Executive Employment Agreement - First Cash Financial Services Inc. and Phillip Eric Powell
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT IS SUBJECT TO MANDATORY AND BINDING ARBITRATION
This Employment Agreement (the "Agreement") is entered into as of
September 30, 2000 (the "Effective Date"), by and between First Cash
Financial Services, Inc. (the "Company"), a Delaware corporation, and
Phillip Eric Powell (the "Executive").
WHEREAS, Executive has provided a significant contribution to the
success of the Company over a long period of time, including but not limited
to the following: Executive has been primarily responsible for building the
company from its inception, has been an integral part of its attaining
fiscal/financial stability, has been its primary guidance in determining the
strategic vision of the Company, and has forgone bonuses and salary
adjustments otherwise due and payable for the good of the Company and its
public shareholders; and
WHEREAS, Executive is presently employed by the Company pursuant to an
employment agreement dated May 31, 1992, between the parties ("Old
Employment Agreement"), and the parties desire to terminate that agreement
and enter into a new agreement based on the terms and conditions set forth
below, and
NOW, THEREFORE, in consideration of the mutual covenants and
obligations hereinafter set forth, the parties agree as follows:
1. TERMINATION OF OLD EMPLOYMENT AGREEMENT.
The parties agree that the Old Employment Agreement shall be terminated
concurrently with the execution of this Agreement and shall be of no further
force or effect. The parties hereto waive and release all rights they may
have under the Old Employment Agreement as of the date hereof.
2. EMPLOYMENT.
The Company desires to continue to employ the Executive, and the
Executive agrees to continue to work in the employ of the Company, according
to the following terms and conditions.
3. DUTIES.
(a) The Company will continue to employ the Executive as Chief
Executive Officer ("CEO") of the Company.
(b) The Executive will serve in the Company's employ in that position.
<PAGE>
(c) Under the direction of the Board of Directors of the Company (the
"Board"), the Executive shall perform such duties, and have such powers,
authority, functions, duties and responsibilities for the Company and
corporations and other entities affiliated with the Company commensurate and
consistent with his employment in the position of CEO. The Executive also
shall have such additional powers, authority, functions, duties and
responsibilities as may be assigned to him by the Board; provided that,
without the Executive's written consent, those additional powers, authority,
functions, duties and responsibilities shall not be materially inconsistent
or interfere with, or detract from, those herein vested in, or otherwise
then being performed for the Company by, the Executive. In the event of an
increase in the Executive's duties, beyond the duties of CEO, the Board
shall review the Executive's compensation and benefits to determine if an
adjustment in compensation and employee benefits commensurate with the
Executive's new duties is warranted, in accordance with the Company's
compensation policies.
4. TERM OF EMPLOYMENT.
The term of employment of Executive is through December 31, 2005.
Subject to the provisions of Section 9, the term of the Executive's
Employment hereunder shall commence on September 30, 2000. At the
discretion of the Board, the term of employment shall be extended for
additional successive periods of 1 year, each year beginning on January 1,
2002, and each anniversary date thereafter, provided that during the
previous year, the Executive met the stipulated performance criteria
established by the Board.
5. EXTENT OF SERVICES.
The Executive shall not at any time during his Employment engage in any
other business related activities unless those activities do not interfere
materially with the Executive's duties and responsibilities to the Company
at that time. The foregoing, however, shall not preclude the Executive from
engaging in appropriate civic, charitable, professional or trade association
activities or from serving on one or more other boards of directors of
public or private companies, as long as such activities and services do not
conflict with his responsibilities to the Company.
6. NO FORCED RELOCATION.
The Executive shall not be required to move his principal place of
residence from the Arlington, Texas area or to perform regular duties that
could reasonably be expected to require either such move against his wish or
to spend amounts of time each week outside the Arlington, Texas area which
are unreasonable in relation to the duties and responsibilities of the
Executive hereunder, and the Company agrees that, if it requests the
Executive to make such a move and the Executive declines that request, (a)
that declination shall not constitute any basis for a termination of the
Executive's Employment and (b) no animosity or prejudice will be held
against Executive.
<PAGE>
7. COMPENSATION.
(a) SALARY.
An annual base salary shall be payable to the Executive by the Company
as a guaranteed minimum amount under this Agreement for each calendar year
during the period from September 30, 2000 to the termination date of the
Executive's Employment. That annual base salary shall (i) accrue daily on
the basis of a 365-day year, (ii) be payable to the Executive in the
intervals consistent with the Company's normal payroll schedules (but in no
event less frequently than semi-monthly) and (iii) be payable beginning
September 30, 2000 at an initial annual rate of $375,000. The Executive's
annual base salary shall not be decreased, but shall be adjusted annually in
each December to reflect such adjustments, if any, as the compensation
committee of the Board determines appropriate based on the Executive's
performance during the most recent performance period, in accordance with
the Company's compensation policies. A failure of the Company to increase
the Executive's annual base salary shall not constitute a breach or
violation of this Agreement by the Company.
(b) BONUS.
At the discretion of the Board's compensation committee, Executive
shall be eligible to be paid an annual bonus by the Company for each
calendar year during the period from January 1, 2000 to the termination date
of the Executive's Employment. That annual bonus shall be payable at such
rate and in such amount as is determined by the compensation committee of
the board of directors. The Executive's annual bonus, if any, shall be
adjusted annually in each December to reflect such adjustments, if any, as
the Board's compensation committee determines appropriate based on the
Executive's performance during the most recent performance period, in
accordance with the Company's compensation policies. A failure of the
Company to pay Executive an annual bonus shall not constitute a breach or
violation of this Agreement by the Company.
(c) OTHER COMPENSATION.
The Executive shall be entitled to participate in all Compensation
Plans from time to time in effect while in the Employment of the Company,
regardless of whether the Executive is an Executive Officer. All awards to
the Executive under all Incentive Plans shall take into account the
Executive's positions with and duties and responsibilities to the Company
and its subsidiaries and affiliates. The Company shall supply Executive
with an automobile, the make and model of which is subject to the approval
of the compensation committee of the Board, and be responsible for all
expenses related thereto throughout the term of this Agreement. Executive
may select an automobile of his own choosing which is reasonable in cost,
appearance and function, taking into account the powers, authority,
functions, duties and responsibilities of Executive, and the financial
position and condition of the Company. In consideration and in support of
Executive's duties under this Agreement, which include fostering the
goodwill, growth and earnings of the Company, the Company shall pay for a
private club membership for Executive, for such amount as is reasonable
taking into account the powers, authority, functions, duties and
responsibilities of Executive, subject to approval of the compensation
committee of the Board.
<PAGE>
(d) EXPENSES.
The Executive shall be entitled to prompt reimbursement of all
reasonable business expenses incurred by him in the performance of his
duties during the term of this Agreement, subject to the presenting of
appropriate vouchers and receipts in accordance with the Company's policies.
8. OTHER BENEFITS.
(a) EMPLOYEE BENEFITS AND PROGRAMS.
During the term of this Agreement, the Executive and the members of his
immediate family shall be entitled to participate in any employee benefit
plans or programs of the Company to the extent that his position, tenure,
salary, age, health and other qualifications make him or them, as the case
may be, eligible to participate, subject to the rules and regulations
applicable thereto.
(b) SUBSCRIPTIONS AND MEMBERSHIPS.
The Company shall pay periodical subscription costs and membership fees
and dues for the Executive to join professional organizations appropriate
for the Executive, and which further the interests of the Company. The
Company shall also pay or reimburse Executive for Executive's membership in
such additional clubs and organizations as may be agreed upon as reasonable
and appropriate between Executive and the Company.
