dependents for coverage under COBRA for
up to 24 consecutive months after the Employment
Termination Date;
(iv) except in the case of Executive's death, the continued payment
to or for the benefit of Executive of amounts equal to (A) the
Company's costs associated with Executive's coverage under the
Benefit Plans described in subsection (i) of Section 3(c),
except for those benefits to be continued in accordance with
subsection (iii) of this Section 6(b), and (B) the Company's
payments under subsection (ii) of Section 3(c), in each case
as of the date immediately preceding the Employment
Termination Date for 24 consecutive months following the
Employment Termination Date, payable in accordance with the
Company's normal procedures in effect as of the date
immediately preceding the Employment Termination Date; and
(v) the vesting of all theretofore unvested outstanding stock
options, and the termination of or release from forfeiture and
transfer restrictions on all outstanding restricted stock
still subject to such restrictions, held by Executive on the
date immediately preceding the Employment Termination Date
(with this provision being deemed, as necessary, an amendment
to each stock option agreement and restricted stock agreement
between the Parties).
(c) Executive Termination. If Executive's employment is terminated by
Executive under an Executive Termination, then if Executive is not
entitled to payments or benefits under the Change-in-Control
Severance Agreement, Executive shall be entitled to the following:
(i) The continued payment of an amount equal to Executive's Base
Salary as of the date immediately preceding the Employment
Termination Date for 18 consecutive months following the
Employment Termination Date, payable in accordance with the
Company's normal payroll procedures;
(ii) if Executive and his eligible covered dependents (if any) who
are qualified beneficiaries as the result of the Executive
Termination elect and maintain continued coverage under COBRA,
then amounts equal to the premiums paid or payable by
Executive and those dependents for coverage under COBRA for up
to 18 consecutive months after the Employment Termination
Date; except that these payments shall expire or terminate
immediately upon Executive's becoming eligible for coverage
under another employer's benefits plan or policy; and
(iii) the continued payment to or for the benefit of Executive of
amounts equal to (A) the Company's costs associated with
Executive's coverage under the Benefit Plans described in
subsection (i) of Section 3(c), except for those benefits to
be continued in accordance with subsection (ii) of this
Section 6(c), and (B) the Company's payments under
subsection(ii) of
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Section 3(c), in each case as of the date immediately
preceding the Employment Termination Date for 18 consecutive
months following the Employment Termination Date, payable in
accordance with the Company's normal procedures in effect as
of the date immediately preceding the Employment Termination
Date.
(d) Any payments or reimbursements under Section 6(b) or Section 6(c),
whichever is applicable, shall not be deemed the continuation of
Executive's employment for any purpose. The Company's obligations
under Section 6(b) or Section 6(c), whichever is applicable, will
not negate or reduce (i) any obligation that the Company may have to
Executive or his covered dependents under COBRA, or (ii) any amounts
due but not yet paid to Executive under this Agreement by the
Company. Further, the Company may at any time make a lump-sum
payment of all or any part of the amounts, or the remaining amounts,
due to Executive under Section 6(b) or Section 6(c), whichever
is applicable. Notwithstanding the provisions of Section 6(b) or
Section 6(c), whichever is applicable, if Executive is entitled to
benefits under the Change-in-Control Executive Severance Agreement
dated as of the Effective Date between the Parties, as it may
hereafter be amended or supplemented and in effect, or any similar
superseding agreement (the "Change-in-Control Severance Agreement"),
then Executive shall be entitled to the benefits under the
Change-in-Control Severance Agreement instead of the payments and
benefits under Section 6(b) or Section 6(c), whichever is
applicable.
(e) General Release; Compliance with Restrictive Covenants. The payment
or provision of any amounts or benefits under this Section 6 shall
be conditioned upon both (i) the Company's receipt of an irrevocable
Settlement Agreement, General Release, and Covenant Not to Sue, in
substantially the form of Addendum A attached to this Agreement (the
"Release"), that is executed and performed by Executive (or in the
case of Executive's death, his estate, heirs, or legatees), and (ii)
Executive's compliance with the Release and the Restrictive
Covenants during the applicable time periods set forth therein. The
Company may discontinue or reduce the amounts or benefits under this
Section 6 if the Board reasonably believes, or there is established
by arbitration or by any legal or injunctive proceeding permitted by
Section 11, that there is or has been any breach or violation by
Executive of the Release or any of the Restrictive Covenants (except
that if the breach or violation is or was of any covenant in Section
9, such breach or violation is also not cured or remedied within 30
days after the Board's written notice to Executive describing that
breach or violation); and Executive shall not be entitled to any
such amounts or benefits that are not so paid or provided. Any such
discontinuance or reduction shall not preclude the Company from
seeking any arbitration award for damages or any legal or injunctive
relief permitted by Section 11.
(f) No Mitigation. Executive shall not be obligated to seek or secure
new employment or to become self-employed after the Employment
Termination Date, and except as stated in Section 6(b) or Section
6(c) (whichever is applicable), Section 6(e), and Section 11(e),
there shall be no offset against any severance
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payment or other benefit under this Agreement on account of any
remuneration or benefits from any subsequent employment (including
self-employment) that Executive may obtain after the Employment
Termination Date.
