Document:

Exhibit 10.15

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of July     ,
2009 (the “Effective Date”), between COLLECT
AMERICA, LTD., a Delaware corporation (the “Company”),
and BRIAN W. TUITE (“Executive”).  The Company and Executive agree as follows:

 

1.0          PURPOSE OF THE
AGREEMENT.

 

1.1          Executive and the Company
are entering into this Agreement setting forth the terms and conditions of
Executive’s employment with the Company. 
The Company hereby employs Executive and Executive hereby accepts
employment with the Company, such employment to commence no later than August 24,
2009, upon the terms and conditions contained in this Agreement.

 

1.2          As an executive officer
of the Company, Executive has access to valuable confidential and proprietary
information used in the business of the Company, including financial data,
customer data, operational data, trade secrets and other intellectual property
that if disclosed to or used by competitors or potential competitors would
cause irreparable harm to the Company.

 

1.3          Executive and the Company
desire to enter into this Agreement in order to provide the Company with
adequate protection from the unauthorized disclosure or use of the Company’s
confidential and proprietary information and unfair competition or solicitation
of the Company’s customers.  The Company
would not have employed Executive, or provided Executive with the equity
incentives outlined in Exhibit B to this Agreement, but for Executive’s
promises contained in Sections 4.7 and 4.8.

 

2.0          DEFINITIONS.

 

2.1          Affiliate: “Affiliate” means, with respect to any party, any
corporation, limited liability company, partnership, joint venture, firm and/or
other entity which Controls, is Controlled by or is under common Control with
such party.

 

2.2          Board of Directors:
“Board of Directors” shall mean the
board of directors of the Company.

 

2.3          Business: “Business” means (i) the providing of operational
assistance and/or software to collection law firms or collection agencies,
including without limitation the operation of a franchise network of collection
law firms, (ii) the purchasing of debt; (iii) the collection of debt
on a contingency basis or otherwise; (iv) the development and sale of
software for the collections industry; and/or (v) any other line of
business in which the Company or its Affiliates engage in, or formulate
business plans to engage in, during the term of Executive’s employment with the
Company.

 

 

2.4          Compensation Committee:
“Compensation Committee” shall mean a
committee of the Board of Directors which has been delegated responsibility for
employee compensation matters or, in the absence thereof, the entire Board of
Directors.

 

2.5          Confidential and
Proprietary Information: “Confidential and
Proprietary Information” means all proprietary trade secrets and/or
proprietary information and any idea in whatever form, tangible or intangible,
pertaining in any manner to the Business of the Company or any Affiliate of the
Company, or to the Company’s clients, consultants, or business associates,
unless the information is or becomes publicly known through lawful means (other
than disclosure by Executive, unless such disclosure by Executive is made in
good faith in the course of performing Executive’s duties under this Agreement,
or with the express written consent of the Board of Directors).

 

2.6          Control: “Control” means (i) in the case of corporate entities,
direct or indirect ownership of at least fifty percent (50%) of the stock or
participating assets entitled to vote for the election of directors; and (ii) in
the case of non-corporate entities (such as individuals, limited liability
companies, partnerships or limited partnerships), either (A) direct or
indirect ownership of at least fifty percent (50%) of the equity interest, or (B) the
power to direct the management and policies of the noncorporate entity.

 

2.7          Covered Entity: “Covered Entity” means every Affiliate of Executive, and
every business, association, trust, corporation, partnership, limited liability
company, proprietorship or other entity in which Executive has invested in
(whether through debt or equity securities), or has contributed any capital or
made any advances to, or in which any Affiliate of Executive has an ownership
interest or profit sharing percentage, or a firm from which Executive or any
Affiliate of Executive receives or is entitled to receive income, compensation
or consulting fees in which Executive or any Affiliate of Executive has an
interest as a lender (other than solely as a trade creditor for the sale of
goods or provision of services that do not otherwise violate the provisions of
this Agreement). The agreements of Executive contained herein specifically
apply to each entity which is presently a Covered Entity or which becomes a
Covered Entity subsequent to the date of this Agreement. Notwithstanding the
foregoing, nothing contained in this Agreement prohibits Executive or any
Affiliate of Executive from owning less than five percent (5%) of any class of
voting securities registered under the Securities Exchange Act of 1934, as
amended, of any issuer, and no such issuer shall be considered a Covered Entity
solely by virtue of such ownership or the incidents thereof. Further
notwithstanding anything contained in the foregoing provisions to the contrary,
the term “Covered Entity” shall not include the Company, any Subsidiary of the
Company, or any Affiliate of the Company or any such Subsidiary.

 

2.8          Discharge For Cause:
“Discharge For Cause” shall mean
termination of employment for any one or more of the following: (i) willful
misfeasance or nonfeasance by Executive of his assigned duties, which includes
not following the reasonable written direction of the Board of Directors or any
committee thereof (other than by reason of disability), or repeated intentional
refusal by Executive to perform his assigned duties (other than by reason of
disability) which continues uncured for thirty (30) days following receipt of
written notice from the President, CEO, or the Chairman of the Board of
Directors; (ii) such Executive personally engaging in illegal conduct or
in any act of moral turpitude that causes material harm to the 

 

 

reputation, business, or finances of the Company or
any Affiliate of the Company; (iii) such Executive breaching in any
material respect any provision of this Agreement except Sections 4.7 or 4.8,
(other than by reason of disability) which continues uncured for thirty (30)
days following receipt of written notice from the President, CEO, or Chairman of
the Board of Directors; (iv)such Executive breaching any obligation contained
in Sections 4.7 or 4.8 of this Agreement; and (v) such Executive’s
commencement of employment with another company while he is an employee of the
Company without the prior consent of the Board of Directors.

 

2.9          Discharge Without
Cause: “Discharge Without Cause” shall
mean the Company’s termination of Executive’s employment hereunder during the
term hereof for any reason other than a Discharge For Cause or due to Executive’s
death or Permanent Disability.

 

2.10        EBITDA: “EBITDA” shall mean earnings before interest, taxes,
depreciation and amortization, as determined by generally accepted accounting
principles, consistently applied, and including without limitation, an accrual
for bonuses of officers and employees (including the Executive) for the year
for which EBITDA is determined.

