**Exhibit 10.2**

EMPLOYMENT AGREEMENT 

This Employment Agreement (the “Agreement”) effective as ofJuly 20, 2006 by and between Jackson Hewitt Tax Service Inc. (the “Company”) and Mark L. Heimbouch (the “Executive”). 

WHEREAS, the Company desires to employ the Executive as its Executive Vice President and Chief Financial Officer, and the Executive desires to serve the Company in such capacities. 

NOW THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,the parties hereby agree as follows: 

SECTION I 

EMPLOYMENT 

The Company agrees to employ the Executive and the Executive agrees to be employed bythe Company for the Period of Employment as provided in Section III below and upon the terms and conditions provided in this Agreement. 

SECTION II 

POSITION AND RESPONSIBILITIES 

During the Period of Employment, the Executive will serve as Executive Vice President and Chief Financial Officer of the Company and, subject to the direction of the Chief Executive Officer of the Company (the“Supervising Officer”), will perform such duties and exercise such supervision with regard to the business of the Company as are associated with such position, as well as such additional duties as may be prescribed from time to time by theSupervising Officer. Executive may also serve as Treasurer of the Company. The Executive currently serves as a member of the Board of Directors of the Company (the “Board”) and shall continue to serve in such capacity during the Period ofEmployment, subject to re-nomination and re-election. Nothing herein shall require the Company to re-nominate Executive for election for additional terms of service on the Board during the Period of Employment. 

The Executive will, during the Period of Employment, devote substantially all of his time and attention during normal business hours to the performanceof services for the Company, except during customary vacation periods and periods of illness. The Executive will maintain a primary office and conduct his business in Parsippany, New Jersey, except for normal and reasonable business travel inconnection with his duties hereunder. Nothing contained in this Agreement will prevent the Executive from serving on civic and charitable boards or from conducting his personal affairs. 

The Executive will, in accordance with the Company’s policy and procedures and applicable law, certify to the accuracy of the Company’spublicly filed financial statements. 

SECTION III 

PERIOD OF EMPLOYMENT 

The period of the Executive’s employment under this Agreement (the“Period of Employment”) will begin on the date of this Agreement and end on the third anniversary of such date, subject to extension or termination as provided in this Agreement. The Period of Employment shall automatically be extended forsuccessive one year terms until such time that the Company delivers written notice to the Executive that this Agreement shall not be so extended in accordance with the following sentence. To be effective, such written notice must be delivered by theCompany to Executive not less than 90 nor more than 180 days prior to the end of the initial Period of Employment (or any subsequent Period of Employment, as the case may be). 

SECTION IV 

COMPENSATION AND BENEFITS 

Compensation. For all services rendered by the Executive pursuant to this Agreement during the Period of Employment, including services as anexecutive, officer, director or committee member of the Company or any subsidiary or affiliate thereof, the Executive will be compensated as follows: 

i. Base Salary. 

The Company will pay the Executive a fixed base salary (“Base Salary”) ofnot less than $320,000, per year. From time to time, the Executive may be eligible to receive annual increases as the Company deems appropriate, in accordance with the Company’s customary policies and procedures regarding the salaries ofexecutive officers, including pursuant to annual compensation reviews to occur no less than once per year, and with due consideration given to the published Consumer Price Index applicable to the New York/New Jersey greater metropolitan area. Annualsalary increases shall be effective as of the beginning of each fiscal year. Base Salary will be payable according to the customary payroll practices of the Company, but in no event less frequently than once each month. 

ii. Annual Incentive Awards. 

TheExecutive will be eligible for discretionary annual incentive compensation awards. The Executive will be eligible to receive an annual bonus opportunity in respect of each fiscal year of the Company during the Period of Employment based upon atarget bonus equal to no less than 75% of his then current Base Salary during such fiscal year (“Target Bonus”); provided, however, that such bonus will be subject to the attainment by the Company of applicable performancetargets reasonably established and certified by the Board or the Compensation Committee of the Board (the “Committee”); provided, further, that such performance targets shall provide for an annual bonus opportunity of not less than 200% ofTarget Bonus. Performance criteria for Executive shall be based on Company performance targets and individual performance targets. The performance targets may relate to such financial and/or business criteria of the Company and its subsidiaries orbusiness units, as determined by the Board and/or the Committee in its sole discretion (each such annual bonus, an “Incentive Compensation Award”). 

