exv10w9



 



EXHIBIT 10.9



EMPLOYMENT AGREEMENT


     EMPLOYMENT AGREEMENT (“Agreement”) effective as of January 6, 2003 (the
“Effective Date”) by and among Global eXchange Services, Inc., a Delaware
corporation (together with its successors, the “Company”), GXS Holdings, Inc.,
a Delaware corporation (together with its successors, “GXS”), and Ross Curtis
(“Executive”), (certain capitalized terms used herein being defined in Article
7 hereof).


     WHEREAS the Company is a wholly owned subsidiary of GXS;


     WHEREAS, each of the Company and GXS considers it in its best interests
and the best interests of its stockholders to offer employment to the Executive.


     WHEREAS, Executive is willing to accept employment on the terms
hereinafter set forth in this Agreement;


     NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements of the parties set forth in this Agreement, and of
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, agree
as follows:


ARTICLE 1

POSITION; TERM OF AGREEMENT


     Section 1.01. Position. (a) As of and following the Effective Date,
Executive shall serve as Senior Vice President – Global Sales of the Company
and shall report to President and Chief Executive Officer (“CEO”). Executive
shall have such duties and authority, consistent with such position, as shall
be determined from time to time by the CEO.


     (b)       During the Employment Term, Executive will devote substantially all of
his business time to the performance of his duties under this Agreement and
will not engage in any other business, profession or occupation for
compensation or otherwise which would conflict with the rendition of such
services either directly or indirectly, without the prior written consent of
the Board.


     Section 1.02. Term. Executive shall be employed by the Company for a
period of 24 months (the “Employment Term”), commencing on the Effective Date
and, subject to earlier termination or extension as provided herein, ending on
the second anniversary thereof; provided that on each anniversary of the
Effective Date beginning on such second anniversary, the Employment Term shall
be automatically extended for successive one-year periods unless not later than
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month prior to any such automatic extension the Company or Executive shall
give notice that the Employment Term shall not be extended.


ARTICLE 2

COMPENSATION AND BENEFITS


     Section 2.01. Base Salary. Commencing on the Effective Date, the
Company shall pay Executive an annual base salary (the “Base Salary”) at the
annual rate of $350,000, payable in equal monthly installments or otherwise in
accordance with the payroll and personnel practices of the Company from time to
time. Executive’s Base Salary shall not be reduced during the Employment Term.


     Section 2.02. Bonus. Subject to Executive’s continued employment on
December 31 of each calendar year during the Employment Term, Executive shall
be eligible to receive an aggregate annual bonus (“Annual Bonus”) each calendar
year during the Employment Term of $350,000 (the “Target Bonus”) if executive
achieves 100% of the targets set forth in the plan for such year assigned by
the CEO (the “Bonus Plan”), with a minimum guaranteed bonus of 50% of the
Target Bonus. However, for the first year only, the minimum guaranteed bonus
will be $250,000 (the “First Year Bonus”). The maximum bonus potential will be
$700,000 if Executive achieves 105% of the Bonus Plan. The Bonus Plan will
have elements relating to (1) Worldwide Revenue, (2) Worldwide Recurring
revenue, (3) EBITDA and (4) Days Sales Outstanding; each element will be
weighted at 25% of the Bonus. Payments pursuant to the Bonus Plan will be
made quarterly subject to a 15% hold back for the first, second and third
calendar quarters and trued up after the end of the fourth calendar quarter to
reflect annual results against the Bonus Plan for the calendar year. Quarterly
bonus payments to the Executive under the Bonus Plan are subject to the
Executive’s continued employment hereunder on the last day of the calendar
quarter to which such payment applies.


     Section 2.03. Employee Benefits. (a) During the Employment Term,
Executive shall be eligible for employee benefits (including fringe benefits,
vacation and health, accident and disability insurance, and retirement plan
participation) substantially similar to those benefits made available generally
to senior executives of the Company.


     (b)       During the Employment Term, the Company shall pay Executive a car
allowance in an amount not to exceed $50,000 every three years.