(c) LOANS TO PAY FEDERAL TAXES.
If the Executive requests and the Company is in a financial position to
do so, in the discretion of the Board, the Company may loan to the Executive
sufficient funds to pay all federal income tax liability ("Tax Liability")
due by reason of the issuance of any securities of the Company. Such loan
shall bear interest at the rate of 7%, per annum (the "Tax Note"), which
shall be secured by Executive's interest in the securities. The Tax Note
shall be pre-payable at any time and mature no later than five years from
the date any funds were first advanced to the Executive under this Section
8(c). If the Executive sells any such securities (or any securities into
which Company issued securities have been converted) for cash while the Tax
Note remains outstanding and unpaid, the Executive shall prepay the Tax Note
within five business days after the Executive receives the proceeds from
that sale in the amount equal to the lesser of (i) the then unpaid balance
plus all interest earned under the Tax Note or (ii) the cash proceeds, net
of any applicable commission and other sale expense and any applicable
capital gain or other income tax, the Executive receives from that sale. The
Tax Note shall be payable either in cash or, in the event that on any date
the Executive makes any payment thereon the Common Stock is listed on the
American Stock Exchange or another national securities exchange or is quoted
through the Nasdaq National Market System (the "NMS") and the Executive
desires to pay such loan by delivery of shares of Common Stock, in shares of
Common Stock valued at the closing price of the Common Stock on (i) the
national securities exchange on which the Common Stock is listed (or, if
there is more than one, the national securities exchange the Company has
designated as the principal market for the Common Stock) or (ii) the NMS, as
the case may be, on the then most recent day on which the Common Stock
traded on such national securities exchange or the NMS, as the case may be;
provided, however, that if the securities issued by the Company to the
Executive are not publicly tradable before the Tax Note shall be due and
payable, payment of the Tax Note may be made by the Executive tendering all
the securities to the Company in exchange for cancellation of the Tax Note.
<PAGE>
(d) LOANS TO EXERCISE OPTIONS
If the Executive requests, the Company shall loan to the Executive
sufficient funds to purchase or exercise any options owned by Executive in
the stock of the Company. The maximum amount of funds, which the Company
shall loan, shall be determined by the exercise price of such options. Such
loan shall bear interest at 7%, per annum, and shall be evidenced by a
promissory note (the "Option Note"), secured by the subject options or
securities. The Option Note shall be pre-payable at any time and mature in
full no later than five years from the date any funds were first advanced to
the Executive under this Section 8(d). If the Executive sells any such
securities (or any securities into which Company issued securities have been
converted) for cash while the Option Note remains outstanding and unpaid,
the Executive shall prepay the Option Note within five business days after
the Executive receives the proceeds from that sale in the amount equal to
the lesser of (i) the then unpaid balance of the Option Note or (ii) the
cash proceeds, net of any applicable commission and other sale expense and
any applicable capital gain or other income tax, the Executive receives from
that sale. The Option Note shall be payable either in cash or, in the event
that on any date the Executive makes any payment thereon the Common Stock is
listed on the American Stock Exchange or another national securities
exchange or is quoted through the Nasdaq National Market System (the "NMS")
and the Executive desires to pay such loan by delivery of shares of Common
Stock, the Common Stock will be valued at the closing price of the Common
Stock on (i) the national securities exchange on which the Common Stock is
listed (or, if there is more than one, the national securities exchange the
Company has designated as the principal market for the Common Stock) or (ii)
the NMS, as the case may be, on the then most recent day on which the Common
Stock traded on such national securities exchange or the NMS, as the case
may be; provided, however, that if the securities issued by the Company to
the Executive are not publicly tradable before the Option Note shall be due
and payable, payment of the Option Note may be made by the Executive
tendering all the Common Stock issued from the proceeds of the Option Note
to the Company in exchange for cancellation of the Option Note.
(e) VACATION.
The Executive shall be entitled to four weeks of vacation leave with
full pay during each year of this Agreement (each such year being a 12-month
period ending on the one year anniversary date of the commencement of the
Executive's employment.) The times for such vacations shall be selected by
the Executive, provided the dates selected do not interfere materially with
the performance of Executive's duties and responsibilities under this
agreement. The Executive may accrue up to eight weeks of vacation time from
year to year, but vacation time otherwise shall not accrue from year to
year.
(f) BOOKKEEPING AND ACCOUNTING
The Executive shall be entitled to Company paid or reimbursed,
bookkeeping services up to $300 per month and annual accounting services of
up to $700 per year.
<PAGE>
(g) INSURANCE
For the term of this Agreement, the Company will provide, at no cost to
Executive, term life insurance benefits under two separate policies. The
first policy shall be in the amount of $2 million with the Company
designated as the beneficiary. The second policy shall be in the amount of
$4 million with the loss payee designated by the Executive. In the
discretion of the Board, during the term of this Agreement, the Company
shall also provide, at no cost to Executive, disability insurance sufficient
to provide, in the event Executive becomes disabled, payments that would be
made to Executive equal or up to the amount equal to Executive's base
salary, as of the date of disability, provided such coverage is reasonably
available at reasonable cost. Executive may procure his own disability
coverage and be reimbursed, if the same is not provided by the Company.
9. TERMINATION.
The Executive's Employment hereunder may be terminated prior to the
term provided for in Section 4 only under the following circumstances:
(a) DEATH.
The Executive's Employment shall terminate automatically on the date of
his death.
(b) DISABILITY.
If a Disability occurs and is continuing, the Executive's Employment
shall terminate 180 days after the Company gives the Executive written
notice that it intends to terminate his Employment on account of that
Disability, or on such later date as the Company specifies in such notice.
If the Executive resumes the performance of substantially all of his duties
under this Agreement before the termination becomes effective, the notice of
intent to terminate shall be deemed to have been revoked. Disability of
Executive shall not prevent the Company from making necessary changes during
the period of Executive's Disability to conduct its affairs.
(c) VOLUNTARY TERMINATION.
The Executive may terminate his Employment at any time and without Good
Cause with 90 days' prior written notice to the Company.
<PAGE>
(d) TERMINATION FOR GOOD CAUSE.
The Executive may terminate his Employment for Good Cause at any time
within 180 days (90 days if the Good Cause is the occurrence of a Change of
Control) after the Executive becomes consciously aware that the facts and
circumstances constituting Good Cause exist are continuing and by giving the
Company 30 days' prior written notice that the Executive intends to
terminate his Employment for Good Cause, which notice will state with
specificity the basis for Executive's contention that Good Cause exists;
provided, however, that if Executive terminates for Good Cause due to a
Change in Control, the Change in Control must actually occur. A Change in
Control will not be deemed to have actually occurred merely because of a
pending or possible event. The Executive shall not have Good Cause to
terminate his Employment solely by reason of the occurrence of a Change in
Control until 90 days after the date such Change in Control actually occurs.
The Executive may not terminate for Good Cause if the facts and
circumstances constituting Good Cause are substantially cured by the Company
within 30 days following notice to the Company.
(e) INVOLUNTARY TERMINATION.
The Executive's Employment is at will. The Company reserves the right
to terminate the Executive's Employment at anytime whatsoever, without
cause, with 30 days' prior written notice to the Executive.
(f) INVOLUNTARY TERMINATION FOR CAUSE.