7. No Violation of Other Obligation. Each Party represents and warrants that
neither that Party's execution, delivery, and performance of this
Agreement nor that Party's execution, delivery, and performance of any
agreement, instrument, or other document or obligation contemplated under
this Agreement will result in a violation of any provision of, or
constitute a default under, any contract, agreement, instrument, or
obligation to which that Party is a party or by which that Party is bound.
8. Confidential Matters. The Company promises to disclose to Executive, and
Executive acknowledges that in and as a result of his employment with the
Company he will receive, have access to, use, acquire, or add to,
Confidential Matters (as defined below).
(a) "Confidential Matters" means, collectively, all information that the
Company or any Subsidiary (as defined below) deems or treats as
confidential, proprietary to it, or its trade secret and all
information of any other Person having any business or commercial
relationship with the Company or any Subsidiary that the Company or
any Subsidiary has acknowledged as, or agreed or otherwise become
obligated to treat as, confidential or proprietary to that other
Person or that other Person's trade secret. "Confidential Matters"
includes all of the following of the Company and the Subsidiaries:
unique business methods and strategies, processes, confidential or
proprietary software, product and design development, programs and
programming codes, pricing methods, operating techniques and
practices, corporate financial information, customer and supplier
requirements and other information, customer and potential customer
lists and marketing techniques, systems, procedures, manuals,
confidential reports, protected and protectable intellectual
property, equipment and methods used and preferred by customers and
the fees paid by them, personnel and employee records and
information, and compilations of information, records, and
specifications. "Subsidiary" means a corporation or other entity,
whether incorporated or unincorporated, of which at least a majority
of the Voting Securities is owned, directly or indirectly, by the
Company (and for this purpose, "Voting Securities"means securities
or other interests having by their terms ordinary voting power to
elect members of the board of directors of a corporation or
individuals serving similar functions for a noncorporate entity).
(b) As a condition of employment and continued employment, Executive (i)
shall keep confidential all Confidential Matters, (ii) shall not
directly or indirectly make known, divulge, furnish, or reveal to
any other Person any Confidential Matters or any knowledge or
information with respect thereto, and (iii) shall not use, or cause
or enable the use of, any Confidential Matters for his personal
benefit or the benefit of any other Person; except, in any case
during employment, in the course of Executive's performance of his
duties to, and in furtherance of the interests of, the Company or
with the Company's prior written consent. During his employment,
Executive shall comply with all policies and procedures established
by the Company, and all reasonable requests of the Company, to
protect
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Confidential Matters and prevent the improper disclosure or
dissemination of Confidential Matters to, or the misuse of
Confidential Matters by, any other Person.
(c) Executive acknowledges that the Company does not voluntarily
disclose Confidential Matters, but takes precautions to prevent
their dissemination and use except pursuant to suitable safeguards.
Executive further acknowledges that Confidential Matters (i) are
secret and not known in the industry, except when disclosed subject
to confidentiality agreements, obligations, or safeguards, (ii) have
been and will be entrusted to Executive because Executive is a
fiduciary of the Company, (iii) have been and will be developed by
the Company or Executive for and on behalf of the Company through
substantial expenditures of time, effort, and money and are and will
be used in the Company's business, (iv) give the Company an
opportunity to obtain an advantage over competitors who do not know
or use the Confidential Matters, and (v) are of such value and
nature as to make it reasonable and necessary for Executive and the
Company to protect and preserve the confidentiality of the
Confidential Matters.
(d) Executive acknowledges and agrees that the Confidential Matters are
valuable, special, and unique assets of the Company, the disclosure
of which could cause substantial injury and loss of profits and
goodwill to the Company. The Confidential Matters to be prepared or
compiled by Executive or the Company or furnished to Executive
during employment shall be the sole and exclusive property of the
Company and shall not be removed from the Company's premises except
in the course of Executive's performance of his duties to, and in
furtherance of the interests of, the Company or with the prior
written consent of the Company. Upon the cessation of employment,
all Confidential Matters (in any and all forms and formats), all
documents and items related to Confidential Matters, and all other
property of the Company that Executive may then possess or control
shall be returned to the Company as soon as practicable, and none
(including any copies) shall be retained by Executive.
(e) If Executive is served with any subpoena or other legal process or
notice, or is otherwise requested, to produce or divulge, directly
or indirectly, any Confidential Matters by any Person in any formal
or informal proceeding, including any interview, deposition,
administrative or judicial hearing, or trial or arbitration,
Executive shall immediately notify and deliver a copy of the
subpoena, process, notice, or request to the Company. Executive
further irrevocably nominates, constitutes, and appoints the Company
(including any attorney retained by the Company) as Executive's true
and lawful attorney-in-fact, to act in Executive's name, place, and
stead, to do and perform any act which Executive might perform,
including to institute, prosecute, defend, quash, compromise,
settle, arbitrate, release, and dispose of any and all legal,
equitable, administrative or arbitral hearings, actions, suits,
attachments, subpoenas, claims, levies, or other proceedings, or
otherwise engage in or defend any and all litigation in connection
with or relating to any request to disclose, directly or indirectly,
any Confidential Matters. Nevertheless, the Company shall be under
no obligation to act as
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Executive's attorney-in-fact and will not do so without written
notice to Executive.
