EXHIBIT 10.43

 

 

EMPLOYMENT AGREEMENT

This agreement (the “Agreement”) between Official Payments Corporation, a
Delaware corporation (the “Company”) and Michael P. Presto (the “Employee”), is
entered into as of this 18th day of July, 2002.  This Agreement shall be
effective as of August 1, 2002 (the “Effective Date”).  The term of this
Agreement is for the period from the Effective Date to January 15, 2003, unless
sooner terminated.  This Agreement supercedes all previous agreements.

 

Agreement

In consideration of the mutual benefits derived from this Agreement and of the
agreements, covenants and provisions hereof, the parties hereto agree as
follows:

 

A.           EMPLOYEE POLICY.  As of the Effective Date, the Company will be a
wholly owned subsidiary of Tier Technologies, Inc., a California Corporation
(“Tier”) and as an affiliated company will be subject to Tier’s employee
policies.

 

B.           AT-WILL EMPLOYMENT.  The Company employs Employee from and after
the Effective Date in the capacity of Chief Operating Officer, Official Payments
Corporation, reporting to the Chief Executive Officer of Tier, or his designee. 
Employee will be based initially in Stamford, CT, but Tier reserves the right to
move designated offices to an area within reasonable proximity within the
tri-state area, including Manhattan, NY.  Employee agrees to perform such
services as are customary to such office and as shall from time to time be
assigned to him by the Company.  Employee agrees to undertake business travel as
is customary to such capacity, and as shall from time to time be requested of
him by the Company or Tier.  The parties agree that employment at the Company is
at will and may be terminated by either the Company or Employee at any time with
or without cause and, except as provided in Section 2.1(a)(i), with or without
notice.  Employee acknowledges that Employee has no right to be employed for a
specific term and no right to insist on specific grounds for termination. 
Employee acknowledges and agrees that the at-will nature of this Agreement
extends to all employment decisions and that any change in the terms and
conditions of employment, including without limitation work assignments,
production standards, job responsibilities, compensation and promotions, shall
be at the Company’s sole discretion.

 

1.            COMPENSATION AND BENEFITS

 

1.1          Base Salary.  In consideration of and as compensation for the
services to be performed by Employee hereunder, the Company shall pay Employee a
base salary (the “Base Salary”) of not less than $350,000 per year, payable
semi-monthly in arrears in accordance with Tier’s regular payroll practices.

1.2          Bonus.  Employee will be eligible to receive a one-time bonus
payment in the amount of $100,000 net of applicable withholdings and
deductions.  Payment of this one-time bonus will be made on January 15, 2003. 
Payment is contingent upon Employee being actively

 

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employed by the Company as of January 15, 2003, or having been terminated by the
Company for any reason other than “for cause,” as defined in Section 2.1(a)
(including, without limitation, by reason of Employee’s death or disability),
prior to January 15, 2003.  Employee will not be eligible for such bonus if he
resigns or if the Company terminates his employment for cause prior to January
15, 2003.

1.3          Participation in Benefit Plans.  Employee shall be entitled to
participate in any pension plans, profit-sharing plans and group insurance,
medical, hospitalization, disability and other benefit plans maintained by Tier
from time to time, as such are generally applicable to employees of Tier and to
the extent Employee is eligible under the general provisions thereof.

1.4          Car Allowance.  Employee shall be entitled to an automobile
allowance equal to $551 per month.

1.5          Reimbursement of Expenses.  The Company shall reimburse Employee
for all business expenses, including, without limitation, travel, entertainment
and similar expenses, incurred by Employee on behalf of the Company if such
expenses are ordinary and necessary business expenses incurred on behalf of the
Company pursuant to the Tier’s standard expense reimbursement policy.  Employee
shall provide the Company with such itemized accounts, receipts or documentation
for such expenses as are required under Tier’s policy regarding the
reimbursement of such expenses.

1.6          Vacation and Personal Leave.  Employee shall be entitled to carry
forward any earned but untaken vacation immediately prior to the Effective Date
and to accrue four (4) weeks’ paid vacation per year for post-Effective Date
periods (pro-rated for post-Effective Date service shorter than one (1) year). 
Employee shall also be entitled to other paid personal leave in accordance with
Tier’s policy.