The Company reserves the right to terminate the Executive's Employment
for Cause. In the event that the Company determines that Cause exists under
Section 13(f)(i) for the termination of the Executive's Employment, the
Company shall provide in writing (the "Notice of Cause"), the basis for that
determination and the manner, if any, in which the breach or neglect can be
cured. If either the Company has determined that the breach or neglect
cannot be cured, as set forth in the Notice of Cause, or has advised the
Executive in the Notice of Cause of the manner in which the breach or
neglect can be cured, but the Executive fails to substantially effect that
cure within 60 days after his receipt of the Notice of Cause, the Company
shall be entitled to give the Executive written notice of the Company's
intention to terminate Executive's Employment for Cause (the "Notice of
Intent to Terminate"). Executive shall have the right to object to any
Notice of Intent to Terminate Executive's Employment for Cause, by
furnishing the Company within ten days of receipt by Executive of the Notice
of Intent to Terminate Executive's Employment for Cause, written notice
specifying the reasons Executive contends either (i) Cause under Section
13(f)(i) does not exist or has been timely cured or (ii) in the circumstance
of a Notice of Intent to Terminate Executive's Employment for Cause under
Section 13(f)(ii), that such Cause does not exist (the "Notice of Intent to
Join Issue over Cause"). The failure of Executive to timely furnish the
Company with a Notice of Intent to Join Issue over Cause shall serve to
conclusively establish Cause hereunder, and the right of the Company to
terminate the Executive's Employment for Cause. Within 30 days following
its receipt of a timely Notice of Intent to Join Issue Over Cause, the
Company must either rescind the Notice of Intent to Terminate the
Executive's Employment for Cause, or file a demand for arbitration in
accordance with Section 27, to determine whether the Company is entitled to
terminate Executive's Employment for Cause. During the pendency of the
arbitration proceeding, and until such time as Executive's Employment is
terminated, Executive shall be entitled to receive Compensation under this
<PAGE>
Agreement. In the discretion of the Board, however, the Executive may be
reassigned or suspended with pay, during not only the pendency of the
arbitration proceeding, but during the period from the date the Company
furnishes Executive with a Notice of Intent to Terminate the Executive's
Employment for Cause until such date as the notice is rescinded, a
determination that Cause does not exist is made in the arbitration
proceeding or in the event of a determination that Cause does exist in the
arbitration proceeding, the effective date of the termination of Executive's
Employment for Cause. In the event that the Company determines that Cause
exists under Section 13(f)(ii) for the termination of the Executive's
Employment, it shall be entitled to immediately furnish Executive with a
Notice of Intent to Terminate Executive's Employment without providing a
Notice of Cause or any opportunity prior to that notice to contest that
determination. Any termination of the Executive's Employment for Cause
pursuant to this Section 9(f) shall be effective immediately upon the
Executive's receipt of the Company's written notice of that termination and
the Cause therefore.
(g) VOLUNTARY TERMINATION AT CONCLUSION OF TERM
At the expiration of the term of employment as stated in Section 4,
either party may terminate this Agreement by giving the other party written
notice at least six months before the expiration of the term of employment
stated in Section 4.
10. SEVERANCE PAYMENTS.
Unless effected under Section 9(g), if the Executive's Employment is
terminated during the term of this Agreement, the Executive shall be
entitled to receive severance payments as follows:
(a) If the Executive's Employment is terminated under Section 9(a),
(b), (d), (e) or (g), the Company will pay or cause to be paid to the
Executive (or, in the case of a termination under Section 9(a), the
beneficiary the Executive has designated in writing to the Company to
receive payment pursuant to this Section 10(a) or, in the absence of such
designation, the Executive's estate): (i) the Accrued Salary; (ii) the
Other Earned Compensation; (iii) the Reimbursable Expenses; and (iv) the
Severance Benefit. Additionally, the Company shall cancel Executive's
obligations under that certain promissory note dated December 31, 2000, in
the principal amount of $2,000,395.82 plus all other loans and advances
(principal and interest), and return to Executive, (or, in the case of
termination under Section 9(a), the beneficiary the Executive has designated
in writing to the Company to receive payment pursuant to Section 10(a) or in
the absence of such designation, the Executive's estate) within ten days,
all property securing the payment thereof. Any taxes due by Executive as a
result of the forgiveness under this provision of the Executive's debt to
the Company will be the sole obligation of the Company, and will be promptly
paid when due.
(b) If the Executive's Employment is terminated under Section 9(c) or
(f), the Company will pay or cause to be paid to the Executive: (i) the
Accrued Salary determined as of and through the termination date of the
Executive's Employment; (ii) the Other Earned Compensation; and (iii) the
Reimbursable Expenses.
<PAGE>
(c) Any payments to which the Executive (or his designated
beneficiary or estate, if Section 9(a) applies) is entitled pursuant to
paragraph (i) of subsection (a) of this Section 10 or paragraph (i) of
subsection (b) of this Section 10, as applicable, will be paid in a single
lump sum within thirty days after the termination date of the Executive's
Employment. At the sole option and election of the Executive (or his
designated beneficiary or estate, if Section 9(a) applies), which election
shall be made within 30 days of the termination of Executive's Employment,
the Company shall pay the executive the Severance Benefit, if at all, (1) in
a lump sum on a present value basis; (2) on a semi-monthly basis (as if
Executive's employment had continued), or (3) on such other periodic basis
reasonably requested by Executive (or his designated beneficiary or estate,
if Section 9(a) applies), in which event, the payments will be discounted to
the extent the periodic basis selected by Executive (or his designated
beneficiary or estate, if Section 9(a) applies) results in an earlier payout
to Executive (or his designated beneficiary or estate, if Section 9(a)
applies) than if Executive were paid on a semi-monthly basis. The Company
shall be given credit for all life or disability insurance proceeds paid to
Executive (or his designated beneficiary or estate, if Section 9(a)
applies) on any policy procured, paid for or reimbursed by the Company
pursuant to this Agreement (up to $2 million in the case of life insurance).
Upon the failure of the Executive to timely make an election as provided
herein, such option and election shall revert to the Company. However, if
Section 9(a) applies and the Executive's designated beneficiary or estate is
the beneficiary of one or more insurance policies purchased by the Company
and then in effect the proceeds of which are payable to that beneficiary by
reason of the Executive's death, then (i) the Company, at its option, may
credit the amount of those proceeds, as and when paid by the insurer to that
beneficiary, against the payment to which the Executive's designated
beneficiary or estate is entitled pursuant to paragraph (iv) of subsection
(a) of this Section 10 and, if it exercises that option, (ii) the payment
otherwise due pursuant to that paragraph (iv) will bear interest on the
outstanding balance thereof from and including the fifth day after that
termination date to the date of payment by the insurer to that beneficiary
at the rate of interest specified in Section 32; and provided, further, that
if Section 10(b) applies and the Executive is the beneficiary of disability
insurance purchased by the Company and then in effect, the Company, at its
option, may credit the proceeds of that insurance which are payable to the
Executive, valued at their present value as of that termination date using
the interest rate specified in Section 32 and then in effect as the discount
rate, against the payment to which the Executive is entitled pursuant to
paragraph (iv) of subsection (a) of this Section 10. Any payments to which
the Executive (or his designated beneficiary or estate, if Section 9(a)
applies) is entitled pursuant to paragraphs (ii) and (iii) of subsection (a)
or (b) of this Section 10, as applicable, will be paid in a single lump sum
within five days after the termination date of the Executive's Employment or
as soon thereafter as is administratively feasible, together with interest
accrued thereon from and including the fifth day after that termination date
to the date of payment at the rate of interest specified in Section 32.
(d) Except as provided in Sections 15, 25 and this Section, the Company
will have no payment obligations under this Agreement to the Executive (or
his designated beneficiary or estate, if Section 9(a) applies) after the
termination date of the Executive's Employment.