9. Covenants Not to Compete, Solicit, or Interfere. As a material inducement
for Executive's receipt of, and the Company's agreement to provide to
Executive, the Confidential Matters, Executive agrees that during his
employment with the Company and for a period of 24 consecutive months
after the date of cessation of employment (unless that cessation of
employment is the result of a termination by the Company for Cause or an
Executive Termination, in which case the time period shall be 18
consecutive months after the date of cessation of employment), Executive
shall not, directly or indirectly:
(a) (i) engage in, work for, conduct, or manage, in any capacity similar
or related (directly or indirectly) to Executive's Job
Responsibilities (as defined below), any Competitive Business (as
defined below) or any Person that owns or conducts a Competitive
Business, or (ii) invest in or own any interest in any Competitive
Business or any Person that owns or conducts a Competitive Business;
except that Executive may acquire or own, solely as a passive
investment, less than five percent (5%) of the outstanding
securities of any issuer registered under Section 12 of the Exchange
Act so long as Executive is not a member of any control group
(within the meaning of the regulations of the Securities and
Exchange Commission) of any such issuer;
(b) employ, hire, engage, or retain, or attempt to employ, hire, engage,
or retain, any other Executive of the Company or any Subsidiary or
any Person who was an Executive of the Company or any Subsidiary
within the preceding six months, or solicit, persuade, influence, or
induce, or attempt to solicit, persuade, influence, or induce, any
other Executive of the Company or any Subsidiary to cease or leave
his or her employment with the Company or such Subsidiary; or
(c) solicit, persuade, influence, or induce, or attempt to solicit,
persuade, influence, or induce, (i) any Customer (as defined below)
to purchase services or products from any Competitive Business, or
(ii) any Customer or any Vendor (as defined below) to cease or
materially alter such Customer's or such Vendor's business or
commercial relationship with the Company or any Subsidiary to the
Company's or such Subsidiary's detriment.
In this Agreement, "Job Responsibilities" means any and all of those
duties and responsibilities that were part of Executive's job or position
with the Company or any Subsidiary within the 24 months preceding the
cessation of employment, including each and all kinds of work, job duties,
or job responsibilities directly or indirectly received, accepted,
assigned, delegated, directed, supervised, attempted, performed,
undertaken, accomplished, or conducted by or to Executive (as applicable);
"Competitive Business" means any business that is or would in any way be
competitive, directly or indirectly, with any business conducted by the
Company or any Subsidiary anywhere in the Restricted Territory, if such
business is the same as, or substantially similar to, business conducted
by the Company or any Subsidiary during employment; "Restricted Territory"
means, collectively, Dallas County, Texas; each county (or equivalent
subdivision) of any
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state, district, or territory of the United States of America as to which
Executive had employment responsibilities, including supervisory
responsibility, for the Company or any Subsidiary during his employment;
and each county (or equivalent territory) adjacent to any of the preceding
counties (or equivalent territories); "Customer" means (a) during
employment, all customers of the Company or any Subsidiary with whom or
which Executive has or has had any contact within the scope of his
employment, and (b) after employment, all customers of the Company or any
Subsidiary with whom or which Executive had any contact within the scope
of his employment at any time during the 24 months preceding the cessation
of employment; and "Vendor" means (a) during employment, all suppliers or
providers of services or products to the Company or any Subsidiary
(whether for use by the Company or any Subsidiary or for sale at any
retail location of the Company or any Subsidiary) with whom or which
Executive has or has had any contact within the scope of his employment,
and (b) after employment, all suppliers or providers of services or
products to Executive or any Subsidiary (whether for use by the Company or
any Subsidiary or for sale at any retail location of the Company or any
Subsidiary) with whom or which Executive had any contact within the scope
of his employment at any time during the 24 months preceding the cessation
of employment.
10. Developments.
(a) Disclosure of Developments. Executive shall promptly disclose to the
Company all inventions, discoveries, improvements, processes,
formulas, ideas, know-how, methods, research, compositions, and
other developments, whether or not patentable or copyrightable, that
Executive, by himself or with any other person, conceives, makes,
develops, or acquires during the Term that (i) are or relate to the
properties, assets, or existing or contemplated business or research
activities of the Company, (ii) are suggested by, arise out of, or
result from, directly or indirectly, Executive's association with
the Company, or (iii) arise out of or result from, directly or
indirectly, the use of the Company's time, labor, materials,
facilities, or other resources (collectively, "Developments").
(b) Assignment and Cooperation. Executive hereby assigns, transfers, and
conveys to the Company, and hereby agrees to assign, transfer, and
convey to the Company (after as well as during the Term), all of his
right and title to and interest in all Developments. Executive
shall, from time to time upon the request of the Company (after as
well as during the Term), execute and deliver any and all
instruments and documents and take any and all other actions that,
in the judgment of the Company or its counsel, are or may be
necessary or desirable to document any such assignment, transfer,
and conveyance to the Company or to enable the Company to file and
process applications for, and to acquire, maintain, and enforce, any
and all patents, trademarks, registrations, or copyrights with
respect to any of the Developments, or to obtain any extension,
validation, re-issue, continuance, or renewal of any such patent,
trademark, registration, or copyright. The Company will be
responsible for the preparation of any such instrument or document
and for the implementation of any such proceedings and will, in
accordance with the Company's policies, practices, and procedures,
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reimburse Executive for all reasonable expenses incurred by him in
complying with this Section 10.