 

2.11        Permanent Disability:
“Permanent Disability” shall mean
Executive’s inability to perform Executive’s duties hereunder due to a physical
or mental condition for a period of one hundred twenty (120) consecutive days
or an aggregate of one hundred eighty (180) days in any twelve (12) month
period.

 

2.12        Subsidiary: “Subsidiary” shall mean any corporation, trust, general or
limited partnership, limited liability company, limited liability partnership,
firm, company or other business enterprise which is Controlled by the Company
thorough direct ownership of the stock or other proprietary interests of such
business enterprise or indirectly through the ownership of stock or other
proprietary interests in one (1) or more other business enterprises which
are connected with the Company by means of one (1) or more chains of
business enterprises that are connected by ownership of stock or other
proprietary interests.   Attached as
Schedule A lists the Company’s current subsidiaries.  An updated Schedule A will be provided to
Executive at the time of any separation of employment for any reason.

 

2.13        Termination For Good
Reason: “Termination For Good Reason” shall
mean voluntary termination of this Agreement by Executive if, without the
written consent of Executive: (i) there is a material reduction by the
Company to either (a) Executive’s annual salary then in effect or (b) Executive’s
bonus target established under Section 5.2 of this Agreement (although the
award of any bonus is discretionary and a bonus award that is less than the
target shall not give Executive the right to terminate this Agreement for Good
Reason); except for any reduction which is remedied by the Company promptly
after receipt of written notice thereof given by Executive; (ii) the
Company materially breaches the terms of this Agreement and such breach is not
cured within thirty (30) days after receipt of written notice thereof given by
Executive; (iii) there is a material, adverse, and non-temporary
diminution of Executive’s current job title, reporting relationship, or duties
as Executive Vice President, Chief Business Development Officer, or
requirements that are inconsistent with the position of Executive Vice
President, Chief Business Development Officer, excluding for this purpose any
action not taken in bad faith and that is remedied by the Company promptly
after receipt of written notice thereof given by Executive as outlined below;
or (iv) there is a relocation of 

 

 

Executive to a facility or location more than forty
(40) miles from the Company’s current location. 
If circumstances arise giving Executive the right to terminate this
Agreement for Good Reason, Executive shall within 60 days notify the Company in
writing of the existence of such circumstances, and the Company shall have an
additional 30 days within which to investigate and remedy the circumstances,
after which 30 days Executive shall have an additional 60 days within which to
exercise the right to terminate for Good Reason.  If Executive does not timely do so the right
to terminate for Good Reason shall lapse and be deemed waived, and the
Executive shall not thereafter have the right to terminate for Good Reason
unless further circumstances occur giving rise independently to a right to
terminate for Good Reason under this paragraph.

 

2.14        Territory: “Territory” means the United States and Canada.

 

3.0          CAPACITIES AND
DUTIES: INDEMNIFICATION.

 

3.1          Title: Executive
is hereby employed in the capacity of Executive Vice President, Chief Business
Development Officer of the Company. Executive shall report directly to the
President and shall be subject to President’s, CEO’s, and Chairman of the Board’s
supervision, control and direction. Executive will at all times abide by the
Company’s written personnel policies applicable to similarly situated employees
of the Company as in effect from time to time and provided to Executive
(including without limitation its equal employment opportunity and harassment
policies), and will faithfully, industriously and to the best of Executive’s
ability, experience and talents perform all of the duties that may be required
of and from Executive pursuant to the terms hereof, consistent with Executive’s
status as an Executive Vice President of the Company.

 

3.2          Exclusive Services:
During the Term, Executive agrees to devote Executive’s best efforts and full
business time to rendering services to the Company. Executive is specifically
restricted from being employed by any other company, other than a Subsidiary or
an Affiliate of the Company, while under the Company’s employ pursuant to this
Agreement.  Notwithstanding the foregoing
sentence, the following activities shall not be prohibited by this Section 3.2:
(i) less than a one percent (1%) ownership interest by Executive in a
publicly-traded competing business entity (where such ownership does not
constitute Control and where Executive does not act as a director, officer,
consultant or otherwise provide services to such entity), (ii) Executive’s
service on the board of directors of any charitable, non-profit or educational
institution without compensation (other than reimbursement of out-of-pocket
expenses) or any for-profit entity that does not compete with the Business,
provided that Executive has obtained advance authorization by the Board to
serve in such capacity, such authorization to be given or withheld in the Board’s
discretion; provided, however, that any such services shall be insubstantial
and shall not include any active involvement in the management of such entity
and provided further that such service or ownership shall not detract from
Executive’s performance of his duties to the Company or, except in the case of Section 3.2(i),
be in direct competition with the Business.

 

3.3         Indemnification:
The Company shall, to the maximum extent permitted by the Company’s bylaws and
applicable law, indemnify and hold harmless Executive for any loss, injury,
damage, expense (including reasonable attorneys’ fees, and costs), and claim or
demand,

 

 

arising out of, connected with, or in any manner
related to, any act, omission, or decision made in good faith while performing
services for the Company from and after the Effective Date.

 

4.0          TERM.

 

4.1          Term: Subject to
Sections 4.2, 4.3, 4.4, 4.5 and 4.6, the term of this Agreement shall be three (3) years
commencing on the Effective Date, unless terminated earlier pursuant to the
terms herein (the “Initial Term”);
provided that, unless earlier terminated pursuant to the terms herein, the
Initial Term shall be automatically extended for additional one-year terms
(each, a “Renewal Term”) upon the expiration of
the Initial Term or any such Renewal Term unless the Company or Executive
delivers to the other at least thirty (30) days prior to the expiration of the
Initial Term or the then-current Renewal Term, as the case may be, a written
notice specifying that the term of Executive’s employment will not be renewed
at the end of the Initial Term or the then-current Renewal Term, as the case
may be. The Initial Term or, in the event that Executive’s employment hereunder
is terminated earlier pursuant to the terms herein or renewed pursuant to this Section 4.1,
such shorter or longer period, as the case may be, is referred to herein as the
“Term.”  In the event that (i) the
Company elects not to renew this Agreement and (ii) this Agreement
terminates by expiration of the Initial Term, or by expiration of the first
Renewal Term, if applicable, then the Company shall have no payment obligation
to Executive except for (i) payment of sums specified in Section 4.2;
and (ii) payment to Executive of the Without Cause Severance Pay, provided
that the Conditions (defined in Section 4.4. below) are met.  If the Agreement terminates by expiration of
the Term in any other instance except those outlined in the foregoing sentence,
the Company’s only obligation shall be payment of sums specified in Section 4.2.