<PAGE>
11. RESIGNATIONS.
Upon termination of Executive's employment with or without cause,
Executive shall resign as an officer and director of the Company and will
thereafter refuse election as an officer or director of the Company.
12. RETURN OF DOCUMENTS.
Upon termination of Executive's employment with or without cause,
Executive shall immediately return and deliver to the Company and shall not
retain any originals or copies of any books, papers, price lists, customer
contracts, bids, customer lists, files, notebooks or any other documents
containing any of the Confidential information or otherwise relating to
Executive's performance of duties under this Agreement. Executive further
acknowledges and agrees that all such documents are the Company's sole and
exclusive property.
13. DEFINITION OF TERMS.
The following terms used in this Agreement when capitalized shall have
the following meanings:
(a) ACCRUED SALARY.
"Accrued Salary" shall mean the salary that has accrued, and the salary
that would accrue through and including the last day of the pay period in
which the termination date of the Executive's Employment occurs, under
Section 7(a), which has not been paid to the Executive as of that
termination date.
(b) ACQUIRING PERSON.
"Acquiring Person" shall mean any person who or which, together with
all Affiliates and Associates of such person, is or are the Beneficial Owner
of 50 percent or more of the shares of Common Stock then outstanding, but
does not include any Exempt Person; provided, however, that a person shall
not be or become an Acquiring Person if such person, together with its
Affiliates and Associates, shall become the Beneficial Owner of 50 percent
or more of the shares of Common Stock then outstanding solely as a result of
a reduction in the number of shares of Common Stock outstanding due to the
repurchase of Common Stock by the Company, unless and until such time as
such person or any Affiliate or Associate of such person shall purchase or
otherwise become the Beneficial Owner of additional shares of Common Stock
constituting 1% or more of the then outstanding shares of Common Stock or
any other person (or persons) who is (or collectively are) the Beneficial
Owner of shares of Common Stock constituting 1% or more of the then
outstanding shares of Common Stock shall become an Affiliate or Associate of
such person, unless, in either such case, such person, together with all
Affiliates and Associates of such person, is not then the Beneficial Owner
of 50% or more of the shares of Common Stock then outstanding.
(c) AFFILIATE.
"Affiliate" has the meaning ascribed to that term in Rule 405 of
Regulation C.
<PAGE>
(d) ASSOCIATE.
"Associate" shall mean, with reference to any person, (i) any
corporation, firm, partnership, association, unincorporated organization or
other entity (other than the Company or a subsidiary of the Company) of
which that person is an officer or general partner (or officer or general
partner of a general partner) or is, directly or indirectly, the Beneficial
Owner of 10% or more of any class of its equity securities, (ii) any trust
or other estate in which that person has a substantial beneficial interest
or for or of which that person serves as trustee or in a similar fiduciary
capacity and (iii) any relative or spouse of that person, or any relative of
that spouse, who has the same home as that person.
<PAGE>
(e) BENEFICIAL OWNER.
A specified person shall be deemed the "Beneficial Owner" of, and shall
be deemed to "beneficially own," any securities: (i) of which that person
or any of that person's Affiliates or Associates, directly or indirectly, is
the "beneficial owner" (as determined pursuant to Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
otherwise has the right to vote or dispose of, including pursuant to any
agreement, arrangement or understanding (whether or not in writing);
provided, however, that a person shall not be deemed the "Beneficial Owner"
of, or to "beneficially own," any security under this subparagraph (i) as a
result of an agreement, arrangement or understanding to vote that security
if that agreement, arrangement or understanding: (A) arises solely from a
revocable proxy or consent given in response to a public (that is, not
including a solicitation exempted by Exchange Act Rule 14a-2(b)(2)) proxy or
consent solicitation made pursuant to, and in accordance with, the
applicable provisions of the Exchange Act; and (B) is not then reportable by
such person on Exchange Act Schedule 13D (or any comparable or successor
report); (ii) which that person or any of that person's Affiliates or
Associates, directly or indirectly, has the right or obligation to acquire
(whether that right or obligation is exercisable or effective immediately or
only after the passage of time or the occurrence of an event) pursuant to
any agreement, arrangement or understanding (whether or not in writing) or
on the exercise of conversion rights, exchange rights, other rights,
warrants or options, or otherwise; provided, however, that a person shall
not be deemed the "Beneficial Owner" of, or to "beneficially own,"
securities tendered pursuant to a tender or exchange offer made by that
person or any of that person's Affiliates or Associates until those
tendered securities are accepted for purchase or exchange; or (iii) which
are beneficially owned, directly or indirectly, by (A) any other person (or
any Affiliate or Associate thereof) with which the specified person or any
of the specified person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy or consent
as described in the proviso to subparagraph (i) of this definition) or
disposing of any voting securities of the Company or (B) any group (as that
term is used in Exchange Act Rule 13d-5(b)) of which that specified person
is a member; provided, however, that nothing in this definition shall cause
a person engaged in business as an underwriter of securities to be the
"Beneficial Owner" of, or to "beneficially own," any securities acquired
through that person's participation in good faith in a firm commitment
underwriting until the expiration of 40 days after the date of that
acquisition. For purposes of this Agreement, "voting" a security shall
include voting, granting a proxy, acting by consent making a request or
demand relating to corporate action (including, without limitation, calling
a stockholder meeting) or otherwise giving an authorization (within the
meaning of Section 14(a) of the Exchange Act) in respect of such security.
(f) CAUSE.
"Cause" shall mean that the Executive has (i) willfully breached or
habitually neglected (otherwise than by reason of injury, or physical or
mental illness, or any disability as defined by the Americans with
Disabilities Act of 1990, Public Law 101_336, 42 U.S.C.A. S 12101 et seq.)
material duties which he was required to perform under the terms of this
Agreement, or (ii) committed and been charged with act(s) of dishonesty or
fraud.
<PAGE>
(g) CHANGE OF CONTROL.
"Change of Control" shall mean the occurrence of the following events:
(i) any person or entity becomes an Acquiring Person, or (ii) a merger of
the Company with or into, or a sale by the Company of its properties and
assets substantially as an entirety to, another person or entity; (iii) a
majority of the incumbent board of directors cease for any reason to
constitute at least a majority of the Board; and (iv) immediately after the
occurrence of (i), (ii) or (iii) above, any person or entity, other than an
Exempt Person, together with all Affiliates and Associates of such person or
entity, shall be the Beneficial Owner of 50% or more of the total voting
power of the then outstanding Voting Shares of the person or entity
surviving that transaction (in the case or a merger or consolidation), or
the person or entity acquiring those properties and assets substantially as
an entirety.
(h) COMPANY.
"Company" shall mean (i) First Cash Financial Services, Inc., a
Delaware corporation, and (ii) any person or entity that assumes the
obligations of "the Company" hereunder, by operation of law, pursuant to
Section 18 or otherwise.
(i) COMPENSATION PLAN.
