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Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”), dated this February 28, 2020 (the
“Effective Date”), is entered into by and between USA Technologies, Inc., a
Pennsylvania corporation, (the “Corporation”), and Donald W. Layden, Jr. (the
“Executive”).
 
WHEREAS, Executive and the Corporation previously entered into a letter
agreement dated October 17, 2019, under which the Executive served as the
Corporation’s interim Chief Executive Officer (the “Prior Employment
Agreement”); and
 
WHEREAS, the Board of Directors of the Corporation (the “Board”) wishes to have
the Executive serve as the Corporation’s President and Chief Executive Officer
on an ongoing rather than an interim basis and the Executive has agreed to serve
in that capacity, and therefore the Corporation and the Executive (collectively,
the “Parties”) desire to enter into this Agreement, which shall have the effect
of superseding the Prior Employment Agreement, which shall be of no further
force and effect, and to set forth the terms by which the Executive shall act as
the Corporation’s President and Chief Executive Officer.
 
NOW THEREFORE, in consideration of the mutual covenants herein contained, the
parties, intending to be legally bound, hereby agree as follows:
 

1.
EMPLOYMENT

 
The Corporation hereby agrees to employ the Executive as the Corporation’s
President and Chief Executive Officer, upon the terms and conditions herein
contained, and the Executive hereby agrees to such employment and to serve as
the Corporation’s President and Chief Executive Officer, and to perform the
duties and functions customarily performed by the President and Chief Executive
Officer of a publicly traded corporation.
 
In such capacity, the Executive shall report to the Corporation’s Board of
Directors (the “Board”), and shall have the powers and responsibilities set
forth in the Corporation’s By-Laws as well as such additional powers and
responsibilities consistent with his position as the Board may assign to him.
 
So long as the Executive serves as the Corporation’s President and Chief
Executive Officer, the Executive will be expected to devote his full working
time and attention to the business of the Company, and he will not render
services to any other business without the prior approval of the Board.
Notwithstanding the foregoing, the Executive may manage personal investments,
participate in civic, charitable, and professional activities (including serving
on boards and committees), and, subject to prior approval by the Board, serve on
the board of directors (and any committees) and/or as an advisor of other
for-profit companies, provided that such activities do not at the time the
activity or activities commence or thereafter (i) create an actual or potential
business or fiduciary conflict of interest, or (ii) individually or in the
aggregate, interfere materially with the performance of his duties to the
Corporation.
 
The Executive shall continue to serve as a member of the Board.  While this
Agreement is in effect, the Corporation agrees to nominate the Executive to
serve as a member of the Board.  The Executive shall not receive any
compensation for service on the Board in addition to the compensation and
benefits set forth in this Agreement so long as this Agreement is in effect.
 

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2.
DURATION OF AGREEMENT

 
This Agreement, together with the Executive’s employment with the Corporation,
may be terminated by either Party at any time by providing advance written
notice to the other Party of no less than three (3) months.  This Agreement
shall automatically terminate at the end of the Executive’s employment with the
Corporation, with the exception of the Corporation’s obligations that arise in
connection with the Executive’s termination of employment.  Notwithstanding the
foregoing, in the event of a Change in Corporate Control (as defined in Section
6 below), the Corporation (or an entity that may control the Corporation or any
successor in interest to the Corporation) may not terminate this Agreement for
at least thirteen (13) months after the time that the Change in Corporate
Control occurs. For avoidance of doubt, the delivery of timely advance written
notice by the Corporation shall not allow it to avoid the payments of amounts
due under Sections 5 or 6 hereof if the requirements of the applicable section
are otherwise satisfied at or prior to the time that this Agreement terminates.
Furthermore, the Corporation shall be entitled to terminate this Agreement and
the Executive’s employment immediately for any reason, subject to the
obligations of the Corporation under Sections 5 and 6 of this Agreement.  Upon
termination of the Executive’s employment hereunder for any reason, unless
otherwise expressly provided by the Board, the Executive shall be deemed to have
resigned from all positions that the Executive holds as an officer or member of
the Board (or a committee thereof) of the Corporation or any of its affiliates.
 