2.            TERMINATION

2.1          Termination.

(a)           Termination for Cause.  Termination “for cause” shall be limited
to the occurrence of any of the following events:

(i)            the Employee’s failure to substantially perform Employee’s duties
with the Company in good faith (provided in the case of illness, injury or
disability that the Company has provided reasonable accommodation under
applicable disabilities laws), after a demand for substantial performance is
delivered to Employee by the Company which identifies, in reasonable detail, the
manner in which the Company believes that the Employee has not substantially
performed Employee’s duties in good faith and such Employee has not, in the sole
discretion of the Company, improved the performance of Employee’s duties during
a period of fourteen (14) days from such demand for substantial performance;

(ii)           the Employee’s willful commission of any act which has a material
adverse effect on the Company, including, without limitation, an act of
dishonesty, fraud, willful disobedience, gross misconduct or breach of duty;

 

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(iii)         the Employee’s commission of any act in contravention of
Employee’s undertakings contained in Section 3 hereof; or

(iv)          the Employee’s conviction of a felony or a misdemeanor involving
dishonesty or moral turpitude.

(b)           Termination Without Cause.  The Company may terminate Employee’s
employment under this Agreement without cause or notice at any time.

2.2          Severance Payment.  For avoidance of doubt, Company and Employee
agree that Employee, due to previous change in control provisions, has vested in
Employee’s original severance (“Severance Payment”) in the amount of  $250,000. 
Upon termination of employment for any reason, whether such termination is by
the Company, by Employee or because of Employee’s death or disability, and upon
the Employee’s furnishing to the Company an executed waiver and release of
claims, in the form of which is attached hereto as Exhibit A, the Employee shall
receive ratable payment of the $250,000 over a period of twelve (12) months (the
“Severance Period”), subject to standard deductions and withholdings.  In
addition, the Company shall pay Employee a lump sum payment of $6,000 in cash
within fourteen (14) days after termination of his employment, in exchange for
Employee’s agreement not to participate in the Company’s medical and dental
coverage at any time during the period of employment and to waive any right to
continue medical and dental coverage under the provisions of COBRA.  Further,
Employee shall be entitled to a lump sum in cash of $2,500, such payment to be
made within fourteen (14) days after termination of employment, in lieu of
participation during the Severance Period in all other Company benefit plans in
which the Employee participated as of the date of termination.  Employee shall
be entitled to the Employee’s Base Salary and accrued and unused vacation earned
through the date of termination, subject to standard deductions and
withholdings.  Employee shall not be entitled to any other severance benefits.

3.            NON-COMPETITION, NON-SOLICITATION AND CONFIDENTIALITY

3.1          Non-Competition.  During the Severance Period, Employee shall not,
either individually or as a partner, joint venturer, consultant, shareholder,
member or Representative of another Person or otherwise, directly or indirectly,
participate in, engage in, or have a financial or management interest in,
promote, or assist any other Person in any business operation or any enterprise
if such business operation or enterprise engages, or would engage, in a
Restricted Business in a Restricted Area; provided, however, that Employee may
own up to one percent of the outstanding equity securities of any Person.

3.2          Non-Solicitation.  For a period of one (1) year after the
termination of Employee’s employment, Employee shall not, directly or indirectly
(i) employ or seek to employ any Person who at the date of such termination, or
within the twelve (12)-month period preceding the date of such termination, was
an employee, contractor or consultant of the Company or Tier, or otherwise
solicit, encourage, cause or induce any such employee, contractor or consultant
to terminate such relationship with the Company or Tier, or (ii) take any
willful action that would interfere with the relationship of the Company or Tier
with its respective clients or vendors.

3.3          Confidential Information.

 

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(a)           Employee acknowledges that the Confidential Information (as
hereinafter defined) is valuable, special and unique; and that the Company and
Tier wish to protect such Confidential Information by keeping it confidential
for the use and benefit of the Company and Tier.  Based on the foregoing,
Employee undertakes:

(i)            to keep any and all Confidential Information in trust for the use
and benefit of the Company or Tier;

(ii)           except as required by Employee’s duties hereunder, as may be
required by any governmental authority, or as may be authorized in writing by
the Company, not at any time to disclose or use, directly or indirectly, any
Confidential Information;

(iii)         to take all reasonable steps necessary, or reasonably requested by
the Company or Tier, to ensure that all Confidential Information is kept
confidential for the use and benefit of the Company or Tier; and

(iv)          upon termination of Employee’s employment with the Company or at
any other time the Company may in writing so request, to promptly deliver to the
Company all materials constituting Confidential Information (including all
copies thereof) that are in Employee’s possession or under Employee’s control. 
Further, the Employee undertakes that, if requested by the Company, Employee
shall return any Confidential Information pursuant to this subsection and shall
not make or retain any copy of or extract from such materials.