iii. Long-Term Incentive Awards

Annual Incentive Awards. At such times as the Board or the Committee determines to conduct annual or periodic grants of long term incentive awardsto employees and officers of the Company, the Executive will be eligible to receive such grants, subject to the sole and complete discretion of the Board or the Committee, and upon such terms and conditions as determined by the Board or theCommittee, but with due consideration given to the Executive’s position with the Company and the Executive’s historical performance and anticipated future contributions to the Company. 

iv. Additional Benefits

(a) TheExecutive will be entitled to participate in all other compensation and employee benefit plans or programs offered generally to employees of the Company, and will receive all perquisites offered to executive officers of the Company, in either casepursuant to any plan or program now in effect, or later established by the Company. The Executive will participate to the extent permissible under the terms and provisions of such plans or programs, and in accordance with the terms of such plans andprograms. 

(b) Vacation, Holidays and Sick Leave. During the Term, the Executive shall be entitled to paid vacation and paidholidays and sick leave in accordance with the Company’s standard policies for its executive officers. 

(c) Services Furnished.The Company shall furnish the Executive with office space, secretarial assistance and such other facilities and services as shall be suitable to the Executive’s position and adequate for the performance of his duties hereunder consistent withpast practice or otherwise suitable. 

SECTION V 

BUSINESS EXPENSES 

The Company will reimburse the Executive for all reasonable travel and otherexpenses incurred by the Executive in connection with the performance of his duties and obligations under this Agreement. The Executive will comply with such limitations and reporting requirements with respect to expenses as may be established bythe Company from time to time and will promptly provide all appropriate and requested documentation in connection with such expenses. 

SECTION VI 

DISABILITY 

If the Executive becomes Disabled, as defined below, during the Period of Employment,the Period of Employment may be terminated at the option of the Executive upon notice of resignation to the Company, or at the option of the Company upon 30 days’ advance notice of termination to the Executive. The Company’s obligation tomake payments to the Executive under this Agreement will cease as of such date of termination, except for Base Salary and Incentive Compensation Awards earned but unpaid as of the date of such termination, and except for payment of a pro rataportion of his Incentive Compensation Award in respect of the fiscal year in which such termination occurs (paid at target level). In addition, upon such event, all of the Executive’s outstanding and unvested stock options and any other equityawards or other incentive or compensation that is subject to vesting will become immediately and fully vested and exercisable and all such options, awards, incentives and compensation shall remain exercisable in accordance with the terms of therespective plans and/or agreements. For purposes of this Agreement, “Disabled” means the Executive’s inability to perform his duties hereunder as a result of serious physical or mental illness or injury for a period of no less than180 days, together with a determination by an independent medical authority that the Executive is currently unable to perform such duties. Such medical authority shall be mutually and reasonably agreed upon by the Company and the Executive and suchopinion shall be binding on the Company and the Executive. 

SECTION VII 

DEATH 

In the event of the death of the Executive during the Period ofEmployment, the Period of Employment will end and the Company’s obligation to make payments under this Agreement will cease as of the date of death, except for Base Salary and Incentive Compensation Awards earned but unpaid through the date ofdeath, and except for payment of a pro rata portion of his Incentive Compensation Award in respect of the fiscal year in which his death occurs (paid at target level); provided that such Incentive Compensation Award shall not be prorated if the dateof death occurs in the last four months of the fiscal year. In addition, upon such event, all of the Executive’s outstanding and unvested stock options and any other equity awards or other incentive or compensation that is subject to vestingwill become immediately and fully vested and exercisable and all such options, awards, incentives and compensation shall remain exercisable in accordance with the terms of the respective plans and/or agreements. All such amounts will be paid to theExecutive’s surviving spouse, estate or personal representative, as applicable. 