3.
BASE COMPENSATION AND BONUS

 
(a)          The Executive shall receive annual base compensation in the amount
of $700,000 (“Base Compensation”).  Such amounts shall be payable in
substantially equal periodic installments in accordance with the Corporation’s
customary payroll practices.  While this Agreement is in effect, the
Compensation Committee of the Board (the “Compensation Committee”) shall review
the Executive’s Base Compensation at annual intervals, and may increase (but not
decrease) the Executive’s annual Base Compensation from time to time.
 
(b)          The Executive shall also be eligible to receive an annual incentive
cash bonus for each fiscal year of the Corporation ending while this Agreement
is in effect with a target bonus amount equal to 100% of the Executive’s Base
Compensation, with the actual amount of such bonus to be determined by the
Compensation Committee, using such performance measures as the Compensation
Committee deems to be appropriate.  Such bonus, if any, shall be paid to the
Executive no later than sixty (60) days after the end of the fiscal year to
which the bonus relates. Such annual bonus will be subject to the terms of any
Corporation bonus plan under which it is granted and (ii) in order to be
eligible to receive an annual bonus, the Executive must be employed by the
Corporation on the last day of the applicable fiscal year.  With respect to the
Corporation’s fiscal year ending in 2020, such bonus shall be prorated for the
portion of such fiscal year beginning on the Effective Date and ending on June
30, 2020.
 
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4.
ADDITIONAL COMPENSATION AND BENEFITS

 
The Executive shall receive the following additional compensation and welfare
and fringe benefits.
 
(a)          Long-Term Incentives.  The Executive shall be eligible to
participate in the Corporation’s 2018 Equity Incentive Plan (“2018 EIP”), or any
other equity compensation plan adopted by the Corporation, as shall be
determined by the Compensation Committee.  Within an administratively reasonable
period of time following the Effective Date, the Executive shall receive a
Restricted Stock Award (as defined under the 2018 EIP) for that number of shares
of the Corporation’s common stock equal to $1.5 million on the date of grant,
rounded to the nearest whole share.  Such Restricted Stock Award shall vest 25%
on the first anniversary of the Effective Date, and the remaining 75% shall vest
in equal quarterly installments over a period of three years beginning on the
first anniversary of the Effective Date and ending on the fourth anniversary of
the Effective Date, so long as the Executive provides services continuously to
the Corporation from the date of grant of such award until the applicable
vesting date, and shall be documented using the Corporation’s standard form of
Restricted Stock Award agreement.  The Executive understands and agrees that he
shall not be eligible to be considered for any future grant of an equity-based
long-term incentive award until following the completion of the Corporation’s
2021 fiscal year.
 
(b)          Employee Benefits.  While this Agreement is in effect, subject to
satisfaction of any applicable eligibility requirements, the Executive will
continue to be eligible to participate in any employee benefit plan that the
Corporation has adopted or may adopt, maintain, or contribute to for the benefit
of its executive officers, which includes health insurance, disability
insurance, life insurance, and a section 401(k) tax-qualified retirement plan. 
The Executive will be eligible to earn paid time off benefits in accordance with
the Corporation’s paid time off policy.  The Corporation reserves the right to
amend, modify or terminate any of its benefit plans, policies, or programs at
any time and for any reason.
 
The Corporation shall continue to indemnify the Executive in accordance with the
terms of the Executive’s existing indemnification agreement with the Corporation
and the Corporation’s Bylaws.
 
(c)          Business Expenses.  The Corporation shall reimburse the Executive
for all reasonable expenses he incurs in promoting the Corporation’s business,
including expenses for travel and similar items, upon presentation by the
Executive from time to time of an itemized account of such expenditures in
accordance with the Corporation’s established business expense reimbursement
policy and applicable law.  Following Executive’s termination of employment, any
expense reimbursement requests must be submitted no later than sixty (60) days
following such termination.
 
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5.
PAYMENTS UPON TERMINATION

 
(a)          Termination without Cause or Termination by Executive for Good
Reason (as defined below).  If the Executive’s employment is terminated by the
Corporation without Cause (but not including due to death or disability) or
terminated by the Executive for Good Reason while this Agreement is in effect,
the Executive shall be entitled to the following:
 
(i)          Accrued Benefits.
 