 

4.2          Payments Upon
Termination.  In the event Executive’s
employment under this Agreement is terminated for any reason, Executive shall
be paid for all accrued, unpaid base salary and all accrued, unused vacation,
in each case through the date of termination, in accordance with applicable
law.  Executive shall also be reimbursed
for any expenses incurred in accordance with Section 5.3 of this
Agreement.

 

4.3          Discharge For
Cause: Executive’s employment under this
Agreement may be immediately terminated by the Company for Cause, without
further obligation by the Company, except for payment of sums specified in Section 4.2,
upon written notice to Executive of a Discharge For Cause. The Company shall
provide Executive in such written notification such facts as shall be
reasonably necessary to apprise Executive of the basis for such Discharge For
Cause.

 

4.4          Discharge Without
Cause or Termination for Good Reason: 
Executive’s employment under this Agreement may be immediately
terminated by the Company upon written notice to Executive of a Discharge
Without Cause or immediately terminated by Executive upon written notice to the
Company of a Termination for Good Reason. In the event of such termination and
subject to the Conditions (defined in this Section 4.4 below), the Company
shall continue to pay to Executive an amount equal to Executive’s base salary,
as provided in Section 5.1, at the annual rate in effect at the time of
termination, over a period equal to six (6) months from the date of such
termination (“Without Cause Severance Pay”).
Without Cause Severance Pay shall also include, in addition to the foregoing, (i) a
bonus equal to a pro 

 

 

rata portion of the bonus amount that would have
been paid to Executive for the current bonus period had Executive not been
terminated, which bonus amount is determined by multiplying the bonus that
would have been earned for the then-current twelve (12) month bonus period by a
fraction, the numerator of which is number of calendar days in the then-current
bonus period that have elapsed as of the date of termination and the
denominator of which is 365, such bonus to be paid at the time that comparable
executives at the Company are paid bonuses for the bonus period; and (ii) to
the extent Executive is eligible under and elects to continue his health care
coverage under COBRA, the Company shall continue to pay Executive’s COBRA
continuation premiums for medical and dental insurance pursuant to Section 5.4
for six (6) months from the date of such termination or, if sooner, the
date Executive becomes eligible to receive health care pursuant to a subsequent
employer’s group health care plan. Other than the foregoing, Executive shall
not be entitled to any payment for subsequent periods after the effective date
of any Discharge Without Cause or Termination for Good Reason. Without Cause
Severance Pay, except as specified above, shall be payable to Executive in
accordance with the Company’s general payroll practices as the same may exist
from time to time. As a condition to receiving any payment under this Section 4.4,
Executive must comply with his post employment obligations under Section 4.7
and 4.8 and must execute and not revoke a 
release of claims in the form attached hereto as Exhibit A
within 45 days of Executive’s termination of employment, collectively (the “Conditions”).

 

4.5          Termination Upon Death:
This Agreement shall be immediately terminated without action or notice by
either party upon the death of Executive and without further obligation by the
Company, except for payment of sums specified in Section 4.2

 

4.6          Termination Upon
Permanent Disability: Executive’s employment under this Agreement may be
immediately terminated by the Company upon written notice of a termination for
the Permanent Disability of Executive. Upon termination pursuant to this Section 4.6
and in addition to payment of the sums specified in Section 4.2, the
Company shall continue to pay to Executive an amount equal to Executive’s base
salary, as provided in Section 5.1, at the annual rate in effect at the
time of termination, for a period equal to three (3) months from the date
of termination (“Permanent Disability Severance Pay”),
provided that Executive complies with
the Conditions outlined in Section 4.4 above.  Permanent Disability Severance Pay shall be
reduced by the amount of any disability benefits paid during and for the same
period to Executive under any disability insurance policy provided by the
Company as a benefit to Executive. Permanent Disability Severance Pay shall be
payable to Executive, in accordance with the Company’s general payroll
practices as the same may exist from time to time, upon Executive’s termination
pursuant to this Section 4.6.

 

4.7          Confidential and
Proprietary Information: Executive agrees that he will not, either directly
or indirectly, both during and after the termination of his employment with the
Company, and Executive will not permit any Covered Entity which is Controlled
by Executive to, either directly or indirectly, divulge to any person or use
any of the Confidential and Proprietary Information, except (i) as
required in connection with the performance of such Executive’s duties to the
Company, (ii) as required to be included in any report, statement or
testimony requested by any municipal, state or national regulatory body having
jurisdiction over Executive or any Covered Entity which is Controlled by
Executive, (iii) as required in response to any summons or subpoena or in
connection with any litigation, (iv) to the extent necessary in 

 

 

order to comply with any law, order, regulation,
ruling or governmental request applicable to Executive or any Covered Entity
which is Controlled by Executive, (v) as required in connection with an
audit by any taxing authority, or (vi) is made with the express written
consent of the Board of Directors. In the event that Executive or any such
Covered Entity which is Controlled by Executive is required to disclose
Confidential and Proprietary Information pursuant to the foregoing exceptions (ii) through
(v) inclusive, Executive shall promptly notify the Company of such pending
disclosure and assist the Company (at the Company’s expense) in seeking a
protective order or in objecting to such request, summons or subpoena with
regard to the Confidential and Proprietary Information. If the Company does not
obtain such relief after a period that is reasonable under the circumstances,
Executive (or such Covered Entity) may disclose that portion of the
Confidential and Proprietary Information which counsel to such party advises
such party that they are legally compelled to disclose or else stand liable for
contempt or suffer censure or penalty. In such cases, Executive shall promptly
provide the Company with a copy of the Confidential and Proprietary Information
so disclosed.