SECTION VIII 

EFFECT OF TERMINATION OF EMPLOYMENT 

A. Without Cause Termination and Constructive Discharge. If the Executive’s employment terminates due to either a Without Cause Termination or a Constructive Discharge, as defined below, the Company will pay the Executive (orhis surviving spouse, estate or personal representative, as applicable) upon such Without Cause Termination or Constructive 

Discharge (i) a lump sum cash payment equal to the sum of the Executive’s then current Base Salary plus histhen current target Incentive Compensation Award, multiplied by the Severance Multiplier (as defined below), (ii) any and all Base Salary and Incentive Compensation Awards earned but unpaid through the date of such termination, and(iii) an amount equal to Incentive Compensation Award at target level for the year in which the termination occurs. In addition, upon such event, all of the Executive’s outstanding and unvested stock options and any other equity awards orother incentive or compensation that is subject to vesting will become immediately and fully vested and exercisable and all outstanding options, awards, incentives and compensation shall be extended and remain exercisable until the later of(1) December 31st of the year in which they would otherwise have expired or (2) the 15th day of the 3rd month following the month in which they would have expired; provided however, that awards granted after the date of execution of this Agreement shall be extended and remain exercisable until the later of the foregoing andthe second anniversary of the date of termination (subject to the original expiration date of the option). In addition, Executive shall be entitled to continue coverage under all health and welfare plans for Executive and members of Executive’simmediate family including medical and dental benefits, for up to twenty-four (24) months with Executive’s cost being no greater than the cost applicable to Executive had Executive been an active full time employee of the Company at suchtime. 

B. Termination for Cause; Resignation. If the Executive’s employment terminates due to a Termination for Cause or aResignation, Base Salary and any Incentive Compensation Awards earned but unpaid as of the date of such termination will be paid to the Executive in a lump sum. Except as provided in this paragraph, the Company will have no further obligations tothe Executive hereunder. All of Executive’s outstanding options, awards, incentives and compensation shall be governed by the plan and/or agreement pursuant to which it was granted, issued or provided. 

C. For purposes of this Agreement, the following terms have the following meanings: 

i. “Termination for Cause” means (i) the Executive’s willful failure to substantially perform his duties as an employee of the Companyor any subsidiary thereof (other than any such failure resulting from incapacity due to physical or mental illness), (ii) any act of fraud, misappropriation, embezzlement, material dishonesty or similar conduct, in each case against the Companyor any subsidiary, (iii) the Executive’s conviction of a felony or any crime involving moral turpitude (which conviction, due to the passage of time or otherwise, is not subject to further appeal), (iv) the Executive’s grossnegligence in the performance of his duties or (v) the Executive makes (or has been found to have made) a false certification to the Company pertaining to its financial statements. The Company will provide the Executive a written notice whichdescribes the circumstances being relied on for the termination with respect to this paragraph. The Executive will have thirty (30) days after receipt of such notice to remedy the situation prior to the effectiveness of the Termination forCause, unless the Company reasonably and in good faith determines that such situation is incurable. A Termination for Cause shall not be effective hereunder unless the Executive is first given an opportunity to address the Board, with his counselpresent if he so elects, upon reasonable notice in advance of any action taken by the Board. 

ii. “Constructive Discharge” means (i) any material failure of the Company to fulfill itsobligations under this Agreement (including without limitation any reduction of the Base Salary, as the same may be increased during the Period of Employment, or other element of compensation), (ii) a material and adverse change to theExecutive’s titles, positions, duties, scope of authority, and responsibilities to the Company (but specifically excluding the Executive no longer serving as a member of the Board due to failure to be nominated, re-elected, removed orotherwise), (iii) the relocation of the Executive’s primary business office to a location more than 20 miles from Parsippany, New Jersey or (iv) the Company fails to cause this Agreement to be assumed by any successor to the businessof the Company. The Executive will provide the Company a written notice which describes the circumstances being relied on for the termination with respect to this Agreement within sixty (60) days after the event giving rise to the notice. TheCompany will have sixty (60) days after receipt of such notice to remedy the situation prior to the termination for Constructive Discharge. 

iii. “Without Cause Termination” or “Terminated Without Cause” means termination of the Executive’s employment by the Company other than due to death, disability, or Termination for Cause. 

iv. “Resignation” means a termination of the Executive’s employment by the Executive, other than in connection with a ConstructiveDischarge. 

v. “Severance Multiplier” means 200%; provided, however, that Severance Multiplier means 299% solely inthe event that the applicable Without Cause Termination or Constructive Discharge occurs within one year of a Change in Control (as defined from time to time in the Company’s 2004 Equity and Incentive Plan or subsequent plan). 