(A)          Base Compensation accrued through the date of termination, based on
the number of days in such year that had elapsed as of the termination date;
 
(B)          any accrued but unpaid paid time off through the date of
termination;
 
(C)          any bonuses earned but unpaid with respect to fiscal years or other
completed bonus periods preceding the termination date;
 
(D)          any nonforfeitable benefits payable to the Executive under the
terms of any deferred compensation, incentive or other benefit plans maintained
by the Corporation, payable in accordance with the terms of the applicable plan;
and
 
(E)          any business expense reimbursements owed to the Executive.
 
Such amounts shall be referred to herein as the “Accrued Benefits”.  All
payments of Accrued Benefits shall be made within thirty (30) days following the
date of such termination and within any shorter time period required by law,
except that any business expense reimbursement shall be paid no later than
thirty (30) days following the date that the written request for reimbursement
has been submitted to the Corporation in accordance with the Corporation’s
policy on such topic and any amounts payable under (D) above shall be paid in
accordance with the terms of the applicable plan.
 
(ii)          Severance Benefits.  In addition to the Accrued Benefits, the
Executive shall be entitled to the following benefits.
 
(A)          a series of semi-monthly severance payments for eighteen (18)
months (the “Severance Period”), each in an amount equal to one-twenty fourth
(1/24th) of the sum of (I) the Executive’s Base Compensation, as in effect on
the date of termination, and (II) the Executive’s target annual cash bonus
opportunity at the time of termination, in either case disregarding any
reductions in Base Compensation or target bonus opportunity that provided the
basis for the Executive’s resignation for “Good Reason”, to be paid in
accordance with the Corporation’s normal payroll practices;
 
(B)          all of the Executive’s unvested compensatory stock awards, whether
options, restricted stock or otherwise, shall become vested on a prorated basis,
based on a fraction, the numerator of which is the number of days from the
commencement of the vesting period to the date of the Executive’s termination of
employment and the denominator of which is the total number of days in the
vesting period, and the resulting number of vested shares of the Corporation’s
common stock shall be rounded to the next higher whole share of the
Corporation’s common stock and any outstanding stock options shall remain
exercisable for six (6) months following the Executive’s termination of
employment (or such longer period of time, if any, as may be set forth in the
stock option agreement documenting such stock option); and
 
(C)          continued coverage under any group health plan maintained by the
Corporation in which the Executive participated at the time of his termination
for the period during which the Executive elects to receive continuation
coverage under Section 4980B of the Code at an after-tax cost to the Executive
comparable to the cost that the Executive would have incurred for the same
coverage had he remained employed during such period.
 
Such benefits shall be referred to as the “Severance Benefits”.
 
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Notwithstanding anything in the 2018 EIP, or any other plan, program or
arrangement sponsored by the Corporation, the Severance Benefits are subject to
a waiver and general release of claims in favor of the Corporation, in a form
substantially the same as the Corporation’s standard form of release used in
connection with the termination of employment of an employee of the Corporation,
that is executed by the Executive and which becomes irrevocable within sixty
(60) days following the date of such termination.  All equity-based payments,
settlements or other actions taken to carry out the terms of this Agreement
under subsection (B) shall be completed no later than thirty (30) days following
the date on which the Executive’s release becomes effective.  The payments set
forth in subsection (A) shall commence on the 60th day following the day of such
termination.
 
For purposes of this Agreement, “Cause” shall mean: (1) any action by the
Executive involving willful disloyalty to the Corporation, such as embezzlement,
fraud, misappropriation of corporate assets; (2) the Executive being convicted
of a felony; (3) the Executive being convicted of any crime or offense that is
not a felony but was (x) committed in connection with the performance of his
duties hereunder or (y) involved moral turpitude; or (4) the intentional and
willful failure by the Executive to substantially perform his duties hereunder
as directed by the Board (other than any such failure resulting from the
Executive’s incapacity due to physical or mental disability) after a demand for
substantial performance is made by the Board.  A termination of employment shall
not be deemed for Cause unless and until (x) there shall have been delivered to
the Executive a notice describing in reasonable detail the particulars giving
rise to a termination for Cause, and (y) in the case of termination pursuant to
clause (4) above, if no cure has occurred by the fifteenth (15th) day after
notice was received by the Executive.
 