3.4          For purposes of this Agreement, “Person” means an individual, a
partnership, a limited liability company, a joint venture, a corporation, a
trust, an unincorporated organization, a division or operating group of any of
the foregoing, a government or any department or agency thereof or any other
entity.  “Representative” means any officer, director, principal, agent,
employee, consultant or other representative of a Person.  “Restricted Business”
means any business involved in the electronic processing of payments to
government or commercial entities or any other business in which Company is
actively engaged on the date of the termination of Employee’s employment. 
“Restricted Area” means any country in which Company conducts a Restricted
Business on the date of the termination of  Employee’s employment with Company. 
“Confidential Information” means any and all information developed by or for the
Company or Tier of which the Employee gained knowledge by reason of  Employee’s
employment with the Company or Tier under this Agreement that is not generally
known in the industry in which the Company or Tier is or may become engaged. 
Confidential Information includes, but is not limited to, any and all
information developed by or for the Company or Tier or customers of the Company
or Tier, concerning plans, marketing and sales methods, materials, processes,
business forms, procedures, devices used by the Company or Tier or contractors
or customers with which the Company or Tier has dealt during the period of
employment, plans for development of new products, services and expansion into
new areas or markets, internal operations and any trade secrets and proprietary
information of any type owned by the Company or Tier together with all written,
graphic and other materials relating to all or any part of the same.

3.5          Remedies.

 

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(a)           Injunctive Relief.  Employee acknowledges and agrees that the
covenants and obligations contained in Sections 3.1, 3.2, 3.3 and 3.4 hereof
relate to special, unique and extraordinary matters and that a violation of any
of the terms of said Sections will cause the Company irreparable injury for
which adequate remedy at law is not available.  Therefore, Employee agrees that
the Company shall be entitled to an injunction, restraining order, or other
equitable relief from any court of competent jurisdiction, restraining the
Employee from committing any violation of such covenants and obligations.

(b)           Remedies Cumulative.  The Company’s rights and remedies in respect
of this Section are cumulative and are in addition to any other rights and
remedies the Company may have at law or in equity.

4.             MISCELLANEOUS

 

4.1          Notices.  Any written notice, required or permitted under this
Agreement, shall be deemed sufficiently given if either hand delivered or by fax
(with written confirmation of receipt) or nationally recognized overnight
courier.  Written notices must be delivered to the receiving party at its
address or facsimile number on the signature page of this Agreement.  The
parties may change the address or facsimile number at which written notices are
to be received in accordance with this Section.

4.2          Indemnification.  The Company shall indemnify Employee (including
his heirs, executors and administrators) to the fullest extent permitted by law
for any and all costs, liabilities, judgments, damages and expenses incurred by
Employee that arise out of, are in connection with or are related to Employee’s
actions or inactions in his performance of his duties hereunder as an employee,
director or committee member or fiduciary of the Company or any subsidiary or
benefit plan thereof and his service prior to the Effective Date as an employee,
director or committee member or fiduciary of the Company or any subsidiary or
benefit plan thereof, that are not covered or actually paid by the Company’s
directors’ and officers’ liability insurance policies.  The Company shall,
within ten (10) days of presentation of invoices, reimburse Employee (including
his heirs, executors and administrators, as applicable) for all legal fees and
disbursements incurred by the Employee in connection with any potentially
indemnifiable matter.  To the extent permitted by applicable law, the Company
shall, upon the request of Employee, advance to Employee such amounts as
necessary to cover expenses, including without limitation legal fees and
expenses, incurred by the Employee in connection with any suit or proceeding in
which Employee may be involved by reason of his being or having been a director
or officer of the Company or of any subsidiary thereof.

4.3          Arbitration.  All parties agree that to the fullest extent
permitted by law, any and all controversies between them, including whether any
termination is with or without cause shall be submitted for resolution to
binding arbitration.  This means that all parties agree that arbitration shall
be their exclusive forum for resolving disputes between them.  All parties
expressly waive their entitlement, if any, to have controversies between them
decided by a court or jury.

4.4          Prevailing Party.  If any dispute arises between the parties hereto
concerning this Agreement or their respective rights, duties and obligations
hereunder, the party

 

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prevailing in such proceeding shall be entitled to reasonable attorney’s fees
and costs, in addition to any other relief that may be granted.

4.5          Assignment.  The Employee may not assign, transfer or delegate his
rights or obligations hereunder, and any attempt to do so shall be void.  This
Agreement shall be binding upon and shall inure the benefit of the Company and
its successors and assigns.