D. Conditions to Payment and Acceleration. All payments due to the Executive under this Section VIII shall be made as soon as practicable;provided, however, that such payments, shall be subject to, and contingent upon, the execution by the Executive (or his beneficiary or estate) of a release of any and all claims against the Company and its affiliates in such reasonableform agreed to by the Company and the Executive (which release will also require the Company to execute a release of claims against the Executive for any and all claims, but only including claims which the Company is then aware of, and specificallyexcluding claims relating to fraud, criminal matters, and accounting irregularities). The payments due to the Executive under this Section VIII shall be in lieu of any other severance benefits otherwise payable to the Executive under any severanceplan of the Company or its affiliates and/or any other agreement or arrangement. Nothing herein shall be construed as limiting the Executive’s entitlement to any other vested accrued benefits to which he (or his estate if applicable) is thenentitled under the Company’s applicable employee benefit plans, including without limitation any disability or death benefits which may become payable. 

E. Resignation from the Board. Executive agrees that effective with any termination, and as a condition to receiving any payments under Paragraph D above, Executive shall resign from all directorships andcommittees of the Board of the Company and its subsidiaries. 

SECTION IX 

OTHER DUTIES OF THE EXECUTIVE 

DURING AND AFTER THE PERIOD OF EMPLOYMENT 

A. The Executive will, with reasonable notice during or after the Period of Employment, furnish information as may be in his possession and fullycooperate with the Company and its affiliates as may be requested in connection with any claims or legal action in which the Company or any of its affiliates is or may become a party. The foregoing shall not unreasonably interfere with theExecutive’s duties to any successor employer. 

B. The Executive recognizes and acknowledges that all information pertaining to thisAgreement or to the affairs; business; results of operations; accounting methods, practices and procedures; members; acquisition candidates; financial condition; clients; customers or other relationships of the Company or any of its affiliates(“Information”) is confidential and is a unique and valuable asset of the Company or any of its affiliates. Access to and knowledge of certain of the Information is essential to the performance of the Executive’s duties under thisAgreement. The Executive will not during the Period of Employment or thereafter, except to the extent reasonably necessary in performance of his duties under this Agreement, give to any person, firm, association, corporation, or governmental agencyany Information, except as may be required by law. The Executive will not make use of the Information for his own purposes or for the benefit of any person or organization other than the Company or any of its affiliates. The Executive will also usehis best efforts to prevent the disclosure of this Information by others. All records, memoranda, etc. relating to the business of the Company or its affiliates, whether made by the Executive or otherwise coming into his possession, are confidentialand will remain the property of the Company or its affiliates. 

C. i. During the Period of Employment and for the Post Termination Periodthereafter (collectively, the “Restricted Period”), the Executive will not use his status with the Company or any of its affiliates to obtain loans, goods or services from another organization on terms that would not be available to him inthe absence of his relationship to the Company or any of its affiliates. The Post Termination Period means a period of two (2) years following the Executive’s termination of employment if, in connection with such termination, the Executivereceives severance under Section VIII.A. of this Agreement and the Post Termination Period means a period of one (1) year following the Executive’s termination in all other cases, irrespective of the cause, manner or time of suchtermination other than a Termination for Cause. 

ii. During the Restricted Period, the Executive will not make any statements or performany acts intended to or which may have the effect of advancing the interest of any existing or prospective competitors of the Company or any of its affiliates or in any way injuring the interests of the Company or any of its affiliates. During theRestricted Period, the Executive, without prior express written approval by the Board, will not engage in, or directly or indirectly (whether for compensation or otherwise) own or hold proprietary interest in, manage, operate, or control, or join orparticipate in the ownership, management, operation or control of, or furnish any capital to or be connected in any manner with, any party which competes in any way or manner with the business of the Company or any of its affiliates, as suchbusiness or businesses may be conducted from time to time, either as a general or limited partner, proprietor, common 

or preferred shareholder, officer, director, agent, employee, consultant, trustee, affiliate, or otherwise. The Executiveacknowledges that the Company’s and its affiliates’ businesses are conducted nationally and agrees that the provisions in the foregoing sentence will operate throughout the United States. 

iii. During the Restricted Period, the Executive, without express prior written approval from the Board, will not solicit any then-current clients of theCompany or any of its affiliates for any existing business of the Company or any of its affiliates or discuss with any employee of the Company or any of its affiliates information or operation of any business intended to compete with the Company orany of its affiliates. 