     Section 2.04. Business And Travel Expenses. Reasonable travel,
entertainment and other business expenses incurred by Executive in the
performance of Executive’s duties hereunder shall be reimbursed by the Company
in accordance with Company policies as in effect from time to
time.


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     Section 2.05. Options. (a) On the Effective Date, the Company shall
grant to Executive an option (the “Option”) to purchase 750,000 shares of
common stock of GXS (“Common Stock”) (representing 0.66% of GXS’s Common Stock
as of the Effective Date on a fully diluted basis), at an exercise price per
share equal to the fair market value (determined in accordance with the terms
of the Plan) of a share of Common Stock on the date of grant. The Option will
be treated as an “incentive stock option” within the meaning of Section 422 of
the Code to the maximum extent permitted by law and shall be issued pursuant to
Rule 701 of the Securities Act or registered on a Form S-8 registration
statement under the Securities Act that becomes effective within ninety (90)
days after the Effective Date.


     (b)       The Option shall consist of five tranches. The first tranche shall
consist of 450,000 shares of Common Stock (representing 60% of the total shares
of Common Stock subject to the Option) and the remaining four tranches shall
each consist of 75,000 shares of Common Stock (each such tranche representing
10% of the total shares of Common Stock subject to the Option). Provided
Executive remains in the employ of the Company, GXS or one of their
Subsidiaries as of the applicable vesting date, each such tranche shall become
vested and exercisable as to 25% of the shares constituting such tranche on the
first anniversary of the Vesting Commencement Date with respect to such
tranche, and the balance of the shares constituting such tranche shall become
vested and exercisable at a rate of 1/36 of such balance per month over the
3-year period following such anniversary.


     (c)       The vesting commencement date (the “Vesting Commencement Date”) with
respect to the first tranche (as described in paragraph (b) above) of the
Option shall be the Effective Date, and the Vesting Commencement Date for the
second, third, fourth and fifth tranches shall be, respectively, the first,
second, third and fourth anniversaries of the Effective Date.


     (d)       Any unvested portion of the Option shall become fully vested and
exercisable upon (i) termination of Executive’s employment by the Company
without Cause (other than by reason of Executive’s death or disability) within
12 months after a Change in Control or (ii) termination of Executive’s
employment by reason of Executive’s death. Except as set forth herein, the
Options shall otherwise be subject to the terms of the GXS Stock Incentive Plan
(the “Plan”) and the applicable award agreement, copies of which are attached
hereto as Attachment 1 and Attachment 2, respectively.


     (e)       Upon termination of Executive’s employment, GXS shall have the right
to repurchase the shares of Common Stock acquired upon exercise of the Option
in accordance with the terms of the Plan and the applicable award agreement.


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ARTICLE 3

CERTAIN TERMINATION BENEFITS


     Section 3.01. Certain Events. (a) A “Qualifying Event” means the
termination of Executive’s employment by the Company without Cause (other than
by reason of Executive’s death or disability).


     (b)       Each party hereto shall give to the other party 30 days prior written
notice of such party’s intent to terminate Executive’s employment with the
Company for any reason.


     Section 3.02. Right To Certain Benefits. In the event of any
termination of employment during the Employment Term, Executive shall be
entitled to receive from the Company either the relevant Severance Benefits to
the extent and as described in Section 3.03 or the relevant Separation Benefits
to the extent and as described in Section 3.04, as the case may be, contingent
upon Executive signing a release in a form reasonably acceptable to the
Company.


     Section 3.03. Benefits Upon A Qualifying Event. In the event of any
termination of employment during the Employment Term, Executive shall be
entitled to the following benefits (the “Severance Benefits”) upon a Qualifying
Event:


     (a)       The Company shall pay Executive as soon as practicable a lump sum, in
cash, equal to Executive’s earned but unpaid Base Salary and other vested but
unpaid cash entitlements for the period through and including the date of
termination of Executive’s employment, including unused earned vacation pay and
unreimbursed documented business expenses (collectively, “Accrued
Compensation”). In addition, Executive shall be entitled to any other vested
benefits earned by Executive for the period through and including the date of
termination of Executive’s employment under any other employee benefit plans
and arrangements maintained by the Company, in accordance with the terms of
such plans and arrangements, except as modified herein (collectively, “Accrued
Benefits”).