"Compensation Plan" shall mean any compensation arrangement, plan,
policy, practice or program established, maintained or sponsored by the
Company or any subsidiary of the Company, or to which the Company or any
subsidiary of the Company contributes, on behalf of any Executive Officer or
any member of the immediate family of any Executive Officer by reason of his
status as such, (i) including (A) any "employee pension benefit plan" (as
defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) or other "employee benefit plan" (as defined in
Section 3(3) of ERISA), (B) any other retirement or savings plan, including
any supplemental benefit arrangement relating to any plan intended to be
qualified under Section 401(a) of the Internal Revenue Code of 1986, as
amended (the "Code"), or whose benefits are limited by the Code or ERISA,
(C) any "employee welfare plan" (as defined in Section 3(1) of ERISA), (D)
any arrangement, plan, policy, practice or program providing for severance
pay, deferred compensation or insurance benefit, (E) any Incentive Plan and
(F) any arrangement, plan, policy, practice or program (1) authorizing and
providing for the payment or reimbursement of expenses attributable to air
travel and hotel occupancy while traveling on business for the Company or
(2) providing for the payment of business luncheon and country club dues,
long-distance charges, mobile phone monthly air time or other recurring
monthly charges or any other fringe benefit, allowance or accommodation of
employment, but (ii) excluding any compensation arrangement, plan, policy,
practice or program to the extent it provides for annual base salary.
(j) DISABILITY.
"Disability" shall mean that the Executive, with reasonable
accommodation, has been unable to perform his essential duties under this
Agreement for a period of at least six consecutive months as a result of his
incapacity due to injury or physical or mental illness, any disability as
defined in a disability insurance policy which provides coverage for the
Executive, or any disability as defined by the Americans with Disabilities
Act of 1990, Public Law 101_336, 42 U.S.C.A. S 12101 et seq.
<PAGE>
(k) EMPLOYMENT.
"Employment" shall mean the salaried employment of the Executive by the
Company or a subsidiary of the Company hereunder.
(l) EXECUTIVE OFFICER.
"Executive Officer" shall mean any of the chief executive officer, the
chief operating officer, the chief financial officer, the president, any
executive, regional or other group or senior vice president or any vice
president of the Company.
(m) EXEMPT PERSON.
"Exempt Person" shall mean: (i)(A) the Company, any subsidiary of the
Company, any employee benefit plan of the Company or any subsidiary of the
Company and (B) any person organized, appointed or established by the
Company for or pursuant to the terms of any such plan or for the purpose of
funding any such plan or funding other employee benefits for employees of
the Company or any subsidiary of the Company; (ii) the Executive, any
Affiliate of the Executive which the Executive controls or any group (as
that term is used in Exchange Act Rule 13d-5(b)) of which the Executive or
any such Affiliate is a member.
(n) GOOD CAUSE.
"Good Cause" for the Executive's termination of his Employment shall
mean: (i) any decrease in the annual base salary under Section 7(a) or any
other violation hereof in any material respect by the Company; (ii) any
material reduction in the Executive's compensation under Section 7; (iii)
the assignment to the Executive of duties inconsistent in any material
respect with the Executive's then current positions (including status,
offices, titles and reporting requirements), authority, duties or
responsibilities or any other action by the Company which results in a
material diminution in those positions, authority, duties or
responsibilities; (iv) any unapproved relocation of the Executive; or (v)
the occurrence of a Change of Control. Good Cause shall not exist if the
Company cures within the period prescribed herein.
(o) INCENTIVE PLAN.
"Incentive Plan" shall mean any compensation arrangement, plan, policy,
practice or program established, maintained or sponsored by the Company or
any subsidiary of the Company, or to which the Company or any subsidiary of
the Company contributes, on behalf of any Executive Officer and which
provides for incentive, bonus or other performance-based awards of cash,
securities, the phantom equivalent of securities or other property,
including any stock option, stock appreciation right and restricted stock
plan, but excluding any plan intended to qualify as a plan under any one or
more of Sections 401(a), 401(k) or 423 of the Code.
(p) OTHER EARNED COMPENSATION.
"Other Earned Compensation" shall mean all the compensation earned by
the Executive prior to the termination date of his Employment as a result of
his Employment (including compensation the payment of which has been
deferred by the Executive, but excluding Accrued Salary and compensation to
be paid to the Executive in accordance with the terms of any Compensation
Plan), together with all accrued interest or earnings, if any, thereon,
which has not been paid to the Executive as of that date.
<PAGE>
(q) REIMBURSABLE EXPENSES.
"Reimbursable Expenses" shall mean the expenses incurred by the
Executive on or prior to the termination date of his Employment which are to
be reimbursed to the Executive under Section 7(c) and which have not been
reimbursed to the Executive as of that date.
(r) SEVERANCE BENEFIT.
"Severance Benefit" shall mean all Compensation provided for under
Section 7 through the remainder of the Executive's term of employment, it
being the parties' intent that, except for a termination under Section 9(c),
(f) or (g) the Executive shall receive all Compensation as if his term of
employment continued as provided for under Section 4. The term "Severance
Benefit" shall also include $1,875,000.00. In the event the Board exercises
its option to extend the term of this Agreement pursuant to Section 4
hereof, the $1,875,000 portion of the Severance Benefit shall be reduced 20%
for each year the term is extended.
14. COVENANTS NOT TO COMPETE
(a) Executive's Acknowledgment. Executive agrees and acknowledges
that in order to assure the Company that it will retain its value
as a going concern, it is necessary that Executive undertake not
to utilize his special knowledge of the business and his
relationships with customers and suppliers to compete with the
Company. Executive further acknowledges that:
(i) the Company is and will be engaged in the business of pawn
shop services, pay day loan services and check cashing
services;
(ii) Executive will occupy a position of trust and confidence with
the Company prior to the date of this agreement and, during
such period and Executive's employment under this agreement,
Company's trade secrets and with other proprietary and
confidential information concerning the Company;
(iii) the agreements and covenants contained in this Section 14
are essential to protect the Company and the goodwill of the
business; and
(iv) Executive's employment with the Company has special, unique
and extraordinary value to the Company and the Company would
be irreparably damaged if Executive were to provide services
to any person or entity in violation of the provisions of
this agreement.
(b) Company's Acknowledgement. The Company hereby acknowledges that
it will provide Executive with confidential and trade secret
information relating to the operation of the Company's business,
including but not limited to, customer lists, operating manuals,
and financing operations.
<PAGE>
(c) Competitive Activities. Executive hereby agrees that for a period
commencing on the date hereof and ending two years following the
later of (i) termination of Executive's employment with the
Company for whatever reason, and (ii) the conclusion of the
period, if any, during which the Company is making payments to
Executive, he will not, directly or indirectly, as employee,
agent, consultant, stockholder, director, co-partner or in any
other individual or representative capacity, own, operate, manage,
control, engage in, invest in or participate in any manner in, act
as a consultant or advisor to, render services for (alone or in
association with any person, firm, corporation or entity), or
otherwise assist any person or entity (other than the Company)
that engages in or owns, invests in, operates, manages or controls
any venture or enterprise that directly or indirectly engages or
proposes in engage in the business of pawnshops, check cashing
services, payday loan services or proposes to in engage in the
business of the distribution or sale of (i) products distributed,
sold or licensed by the Company or services provided by the
Company at the time of termination or (ii) products or services
proposed at the time of such termination to be distributed, sold,
licensed or provided by the Company within 50 miles of any of the
Company's locations (the "Territory"); provided, however, that
nothing contained herein shall be construed to prevent Executive
from investing in the stock of any competing corporation listed on
a national securities exchange or traded in the over-the-counter
market, but only if Executive is not involved in the business of
said corporation and if Executive and his associates (as such term
is defined in Regulation 14(A) promulgated under the Securities
Exchange Act of 1934, as in effect on the date hereof),
collectively, do not own more than an aggregate of two percent of
the stock of such corporation. With respect to the Territory,
Executive specifically acknowledges that the Company has conducted
the business throughout those areas comprising the Territory and
the Company intends to continue to expand the business throughout
the Territory.