11. Stipulations; Reformation; Severability; Injunctive Relief.
(a) Stipulations. Executive stipulates and agrees that:
(i) Adequate consideration exists for the Restrictive Covenants;
(ii) The Restrictive Covenants are necessary to insure the
preservation and continuity of the Company's business and
goodwill;
(iii) The time period(s) of the respective Restrictive Covenants are
reasonable temporal restraints;
(iv) The scope of the activities restricted by the Restrictive
Covenants is reasonable; and
(v) The enforcement of any of the Restrictive Covenants will not
interfere with Executive's livelihood.
(b) Reformation. The Parties hereto intend all provisions of the
Restrictive Covenants to be enforced to the fullest extent permitted
by law. Accordingly, should a court of competent jurisdiction
determine that the scope of any provision of the Restrictive
Covenants is too broad to be enforced as written, based on their
duration, geographic limitations, scope of activities, or otherwise,
the Parties intend that the court reform the provision to such
narrower scope as it determines to be reasonable and enforceable.
The Parties agree that each of the agreements set forth in the
Restrictive Covenants constitutes a separate agreement independently
supported by good and adequate consideration, shall be severable
from the other provisions of this Agreement, and (with this Section
11) shall survive the expiration or termination of this Agreement or
Executive's employment under this Agreement.
(c) Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws, (i)
such provision shall be fully severable, (ii) this Agreement shall
be construed and enforced as if such illegal, invalid, or
unenforceable provision never constituted a part of this Agreement,
and (iii) the remaining provisions of this Agreement shall remain in
full force and effect and shall not be affected by the illegal,
invalid, or unenforceable provision or by its severance from this
Agreement. Furthermore, in lieu of such illegal, invalid, or
unenforceable provision, there shall be added as part of this
Agreement a provision as similar in its terms to such illegal,
invalid, or unenforceable provision as may be possible and be legal,
valid, and enforceable.
(d) Injunctive Relief. Executive acknowledges the difficulty in
forecasting damages arising from the breach of any of the
Restrictive Covenants and that the Company may be irreparably harmed
thereby. Therefore, Executive agrees that the Company shall be
entitled to elect to enforce each of the Restrictive Covenants by
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means of injunctive relief or an order of specific performance and
that such remedy shall be available in addition to all other
remedies available at law or in equity to the Company, including the
recovery of damages from Executive's agents or affiliates involved
in such breach.
(e) Restoration of Equity Severance. Executive acknowledges and agrees
that the Restrictive Covenants are material terms of his
relationship with the Company under this Agreement, not only during
his employment, but also thereafter. Accordingly, Executive agrees
that, after the Employment Termination Date, if he fails to comply
with, or breaches or violates, any of the Restrictive Covenants
(and, with respect to any of the covenants in Section 9 only, such
noncompliance or breach or violation continues after the 30-day
notice and cure period provided for in Section 6(e)), in any case as
reasonably determined by the Board, irrespective of whether the
Restricted Covenants are enforced or sought to be enforced in an
action or a proceeding between or involving the Parties, then:
(i) all theretofore unexercised Severance-Vested Options (as
defined below) then held by Executive shall be void and
non-exercisable;
(ii) all shares of Common Stock acquired by exercise of
Severance-Vested Options then held by Executive, reduced by
the Tax Effect (as defined below), shall be transferred to the
Company;
(iii) all shares of Common Stock that were Severance-Vested
Restricted Stock (as defined below) then held by Executive,
reduced by the Tax Effect, shall be transferred to the
Company; and
(iv) if Executive has sold, transferred, or otherwise disposed of
any shares of Common Stock acquired by exercise of
Severance-Vested Options or any shares of Common Stock that
were Severance-Vested Restricted Stock, Executive shall pay to
the Company an amount equal to (A) in the case of shares
acquired by exercise of Severance-Vested Options, the excess
of the fair market value of those shares on the date of sale,
transfer, or other disposition over the exercise or option
price paid by Executive to acquire those shares, reduced by
the Tax Effect, and (B) in the case of shares of Common Stock
that were Severance-Vested Restricted Stock, the fair-market
value of the shares of Common Stock on the Employment
Termination Date or the fair market value of the shares of
Common Stock on the date of sale, transfer, or other
disposition by Executive, whichever is greater, reduced by the
Tax Effect.
Executive agrees to execute and deliver such documents as may be
required to effect the foregoing. In this Section 11(e),
"Severance-Vested Options" are those outstanding stock options
granted to Executive on or after the Effective Date and held by
Executive on
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the date immediately preceding the Employment Termination Date the
vesting of which is accelerated under subsection (v) of Section
6(b); "Severance-Vested Restricted Stock" are those shares of
restricted stock granted to Executive on or after the Effective Date
and held by Executive on the date immediately preceding the
Employment Termination Date that are released from forfeiture and
transfer restrictions under subsection (v) of Section 6(b); and the
"Tax Effect" means the excess, if any, of (1) all federal and state
income taxes paid or payable by Executive because of, as applicable,
the exercise of Severance-Vested Options, the lapse or release of
forfeiture restrictions on the Severance-Vested Restricted Stock,
the transfer or disposition of shares of Common Stock acquired by
exercise of Severance-Vested Options (including to the Company under
this Section 11(e)), or the transfer or disposition of shares of
Common Stock that were Severance-Vested Restricted Stock (including
to the Company under this Section 11(e)), over (2) all deductions
and other federal and state income tax benefits realized or
realizable by Executive because of, as applicable, the transfer or
disposition of shares of Common Stock acquired by exercise of
Severance-Vested Options (including to the Company under this
Section 11(e)) or the transfer or disposition of shares of Common
Stock that were Severance-Vested Restricted Stock (including to the
Company under this Section 11(e)), as reasonably determined (in each
case) by the Company's independent tax accountant or advisor (and
assuming Executive's timely payment of all required taxes due). For
the purpose of determining any shares of Common Stock that Executive
may retain, and not transfer to the Company under clause (ii) or
clause (iii) of this Section 11(e), each share will be valued at the
fair-market value of a share of Common Stock at either the date of
Executive's failure to comply with, or breach or violation of, the
Restrictive Covenant (after the expiration of the notice and cure
period, if applicable) that triggers the obligation to transfer
shares to the Company or the date of the transfer to the Company
under this Section 11(e), whichever is greater.