     (b)       The Company shall pay Executive (i) a pro rata portion (based on the
number of whole and partial calendar months prior to and including the month in
which the Qualifying Event occurs) of the most recent Annual Bonus or
First-Year Bonus, as applicable, paid to Executive less any quarterly bonus
payments paid to Executive pursuant to Section 2.02 for the calendar year in
which termination occurs, and (ii) a lump sum severance payment in an amount
equal to one times the sum of (A) the annual Base Salary in effect immediately
prior to such Qualifying Event and (B) the most recent Annual Bonus or
First-Year Bonus, as applicable, paid to Executive. For the purposes of this
section 3.03 (b) and section 3.05, “the most Recent Annual Bonus” shall not
exceed the Target Bonus.


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     (c)       The portion of the Option which would have become vested and
exercisable within the 12-month period following the date of termination shall
become fully vested and exercisable on the date of such termination. The
vested portion of the Option shall remain exercisable by Executive for three
months following the date of such termination.


     (d)       Except as set forth in this Section 3.03, Executive will be entitled
to no other payments or benefits from the Company.


     Section 3.04. Separation Benefits. In the event of any termination of
employment during the Employment Term other than upon a Qualifying Event,
Executive (or his estate, as the case may be) shall be entitled to the benefits
set forth below (the “Separation Benefits”):


     (i)       The Accrued Compensation;


     (ii)      The Accrued Benefits; and


     (iii)      Executive shall be entitled to exercise the portion of the Options
vested on the date of such termination for the period provided in the Plan and
the applicable award agreement.


     Section 3.05. Non-renewal Of Agreement. In the event that at the end of
the Employment Term the Company does not renew this Agreement in accordance
with 1.02 hereof and terminates Executive’s employment without Cause at such
time, the Executive shall be entitled to the following benefits:


     (i)       The Accrued Compensation;


     (ii)      The Accrued Benefits; and


     (iii)     The Company shall pay Executive a lump sum severance payment in an
amount equal to the sum of (A) the annual Base Salary in effect immediately
prior to such Qualifying Event and (B) the most recent Annual Bonus or
First-Year Bonus, as applicable, paid to Executive.


ARTICLE 4

COVENANTS AND REPRESENTATIONS


     Section 4.01. Noncompetition, Nonsolicitation, Noncompete,
Nondisparagement And Nondisclosure. (a) While employed by the Company and for
12 months after the termination of Executive’s employment, Executive shall not,
on his account, or as an employee, consultant, independent contractor, partner,
owner, officer, director or stockholder, engage in, be connected with, have any
interest in, or aid or assist anyone else to engage in, be connected with, or
have any interest in, any firm or person which directly competes with a line or
lines of business which the Company or GXS (or any of their Subsidiaries) was


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engaged in during the Employment Term; provided that Executive may (i)
purchase securities in any corporation whose securities are listed or traded on
a national securities exchange or in an over-the-counter securities market if
such purchases do not result in Executive beneficially owning, directly or
indirectly, at any time 5% or more of the equity securities of any such
corporation and (ii) be an employee, independent contractor or officer of any
such firm or person provided Executive has no direct or indirect duties or
responsibilities with respect to any activities of such firm or person which
are competitive with any line or lines of business of the Company or GXS (or
any of their Subsidiaries).


     (b)       While employed by the Company and for 12 months after the termination
of Executive’s employment, Executive shall not, directly or indirectly:



		
	 	     (i)     induce or attempt to induce any employee of GXS or the Company
(or any Subsidiary of GXS or the Company) to be employed or perform
services elsewhere;




		
	 	     (ii)    solicit or attempt to solicit the trade of any individual or
entity which, at the time of such solicitation, is a customer of GXS or
the Company (or any Subsidiary of GXS or the Company) or which GXS or
the Company (or any Subsidiary of GXS or the Company) is undertaking
reasonable steps to procure as a customer at the time of or immediately
preceding termination of employment; provided, however, that this
limitation shall only apply to any product or service which is in
competition with a product or service of GXS or the Company (or any
Subsidiary of GXS or the Company).