iv. During the Restricted Period, the Executive will not interfere with the employees or affairs of the Company orany of its affiliates or solicit or induce any person who is an employee of the Company or any of its affiliates to terminate any relationship such person may have with the Company or any of its affiliates, nor will the Executive during such perioddirectly or indirectly engage, employ or compensate, or cause or permit any person with which the Executive may be affiliated, to engage, employ or compensate, any employee of the Company or any of its affiliates. The Executive hereby represents andwarrants that the Executive has not entered into any agreement, understanding or arrangement with any employee of the Company or any of its affiliates pertaining to any business in which the Executive has participated or plans to participate, or tothe employment, engagement or compensation of any such employee. 

v. For the purposes of this Agreement, proprietary interest means legalor equitable ownership, whether through stock holding or otherwise, of an equity interest in a business, firm or entity or ownership of more than 5% of any class of equity interest in a publicly-held company and the term “affiliate” willinclude without limitation all subsidiaries and licensees of the Company. 

D. The Executive hereby acknowledges that damages at law may bean insufficient remedy to the Company if the Executive violates the terms of this Agreement and that the Company will be entitled, upon making the requisite showing, to preliminary and/or permanent injunctive relief in any court of competentjurisdiction to restrain the breach of or otherwise to specifically enforce any of the covenants contained in this Section IX without the necessity of showing any actual damage or that monetary damages would not provide an adequate remedy. Suchright to an injunction will be in addition to, and not in limitation of, any other rights or remedies the Company may have. Without limiting the generality of the foregoing, neither party will oppose any motion the other party may make for anyexpedited discovery or hearing in connection with any alleged breach of this Section IX. 

E. The period of time during which the provisionsof this Section IX will be in effect will be extended by the length of time during which the Executive is in breach of the terms hereof as determined by any court of competent jurisdiction on the Company’s application for injunctive relief.

F. The Executive agrees that the restrictions contained in this Section IX are an essential element of the compensation the Executive isgranted hereunder and but for the Executive’s agreement to comply with such restrictions, the Company would not have entered into this Agreement. 

SECTION X 

INDEMNIFICATION 

The Company will indemnify the Executive to the fullest extent permitted by thelaws of the state of the Company’s incorporation in effect at that time, or the certificate of incorporation and by-laws of the Company, whichever affords the greater protection to the Executive. If applicable, the Company will maintain D&Oinsurance for the Executive on a basis no less favorable than it maintains for other officers of the Company. 

SECTION XI 

MITIGATION 

The Executive will not berequired to mitigate the amount of any payment provided for hereunder by seeking other employment or otherwise, nor will the amount of any such payment be reduced by any compensation earned by the Executive as the result of employment by anotheremployer after the date the Executive’s employment hereunder terminates or by offset against any amount claimed to be owed by the Executive to the Company, or otherwise. 

SECTION XII 

WITHHOLDING TAXES; EXCISE TAXES 

The Executive acknowledges and agrees that the Company may directly or indirectly withhold from any payments under this Agreement all federal, state,city or other taxes that will be required pursuant to any law or governmental regulation. 

If the Executive becomes entitled to theseverance payments described in Section VIII.A. above, and if any of the payments or benefits received or to be received by the Executive with respect to equity or equity-type awards of the Company (including but not limited to options to acquirecommon stock of the Company) pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, any person whose actions result in a Change in Control or any person affiliated with the Company or such person) (allsuch payments and benefits, excluding the Gross-Up Payment (as defined below), being hereinafter referred to as the “Relevant Payments”) will be subject to the excise tax (the “Excise Tax”) imposed under section 4999 of theInternal Revenue Code of 1986, as amended (the “Code”), the Company shall pay to the Executive an additional amount (the “Gross-Up Payment”) such that the net amount retained by the Executive, after deduction of any Excise Tax onthe Relevant Payments and any federal, state and local income and employment taxes and Excise Tax upon the Gross-Up Payment, shall be equal to the Relevant Payments. 

A. For purposes of determining whether any of the Relevant Payments will be subject to the Excise Tax and the amount of such Excise Tax, (i) all payments or benefits received or to be received by the Executive inconnection with a Change in Control or the Executive’s termination of employment (whether pursuant to the terms of this Agreement or any other 