 

4.8          Non-Compete and Non-Solicitation:

 

(i)            During
the term of Executive’s employment with the Company or any Affiliate of the
Company and for one (1) year thereafter, regardless of the reason for the
termination of Executive’s employment, Executive shall not either directly or
indirectly, and will not permit any Covered Entity which is Controlled by
Executive to either directly or indirectly, compete with the Business in the
Territory or otherwise participate in, assist, aid or advise in any way, any
competitive business or enterprise that competes with the Business in the
Territory.

 

(ii)           During
the term of Executive’s employment with the Company or any Affiliate of the
Company and one (1) year thereafter, Executive will not, either directly
or indirectly and will not permit any Covered Entity which is Controlled by
Executive to, either directly or indirectly, (a) (1) attempt in any
manner to solicit the business of any franchisee of the Company or Affiliates
of the Company, or (2) solicit the business of any financial institution
or other creditors with which the Company or its Affiliates has had a
relationship, except that Executive may solicit such institutions or creditors
if doing so would not violate his obligations under Section 4.8(i); or (b) hire,
solicit, take away, or attempt to hire, solicit or take away (either on such
Executive’s behalf or on behalf of any other person or entity) any person (1) who
is then an employee of the Company or any Affiliate of the Company or an
employee or a franchisee of the Company; or (2) who has terminated his or
her employment with the Company or any Affiliate of the Company within the
previous ninety (90) days.

 

(iii)          Executive
acknowledges that the foregoing geographic restriction on competition is fair
and reasonable, given the nature and geographic scope of the Company’s business
operations and the nature of Executive’s position with the Company.  Executive also acknowledges that while
employed by the Company, Executive will have access to information that would
be valuable or useful to the Company’s competitors, and therefore acknowledges
that the foregoing restrictions on Executive’s future employment and business
activities are fair and reasonable. 
Executive acknowledges and is prepared for the possibility that
Executive’s standard of living may be reduced during the one-year period
following the termination of Executive’s employment, and assumes and accepts
any risk associated with that possibility.

 

 

(iv)          Executive
acknowledges the following provisions of Colorado law, set forth in Colorado
Revised Statutes § 8-2-113(2):

 

Any covenant not to compete which restricts
the right of any person to receive compensation for performance of skilled or
unskilled labor for any employer shall be void, but this subsection (2) shall
not apply to:

 

 

(b)           Any
contract for the protection of trade secrets;

 

 

(d)           Executive
and management personnel and officers and employees who constitute professional
staff to executive and management personnel.

 

Executive acknowledges that this agreement
is a contract for the protection of trade secrets within the meaning of § 8-2-113(2)(b) and
is intended to protect the Confidential Information and Confidential Records
identified above and that Executive is an executive or manager, or professional
staff to an executive or manager,  within
the meaning of § 8-2-113(2)(d).

 

(v)           Executive
agrees that the payment of any Without Cause Severance Pay is conditioned on
Executive’s compliance with this Section 4.8 and that the Company will
have the right to withhold payment, and/or seek to recover any payments already
made, if Executive is in breach of this Section 4.8.

 

(vi)          Notwithstanding
the provisions of Sections 4.8(i) and (ii) above, (a) Executive’s
ownership of less than a one percent (1%) ownership interest in a
publicly-traded competing business entity (where such ownership does not constitute
Control and where Executive does not act as a director, officer, consultant or
otherwise provide services to such entity), or (b) Executive’s service on
the board of directors of any charitable, non-profit or educational institution
without compensation (other than reimbursement of out-of-pocket expenses) or
any entity that does not compete with the Business, shall not constitute a
violation of this Section 4.8, provided, however, that any such services
shall be insubstantial and shall not include any active involvement in the
management, or business development activities, of such entity and provided
further that such service or ownership shall not detract from Executive’s
performance of his duties to the Company or, except in the case of Section 4.8(vi)(a),
be in direct competition with the Business.

 

4.9          Enforcement; Remedies:
Executive acknowledges that Executive’s expertise in the Business is of a
special and unique character which gives this expertise a particular value, and
that a breach of Sections 4.7 or 4.8 by Executive will cause serious and
potentially irreparable harm to the Company. Executive therefore acknowledges
that a breach of Sections 4.7 or 4.8 by Executive cannot be adequately
compensated in an action for damages at law, and equitable relief would be
necessary to protect the Company from a violation of this Agreement and from
the harm which this Agreement is intended to prevent. By reason thereof,
Executive acknowledges that the Company is entitled, in addition to any other
remedies it may have under this Agreement or otherwise, to preliminary and
permanent injunctive and other equitable relief to prevent or curtail any
breach of this Agreement. Executive acknowledges, 

 

 

however, that no specification in this Agreement of
a specific legal or equitable remedy may be construed as a waiver of or
prohibition against pursuing other legal or equitable remedies in the event of
a breach of this Agreement by Executive. Executive’s sole and exclusive remedy
in the event of a breach of this Agreement by the Company shall be payment of
the Without Cause Severance Pay or Good Reason Severance Pay.

 

4.10        Limitations Under Code Section 409A

 

(i)            If
at the time of Executive’s separation from service, (i) Executive is a
specified employee (within the meaning of Section 409A and using the
identification methodology selected by the Company from time to time), and (ii) the
Company makes a good faith determination that an amount payable hereunder
constitutes deferred compensation (within the meaning of Section 409A) the
payment of which is required to be delayed pursuant to the six-month delay rule set
forth in Section 409A in order to avoid taxes or penalties under
Section 409A, then the Company will not pay such amount on the otherwise
scheduled payment date but will instead pay it in a lump sum on the first
business day after such six-month period, together with interest for the period
of delay, compounded annually, equal to the prime rate (as published in the
Wall Street Journal) in effect as of the dates the payments should otherwise
have been provided.

 

(ii)           It
is the intention of the parties that payments or benefits payable under this
Agreement not be subject to the additional tax imposed pursuant to Section 409A
of the Code.  To the extent such potential
payments or benefits could become subject to such Section, the parties shall
cooperate to amend this Agreement with the goal of giving Executive the
economic benefits described herein in a manner that does not result in such tax
being imposed.

 

(iii)          With
respect to payments under this Agreement, for purposes of Section 409A of
the Code of 1986, each severance payment and COBRA continuation reimbursement
payment will be considered one of a series of separate payments.

 

(iv)          Executive
will be deemed to have a termination of employment for purposes of determining
the timing of any payments that are classified as deferred compensation only
upon a “separation from service” within the meaning of Section 409A.