(d) Blue Pencil. If an arbitrator shall at any time deem the terms of
this agreement or any restrictive covenant too lengthy or the
Territory too extensive, the other provisions of this section 14
shall nevertheless stand, the restrictive period shall be deemed
to be the longest period permissible by law under the
circumstances and the Territory shall be deemed to comprise the
largest territory permissible by law under the circumstances. The
arbitrator in each case shall reduce the restricted period and/or
the Territory to permissible duration or size.
(e) Non-Solicitation of Employees. Executive agrees that while
employed by the Company and for two (2) years after the cessation
of the Executive's employment for whatever reason, the Executive
will not recruit, hire or attempt to recruit or hire, directly or
assisted by others, any other employee of the Company with whom
the Executive had contact during the Executive=s employment with
the Company. For the purposes of this paragraph Acontact@ means
any interaction whatsoever between the Executive and the other
employee.
<PAGE>
(f) Non-Solicitation of Customers. Executive agrees that while
employed by the Company and for two (2) years after the cessation
of the Executive=s employment for whatever reason, the Executive
will not directly or indirectly, for himself or on behalf of any
other person, partnership, company, corporation or other entity,
solicit or attempt to solicit, for the purpose of engaging in
competition with the Company,
(i) any person or entity whose account was serviced by
Executive at the Company; or
(ii) any person or entity who is or has been a customer of
the Company prior to Executive's termination; or
(iii) any person or entity the Company has targeted and
contacted prior to Executive's termination for the purpose of
establishing a customer relationship.
Executive agrees that these restrictions are necessary to protect
Executive's legitimate business interests, and Executive agrees that these
restrictions will not prevent Executive from earning a livelihood.
<PAGE>
15. TAX INDEMNITY.
Should any of the payments of salary, other incentive or supplemental
compensation, benefits, allowances, awards, payments, reimbursements or
other perquisites, or any other payment in the nature of compensation,
singularly, in any combination or in the aggregate, that are provided for
hereunder to be paid to or for the benefit of the Executive be determined or
alleged to be subject to an excise or similar purpose tax pursuant to
Section 4999 of the Code, or any successor or other comparable federal,
state or local tax law by reason of being a "parachute payment" (within the
meaning of Section 280G of the Code), the parties agree to negotiate in good
faith changes to this Agreement necessary to avoid such excise or similar
purpose tax, without diminishing Executive's salary, other incentive or
supplemental compensation, benefits, allowances, awards, payments,
reimbursements or other perquisites, or any other payment in the nature of
compensation. Alternatively, the Company shall pay to the Executive such
additional compensation as is necessary (after taking into account all
federal, state and local taxes payable by the Executive as a result of the
receipt of such additional compensation) to place the Executive in the same
after-tax position (including federal, state and local taxes) he would have
been in had no such excise or similar purpose tax (or interest or penalties
thereon) been paid or incurred. The Company hereby agrees to pay such
additional compensation within the earlier to occur of (i) five business
days after the Executive notifies the Company that the Executive intends to
file a tax return taking the position that such excise or similar purpose
tax is due and payable in reliance on a written opinion of the Executive's
tax counsel (such tax counsel to be chosen solely by the Executive) that it
is more likely than not that such excise tax is due and payable or (ii) 24
hours of any notice of or action by the Company that it intends to take the
position that such excise tax is due and payable. The costs of obtaining the
tax counsel opinion referred to in clause (i) of the preceding sentence
shall be borne by the Company, and as long as such tax counsel was chosen by
the Executive in good faith, the conclusions reached in such opinion shall
not be challenged or disputed by the Company. If the Executive intends to
make any payment with respect to any such excise or similar purpose tax as a
result of an adjustment to the Executive's tax liability by any federal,
state or local tax authority, the Company will pay such additional
compensation by delivering its cashier's check payable in such amount to the
Executive within five business days after the Executive notifies the Company
of his intention to make such payment. Without limiting the obligation of
the Company hereunder, the Executive agrees, in the event the Executive
makes any payment pursuant to the preceding sentence, to negotiate with the
Company in good faith with respect to procedures reasonably requested by the
Company which would afford the Company the ability to contest the imposition
of such excise or similar purpose tax; provided, however, that the Executive
will not be required to afford the Company any right to contest the
applicability of any such excise or similar purpose tax to the extent that
the Executive reasonably determines (based upon the opinion of his tax
counsel) that such contest is inconsistent with the overall tax interests of
the Executive.
16. LOCATIONS OF PERFORMANCE.
The Executive's services shall be performed primarily in the vicinity
of Arlington, Texas. The parties acknowledge, however, that the Executive
will be required to travel in connection with the performance of his duties.
<PAGE>
17. PROPRIETARY INFORMATION.
(a) The Executive agrees to comply fully with the Company's policies
relating to non-disclosure of the Company's trade secrets and proprietary
information and processes. Without limiting the generality of the foregoing,
the Executive will not, during the term of his Employment, disclose any such
secrets, information or processes to any person, firm, corporation,
association or other entity for any reason or purpose whatsoever except as
may be required by law or governmental agency or legal process, nor shall
the Executive make use of any such property for his own purposes or for the
benefit of any person, firm, corporation or other entity (except the Company
or any of its subsidiaries) under any circumstances during or after the term
of his Employment, provided that after the term of his Employment this
provision shall not apply to secrets, information and processes that are
then in the public domain (provided that the Executive was not responsible,
directly or indirectly, for such secrets, information or processes entering
the public domain without the Company's consent).
(b) The Executive hereby sells, transfers and assigns to the Company
all the entire right, title and interest of the Executive in and to all
inventions, ideas, disclosures and improvements, whether patented or
unpatented, and copyrightable material, to the extent made or conceived by
the Executive solely or jointly with others during the term of this
Agreement The Executive shall communicate promptly and disclose to the
Company, in such form as the Company requests, all information, details and
data pertaining to the aforementioned and, whether during the term hereof or
thereafter, the Executive shall execute and deliver to the Company such
formal transfers and assignments and such other papers and documents as may
be required of the Executive to permit the Company to file and prosecute any
patent applications relating to same and, as to copyrightable material, to
obtain copyright thereon.
(c) Trade secrets, proprietary information and processes shall not be
deemed to include information which is: (i) known to the Executive at the
time it is disclosed to him; (ii) publicly known (or becomes publicly
known) without the fault or negligence of Executive; (iii) received from a
third party without restriction and without breach of this Agreement; (iv)
approved for release by written authorization of the Company; or (v)
required to be disclosed by law or legal process; provided, however, that in
the event of a proposed disclosure pursuant to this subsection (c)(v), the
Executive shall give the Company prior written notice before such disclosure
is made in a time and manner which will best provide the Company with the
ability to oppose such disclosure.
<PAGE>
18. ASSIGNMENT.
This Agreement may not be assigned by either party; provided that the
Company may assign this Agreement (i) in connection with a merger or
consolidation involving the Company or a sale of its business, properties
and assets substantially as an entirety to the surviving corporation or
purchaser as the case may be, so long as such assignee assumes the Company's
obligations hereunder; and (ii) so long as the assignment in the reasonable
discretion of Executive does not result in a materially increased risk of
non-performance of the Company's obligations hereunder by the assignee. The
Company shall require as a condition of such assignment any successor
(direct or indirect (including, without limitation, by becoming the sole
stockholder of the Company) and whether by purchase, merger, consolidation,
share exchange or otherwise) to the business, properties and assets of the
Company substantially as an entirety expressly to assume and agree to
perform this Agreement in the same manner and to the same extent the Company
would have been required to perform it had no such succession taken place.