12. Dispute Resolution; Arbitration.
(a) Judicial Disputes. Any dispute or question arising out of or
relating to any of the Restrictive Covenants or any claim by
Executive for workers' compensation benefits or unemployment
compensation benefits (a "Judicial Dispute") shall be resolved by
proceedings before any court of proper jurisdiction in accordance
with this Agreement.
(b) Arbitration Provisions. Any and all disputes or questions arising
out of our relating to this Agreement or any and all rights and
obligations hereunder, other than Judicial Disputes (collectively,
"Disputes"), between or involving the Parties shall be resolved by
final and binding arbitration in Dallas, Texas, under the National
Rules for the Resolution of Employment Disputes of the American
Arbitration Association ("AAA"), as modified below in this Section
12(b) (the "Arbitration Procedure").
(i) Except only for Judicial Disputes, the Arbitration Procedure
covers all legal and equitable claims arising out of or
relating to Executive's employment or the termination of
employment under this Agreement, including claims for
compensation or benefits; claims for breach of any agreement
or covenant, whether expressed or implied; tort claims; claims
for wrongful discharge; claims of discrimination (including
race, color,
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sex, sexual orientation or preference, religion, national
origin, age, marital status, handicap or disability, veteran
or citizenship status); claims of retaliation; claims of
sexual harassment; and claims for violation of any federal,
state, or local government statute, regulation, or ordinance.
(ii) The arbitrator shall be selected by mutual agreement of the
Parties, if possible. If the Parties fail to reach agreement
upon appointment of an arbitrator within 30 days following
receipt by one Party of the other Party's notice of desire to
arbitrate, the arbitrator shall be selected from a panel or
panels of persons submitted by the AAA. The selection process
shall be that which is set forth in the applicable rules of
the AAA, except that if the Parties fail to select an
arbitrator from one or more panels within 15 days after the
first panel is submitted to the Parties by the AAA, then the
AAA shall have the power to make an appointment.
(iii) Each Party shall share equally the fees and expenses of the
arbitrator and of the AAA.
(iv) At least 30 days before the arbitration hearing, each Party
shall give the other a brief summary of its claims and
defenses, and a list of documents and the names and addresses
of witnesses on which it intends to rely, and shall permit
reasonable access to those documents and individuals.
Additional discovery may be available on application to the
arbitrator, based on a showing of substantial need. The
Federal Rules of Procedure shall apply to discovery and
evidentiary matters as part of the arbitration.
(v) IN DECIDING THE SUBSTANCE OF THE CLAIMS AND DEFENSES, THE
ARBITRATOR SHALL APPLY THE SUBSTANTIVE LAWS OF THE STATE OF
TEXAS (EXCLUDING ANY CHOICE-OF-LAW PRINCIPLES THAT MIGHT CALL
FOR THE APPLICATION OF SOME OTHER STATE'S LAW). The arbitrator
shall have the same power to award damages and to direct
remedies, including equitable remedies like injunctive relief,
as a court sitting in the same jurisdiction.
(vi) The arbitrator's determination or award shall be final and
binding on the Parties, and judgment upon that determination
or award may be enforced in court. Except as provided in
Section 12(a), the Arbitration Procedure bars litigation in
any court by either Party of any claim that could be
arbitrated under this Arbitration Procedure. However, either
Party has the right to move in court to compel arbitration or
to confirm and enforce an arbitrator's determination or award
under this Arbitration Procedure.
(vii) The implementation of this Arbitration Procedure should not be
construed as preventing, limiting or delaying either the
Company from taking disciplinary action, including immediate
discharge, in circumstances that the Company deems appropriate
in its sole discretion or Executive from
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terminating his employment in accordance with the terms of
this Agreement.
13. Successors and Assigns; Survival of Rights and Obligations.
(a) Binding Agreement; Executive's Personal Agreement. This Agreement
shall be binding upon and inure to the benefit of Executive and his
heirs and legal representatives and the Company and its successors
and assigns. Executive's rights and obligations under this Agreement
are personal and may not be assigned or transferred in whole or in
part by Executive (except that his rights may be transferred upon
his death by will, trust, or the laws of intestacy).
(b) The Company's Successor. The Company will require any successor to
all or substantially all of the business and assets of the Company
(whether direct or indirect, by purchase, merger, consolidation or
otherwise) 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; except
that no such assumption and agreement will be required if the
successor is bound by operation of law to perform this Agreement. In
this Agreement, the "Company" shall include any successor to the
Company's business and assets that assumes and agrees to perform
this Agreement (either by agreement or by operation of law).