For purposes of this Agreement, “Good Reason” shall mean: (1) the assignment of
Executive to a position other than the President and Chief Executive Officer of
the Corporation; (2) the assignment of duties materially inconsistent with such
position if such change in assignment constitutes (x) a material diminution in
the Executive’s total compensation opportunity, authority, duties or
responsibilities or (y) a change in the reporting structure such that the
Executive is directed to report to anyone other than the Board; (3) the
relocation of the Executive’s principal place of business by a distance of more
than fifty (50) miles, which principal place of business as of the Effective
Date is Milwaukee, Wisconsin; or (4) a material breach by the Corporation of
this Agreement; provided, however, Executive must not have consented to any such
act or omission that could give rise to a claim for “Good Reason”, the Executive
must have notified the Corporation in writing within the first thirty (30) days
following the occurrence of any of the foregoing events and the Corporation must
have failed to substantially cure such breach within thirty (30) days following
its receipt of such notice from the Executive; and provided further, the
Executive must have resigned under this paragraph within ninety (90) days
following the occurrence of the event.
 
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(b)          Termination for Cause.  If the Executive’s employment is terminated
by the Corporation for Cause, the Executive shall be entitled to the Accrued
Benefits.
 
(c)          Voluntary Termination or Resignation by the Executive.  If the
Executive voluntarily terminates or resigns his employment other than for Good
Reason, the Executive shall be entitled to the Accrued Benefits.
 
(d)          Cooperation. The parties agree that certain matters in which the
Executive will be involved while serving as the Corporation’s President and
Chief Executive Officer may necessitate the Executive’s cooperation in the
future.  Accordingly, following the termination of the Executive’s employment
for any reason, to the extent reasonably requested by the Board, the Executive
shall endeavor to cooperate with the Corporation in connection with matters
arising out of the Executive’s service to the Corporation; provided that, the
Corporation shall collaborate with the Executive to minimize disruption of the
Executive’s other activities.  The Corporation shall reimburse the Executive for
reasonable expenses incurred in connection with such cooperation and in the
event that substantial amounts of the Executive’s time is involved, the
Corporation and the Executive shall agree on commercially reasonable
compensation.
 

6.
CHANGE IN CORPORATE CONTROL

 
(a)           If at any time upon, or during the period of thirteen (13)
consecutive months following, the occurrence of a Change in Corporate Control
(as defined below), and while this Agreement is in effect, the Executive is
involuntarily terminated (other than for Cause), or resigns his employment for
Good Reason, the Executive shall be entitled to the Accrued Benefits and also
the following benefits:
 
(i)          a lump sum payment equal to 2.5 times the sum of (A) the
Executive’s Base Compensation, as in effect on the date of termination, and (B)
the Executive’s target annual cash bonus opportunity at the time of termination,
in either case disregarding any reductions in Base Compensation or target bonus
opportunity that provided the basis for the Executive’s resignation for “Good
Reason”;
 
(ii)         all of the Executive’s unvested compensatory stock awards, whether
options, restricted stock or otherwise, shall become fully vested and any
outstanding stock options shall remain exercisable for six (6) months following
the Executive’s termination of employment (or such longer period of time, if
any, as may be set forth in the stock option agreement documenting such stock
option); and
 
(iii)         continued coverage under any group health plan maintained by the
Corporation in which the Executive participated at the time of his termination
for the period during which the Executive elects to receive continuation
coverage under Section 4980B of the Code at an after-tax cost to the Executive
comparable to the cost that the Executive would have incurred for the same
coverage had he remained employed during such period.
 
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The benefits set forth in subsections (i), (ii) and (iii) above shall be subject
to a waiver and general release of claims in favor of the Corporation, in a form
substantially the same as the Corporation’s standard form of release used in
connection with the termination of employment of an employee of the Corporation,
that is executed by the Executive and which becomes irrevocable within sixty
(60) days following the date of such termination of such termination.  All
equity-based payments, settlements or other actions taken to carry out the terms
of this Agreement under subsection (ii) shall be completed no later than thirty
(30) days following the date on which the Executive’s release becomes
effective.  The payments set forth in subsection (i) shall commence on the 60th
day following the day of such termination.
 
(b)          For purposes of this Agreement, a “Change in Corporate Control”
shall have the following meaning.
 