plan, arrangement or agreement with the Company, any person whose actions result in a Change in Control or any personaffiliated with the Company or such person) (all such payments and benefits, excluding the Gross-Up Payment, being hereinafter referred to as the “Total Payments”) shall be treated as “parachute payments” (within the meaning ofsection 280G(b)(2) of the Code) unless, in the opinion of tax counsel (“Tax Counsel”) reasonably acceptable to the Executive and selected by the accounting firm which was, immediately prior to the Change in Control, the Company’sindependent auditor (the “Auditor”), such payments or benefits (in whole or in part) do not constitute parachute payments, including by reason of section 280G(b)(4)(A) of the Code, (ii) all “excess parachute payments” withinthe meaning of section 280G(b)(l) of the Code shall be treated as subject to the Excise Tax unless, in the opinion of Tax Counsel, such excess parachute payments (in whole or in part) represent reasonable compensation for services actually rendered(within the meaning of section 280G(b)(4)(B) of the Code) in excess of the Base Amount (within the meaning of section 280G(b)(3) of the Code) allocable to such reasonable compensation, or are otherwise not subject to the Excise Tax, and(iii) the value of any noncash benefits or any deferred payment or benefit shall be determined by the Auditor in accordance with the principles of sections 280G(d)(3) and (4) of the Code. For purposes of determining the amount of theGross-Up Payment, the Executive shall be deemed to pay federal income tax at the highest marginal rate of federal income taxation in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highestmarginal rate of taxation in the state and locality of the Executive’s residence on the date of termination of his employment, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and localtaxes. 

B. In the event that the Excise Tax is finally determined to be less than the amount taken into account hereunder in calculatingthe Gross-Up Payment, the Executive shall repay to the Company, within five (5) business days following the time that the amount of such reduction in the Excise Tax is finally determined, the portion of the Gross-Up Payment attributable to suchreduction (plus that portion of the Gross-Up Payment attributable to the Excise Tax and federal, state and local income and employment taxes imposed on the Gross-Up Payment being repaid by the Executive), to the extent that such repayment results ina reduction in the Excise Tax and a dollar-for-dollar reduction in the Executive’s taxable income and wages for purposes of federal, state and local income and employment taxes, plus interest on the amount of such repayment at 120% of the rateprovided in section 1274(b)(2)(B) of the Code. In the event that the Excise Tax is determined to exceed the amount taken into account hereunder in calculating the Gross-Up Payment (including by reason of any payment the existence or amount of whichcannot be determined at the time of the Gross-Up Payment), the Company shall make an additional Gross-Up Payment in respect of such excess (plus any interest, penalties or additions payable by the Executive with respect to such excess) within five(5) business days following the time that the amount of such excess is finally determined. The Executive and the Company shall each reasonably cooperate with the other in connection with any administrative or judicial proceedings concerning theexistence or amount of liability for Excise Tax with respect to the Total Payments. 

SECTION XIII 

EFFECT OF PRIOR AGREEMENTS 

Except as set forth in the following sentence, this Agreement willsupersede any prior employment agreement between the Executive on the one hand, and the Company on the other hand, and any such prior employment agreement will be deemed terminated without any remaining obligations of either party thereunder.Notwithstanding the foregoing, the following provisions relating to Executive contained in that certain Employment Agreement dated June 2004 among Jackson Hewitt Tax Service Inc., Cendant Corporation and Executive shall remain in full force andeffect: (x) Section IV(iii)(a); (y) the second paragraph of Section IV(iv); and (z) the second and third paragraph of Section X. 

SECTION XIV 

CONSOLIDATION, MERGER OR SALE OF ASSETS 

Nothing in this Agreement will preclude the Company from consolidating or merging into or with, or transferring all or substantially all of its assetsto, another corporation which assumes this Agreement and all obligations and undertakings of the Company hereunder. Upon such a consolidation, merger or sale of assets the term “the Company” will mean the other corporation and thisAgreement will continue in full force and effect. In addition to the obligations imposed by law upon any successor to the Company will require any successor (by purchase, merger, consolidation or otherwise) to all or substantially all of thebusiness and/or assets of the Company, by agreement in form and substance reasonably satisfactory to the Executive, to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be requiredto perform it if no such succession had taken place. Failure of the Company to obtain such agreement prior to the effectiveness of such succession shall be a breach of this Agreement and shall entitle the Executive to compensation from the Companyin the same amount and on the same terms as the Executive would be entitled to hereunder if the Executive’s employment were to terminate in a Without Cause Termination provided in Section VIII.A. hereof using a Change in Control SeveranceMultiplier, except that the date on which any such succession becomes effective shall be deemed the date of the Executive’s termination of employment. 