This Agreement shall be binding upon all successors and assigns. In the
event of a Change of Control, and regardless of whether the Executive's
employment is thereafter terminated, the Company shall cancel Executive's
obligations under that certain promissory note dated 12/31/00, in the
principal amount of $2,000,395.82, plus all other loans and advances
(principal and interest), and return to Executive, (or, in the case of
termination under Section 9(a), the beneficiary the Executive has designated
in writing to the Company to receive payment pursuant to Section 9(a) or in
the absence of such designation, the Executive's estate) within ten days,
all property securing the payment thereof. Any taxes due by Executive as a
result of the forgiveness under this provision of the Executive's debt to
the Company will be the sole obligation of the Company.
19. NOTICES.
Any notice required or permitted to be given under this Agreement shall
be sufficient if in writing and sent by registered or certified mail to the
Executive at his residence maintained on the Company's records, or to the
Company at its address at 690 E. Lamar Blvd. Suite 400, Arlington, Texas
76011, Attention: Corporate Secretary, or such other addresses as either
party shall notify the other in accordance with the above procedure.
20. FORCE MAJEURE.
Neither party shall be liable to the other for any delay or failure to
perform hereunder, which delay or failure is due to causes beyond the
control of said party, including, but not limited to: acts of God; acts of
the public enemy; acts of the United States of America or any state,
territory or political subdivision thereof or of the District of Columbia;
fires; floods; epidemics; quarantine restrictions; strikes; or freight
embargoes; provided, however, that this Section 20 will not relieve the
Company of any of its payment obligations to the Executive under this
Agreement. Notwithstanding the foregoing provisions of this Section 20, in
every case the delay or failure to perform must be beyond the control and
without the fault or negligence of the party claiming excusable delay.
<PAGE>
21. INTEGRATION.
This Agreement represents the entire agreement and understanding
between the parties as to the subject matter hereof and supersedes all prior
or contemporaneous agreements whether written or oral. No waiver, alteration
or modification of any of the provisions of this Agreement shall be binding
unless in writing and signed by duly authorized representatives of the
parties hereto.
22. WAIVER.
Failure or delay on the part of either party hereto to enforce any
right, power or privilege hereunder shall not be deemed to constitute a
waiver thereof. Additionally, a waiver by either party of a breach of any
promise herein by the other party shall not operate as or be construed to
constitute a waiver of any subsequent breach by such other party.
23. SAVINGS CLAUSE.
If any term, covenant or condition of this Agreement or the application
thereof to any person or circumstance shall to any extent be invalid or
unenforceable, the remainder of this Agreement, or the application of such
term, covenant or condition to persons or circumstances other than those as
to which it is held invalid or unenforceable shall not be affected thereby,
and each term, covenant or condition of this Agreement shall be valid and
enforced to the fullest extent permitted by law.
24. AUTHORITY TO CONTRACT.
The Company warrants and represents to the Executive that the Company
has full authority to enter into this Agreement and to consummate the
transactions contemplated hereby and that this Agreement is not in conflict
with any other agreement to which the Company is a party or by which it may
be bound. The Company further warrants and represents to the Executive that
the individual executing this Agreement on behalf of the Company has the
full power and authority to bind the Company to the terms hereof and has
been authorized to do so in accordance with the Company's articles or
certificate of incorporation and bylaws.
<PAGE>
25. PAYMENT OF EXPENSES.
If at any time during the term hereof or afterwards: (a) there should
exist a dispute or conflict between the Executive and the Company or another
Person as to the validity, interpretation or application of any term or
condition hereof, or as to the Executive's entitlement to any benefit
intended to be bestowed hereby, which is not resolved to the satisfaction of
the Executive, (b) the Executive must (i) defend the validity of this
Agreement or (ii) contest any determination by the Company concerning the
amounts payable (or reimbursable) by the Company to the Executive or (c) the
Executive must prepare responses to an Internal Revenue Service ("IRS")
audit of, or otherwise defend, his personal income tax return for any year
the subject of any such audit, or an adverse determination, administrative
proceedings or civil litigation arising therefrom, which is occasioned by or
related to an audit by the IRS of the Company's income tax returns, then the
Company hereby unconditionally agrees: (a) on written demand of the Company
by the Executive, to provide sums sufficient to advance and pay on a current
basis (either by paying directly or by reimbursing the Executive) not less
than 30 days after a written request therefor is submitted by the Executive,
all the Executive's costs and expenses (including, without limitation,
attorney's fees, expenses of investigation, travel, lodging, copying,
delivery services and disbursements for the fees and expenses of experts,
etc.) incurred by the Executive in connection with any such matter; (b) the
Executive shall be entitled, on demand in accordance with Section 27, below,
to the entry of a mandatory injunction without the necessity of posting any
bond with respect thereto which compels the Company to pay or advance such
costs and expenses on a current basis; and (c) the Company's obligations
under this Section 25 will not be affected if the Executive is not the
prevailing party in the final resolution of any such matter unless it is
determined pursuant to Section 27 that, in the case of one or more of such
matters, the Executive has acted in bad faith or without a reasonable basis
for his position, in which event and, then only with respect to such matter
or matters, the successful or prevailing party or parties shall be entitled
to recover from the Executive reasonable attorneys' fees and other costs
incurred in connection with that matter or matters (including the amounts
paid by the Company in respect of that matter or matters pursuant to this
Section 25), in addition to any other relief to which it or they may be
entitled.
26. REMEDIES.
In the event of a breach by the Executive of Section 14 or 17 of this
Agreement, in addition to other remedies provided by applicable law, the
Company will be entitled to issuance of a temporary restraining order or
preliminary injunction enforcing its rights under such Section.
27. ARBITRATION.
This Agreement Is Subject to Binding Arbitration. Any dispute or
controversy arising under or in connection with this Agreement or in any
manner associated with Employee's employment (other than those described in
Section 26 _ Remedies) shall be settled exclusively by arbitration in
Arlington, Texas, in accordance with the rules of the American Arbitration
Association then in effect. The parties agree to execute and be bound by
the mutual agreement to arbitrate claims attached hereto as Attachment A.
<PAGE>
28. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Texas.
29. WAIVER OF ACTUAL OR POTENTIAL CONFLICTS OF INTEREST
Should it become necessary for Executive to seek to enforce the terms
of this Agreement, the Company consents to Executive's use of counsel which
either then or may have in the past represented the Company, provided that
counsel agrees to undertake Executive's representation, and such
representation and waiver of actual or potential conflicts of interest is in
accordance with the Texas State Bar Rules, including the Texas Disciplinary
Rules of Professional Conduct. To the extent permitted by the Rules, the
Company waives any such actual or potential conflict of interest arising
thereby.
30. COUNTERPARTS.
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the
same instrument.
31. INDEMNIFICATION.
The Executive shall be indemnified by the Company to the maximum
permitted by the law of the state of the Company's incorporation, and by the
law of the state of incorporation of any subsidiary of the Company of which
the Executive is a director or an officer or employee, as the same may be in
effect from time to time.
32. INTEREST.
If any amounts required to be paid or reimbursed to the Executive
hereunder are not so paid or reimbursed at the times provided herein
(including amounts required to be paid by the Company pursuant to Sections
7, 15 and 25), those amounts shall bear interest at the rate of 7% from the
date those amounts were required to have been paid or reimbursed to the
Executive until those amounts are finally and fully paid or reimbursed;
provided, however, that in no event shall the amount of interest contracted
for, charged or received hereunder exceed the maximum non-usurious amount of
interest allowed by applicable law.
