ex10_2.htm


    
      

    

    Exhibit
      10.2

     

    STOCK
      ISSUANCE AND WITHHOLDING AGREEMENT

    


    This
      Agreement is made on the 28th day
      of September 2007, by and between STEPHEN P. HERBERT (“Herbert”), and USA
      TECHNOLOGIES, INC., a Pennsylvania corporation (“USA”).

    


    Background

    


    USA
      and Herbert entered into an Amended
      and Restated Employment And Non-Competition Agreement dated May 11, 2006 (the
      “Employment Agreement”), pursuant to which USA granted to Herbert, as a bonus,
      16,667 shares of Common Stock (the “Bonus Shares”) that vested on January 1,
      2007. The Bonus Shares have been issued to Herbert. Further, on February 12,
      2007, USA adopted the Long-Term Equity Incentive Program (the “Plan”). Pursuant
      to the Plan, Herbert has earned 51,028 shares of Common Stock of USA (the “Plan
      Shares”) on account of the 2007 fiscal year. The Plan Shares have not yet been
      issued to Herbert. As more fully set forth herein, the parties desire to make
      arrangements for the issuance of the Plan Shares to Herbert and for the
      satisfaction, among other things, of USA’s tax withholding obligations in
      respect of the Bonus Shares already issued to Herbert.

    


    Agreement

    


    NOW,
      THEREFORE, in consideration of the
      covenants set forth herein, and intending to be legally bound hereby, the
      parties agree as follows:

    


    1.           Herbert
      hereby elects to have USA withhold and retain 6,400 Plan Shares which are
      otherwise issuable to Herbert pursuant to the Plan. The 6,400 Plan Shares have
      an aggregate fair market value of approximately $53,624.88 as of close of
      business on September 28, 2007, which amount represents the minimum amount
      of
      tax required to be withheld by USA under federal, state and local laws in
      respect of the Bonus Shares already issued to Herbert.


    
      
        
        

      

      
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    2.           As
      of the date hereof, USA shall issue to Herbert an aggregate of 44,628 shares.
      These shares represent the 51,028 Plan Shares earned by Herbert for the 2007
      fiscal year less the 6,400 shares to be retained by USA in order to satisfy
      its
      tax withholding obligations in connection with the Bonus Shares already issued
      to Herbert.

    


    3.           USA
      shall instruct its transfer agent to issue the Plan Shares referred to in
      Section 2 hereof as of the date hereof. The certificates representing the Plan
      Shares shall be subject to stop transfer instructions and shall bear the
      following restrictive legends:

    


    THESE
      SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED, OR THE SECURITIES LAWS OF ANY STATE OR JURISDICTION, IN RELIANCE UPON
      EXEMPTIONS UNDER THOSE ACTS. THE SALE OR OTHER DISPOSITION OF THESE SECURITIES
      IS PROHIBITED UNLESS THE CORPORATION RECEIVES AN OPINION OF COUNSEL SATISFACTORY
      TO IT THAT SUCH SALE OR DISPOSITION CAN BE MADE WITHOUT REGISTRATION UNDER
      THE
      SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OR
      JURISDICTION. BY ACQUIRING THESE SECURITIES, THE HOLDER REPRESENTS THAT THE
      HOLDER HAS ACQUIRED SUCH SECURITIES FOR INVESTMENT PURPOSES ONLY AND THAT THE
      HOLDER WILL NOT SELL OR OTHERWISE DISPOSE OF THESE SECURITIES WITHOUT
      REGISTRATION OR COMPLIANCE WITH THE AFORESAID ACTS AND THE RULES AND REGULATIONS
      ISSUED THEREUNDER.

    


    THE
      SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CANCELLATION PURSUANT
      TO
      THE TERMS OF A CERTAIN STOCK ISSUANCE AND WITHHOLDING AGREEMENT DATED SEPTEMBER
      28, 2007 ENTERED INTO BY THE CORPORATION AND THE INITIAL HOLDER HEREOF, A COPY
      OF WHICH AGREEMENT MAY BE INSPECTED BY THE HOLDER OF THIS CERTIFICATE AT THE
      PRINCIPAL OFFICE OF THE CORPORATION, OR FURNISHED BY THE CORPORATION TO THE
      HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST WITHOUT CHARGE.


    
      
        
        

      

      
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    4.           Herbert
      agrees that, on or before December 31, 2007, Herbert shall satisfy all
      applicable federal, state and local income and other tax withholding obligations
      of USA in connection with the 16,666 additional bonus shares that vested on
      June
      1, 2007 under his Employment Agreement as well as the 51,028 Plan Shares earned
      by him on account of the 2007 fiscal year through either: (a) the delivery
      by
      Herbert to USA of the amount of the withholding tax obligations, or (b) the
      cancellation of a portion of the shares issued to Herbert hereunder by that
      number of shares having a value equal to the withholding tax obligations
      required to be withheld by law.

    


    5.           The
      implementation and interpretation of this Agreement shall be governed by and
      enforced in accordance with the laws of the Commonwealth of Pennsylvania without
      regard to its conflict of laws rules.

    


    6.           The
      rights and obligations of both parties under this Agreement shall inure to
      the
      benefit of and shall be binding upon their personal representatives, heirs,
      successors and assigns.

    


    7.           This
      Agreement may only be modified by an agreement in writing executed by both
      USA
      and Herbert.


    
      
        
        

      

      
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    IN
      WITNESS WHEREOF, the parties hereto have executed this Stock Issuance And
      Withholding Agreement on the day and year first above written.

    


    
      	 	/s/
              Stephen P. Herbert
	 	
              STEPHEN
                P. HERBERT

            
	 	 	 
	 	
              USA
                TECHNOLOGIES, INC.

            
	 	 	 
	 	 	 
	 	
              By:

            	/s/
              George R. Jensen
	 	 	
              George
                R. Jensen, Jr.

            
	 	 	
              Chief
                Executive Officer

            


    

     

     

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