 

(v)           Any
amount that Executive is entitled to be reimbursed under this Agreement will be
reimbursed to Executive as promptly as practical and in any event not later
than the last day of the calendar year after the calendar year in which the
expenses are incurred, and the amount of the expenses eligible for
reimbursement during any calendar year will not affect the amount of expenses
eligible for reimbursement in any other calendar year.

 

(vi)          If
on the due date for any payment pursuant to Section 4 (except for payments
under Section 4.2), the release has not been executed and delivered and
all revocation periods with respect to the release have not yet expired, such
payment will not be made until such revocation period has expired and if such
revocation period has not expired by the end of the calendar year in which the
payment would have otherwise been made, the payment shall be forfeited.  To the extent not forfeited pursuant to the
prior sentence, the Company will

 

 

pay all amounts that would have otherwise
been paid pursuant to Section 4 prior to the executive’s delivery and
lapse of the revocation periods for the release within five days after
satisfaction of these requirements.

 

5.0          COMPENSATION AND
BENEFITS. For Executive’s services, the Company agrees to pay Executive
compensation as follows:

 

5.1          Salary: Base
compensation equal to an annual salary of $250,000 (Two Hundred Fifty Thousand
Dollars) to be paid according to the Company’s general payroll practices as
same may exist from time to time.

 

5.2          Incentive Compensation
Program: During the Term, Executive shall be eligible for an annual
discretionary performance-based bonus, with a target bonus of 100% of base
salary, and based upon the actual performance of the Company in relation to
projected EBITDA milestones, other tangible financial metrics, and Individual
Scorecard Objectives to be established by the President and consistent with
plans approved by the Compensation Committee of the Board of Directors (the “Compensation
Committee”) after consultation with the Chairman of the Board. The President
will set such Individual Scorecard Objectives within the first 45 days of each
calendar year, and within 45 days following Executive’s first day of employment
for the for calendar year 2009. Any bonus payable as a performance bonus shall
be in the amount and paid in the manner, as determined by the Compensation
Committee or the Board of Directors in its sole discretion.  Any such bonus payable shall be paid within
fifteen (15) days of the delivery of the Company annual audit but in any event
by the end of the calendar year after the calendar year to which the
performance relates. Executive shall not be entitled to any bonus for the
calendar year in which Executive’s employment with the Company is terminated
for any reason, except as provided in Sections 4.1 and 4.4.  Executive shall be entitled to receive a
prorated bonus for calendar year 2009  at the target
rate of 100% of base salary, prorated based on Executive’s first day of
employment with the Company, and with a guaranteed minimum bonus for 2009 of
$50,000 such guarantee to be enforceable only if Executive remains employed
with the Company through December 31, 2009 or Executive’s employment
terminates prior to that date due to a Discharge Without Cause or Termination
for Good Reason.

 

5.3          Relocation Bonus.  The Company will pay Executive
a one-time relocation bonus in the gross amount of $100,000, plus a one-time
gross up of this bonus amount for tax purposes (the bonus plus the gross-up,  the “Relocation Bonus”).  If during the Initial Term, Executive (i) is
Discharged for Cause or (ii) resigns his employment under circumstances
that are not a Termination for Good Reason, then Executive will be obligated to
repay the entire Relocation Bonus and, by Executive’s signature below,
Executive authorizes the Company to withhold the amount due, in whole or in
part, from any final wages, compensation, bonus, accrued vacation, or other
payment due to Executive upon termination.

 

5.4          Reimbursement of
Expenses: The Company shall
reimburse Executive for any reasonable business expenses incurred by Executive
in the ordinary course of the Company’s business in accordance with the Company’s
reimbursement policies then in effect. These expenses shall be substantiated by
invoices and receipts, to be submitted by Executive within thirty (30) days
after incurrence.

 

 

5.5          Benefits: During
the Term, Executive shall be entitled to receive all benefits of employment
generally available to the Company’s other executive employees on the same
terms and conditions applicable to such executive employees.  At present, such benefits include
participation in the Company’s: (i) group health plan; (ii) 401(k) retirement
plan upon the first eligible commencement date following six (6) months of
continuous employment; and (iii) 125 Cafeteria Plan. .

 

5.6          Stock:  In addition, the Company shall
use its reasonable best efforts to issue Executive within 120 days of the
Effective Date of this Agreement the stock described in Exhibit B, subject
to the terms contained in such Exhibit B and the Certificate(s) of
Designation for such stock.

 

5.6         Reimbursement for
House-Hunting Expenses.  The Company
will reimburse Executive for the reasonable costs of travel and lodging for up
to two (2) trips to the Denver area for Executive and Executive’s spouse
for the purposes of securing permanent housing. 
If Executive is unable to secure permanent housing prior to Executive’s
first day of employment, the Company will reimburse Executive, in an amount not
to exceed $6,000.00, to assist Executive in paying for the cost of temporary
housing in the Denver metropolitan area for the shorter of (i) 45 days, or
(ii) until such time as Executive secures and is able to occupy permanent
housing (the “Stipend Period”).

 

5.7          Vacation: During the Term, Executive shall be entitled to  four
(4) weeks (160 hours) of paid vacation each year during the Term, accrued
on a pro rata basis through each full year of the Term. Executive will use his
reasonable efforts to schedule vacation periods to minimize disruption of the
Company’s business.  Any accrued vacation
time that is not used by December 31st of each calendar year will not roll over to
the following year absent written approval by the President.

 

5.8          Withholding:
Executive authorizes the Company to make any and all applicable withholdings of
federal and state taxes and other items the Company may be required to deduct,
as such items may exist under this Agreement or otherwise from time to time.

 

6.0          SUCCESSORS AND ASSIGNS.
This Agreement is intended to bind and inure to the benefit of and be
enforceable by Executive, the Company and their respective heirs, successors
and assigns, except that Executive shall not have any right to assign or
otherwise transfer this Agreement, or any of Executive’s rights, duties or any
other interest herein to any party without the prior written consent of the
Company, and any such purported assignment shall be null and void.

 

7.0          SURVIVAL OF RIGHTS AND
OBLIGATIONS. The rights and obligations of the parties as stated herein
shall survive the termination of this Agreement.