(i)          the acquisition by any person, entity or group required to file (or
which would be required to file if the Corporation had been subject to such
provisions) a Schedule 13D or Schedule 14d-1 promulgated under the Securities
Exchange Act of 1934, as amended (the ”Exchange Act”) or any acquisition by any
person entitled to file (or which would be entitled to file if the Corporation
had been subject to such provisions) a Form 13G under the Exchange Act with
respect to such acquisition of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of 51% or more of  the Company’s
then-outstanding voting securities entitled to vote generally in the election
of  directors (the “Outstanding Shares”); provided that a person, entity or
group shall not be deemed  to “beneficially own” any security under this clause
(i) as a result of an agreement, arrangement or understanding to vote such
security if such agreement, arrangement or understanding arises solely from a
revocable proxy, agent designation or consent given in response to a public
proxy, agent designation or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations under the Exchange Act,
including the disclosure requirements of Schedule 14A thereunder; or
 
(ii)  (A) the consummation of a merger, reorganization, or consolidation of the
Corporation with any other entity, whether or not the Corporation is the
surviving entity in such transaction; (B) the approval by the shareholders of a
plan or proposal for the liquidation or dissolution of the Corporation; or (C)
the sale, transfer, lease or other disposition of all or substantially all of
the assets of the Corporation (hereinafter collectively, a “Business
Combination”).
 
Notwithstanding subsection (ii) above, and other than in connection with a
liquidation or dissolution of the Company referred to in subsection (ii)(B)
above, a Business Combination described in subsection (ii)  above shall not
constitute a Change in Corporate Control if, following such Business
Combination:  (A) all or substantially all of the individuals and entities who
were the beneficial owners of the Outstanding Shares immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 51% of
the Outstanding Shares of the entity resulting from such business combination
(including without limitation, an entity which as a result of such transactions
owns the Corporation or all or substantially all of the Corporation’s assets
either directly or through one or more subsidiaries); and  (B) no person owns,
directly or indirectly, 49% or more of the Outstanding Shares of the entity
resulting from such Business Combination except for intermediate holding
companies of the ultimate parent entity or to the extent that such ownership
existed prior to the Business Combination.
 
Notwithstanding the foregoing, if a Change in Corporate Control constitutes a
payment event with respect to any benefits that provides for the deferral of
compensation that is subject to Section 409A of the Code, then, to the extent
required to avoid the imposition of additional taxes under Section 409A of the
Code, the transaction or event described in subparagraph (i) or (ii) above, with
respect to such benefits, shall only constitute a Change in Corporate Control
for purposes of the payment timing of such benefits if such transaction also
constitutes a “change in control event,” as defined in Treasury Regulation
§1.409A-3(i)(5).
 
(c)          Notwithstanding anything else in this Agreement to the contrary, in
the event that it shall be determined that any payments or distributions by the
Corporation to or for the benefit of the Executive, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise (together, the “Payments”) would constitute “parachute payments”
within the meaning of Section 280G of the Code, then the Payments shall be
payable either in (i) full or (ii) as to such lesser amount which would result
in no portion of such Payments being subject to the excise tax imposed under
Section 4999 of the Code, such that the Executive shall receive the greater, on
an after-tax basis, of either (i) or (ii) above, as determined by an independent
accountant or tax advisor (“Independent Tax Advisor”) selected by the
Corporation.  In the event that the Payments are to be reduced pursuant to this
Section 6(c), such Payments shall be reduced as determined by the Independent
Tax Advisor such that the reduction of compensation to be provided to or for the
benefit of the Executive as a result of this Section 6(c) is minimized and to
effectuate that, Payments shall be reduced (i) by first reducing or eliminating
the portion of such Payments which is not payable in cash (other than that
portion of such payments that is subject to clause (iii) below), (ii) then by
reducing or eliminating cash Payments (other than that portion of such Payments
subject to clause (iii) below) and (iii) then by reducing or eliminating the
portion of such Payments (whether or not payable in cash) to which Treas. Reg.
§1.280G-1 Q/A 24(c) (or any successor provision thereto) applies, in each case
in reverse order beginning with Payments which are to be paid the farthest in
time from the date of the transaction constituting a change in ownership of the
Corporation within the meaning of Section 280G of the Code.  Any reductions made
pursuant to this Section 6(c) shall be made in a manner consistent with the
requirements of Section 409A and where two economically equivalent amounts are
subject to reduction but payable at different times, such amounts shall be
reduced on a pro rata basis but not below zero.
 