(c) Survival. The respective rights and obligations of the Parties under
this Agreement (including Sections 6 and 8 through 15) shall survive
the expiration or termination of the Term to the extent necessary to
give full effect to those rights and obligations.
14. Additional Obligations. During and after the Term, Executive shall, upon
reasonable notice from the Company, furnish the Company with such
information as may be in Executive's possession, and cooperate with the
Company as may reasonably be requested by the Company, in connection with
any legal or governmental proceedings in which the Company or any of its
affiliates is or may become a party. During the Term, the reimbursement of
Executive's expenses shall be governed by Section 4; after the Term, the
Company shall reimburse Executive for his reasonable expenses in
fulfilling his obligations under this Section 14.
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15. Miscellaneous.
(a) Notices. Any notice, consent, demand, request, approval, or other
communication to be given under this Agreement by one Party to the
other ("Notice") must be in writing and must be either (i)
personally delivered, (ii) mailed by registered or certified mail,
postage prepaid with return receipt requested, (iii) delivered by
same-day or overnight courier service, or (iv) delivered by
facsimile transmission, in any event to the address or number set
forth below or to such other address or number as may be designated
by either or both of the Parties from time to time in accordance
with this Section 15(a):
If to the Company: Ace Cash Express, Inc.
Attention: General Counsel
1231 Greenway Drive
Suite 600
Irving, Texas 75038
Facsimile: (972) 582-1426
If to Executive: At the address beneath
Executive's signature hereto.
Notices delivered personally or by courier service shall be deemed
given and received as of actual receipt. Notices mailed as described
above shall be deemed given and received three business days after
mailing or upon actual receipt, whichever is earlier. Notices
delivered by facsimile transmission shall be deemed given and
received upon receipt by the sender of the transmission
confirmation.
(b) Entire Agreement. This Agreement, including Addendum A (which is an
integral part of this Agreement), supersedes any and all other
agreements and understandings of any kind, either oral or written,
between the Parties with respect to the subject matter of this
Agreement and contains all of the covenants and agreements between
the Parties with respect to the subject matter of this Agreement;
except that this Agreement does not affect or negate any currently
effective stock option agreement or restricted stock agreement
between the Parties entered into under the Plan or the
Change-in-Control Severance Agreement.
(c) Modification. Except as stated in the next sentence, no change or
modification of this Agreement shall be valid or binding upon the
Parties, nor shall any waiver of any term or condition be so
binding, unless the change or modification or waiver is in writing
and signed by the Parties. Executive acknowledges that the Company
may from time to time establish, maintain, and distribute employee
handbooks or policy manuals, and officers or other representatives
of the Company may make written or oral statements relating to
personnel policies and procedures. Such handbooks, manuals, and
statements are intended only for general guidance and shall not be
deemed to change or modify this Agreement or to create any
obligations of the Company to Executive under this Agreement.
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(d) GOVERNING LAW; CONSENT TO FORUM. THIS AGREEMENT HAS BEEN NEGOTIATED,
EXECUTED, AND DELIVERED AT, AND SHALL BE DEEMED TO HAVE BEEN MADE
IN, DALLAS COUNTY, TEXAS. THIS AGREEMENT SHALL BE GOVERNED BY,
ENFORCED UNDER, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS. AS PART OF THE CONSIDERATION FOR THIS AGREEMENT, AND
REGARDLESS OF ANY PRESENT OR FUTURE DOMICILE OR PRINCIPAL PLACE OF
BUSINESS OF EXECUTIVE, EXECUTIVE HEREBY CONSENTS AND AGREES THAT THE
COURTS IN DALLAS COUNTY, TEXAS, SHALL HAVE JURISDICTION TO HEAR AND
DETERMINE ANY JUDICIAL DISPUTES BETWEEN THE PARTIES OR OTHER MATTERS
EXPRESSLY PERMITTED BY THIS AGREEMENT TO BE LITIGATED IN A COURT.
EXECUTIVE EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT AND
HEREBY WAIVES ANY OBJECTION WHICH EXECUTIVE MAY HAVE BASED UPON LACK
OF PERSONAL JURISDICTION, IMPROPER VENUE, OR FORUM NON CONVENIENS.
(e) Counterparts. This Agreement may be executed in counterparts, each
of which constitutes an original, but all of which constitute one
document.
(f) Gender. Whenever the context requires, words in this Agreement
denoting gender shall include the masculine, feminine, and neuter.
(g) Estate. If Executive dies during his employment hereunder, any
amounts due him from the Company under this Agreement as of the date
of his death shall be paid to his estate, heirs, or legatees.
(h) Waiver of Breach. Any waiver by a Party of a breach of any provision
of this Agreement by the other Party shall not operate or be
construed as a waiver of any other or any subsequent breach.
(i) Certain Defined Terms. As used in this Agreement, (i) "Person" means
an individual or any corporation, partnership, trust, unincorporated
association, or other legal entity, whether acting in an individual,
fiduciary, or other capacity, and any government, court, or other
governmental agency, (ii) "include" and "including" shall not denote
or signify any limitation, (iii) "business day" means any Monday
through Friday other than any such weekday on which the executive
offices of the Company are closed, and (iv) "Section" is a reference
to a Section in this Agreement, unless otherwise stated, and (v)
"affiliate" of a Person means any other Person controlling,
controlled by, or under common control with that first Person (and
for this purpose, "control" and correlative terms mean the power to
direct the management of the business and affairs of a Person). In
addition, the use herein of "annual" or "monthly" (or similar terms)
to indicate a measurement period shall not itself be deemed to grant
rights to Executive for employment or compensation for such period.