 

8.0          ENTIRE AGREEMENT.

 

8.1          Sole Agreement:
This Agreement (including any attachments and exhibits hereto) contain the
parties’ sole and entire agreement regarding the subject matter hereof, and
supersedes any and all other agreements, statements and representations of the
parties.

 

 

8.2          No Other
Representations: The parties acknowledge and agree that no party has made
any representations (i) concerning the subject matter hereof, or (ii) inducing
the other party to execute and deliver this Agreement, except those
representations specifically referenced herein. The parties have relied on
their own judgment in entering into this Agreement.

 

9.0          MODIFICATIONS OR
WAIVERS. Waivers or modifications of this Agreement, or of any covenant,
condition, or limitation contained herein, are valid only if in writing duly
executed by the parties hereto.

 

10.0        GOVERNING LAW. This
Agreement shall be governed pursuant to the laws of the State of Colorado.

 

11.0        SEVERABILITY. If any
part, clause, or condition of this Agreement is held to be partially or wholly
invalid, unenforceable, or inoperative for any reason whatsoever, such shall
not affect any other provision or portion hereof, which shall continue to be
effective as though such invalid, unenforceable or inoperative part, clause or
condition had not been made.

 

12.0        INTERPRETATION.

 

12.1        Section headings:
The section and subsection heading of this Agreement are included for purposes
of convenience only, and shall not affect the construction or interpretation of
any of its provisions.

 

12.2        Gender and Number: Whenever required by the context, the singular shall include the
plural, the plural shall include the singular, and the masculine gender shall
include the neuter and feminine genders and vice versa.

 

13.0        NOTICES. All notices and other communications under or in connection with this
Agreement shall be in writing and shall be deemed given (i) if delivered
personally, upon delivery, (ii) if delivered by registered or certified
mail (return receipt requested), upon the earlier of actual delivery or three
(3) days after being mailed, (iii) if given by overnight courier with
receipt acknowledgment requested, the next business day following the date
sent, or (iv) if given by telecopy, upon confirmation of transmission by
telecopy, in each case to the parties at the following addresses:

 

	
  To the Company:

  	
  Collect America, Ltd.

  
	
   

  	
  4340 S. Monaco, Second Floor

  
	
   

  	
  Denver, CO 80237

  
	
   

  	
  Attention:

  	
  President/Chairman of the Board

  
	
   

  	
  Facsimile:

  	
  (303) 713-2509

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
  KRG Capital Partners, LLC

  
	
   

  	
  1515 Arapahoe Street

  
	
   

  	
  Tower One, Suite 1500

  
	
   

  	
  Denver, Colorado 80202

  
	
   

  	
  Facsimile:

  	
  (303) 390-5015

  
	
   

  	
  Attention:

  	
  Mark M. King

  
	
   

  	
   

  	
  Damon Judd

  
				

 

 

	
  with a copy to:

  	
  Hogan & Hartson LLP

  
	
   

  	
  1200 17th Street, 15th Floor

  
	
   

  	
  Denver, Colorado 80210

  
	
   

  	
  Facsimile:

  	
  (303) 899-7333

  
	
   

  	
  Attention:

  	
  George Hagerty, Esq./Robert Mintz, Esq.

  
	
   

  	
   

  
	
  To Executive:

  	
  To the address listed on the signature
  page hereto.

  

 

14.0        JOINT PREPARATION. All parties to this Agreement have negotiated it at length, and have
had the opportunity to consult with and be represented by their own competent
counsel. This Agreement is therefore deemed to have been jointly prepared by
the parties, and any uncertainty or ambiguity existing in it shall not be
interpreted against any party, but rather shall be interpreted according to the
rules generally governing the interpretation of contracts.

 

15.0        THIRD-PARTY
BENEFICIARIES. No term or provision of
this Agreement is intended to be, or shall be, for the benefit of any person,
firm, organization or corporation not a party hereto, and no such other person,
firm, organization or corporation shall have any right or cause of action
hereunder.

 

16.0        COOPERATION AND FURTHER
ACTIONS. The parties agree to perform any and all acts and to execute and
deliver any and all documents necessary or convenient to carry out the terms of
this Agreement.

 

17.0        ATTORNEYS’ FEES. In the event of any dispute related to or based upon this Agreement,
the prevailing party shall be entitled to recover from the other party its
reasonable attorneys’ fees and costs.

 

18.0        COUNTERPARTS. This
Agreement may be executed in one or more counterparts, including electronically
transmitted counterparts, each of which shall be deemed an original and all of
which shall be considered one and the same instrument.

 

19.0        RESOLUTION OF DISPUTES
AND CONSENT TO JURISDICTION.

 

19.1        Litigation of
Disputes Under Sections 4.7 and 4.8 of this Agreement.  All disputes under or related
to the enforcement of Sections 4.7 and 4.8 of this Agreement, together with any
other dispute under this Agreement that is related to whether Sections 4.7 and
4.8 have been or are threatened to be breached (including without limitation
whether any termination under this Agreement was for Cause) shall be litigated
as provided below.  Specifically, with
respect to such disputes or enforcement actions, each party to this Agreement
hereby (a) consents to the jurisdiction of the United States District
Court for the District of Colorado or, if such court does not have jurisdiction
over such matter, the applicable Colorado State or County Court that has
jurisdiction, (b) consents to personal jurisdiction within the City and
County of Denver, Colorado, and (c) accepts, generally and
unconditionally, the exclusive jurisdiction and venue of the aforesaid courts and
waives any defense of lack of personal jurisdiction or inconvenient forum or
any similar defense, and irrevocably agrees to be bound by any non-appealable
judgment rendered thereby.