33. TIME OF THE ESSENCE.
Time is of the essence with respect to any act required to be performed
by this Agreement.
34. PRIOR INSTRUMENTS UNAFFECTED.
Except for the Old Employment Agreement which is being terminated
pursuant to this Agreement, all prior instruments between the Company and
Executive shall remain in full force and effect and the terms and conditions
thereof shall not be affected by this Agreement.
<PAGE>
FIRST CASH FINANCIAL SERVICES, INC. EXECUTIVE
/S/ RICHARD T. BURKE /S/ PHILLIP E. POWELL
----------------------------------- -----------------------------
Richard T. Burke Phillip Eric Powell
Director
<PAGE>
ATTACHMENT "A"
MUTUAL AGREEMENT TO ARBITRATE
1. I, Phillip Eric Powell, recognize that differences could arise between
First Cash Financial Services, Inc. ("the Company") and me during or
following my employment with the Company. I understand and agree that by
entering into this Mutual Agreement to Arbitrate ("Agreement"), I gain the
benefits of a speedy, impartial dispute-resolution procedure.
2. I understand that any reference in this Agreement to the Company will be
a reference also to all stockholders, directors, officers, employees,
parents, subsidiaries and affiliated entities, all benefit plans, the
benefit plans' sponsors, fiduciaries, administrators, and all successors and
assigns of any of them.
Claims Covered by the Agreement
3. The Company and I mutually agree to the resolution by arbitration of all
claims or controversies ("claims"), whether or not arising out of my
employment (or its termination), that the Company may have against me or
that I may have against the Company. The claims covered by this Agreement
include, but are not limited to, claims under my Employment Agreement,
claims for wages or other compensation due; for breach of any contract or
covenant (express or implied); tort claims; claims for discrimination
(including, but not limited to, race sex, color, religion, national origin,
age (state or federal Age Discrimination in Employment Act), marital status,
veterans status, sexual preference, medical condition, handicap or
disability); claims for benefits (except where an employee benefit or
pension plan specifies that its claims procedure shall culminate in an
arbitration procedure different from this one); and claims for violation of
any federal, state, or other law, statute, regulation, or ordinance, except
claims excluded in the following paragraphs.
Claims Not Covered by the Agreement
4. Claims I may have for workers' compensation or unemployment compensation
benefits are not covered by this Agreement.
<PAGE>
Arbitration
5. (a) Procedure for Injunctive Relief. In the event either the Company
or myself seeks injunctive relief, the claim shall be administratively
expedited by the American Arbitration Association ("AAA"), which shall
appoint a single, neutral arbitrator for the limited purpose of deciding
such claim. Such arbitrator shall be a qualified member of the State Bar of
Texas in good standing, and preferably shall be a retired state or federal
district judge. The single arbitrator shall decide the claim for injunctive
relief immediately on hearing or receiving the parties' submissions (unless,
in the interests of justice, he must rule ex parte); provided, however, that
the single arbitrator shall rule on such claims within 24 hours of
submission of the claim to the AAA. The single arbitrator's ruling shall
not extend beyond 14 calendar days and on application by the claimant, up to
an additional 14 days following which, after a hearing on the claim for
injunctive relief, a temporary injunction may issue pending the award. Any
relief granted under this procedure for injunctive relief shall be
specifically enforceable in Harris County District Court on an expedited, ex
parte basis and shall not be the subject of any evidentiary hearing or
further submission by either party, but the court, on application to enforce
a temporary order, shall issue such orders as necessary to its enforcement.
(b) Procedure after a Claim for Injunctive Relief or where no Claim
for Injunctive Relief Is Made. The arbitrator shall be selected as
follows: in the event the Company and I agree on one arbitrator, the
arbitration shall be conducted by such arbitrator. In the event the Company
and I do not agree, the Company and I shall each select one independent,
qualified arbitrator, and the two arbitrators so selected shall select the
third arbitrator. The arbitrator(s) are herein referred to as the "Panel."
The Company reserves the right to object to any individual arbitrator who
shall be employed by or affiliated with a competing organization.
(c) The Arbitration shall take place at Arlington, Texas, or any
other location mutually agreeable to us. At the request of either of us,
arbitration proceedings will be conducted in the utmost secrecy; in such
case all documents, testimony and records shall be received, heard and
maintained by the Panel in secrecy, available for inspection only by the
Company or me and our respective attorneys and our respective experts, who
shall agree in advance and in writing to receive all such information
confidentially and to maintain such information in secrecy until such
information shall become generally known. The Panel shall be able to award
any and all relief, including relief of an equitable nature. The award
rendered by the Panel may be enforceable in any court having jurisdiction
thereof.
(d) The Company will pay all the fees and out-of-pocket expenses of
each arbitrator selected pursuant to this Section 5 and the AAA. In
addition, the Company will pay my reasonable attorneys' fees, unless the
arbitration is the result of a termination for cause as defined in Section
13(f)(ii) of the Executive Employment Agreement to which this Attachment is
appended.
Requirements for Modification or Revocation
6. This Agreement to arbitrate shall survive the termination of my
employment. It can only be revoked or modified by a writing signed by the
Company and I, which specifically states a mutual intent to revoke or modify
this Agreement.
<PAGE>
Sole and Entire Agreement
7. This is the complete agreement of us on the subject of arbitration of
disputes [except for any arbitration agreement in connection with any
pension or benefit plan].
This Agreement supersedes any prior or contemporaneous oral or written
understanding on the subject.
8. Neither of us is relying on any representations, oral or written, on the
subject of the effect, enforceability or meaning of this Agreement, except
as specifically set forth in this Agreement.
Construction
9. If any provision of this Agreement is found to be void or otherwise
unenforceable, in whole or in part, such adjudication shall not affect the
validity of the remainder of the Agreement.
Consideration
10. The promises by the Company and by me to arbitrate differences, rather
than litigate them before courts or other bodes, provide consideration for
each other. In addition, I have entered into an Employment Agreement as
further consideration for entering into this Agreement.
Not an Employment Agreement
11. This Arbitration Agreement is purely procedural. It does not provide
any substantive rights in addition to those provided by applicable law or my
Employment Agreement.
Voluntary
12. I acknowledge that I have carefully read this agreement, that I
understand its terms, that all understandings and agreements between the
company and me relating to the subjects covered in the agreement are
contained in it, and that I have entered into the agreement voluntarily and
not in reliance on any promises or representations by the company other than
those contained in this agreement itself.
<PAGE>
13. The Age Discrimination in Employment Act protects individuals over 40
years of age from age discrimination. The ADEA contains some special
requirements before an employee can give up the right to file a lawsuit in
court. The following provisions are designed to comply with those
requirements.
a. I agree that this Agreement to arbitrate is valuable to me,
because it permits a faster resolution of claims that I would receive in
court.
b. I have been advised to consult an attorney before signing this.
c. I have 21 days to consider this Agreement. However, I may sign it
sooner if I wish to do so.
d. I have 7 days following my signing this Agreement to revoke my
signature, and the Agreement will not be legally binding until the 7 day
period has gone by.
33. I FURTHER ACKNOWLEDGE THAT I HAVE BEEN GIVEN THE OPPORTUNITY TO DISCUSS
THIS AGREEMENT WITH MY PRIVATE LEGAL COUNSEL AND HAVE AVAILED MYSELF TO THAT
OPPORTUNITY TO THE EXTENT I WISH TO DO SO.
First Cash Financial Services, Inc. Executive
/S/ RICHARD T. BURKE /S/ PHILLIP E. POWELL
----------------------------------- -----------------------------
Richard T. Burke Phillip Eric Powell
Director