4.6          Entire Agreement.  This Agreement contains the entire agreement of
the parties hereto with respect to the subject matter hereof, and all other
prior agreements, written or oral, are hereby merged herein and are of no
further force or effect.  This Agreement may be modified or amended only by a
written agreement that is signed by the Company and the Employee.  No waiver of
any section or provision of this Agreement shall be valid unless such waiver is
in writing and signed by the party against whom enforcement of the waiver is
sought.  The waiver by the Company of any section of provision of  this
Agreement shall not apply to any subsequent breach of this Agreement.  Captions
to the various Sections of this Agreement are for the convenience of the parties
only and shall not affect the meaning or interpretation of this Agreement.  This
Agreement may be executed in several counterparts, each of which shall be deemed
an original, but together they shall constitute one and the same instrument.

4.7          Severability.  The provisions of this Agreement shall be deemed
severable, and if any part of any provision is held illegal, void or invalid
under applicable law, such provision may be changed to the extent reasonably
necessary to make the provision, as so changed, legal valid and binding.  If any
provision of this Agreement is held illegal, void or invalid in its entirety,
the remaining provisions of this Agreement shall not in any way be affected or
impaired but shall remain binding in accordance with their terms.

4.8          Continuing Obligations.  The provisions contained in Sections 2.2,
3, 4.2, 4.3, 4.7, 4.8 and 4.9 of this Agreement shall continue and survive the
termination of this Agreement.

4.9          Applicable Law.  This Agreement and the rights and obligations of
the Company and the Employee hereunder shall be governed by and construed and
enforced under the laws of Connecticut, without reference to any principles of
conflict of laws.

IN WITNESS WHEREOF, the parties here to have executed this Agreement as of the
date first above written

 

 

OFFICIAL PAYMENTS CORPORATION

 

 

 

 

 

 

 

By:

 

/s/ Laura B. DePole

 

 

 

 

 

 

 

 

 

Print Name:

 

Laura B. DePole

 

 

 

 

Title:

 

Secretary/Treasurer

 

 

 

 

 

 

 

 

 

/s/ Michael P. Presto

 

 

Michael P. Presto

 

 

 

 

 

 

 

Address:

 

 

 

 

Facsimile:

 

 

 

 

 

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EXHIBIT A

RELEASE AND WAIVER OF CLAIMS

In consideration of the payments and other benefits set forth in Section 2.2 of
the Employment Agreement dated August 1, 2002, to which this form is attached,
I, Michael P. Presto, hereby furnish Official Payments Corporation and Tier
Technologies, Inc (collectively “the Companies”), with the following release and
waiver (the “Release and Waiver”).

 

I hereby release, and forever discharge the Companies, its officers, directors,
agents, employees, stockholders, successors, assigns, affiliates, parent,
subsidiaries, and benefit plans, of and from any and all claims, liabilities,
demands, causes of action, costs, expenses, attorneys’ fees, damages,
indemnities and obligations of every kind and nature, in law, equity, or
otherwise, known and unknown, suspected and unsuspected, disclosed and
undisclosed, arising at any time prior to and including my employment
termination date with respect to any claims, including but not limited to those
claims relating to my employment and the termination of my employment;
including, but not limited to, claims pursuant to any federal, state or local
law relating to employment, including, but not limited to, discrimination
claims, claims under any local statute governing discrimination, and the Federal
Age Discrimination in Employment Act of 1967, as amended (“ADEA”), or claims for
wrongful termination, breach of the covenant of good faith, contract claims,
tort claims and wage or benefit claims, including, but not limited to, claims
for salary, bonuses, commissions, stock, stock options, vacation pay, fringe
benefits, severance pay or any form of compensation.

 

I also acknowledge that I have read and understand Section 1542 of the
California Civil Code or any comparable statute under any other state, which
reads as follows: “A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his settlement
with the debtor.”  I hereby  expressly waive and relinquish all rights and
benefits under that section and any law of any jurisdiction of similar effect
with respect to any claims I may have against the Companies.

 

I acknowledge that, among other rights, I am waiving and releasing any rights I
may have under ADEA, and that this Release and Waiver is knowing and voluntary. 
I further acknowledge that I have been advised, as required by the Older Workers
Benefit Protection Act, that:  (a) the Release and Waiver granted herein does
not relate to claims which may arise after this Release and Waiver is executed;
(b) I have the right to consult with an attorney prior to executing this Release
and Waiver (although I may choose voluntarily not to do so); and if I am over 40
years of age upon execution of this Release and Waiver:  (c) I have twenty-one
(21) days from the date of termination of my employment with the Company in
which to consider this Release and Waiver (although I may choose voluntarily to
execute this Release and Waiver earlier); (d) I have seven (7) days following
the execution of this Release and Waiver to revoke my consent to this Release
and Waiver; and (e) this Release and Waiver shall not be effective until the
seven (7) day revocation period has expired.

 

Date:_____________________                      By: 
____________________________

 

Print Name:  ______________________

 

 

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