     (c)       In connection with the termination of Executive’s employment
hereunder, Executive shall cooperate with the Company and any Subsidiary or
Affiliate of the Company to ensure an orderly transition, in such a manner and
at such times as the Company shall reasonably request.


     (d)       Except as required by law, neither party will at any time (whether
during or after termination of Executive’s employment with the Company)
knowingly make any statement, written or oral, or take any other action that
would disparage or otherwise harm the other party, its business or reputation
or, in the case of the Company, the reputation of any of its Affiliates or the
officers and directors of any of them.


     (e)       Executive shall enter into and agrees to be bound by the Proprietary
Information and Inventions Agreement of the Company, a copy of which is
attached as Annex A to the Plan.


     Section 4.02. Material Inducement; Specific Performance. (a) If any
provision of Section 4.01 is determined by a court of competent jurisdiction
not to be enforceable in the manner set forth in this Agreement, the Company
and


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Executive agree that it is the intention of the parties that such
provision should be enforceable to the maximum extent possible under applicable
law and that such court shall reform such provision to make it enforceable in
accordance with the intent of the parties.


     (b)       Executive acknowledges that a material part of the inducement for the
Company to provide the compensation provided herein is Executive’s covenants
set forth in Section 4.01 and that the covenants and obligations of Executive
with respect to noncompetition, nondisclosure and nonsolicitation relate to
special, unique and extraordinary matters and that a violation of any of the
terms of such covenants and obligations will cause the Company irreparable
injury for which adequate remedies are not available at law. Therefore,
Executive agrees that, if Executive shall materially breach any of those
covenants during or following termination of employment, the Company shall be
entitled to an injunction, restraining order or such other equitable relief
(without the requirement to post a bond) restraining Executive from committing
any violation of the covenants and obligations contained in Section 4.01 and
the Company shall have no further obligation to pay Executive any benefits
otherwise payable hereunder. The remedies in the preceding sentence are
cumulative and are in addition to any other rights and remedies the Company may
have at law or in equity as an arbitrator (or court) shall reasonably
determine.


     Section 4.03. Employee Representation. Executive expressly represents
and warrants to the Company that Executive is not a party to any contract or
agreement and is not otherwise obligated in any way, and is not subject to any
rules or regulations, whether governmentally imposed or otherwise, which will
or may restrict in any way Executive’s ability to fully perform Executive’s
duties and responsibilities under this Agreement.


ARTICLE 5

SUCCESSORS AND ASSIGNMENTS


     Section 5.01. Assignments. Except for an assignment in the event of a
Change in Control or an assignment to an affiliate of the Company, this
Agreement shall not be assignable by the Company without the written consent of
Executive. This Agreement shall not be assignable by Executive.


     Section 5.02. Successors; Binding Agreement. This Agreement shall inure
to the benefit of and be binding upon personal or legal representatives,
executors, administrators, successors, heirs, distributees, devisees, and
legatees.


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ARTICLE 6

MISCELLANEOUS


     Section 6.01. Notices. Any notice required to be delivered hereunder
shall be in writing and shall be addressed:


     (i)       if to the Company, to:


                100 Edison Park Drive

                Gaithersburg, MD 20878

                Fax: 301-340-5840

                Attn: General Counsel


     (ii)       if to Executive, to Executive’s last known address as reflected on
the books and records of the Company;


or, in each case, to such other address as such party may hereafter specify for
the purpose by written notice to the other party hereto. Any such notice shall
be deemed received on the date of receipt by the recipient thereof if received
prior to 5:00 p.m. in the place of receipt and such day is a business day in
the place of receipt. Otherwise, any such notice shall be deemed not to have
been received until the next succeeding business day in the place of receipt.


     Section 6.02. Effectiveness of Agreement. The effectiveness of this
Agreement is subject to approval by a majority of the Board of Directors of GXS
and approval by a vote of the persons who own more than 75% of the outstanding
voting stock of GXS immediately after the Effective Date.