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7.
WITHHOLDING AND SECTION 409A COMPLIANCE

 
(a)          The Corporation shall, to the fullest extent not prohibited by law,
have the right to withhold and deduct from any payment hereunder any federal,
state or local taxes of any kind required by law to be withheld with respect to
any such payment.
 
(b)          This Agreement is intended to comply with the requirements of
Section 409A of the Code or an exemption thereunder, and shall be interpreted
and construed consistently with such intent.  The payments to the Executive
pursuant to this Agreement are intended to be exempt from Section 409A of the
Code to the maximum extent possible, under the separation pay exemption, as
short-term deferrals, or otherwise.  For purposes of Section 409A of the Code,
each installment payment provided under this Agreement shall be treated as a
separate payment.  In the event the terms of this Agreement would subject the
Executive to additional income taxes, interest or penalties under Section 409A
of the Code (“409A Penalties”), the Corporation and the Executive shall
cooperate diligently to amend the terms of the Agreement to avoid such 409A
Penalties, to the extent possible.  To the extent any amounts under this
Agreement are payable by reference to Executive’s “termination,” “termination of
employment,” or similar phrases, such term shall be deemed to refer to the
Executive’s “separation from service” (as defined in Section 409A of the Code). 
Notwithstanding any other provision in this Agreement, including but not limited
to Sections 5 and 6, if the Executive is a “specified employee” (as defined in
Section 409A(a)(2)(b)(i)), then to the extent any amount payable under this
Agreement (i) constitutes the payment of nonqualified deferred compensation,
within the meaning of Section 409A of the Code, (ii) is payable upon the
Executive’s separation from service, and (iii) under the terms of this Agreement
would be payable prior to the six-month anniversary of the Executive’s
separation from service, such payment shall be delayed and paid to the
Executive, on the first day of the first calendar month beginning at least six
months following the date of termination, or, if earlier, within ninety (90)
days following the Executive’s death to the Executive’s surviving spouse (or
such other beneficiary as the Executive may designate in writing).  Any
reimbursement or advancement payable to the Executive pursuant to this Agreement
shall be conditioned on the submission by the Executive of all expense reports
reasonably required by the Corporation under any applicable expense
reimbursement policy, and shall be paid to the Executive within thirty (30) days
following receipt of such expense reports, but in no event later than the last
day of the calendar year following the calendar year in which the Executive
incurred the reimbursable expense.  Any amount of expenses eligible for
reimbursement, or in-kind benefit provided, during a calendar year shall not
affect the amount of expenses eligible for reimbursement, or in-kind benefit to
be provided, during any other calendar year.  The right to any reimbursement or
in-kind benefit pursuant to this Agreement shall not be subject to liquidation
or exchange for any other benefit.
 
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8.
PROTECTION OF CONFIDENTIAL INFORMATION

 
The Executive hereby agrees that, during his employment with the Corporation and
thereafter, he shall not, directly or indirectly, disclose or make available to
any person, firm, corporation, association or other entity for any reason or
purpose whatsoever, any Confidential Information (defined below).  The Executive
further agrees that, upon the date of the Executive’s termination, all
Confidential Information in his possession that is in written or other tangible
form shall be returned to the Corporation and shall not be retained by the
Executive or furnished to any third party, in any form except as provided
herein.  Notwithstanding the foregoing, this Section 9 shall not apply to
Confidential Information that (i) was publicly known at the time of disclosure
to the Executive, (ii) becomes publicly known or available thereafter other than
by any means in violation of this Agreement or any other duty owed to the
Corporation by the Executive, (iii) is lawfully disclosed to the Executive by a
third party, or (iv) is required to be disclosed by law or by any court,
arbitrator or administrative or legislative body with actual or apparent
jurisdiction to order the Executive to disclose or make accessible any
information.  As used in this Agreement, Confidential Information means, without
limitation, any non-public confidential or proprietary information disclosed to
Executive or known by the Executive as a consequence of or through the
Executive’s relationship with the Corporation, in any form, including electronic
media.  Confidential Information also includes, but is not limited to the
Corporation’s business plans and financial information, marketing plans, and
business opportunities.  Nothing herein shall limit in any way any obligation
the Executive may have relating to Confidential Information under any other
agreement or promise to the Corporation.
 