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(j) Captions and Section Headings. Captions and Section or subsection
headings used herein are for convenience only and are not a part of
this Agreement and shall not be used in any construction of this
Agreement.
(k) Expenses. The Company shall bear all of its expenses, including the
fees and expenses of its counsel, incurred in its negotiating and
preparing this Agreement. The Company will pay or reimburse
Executive for all of his reasonable expenses, including the
reasonable fees and expenses of his counsel, incurred in Executive's
negotiating and preparing of this Agreement.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
date first above written.
The Company: ACE CASH EXPRESS, INC.
By: /s/ WALTER E. EVANS
----------------------------
Printed Name: Walter E. Evans
Title: Senior Vice President and General Counsel
Executive: /s/ JAY B. SHIPOWITZ
--------------------------------
JAY B. SHIPOWITZ
Address: __________________________
__________________________
Facsimile: ( ) ____-_____
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ADDENDUM A
Settlement Agreement, General Release, and Covenant Not to Sue
[See attached]
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SETTLEMENT AGREEMENT,
GENERAL RELEASE, AND COVENANT NOT TO SUE
This Settlement Agreement, General Release, and Covenant Not to Sue
("Agreement") is made and entered into as of the _______ day of ____________,
20____, by and between Jay B. Shipowitz ("Executive") and Ace Cash Express,
Inc., a Texas corporation (the "Company"), both of which are hereinafter
collectively referred to as the "parties."
Recitals
WHEREAS, Executive was employed as the Company's Chief Executive Officer
pursuant to the terms and conditions of that certain Executive Employment
Agreement, dated as of July 1, 2004 (the "Employment Agreement"), by and between
Executive and the Company;
WHEREAS, Executive's employment under the Employment Agreement [SHALL
TERMINATE/HAS TERMINATED] effective ___________, 20___ (the "Termination Date");
and
WHEREAS, the parties desire to settle fully and finally, in the manner set
forth herein, all differences between them which have arisen, or which may
arise, prior to, or at the time of, the execution of this Agreement, including,
but in no way limited to, any and all claims and controversies arising out of
the Employment Agreement, the employment relationship between Executive and the
Company, and the cessation or termination thereof;
Agreement
NOW, THEREFORE, in consideration of the Recitals and the mutual promises,
covenants and agreements set forth herein, the parties covenant and agree as
follows:
1. Executive, for himself and on behalf of his attorneys, heirs,
legatees, assigns, successors, executors, and administrators, IRREVOCABLY AND
UNCONDITIONALLY RELEASES, ACQUITS, AND FOREVER DISCHARGES the Company, its
current and former parent, subsidiary, affiliated, and related corporations,
firms, associations, partnerships, limited liability companies, and other
entities, their successors and assigns, and the current and former owners,
members, shareholders, managers, directors, officers, partners, employees,
agents, attorneys, representatives, and insurers of said corporations, firms,
associations, partnerships, limited liability companies, and other entities, and
their guardians, successors, assigns, heirs, executors, and administrators
(hereinafter collectively referred to as the "Releasees"), from any and all
claims, complaints, grievances, liabilities, obligations, promises, agreements,
damages, causes of action, rights, debts, demands, controversies, costs, losses,
damages, and expenses (including, without limitation, attorneys' fees and
expenses) whatsoever (collectively, "Claims") under any municipal, local, state,
or federal law, common or statutory -- including, but in no way limited to,
Claims under the AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, 29 U.S.C. Section
621, et seq. -- for any actions or omissions whatsoever, whether known or
unknown, that are connected with or related to the Employment Agreement, the
employment of Executive by the
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Company, or the cessation or termination thereof, which existed or may have
existed prior to, or contemporaneously with, the execution of this Agreement.
Executive does not, however, release, acquit, or discharge the Releasees from
any Claim arising out of any nonperformance or failure to perform by the Company
of any of its obligations under this Agreement or any Claim not connected with
or related to the Employment Agreement, the employment of Executive by the
Company, or the cessation or termination thereof. In addition, nothing in this
Agreement constitutes any waiver or release by Executive of any rights under (a)
any applicable directors' and officers' insurance policy covering Executive, (b)
any applicable exculpation or indemnification provision under the Company's
governing corporate documents covering Executive, or (c) any applicable
equity-incentive plan of the Company, and corresponding stock option and
restricted stock agreements with the Company, under which Executive continues to
have rights or benefits that, by their terms, survive the cessation or
termination of Executive's employment. Further, nothing in this paragraph 1 or
in paragraph 2 below in any way prohibits or restricts Executive from defending
any action brought by or on behalf of any Releasee against Executive.
2. Executive, for himself and on behalf of his attorneys, heirs,
legatees, assigns, successors, executors, and administrators, COVENANTS NOT TO
SUE OR OTHERWISE CONSENT TO PARTICIPATE IN ANY ACTION AGAINST, any of the
Releasees based upon any of the Claims released in paragraph 1 of this
Agreement.
3. Executive waives and releases forever any right or rights he might
have to employment, reemployment, or reinstatement with the Company or any of
the other Releasees, except as may be provided under the terms of this
Agreement.