     Section 6.03. Dispute Resolution. (a) Except as provided in Section
4.02, each of Executive and the Company shall have the right and option to
elect (in lieu of litigation) to have any dispute or controversy arising under
or in connection with this Agreement settled by arbitration, conducted before a
panel of three arbitrators sitting in a location in Maryland, in accordance
with the rules of the American Arbitration Association then in effect.
Executive’s election to arbitrate, as herein provided, and the decision of the
arbitrators in that proceeding, shall be binding on the Company and Executive.
Judgment may be entered on the award of the arbitrator in any court having
jurisdiction.


     (b)       Each party shall pay its own expenses of such arbitration or
litigation and all common expenses of such arbitration or litigation shall be
borne equally by Executive and the Company. Each party to an arbitration or
litigation hereunder shall be responsible for the payment of its own attorneys’
fees.


     Section 6.04. Unfunded Agreement. The obligations of the Company under
this Agreement represent an unsecured, unfunded promise to pay benefits to
Executive and/or Executive’s beneficiaries, and shall not entitle Executive or
such beneficiaries to a preferential claim to any asset of the
Company.



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     Section 6.05. Non-exclusivity Of Benefits. Unless specifically provided
herein, neither the provisions of this Agreement nor the benefits provided
hereunder shall reduce any amounts otherwise payable, or in any way diminish
Executive’s rights as an employee of the Company, whether existing now or
hereafter, under any compensation and/or benefit plans (qualified or
nonqualified), programs, policies, or practices provided by the Company, for
which Executive may qualify; provided, however, that the Severance Benefits
shall be in lieu of any severance benefits under any such plans, programs,
policies or practices. Vested benefits or other amounts which Executive is
otherwise entitled to receive under any plan, policy, practice, or program of
the Company (i.e., including, but not limited to, vested benefits under any
qualified or nonqualified retirement plan), at or subsequent to the date of
termination of Executive’s employment shall be payable in accordance with such
plan, policy, practice, or program except as expressly modified by this
Agreement.


     Section 6.06. Employment Status. Nothing herein contained shall
interfere with the Company’s right to terminate Executive’s employment with the
Company at any time, with or without Cause, subject to the Company’s obligation
to provide Severance Benefits or Separation Benefits, if any. Executive shall
also have the right to terminate Executive’s employment with the Company at any
time without liability, subject only to the provisions hereof and Executive’s
obligations hereunder.


     Section 6.07. Entire Agreement. This Agreement represents the entire
agreement between Executive and the Company and its affiliates with respect to
Executive’s employment and/or severance rights, and supersedes all prior
discussions, negotiations, and agreements concerning such rights; provided,
however, that any amounts payable to Executive hereunder shall be reduced by
any amounts paid to Executive as required by any applicable law in connection
with any termination of Executive’s employment.


     Section 6.08. Tax Withholding. Notwithstanding anything in this
Agreement to the contrary, the Company shall withhold from any amounts payable
under this Agreement all federal, state, city, or other taxes as are legally
required to be withheld.


     Section 6.09. Waiver Of Rights. The waiver by either party of a breach
of any provision of this Agreement shall not operate or be construed as a
continuing waiver or as a consent to or waiver of any subsequent breach hereof.


     Section 6.10. Severability. In the event any provision of this
Agreement shall be held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining parts of this Agreement, and this
Agreement shall be construed and enforced as if the illegal or invalid
provision had not been included.


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     Section 6.11. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland without
reference to principles of conflict of laws.


     Section 6.12. Counterparts. This Agreement may be signed in several
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were on the same instrument.


ARTICLE 7

DEFINITIONS


     For purposes of this Agreement, the following terms shall have the
meanings set forth below.


     “Accrued Benefits” has the meaning accorded such term in Section 3.03.


     “Accrued Compensation” has the meaning accorded such term in Section 3.03.


     “Affiliate” has the meaning accorded to such term in Rule 12b-2 under the
Exchange Act.


     “Agreement” has the meaning accorded such term in the introductory
paragraph of this Agreement.


     “Base Salary” has the meaning accorded such term in Section 2.01.