The Executive specifically acknowledges that all such Confidential Information,
whether reduced to writing, maintained on any form of electronic media, or
maintained in the mind or memory of the Executive and whether compiled by the
Corporation, and/or the Executive, derives independent economic value from not
being readily known to or ascertainable by proper means by others who can obtain
economic value from its disclosure or use, that reasonable efforts have been
made by the Corporation to maintain the secrecy of such information, that such
information is the sole property of the Corporation and that any retention and
use of such information by the Executive during his employment with the
Corporation (except in the course of performing his duties and obligations to
the Corporation) or after the termination of his employment shall constitute a
misappropriation of the Corporation’s trade secrets.
 
The Executive agrees that Confidential Information gained by the Executive
during the Executive’s association with the Corporation, has been developed by
the Corporation through substantial expenditures of time, effort and money and
constitute valuable and unique property of the Corporation.  The Executive
recognizes that because his work for the Corporation will bring him into contact
with confidential and proprietary information of the Corporation, the
restrictions of this Section 8 are required for the reasonable protection of the
Corporation and its investments and for the Corporation’s reliance on and
confidence in the Executive.  The Executive further understands and agrees that
the foregoing makes it necessary for the protection of the Corporation’s
business that the Executive not compete with the Corporation during his
employment with the Corporation, as further provided in the following Section 9.
 
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9.
RESTRICTIVE COVENANTS

 
(a)          During the Executive’s employment as President and Chief Executive
Officer, he will be prohibited from competing within any geographic area in
which the Corporation’s business was conducted as of the date of this Agreement
including but not limited to, delivering services or products to unattended
retail locations, and including any related production, promotion, marketing, or
sales activities. The term “competing” means acting, directly or indirectly, as
a partner, principal, stockholder, joint venture, associate, independent
contractor, creditor of, consultant, trustee, lessor to, sub-lessor to, employee
or agent of, or to have any other involvement with, any person, firm,
corporation, or other business organization which is engaged in the businesses
described in this section. For any and all purposes of this Section 9(a),
references to the Corporation shall mean and include any affiliate (as such term
is defined in Rule 144 under the Securities Act of 1933, as amended) of the
Corporation, whether on the date of this Agreement or in the future, including
but not limited to, Cantaloupe Systems, Inc.
 
(b)          For a one-year period following the termination of the Executive’s
employment for any reason, the Executive will not (a) directly or indirectly,
solicit for hire for any business entity other than the Corporation, any person
employed by the Corporation as of the date of termination of this Agreement; or
(b) directly or indirectly interfere with the Corporation’s relations with any
person employed by the Corporation as of the date of termination of this
Agreement.  Such restriction shall not limit any employee or candidate
responding to a general job posting. For all purposes of this Section 9(b),
references to the Corporation shall mean and include any affiliate (as such term
is defined in Rule 144 under the Securities Act of 1933, as amended) of the
Corporation, whether on the date of this Agreement or in the future, including
but not limited to, Cantaloupe Systems, Inc.
 
(c)          For a one-year period following the termination of the Executive’s
employment for any reason, the Executive shall not solicit any customer of the
Corporation in connection with engaging in a business competing with or similar
to that of the Corporation as conducted as of the date of this Agreement,
including but not limited to, delivering services or products to unattended
retail locations, and including any production, promotion, marketing, or sales
activities relating thereto, and including any production, promotion, marketing,
or sales activities. For all purposes of this paragraph, references to the
Corporation shall mean and include any affiliate (as such term is defined in
Rule 144 under the Securities Act of 1933, as amended) of the Corporation,
whether on the date of this Agreement or in the future, including but not
limited to, Cantaloupe Systems, Inc.
 
(d)          During his employment with the Corporation and thereafter,
Executive will not make or authorize anyone else to make on Executive’s behalf
any disparaging or untruthful remarks or statements, whether oral or written,
about the Corporation, its operations or its products, services, affiliates,
officers, directors, employees, or agents, or issue any communication that
reflects adversely on or encourages any adverse action against the Corporation. 
Executive will not make any direct or indirect written or oral statements to the
press, television, radio or other media or other external persons or entities
concerning any matters pertaining to the business and affairs of the
Corporation, its affiliates or any of its officers or directors. The Corporation
agrees not to make, and shall direct its directors and executive officers not to
make on its behalf, any disparaging or untruthful remarks or statements, whether
oral or written, about Executive, including comments to the press, television,
radio, or other media or other external persons or entities.
 