4. Upon the expiration of seven (7) days after Executive's execution of
this Agreement, the Company agrees to begin to pay or provide Executive the
severance payments and benefits under [SECTION 6(b)/SECTION 6(c)] of the
Employment Agreement in accordance with the surviving terms of the Employment
Agreement.
5. The parties hereto recognize that, by entering into this Agreement,
the Company and each other Releasee does not admit, and does specifically deny,
any violation of any local, state, or federal law, common or statutory. The
parties further recognize that this Agreement has been entered into in release
and compromise of any claims which might be asserted by Executive in connection
with his employment by the Company, or the termination thereof, and to avoid the
expense and burden of any litigation related thereto.
6. The parties acknowledge and agree that in the event Executive
materially breaches any provision of this Agreement, (a) Executive will
indemnify and hold the Company harmless from and against any and all resulting
damages, expense, or loss incurred by the Company (including, without
limitation, attorneys' fees and expenses), (b) Executive will immediately repay
to the Company in full any payments made to him under the provisions (including,
without limitation, paragraph 4) of this Agreement, and (c) the Company will be
entitled to file counterclaims against Executive for breach of the covenant not
to sue and may recover from Executive any payment not repaid to the Company, as
required by clause (b) of this paragraph 6, as well as any and all other
resulting actual or consequential damages.
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7. One or more waivers of a breach of any covenant, term, or provision
of this Agreement by either party shall not be construed as a waiver of a
subsequent breach of the same covenant, term, or provision, nor shall it be
considered a waiver of any other then existing or subsequent breach of a
different covenant, term, or provision.
8. If any provision or term of this Agreement is held to be illegal,
invalid, or unenforceable, (a) such provision or term shall be fully severable,
(b) this Agreement shall be construed and enforced as if such illegal, invalid,
or unenforceable provision had never constituted part of this Agreement, and (c)
the remaining provisions of this Agreement shall remain in full force and effect
and shall not be affected by the illegal, invalid, or unenforceable provision or
by its severance from this Agreement. Furthermore, in lieu of each such illegal,
invalid, or unenforceable provision or term there shall be added automatically
as a part of this Agreement another provision or term as similar to the illegal,
invalid, or unenforceable provision as may be possible and that is legal, valid,
and enforceable.
9. The parties agree that any dispute arising from or attributable to
this Agreement shall be subject to the arbitration provisions (and to the same
extent and with the same limitations) set forth in the Employment Agreement;
provided, however, notwithstanding anything set forth herein or set forth in the
Employment Agreement to the contrary, the Company shall have the right to sue
for specific performance of this Agreement and for declaratory and injunctive
relief.
10. Executive may revoke this Agreement, within seven (7) days of the
date of its execution by Executive (the "Revocation Period"), by written notice
to the Company. Executive agrees that if he revokes this Agreement, he shall
receive none of the benefits provided for under its terms or the surviving terms
of the Employment Agreement. Executive further understands and agrees that,
unless the Company receives from Executive, prior to the expiration of the
Revocation Period, written notice of his revocation of this Agreement, this
Agreement and all of its terms shall have full force and effect, and Executive
shall have forever waived his right to revoke this Agreement.
11. This Agreement and the terms of the Employment Agreement that
survive the cessation or termination of Executive's employment thereunder
constitute the entire agreement of the parties, and supersede all prior and
contemporaneous negotiations and agreements, oral or written, between the
parties, regarding the subject matter of this Agreement. All prior and
contemporaneous negotiations and agreements are deemed incorporated and merged
into this Agreement and are deemed to have been abandoned if not so
incorporated. No representations, oral or written, are being relied upon by
either party in executing this Agreement other than the express representations
of this Agreement and the terms of the Employment Agreement that survive the
cessation or termination of Executive's employment thereunder. This Agreement
cannot be changed or terminated without the express written consent of the
parties.
12. This Agreement shall be governed by, enforced under, and construed
in accordance with the laws of the State of Texas, except where preempted by
federal law.
13. By executing this Agreement, Executive acknowledges that (a) this
Agreement has been reviewed with him by a representative of the Company, and
incorporated herein by
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reference), (b) he has had at least twenty-one (21) days to consider the terms
of the Agreement and has considered its terms for that period of time or has
knowingly and voluntarily waived his right to do so, (c) he has been advised by
the Company in writing to consult with an attorney regarding the terms of the
Agreement, (d) he has consulted with, or has had sufficient opportunity to
consult with, an attorney of his own choosing regarding the terms of this
Agreement, (e) any and all questions regarding the terms of this Agreement have
been asked and answered to his complete satisfaction, (f) he has read this
Agreement and fully understands its terms and their import, (g) except as
provided by this Agreement, he has no contractual right or claim to the benefits
described herein, (h) the consideration provided for herein is good and
valuable, and (i) HE IS ENTERING INTO THIS AGREEMENT VOLUNTARILY, OF HIS OWN
FREE WILL, AND WITHOUT ANY COERCION, UNDUE INFLUENCE, THREAT, OR INTIMIDATION OF
ANY KIND OR TYPE WHATSOEVER.
EXECUTED in _______________, Texas, this ___day of _________, 20____.
EXECUTIVE:
_______________________________________
JAY B. SHIPOWITZ
EXECUTED in ______________, _____________, this ____day of _________,
200___.
ACE CASH EXPRESS, INC.
By:____________________________________
Its:___________________________________
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