SECTION XV 

MODIFICATION; WAIVER 

This Agreement may not be modified or amended except in writing signed by the parties. No term or condition of this Agreement will be deemed to have beenwaived except in writing by the party charged with waiver. A waiver will operate only as to the specific term or condition waived and will not constitute a waiver for the future or act on anything other than that which is specifically waived. Theparties acknowledge that certain provisions of this Agreement may be required to be amended, following the issuance of additional guidance by the Internal Revenue Service with respect to Section 409A, to avoid the possible imposition ofadditional tax under Section 409A with respect to certain payments and benefits under this Agreement. The Company agrees that it will not unreasonably withhold its consent to any such amendments which in its determination are (i) feasibleand necessary to avoid adverse tax treatment under Section 409A for the Executive, and (ii) not adverse to the interests of the Company. 

SECTION XVI 

GOVERNING LAW 

This Agreement has been executed and delivered in the State of New Jersey and itsvalidity, interpretation, performance and enforcement will be governed by the internal laws of that state. 

SECTION XVII 

ARBITRATION 

A. Any controversy,dispute or claim arising out of or relating to this Agreement or the breach hereof which cannot be settled by mutual agreement (other than with respect to the matters covered by Section IX for which the Company may, but will not be required to, seekinjunctive relief) will be finally settled by binding arbitration in accordance with the Federal Arbitration Act (or if not applicable, the applicable state arbitration law) as follows: Any party who is aggrieved will deliver a notice to the otherparty setting forth the specific points in dispute. Any points remaining in dispute twenty (20) days after the giving of such notice may be submitted to arbitration in Parsippany, New Jersey, to the American Arbitration Association, before asingle arbitrator appointed in accordance with the arbitration rules of the American Arbitration Association, modified only as herein expressly provided. After the aforesaid twenty (20) days, either party, upon ten (10) days notice to theother, may so submit the points in dispute to arbitration. The arbitrator may enter a default decision against any party who fails to participate in the arbitration proceedings. 

B. The decision of the arbitrator on the points in dispute will be final, unappealable and binding, and judgment on the award may be entered in any courthaving jurisdiction thereof. 

C. Except as otherwise provided in this Agreement, the arbitrator will be authorized to apportion its feesand expenses and the reasonable attorneys’ fees and expenses of any such party as the arbitrator deems appropriate. In the absence of any such apportionment, the fees and expenses of the arbitrator will be borne equally by each party, and eachparty will bear the fees and expenses of its own attorney. Notwithstanding the foregoing, Executive shall be entitled to receive reimbursement of all fees and cost incurred by Executive in connection with any arbitration in the event Executive isdeemed to have prevailed in such arbitration as determined by the arbitrator. 

D. The parties agree that this Section XVII has beenincluded to rapidly and inexpensively resolve any disputes between them with respect to this Agreement, and that this Section XVII will be grounds for dismissal of any court action commenced by either party with respect to this Agreement, other thanpost-arbitration actions seeking to enforce an arbitration award. In the event that any court determines that this arbitration procedure is not binding, or otherwise allows any litigation regarding a dispute, claim, or controversy covered by thisAgreement to proceed, the parties hereto hereby waive any and all right to a trial by jury in or with respect to such litigation. 

E. The parties will keep confidential, and will not disclose to any person, except as may be required bylaw, the existence of any controversy hereunder, the referral of any such controversy to arbitration or the status or resolution thereof. 

SECTION XVIII 

SURVIVAL 

Sections VIII, IX, X, XI, XII, XIII, XIV, XVI and XVII will continue in full force in accordance with their respective terms notwithstanding any termination of the Period of Employment. 

SECTION XIX 

SEPARABILITY 

All provisions of this Agreement are intended to be severable. In the event any provision or restriction contained herein is held to be invalid orunenforceable in any respect, in whole or in part, such finding will in no way affect the validity or enforceability of any other provision of this Agreement. The parties hereto further agree that any such invalid or unenforceable provision will bedeemed modified so that it will be enforced to the greatest extent permissible under law, and to the extent that any court of competent jurisdiction determines any restriction herein to be unreasonable in any respect, such court may limit thisAgreement to render it reasonable in the light of the circumstances in which it was entered into and specifically enforce this Agreement as limited. 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.

 
JACKSON HEWITT TAX SERVICES INC.
/s/ Peter Karpiak
By: Peter KarpiakTitle: Senior Vice PresidentEXECUTIVE
/s/ Mark L. Heimbouch
Mark L. Heimbouch