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10.
INJUNCTIVE RELIEF

 
The Executive acknowledges and agrees that it would be difficult to fully
compensate the Corporation for damages resulting from the breach or threatened
breach of the covenants set forth in Sections 8 and 9 of this Agreement and
accordingly agrees that the Corporation shall be entitled to temporary and
injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, without the need to post any bond, to
enforce such provisions in any action or proceeding instituted in the United
States District Court for the Eastern District of Pennsylvania or in any court
in the State of Pennsylvania having subject matter jurisdiction.  This provision
with respect to injunctive relief shall not, however, diminish the Corporation’s
right to claim and recover damages.
 

11.
NOTICES

 
All notices or communications hereunder shall be in writing and sent by
overnight courier, certified mail, or registered mail (return receipt
requested), postage prepaid, addressed as follows (or to such other address as
such party may designate in writing from time to time):
 
If to the Corporation:
 
USA Technologies, Inc.
100 Deerfield Lane, Suite 300
 Malvern, Pennsylvania
Attention:  General Counsel

If to the Executive, at the address on file with the Corporation’s Human
Resources department.
 
The actual date of mailing, as shown by a mailing receipt therefor, shall
determine the time at which notice was given.
 
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12.
SEPARABILITY

 
If any provision of this Agreement shall be declared to be invalid or
unenforceable, in whole or in part, such invalidity or unenforceability shall
not affect the remaining provisions hereof which shall remain in full force and
effect.
 
It is expressly understood and agreed that although the parties consider the
restrictions contained in this Agreement to be reasonable, if a court determines
that the time or territory or any other restriction contained in this Agreement
is an unenforceable restriction on the activities of the Executive, no such
provision of this Agreement shall be rendered void but shall be deemed amended
to apply as to such maximum time and territory and to such extent as such court
may judicially determine or indicate to be reasonable.
 

13.
ASSIGNMENT

 
This Agreement shall be binding upon and inure to the benefit of the heirs and
representatives of the Executive and the assigns and successors of the
Corporation, but neither this Agreement nor any rights or obligations hereunder
shall be assignable or otherwise subject to hypothecation by the Executive.  The
obligations of the Corporation under this Agreement shall also be legally
binding on any successor to the Corporation.
 

14.
ENTIRE AGREEMENT

 
This Agreement represents the entire agreement of the parties and shall
supersede any and all previous contracts, arrangements or understandings between
the Corporation and the Executive (including the Prior Employment Agreement). 
The Agreement may be amended at any time by mutual written agreement of the
parties hereto.
 
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15.
GOVERNING LAW AND ARBITRATION

 
This Agreement shall be construed, interpreted, and governed in accordance with
the laws of the State of Pennsylvania, without regard to principles of conflicts
of laws.
 
Any dispute, controversy or claim arising out of or related to this Agreement or
any breach of this Agreement shall be submitted to and decided by binding
arbitration. Arbitration shall be administered exclusively by the American
Arbitration Association located in Philadelphia, Pennsylvania and shall be
conducted in accordance with the National Rules for the Resolution of Employment
Disputes. Any arbitral award determination shall be final and binding upon the
parties. Judgment may be entered in any court having jurisdiction.
Notwithstanding the foregoing, the Corporation shall be entitled to seek a
restraining order or injunction in any court of competent jurisdiction to
prevent any continuation of any violation of Sections 8 or 9 hereof.
 

16.
SURVIVAL

 
Subject to any limits on applicability contained therein, Sections 8 through 10
and Section 15 and this Section 16 shall survive and continue in full force in
accordance with their terms notwithstanding any termination of this Agreement.
 
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IN WITNESS WHEREOF, the Corporation has caused this Agreement to be duly
executed, and the Executive has hereunto set his hand, as of the day and year
first above written.
 

 
USA TECHNOLOGIES, INC.
     
By:

/s/ William J. Schoch

Name:

William J. Schoch

Title:

Director
        EXECUTIVE          /s/ Donald W. Layden, Jr.   Donald W. Layden, Jr.

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