 

 

19.2        Arbitration of
Other Disputes Under this Agreement.

 

(i)            Any
controversy, claim or dispute involving the parties (or their affiliated
persons) concerning this Agreement, or the subject matter thereof, except as
provided in Section 19.1, shall be finally settled by arbitration held in
Denver, Colorado by one (1) arbitrator in accordance with the rules of
employment arbitration then followed by the American Arbitration Association or
any successor to the functions thereof. The arbitrator shall apply Colorado law
in the resolution of all controversies, claims and disputes and shall have the
right and authority to determine how his or her decision or determination as to
each issue or matter in dispute may be implemented or enforced. Any decision or
award of the arbitrator shall be final and conclusive on the parties to this
Agreement and their respective affiliates, and there shall be no appeal
therefrom other than from gross negligence or willful misconduct.
Notwithstanding the foregoing, claims of employment discrimination, worker’s
compensation and unemployment compensation benefits shall not be subject to
arbitration under this Agreement. The Company shall bear all costs of the
arbitrator in any action brought under this Section 19.2.

 

(ii)           The
parties hereto agree that any action to compel arbitration pursuant to this Section 19.2
may be brought in the appropriate Colorado court and in connection with such
action to compel the laws of the State of Colorado shall control. Application
may also be made to such court for confirmation of any decision or award of the
arbitrator, for an order of the enforcement and for any other remedies which
may be necessary to effectuate such decision or award. The parties hereto
hereby consent to the jurisdiction of the arbitrator and of such court and
waive any objection to the jurisdiction of such arbitrator and court.

 

[SIGNATURE PAGE FOLLOWS]

 

 

[SIGNATURE PAGE TO EXECUTIVE EMPLOYMENT
AGREEMENT]

 

IN WITNESS WHEREOF, the parties hereto have
executed, or caused their duly authorized representatives to execute, this
Agreement as of the Effective Date.

 

	
   

  	
  COLLECT AMERICA, LTD.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul A. Larkins

  
	
   

  	
  Name:

  	
  Paul A. Larkins

  
	
   

  	
  Title:

  	
  President

  

 

	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  

 

	
   

  	
   

  
	
   

  	
  /s/ Brian W. Tuite

  
	
   

  	
  Brian W. Tuite

  

 

	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Facsimile:

  	
   

  

 

 

EXHIBIT A

 

FORM OF MUTUAL RELEASE

 

Mutual Legal Release

 

This
Mutual Legal Release (“Release”)
is between Collect America, LTD. (the “Company”)
and Brian W. Tuite (“Executive”)
(each a “Party,” and together, the
“Parties”) and shall be effective
on the day that Executive signs it, provided that such day is after Executive’s
last day of employment with the Company (“Effective Date”).

 

Recitals

 

1.             Executive and the
Company are parties to an Executive Employment Agreement to which this Release
is appended as Appendix A (the “Agreement”).

 

2.             Executive wishes to
receive the Without Cause Severance Pay or Permanent Disability Severance Pay,
as the case may be and as provided for and defined in the Agreement, and
understands that receipt of such benefits are conditioned upon his execution of
this Release and compliance with the terms of Sections 4.7 and 4.8 of the
Agreement.

 

3.             Executive and the
Company wish to resolve, except as specifically set forth herein, all claims
between them arising from or relating to any act or omission predating the
Effective Date defined above.

 

Agreement

 

The
Parties agree as follows:

 

1.             Confirmation of
Severance Pay Obligation  The Company
shall pay or provide to the Executive the [Without Case Severance Pay or
Permanent Disability Severance pay] as, when and on the terms and conditions
specified in the Agreement, including but not limited to continued compliance
with Executive’s obligations under Sections 4.7 and 4.8 of the Agreement.

 

2.             Legal
Releases.

 

(a)           Executive, on behalf of Executive and
Executive’s heirs, personal representatives and assigns, and any other person
or entity that could or might act on behalf of Executive, including, without
limitation, Executive’s counsel (all of whom are collectively referred to as “Executive Releasers”), hereby fully and forever releases and
discharges the Company, its present and future parents, affiliates, and
subsidiaries, and each of their past, present and future officers, directors,
employees, shareholders, investors, independent contractors, attorneys,
insurers and any and all other persons or entities that are now or may become
liable to any Executive Releaser due to any Executive Releasee’s act or
omission, (all of whom are collectively referred to as “Executive
Releasees”) of and from any and all actions, causes of action,
claims, demands, costs and expenses, including attorneys’ fees, of every kind
and nature whatsoever, in law or in equity, whether now known or unknown, that
Executive 

 

 

Releasers,
or any person acting under any of them, may now have, or claim at any future
time to have, based in whole or in part upon any act or omission relating to or
arising out of Executive’s employment relationship with, and/or service as a
member of the Board of Directors (if any) for, the Company or its subsidiaries
or affiliates occurring on or before the Effective Date, without regard to
present actual knowledge of such acts or omissions, including specifically, but
not by way of limitation, matters which may arise at common law, such as breach
of contract, express or implied, promissory estoppel, wrongful discharge,
tortious interference with contractual rights, infliction of emotional
distress, defamation, or under federal, state or local laws, such as the Fair
Labor Standards Act, the Employee Retirement Income Security Act, the National
Labor Relations Act, Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act, the Rehabilitation Act of 1973, the Equal Pay
Act, the Americans with Disabilities Act, the Family and Medical Leave Act, and
any civil rights law of any state or other governmental body, all as amended
and to the extent releasable under the statute, and all claims relating to
equity incentives of any kind, except as specifically set forth in the Agreement; PROVIDED, HOWEVER, that notwithstanding the foregoing or
anything else contained in the Agreement or this Release, the release set forth
in this Supplemental Release shall not extend to:  (i) any vested, unpaid rights under any
pension, retirement, profit sharing or similar plan; or (ii) Executive’s
rights, if any, to indemnification, and/or defense under any Company
certificate of incorporation, bylaw and/or policy or procedure, or under any
insurance contract, in connection with Executive’s acts an omissions within the
course and scope of Executive’s employment with the Company.  Executive hereby warrants that Executive has
not assigned or transferred to any person any portion of any claim which is
released, waived and discharged above. 
Executive further states and agrees that Executive has not experienced
any illness, injury, or disability that is compensable or recoverable under the
worker’s compensation laws of any state that was not reported to the Company by
Executive before the Effective Date, and Executive agrees not to not file a
worker’s compensation claim asserting the existence of any such previously
undisclosed illness, injury, or disability. 
Executive has specifically consulted with counsel with respect to the
agreements, representations, and declarations set forth in the previous
sentence.  Executive understands and
agrees that by signing this Agreement and Release, Executive is giving up any
right to bring any legal claim against the Company concerning, directly or
indirectly, Executive’s employment relationship with the Company, including
Executive’s separation from employment. 
Executive agrees that this legal release is intended to be interpreted
in the broadest possible manner in favor of the Company, to include all actual
or potential legal claims that Executive may have against the Company, except
as specifically provided otherwise in this Agreement or Release.