     “Beneficial Ownership” A Person shall be deemed the “Beneficial Owner”
of, and shall be deemed to “beneficially own,” securities pursuant to Rule
13d-3 under the Exchange Act.


     “Board” means, the Board of Directors of the Company.


     “Cause” means the occurrence of any one or more of the following:



		
	 	     (i)     Executive’s willful and continued failure substantially to
perform the duties of Executive’s position as then in effect (other than
as a result of incapacity due to physical or mental illness) which
failure is not remedied within fifteen business days of written notice
from the Company;




		
	 	     (ii)    Executive’s gross negligence or willful malfeasance in the
performance of Executive’s duties hereunder as then in effect;




		
	 	     (iii)   Executive’s breach of any of the covenants contained in
Section 4.01; or



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	 	     (iv)   Executive’s commission of an act constituting fraud,
embezzlement, or any other act constituting a felony;




		
	 	provided, however, that for purposes of this definition, no act or
failure to act shall be deemed “willful” unless effected by Executive
not in good faith and without reasonable belief that such action or
failure to act was in the best interests of the Company.



     “Change in Control” means the occurrence of any of the following:



		
	 	     (i)     the consummation of a merger or consolidation of the Company or
GXS with or into any other entity pursuant to which the stockholders of
the Company or GXS, as applicable, immediately prior to such merger or
consolidation hold less than 50% of the voting power of the surviving
entity;




		
	 	     (ii)   the sale or other disposition of all or substantially all of
the Company’s or GXS’s assets or any approval by the stockholders of the
Company or GXS of a plan of complete liquidation of the Company or GXS,
as applicable;




		
	 	     (iii)   any acquisition by any person or persons (other than the
direct and indirect stockholders of the Company or GXS immediately after
the Effective Date) of the Beneficial Ownership of 50% or more of the
voting power of the Company’s or GXS’s equity securities in a single
transaction or series of related transactions; provided, however, that
an underwritten public offering of the Company’s or GXS’s securities
shall not be considered a Change in Control; or




		
	 	     (iv)   any change in the composition of the Board over a two-year
period such that the directors at the beginning of the period and new
directors elected during that period and approved by two-thirds of the
incumbent directors cease to constitute at least a majority of the
Board;




		
	 	provided, however, that a transaction shall not constitute a Change in
Control if its sole purpose is to change the state of the Company’s
incorporation or to create a holding company that will be owned in
substantially the same proportions by the persons who held the Company’s
securities immediately before such transaction.



     “Code” means the Internal Revenue Code of 1986, as amended.


     “Employment Term” has the meaning accorded such term in Section 1.02.


     “Exchange Act” means the Securities Exchange Act of 1934, as amended.


     “Option” has the meaning accorded such term in Section 2.05.


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     “Person” means an individual, corporation, partnership, association, trust
or any other entity or organization.


     “Qualifying Event” has the meaning accorded such term in Section 3.01.


     “Securities Act” means the Securities Act of 1933, as amended.


     “Separation Benefits” has the meaning accorded such term in Section 3.04.


     “Severance Benefits” has the meaning accorded such term in Section 3.03.


     “Subsidiary” of any Person means any other Person of which securities or
other ownership interests having voting power to elect a majority of the board
of directors or other Persons performing similar functions are at the time
directly or indirectly owned by such Person.


     “Vesting Commencement Date” shall have the meaning accorded such term in
Section 2.05(c).


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     IN WITNESS WHEREOF, the Company, GXS and Executive have executed this
Agreement, to be effective as of the day and year first written above.






	 	 	 
	GXS HOLDINGS, INC.
	 	 	 
	 	 	 
	By:	 	
/s/ Harvey F. Seegers

Name: Harvey F. Seegers

Title: President & Chief Executive Officer
	 	 	 
	GLOBAL EXCHANGE SERVICES, INC.
	 	 	 
	 	 	 
	By:	 	
/s/ Harvey F. Seegers

Name: Harvey F. Seegers

Title: President & Chief Executive Officer
	 	 	 
	EXECUTIVE:
	 	 	 
	 	 	 
	/s/ Ross Curtis
Ross Curtis






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