 

(b)           Executive agrees and
acknowledges that Executive: (i) understands the language used in this
Release and its legal effect; (ii) understands that by signing this
Release Executive is giving up the right to sue the Company for age
discrimination;(iii) will receive compensation and/or benefits under the
Agreement to which Executive would not have been entitled without signing this
Release; (iv) has been advised by the Company to consult with an attorney
before signing the Agreement and this Release; and (iv) will be given no
less than [twenty-one OR forty-five} days to consider whether to sign this
Release.

 

(c)           For a period of seven days after the
Effective Date, Executive may, in Executive’s sole discretion, rescind this
Release, by delivering a written notice of rescission to [insert contact] at
the Company.  If Executive rescinds this
Release within seven calendar days 

 

 

after
the Effective Date, this Release shall be void, all actions taken pursuant to
this Release shall be reversed, and neither this Release nor the fact of or
circumstances surrounding its execution shall be admissible for any purpose
whatsoever in any proceeding between the parties, except in connection with a
claim or defense involving the validity or effective rescission of this
Release.  If Executive does not rescind
this Release within seven calendar days after the Effective Date, this Release
shall become final and binding and shall be irrevocable.

 

(d) 
The Company, for itself, its affiliates, and any other person or entity that
could or might act on behalf of the Company, including, without limitation, the
Company’s counsel (all of whom are collectively referred to as “Company Releasers”), hereby fully and forever releases and
discharges Executive and Executive’s heirs, personal representatives and any
and all other persons or entities that are now or may become liable to any
Company Releaser due to any Company Releasee’s act or omission, (all of whom
are collectively referred to as “Company Releasees”)
of and from any and all actions, causes of action, claims, demands, costs and
expenses, including attorneys’ fees, of every kind and nature whatsoever, in
law or in equity, whether now known or unknown, that Company Releasers, or any
person acting under any of them, may now have, or claim at any future time to
have, based in whole or in part upon any act or omission occurring within the
course and scope of Executive’s employment relationship with the Company or its
subsidiaries and affiliates occurring on or before the Effective Date, without
regard to present actual knowledge of such acts or omissions, including
specifically, but not by way of limitation, matters which may arise at common
law, such as breach of contract, express or implied, promissory estoppel,
wrongful discharge, tortious interference with contractual rights, infliction
of emotional distress, defamation, or under federal, state or local laws; PROVIDED, HOWEVER, that notwithstanding the foregoing or
anything else contained in this Agreement, the release set forth in this
paragraph shall not extend to:  (i) any
rights of the Company or duties of the Executive pursuant to the Section 4.7,
4.8, or 4.9 of the Agreement, which sections shall survive the signing of this
Release; (ii) to any Executive act or omission that was actively concealed
from the Company by Executive or at Executive’s direction; or (iii) to any
acts of fraud, embezzlement, or other misappropriation of Company funds,
assets, or property.  The Company hereby
warrants that the Company has not assigned or transferred to any person any
portion of any claim which is released, waived and discharged above.  The Company understands and agrees that by
signing this Agreement the Company is giving up any right to bring any legal
claim against Executive concerning, directly or indirectly, Executive’s
employment relationship with the Company, including Executive’s separation from
employment.  The Company agrees that this
legal release is intended to be interpreted in the broadest possible manner in
favor of Executive, to include all actual or potential legal claims that the
Company may have against Executive, except as specifically provided otherwise
in this Release or the Agreement.

 

3.             Executive
acknowledges that the Company paid Executive for all earned, unpaid wages and
all accrued, unused vacation, less applicable withholdings, through his last
day of employment, and that Executive is entitled to no further payments for
wages, compensation, benefits, bonuses, equity, or any other type of
compensation or benefit, except for the [Without Case Severance Pay or
Permanent Disability Severance pay] Executive will receive if he signs and does
not revoke this Release.

 

 

4.             Executive
covenants never to disparage or speak ill of the Company or any of the
Company’s products or services, or of any past or present employee, officer or
director of the Company, nor shall Executive at any time harass or behave
unprofessionally toward any past, present or future Company employee, officer
or director.  If Executive breaches this
non-disparagement obligation, Executive shall be liable to the Company for
liquidated damages, not a penalty, in the amount of $10,000 for each breach.

 

5.             Executive
acknowledges that because of Executive’s position with the Company, Executive
may possess information that may be relevant to or discoverable in connection
with claims, litigation or judicial, arbitral or investigative proceedings
initiated by a private party or by a regulator, governmental entity, or
self-regulatory organization, that relates to or arises from matters with which
Executive was involved during Executive’s employment with the Company, or that
concern matters of which Executive has information or knowledge (collectively,
a “Proceeding”).  Executive agrees that
Executive shall testify truthfully in connection with any such Proceeding,
shall cooperate with the Company in connection with every such Proceeding, and
that Executive’s duty of cooperation shall include an obligation to meet with
the Company representatives and/or counsel concerning all such Proceedings for
such purposes, and at such times and places, as the Company reasonably
requests, and to appear for deposition and/or testimony upon the Company’s
reasonable request and without a subpoena. 
The Company shall reimburse Executive for reasonable out-of-pocket
expenses that Executive incurs in honoring Executive’s obligation of
cooperation under this paragraph.

 

 [SIGNATURES FOLLOW]

 

 

[SIGNATURE
PAGE TO MUTUAL RELEASE]

 

	
  BRIAN W. TUITE

  	
  COLLECT
  AMERICA, LTD.,

  a
  Delaware corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  As its:

  	
   

  
	
   

  	
   

  	
   

  	
  Date:

  	
   

  

 

 

EXHIBIT
B

 

Equity
Incentives

 

Stock Option

 

·                       The Company will
grant you, subject to the approval of the Board of Directors, an option to
purchase 1,250 shares of the Common Stock of the Company (the “Option”).  This grant will be governed by the CA
Holding, Inc. Amended and Restated 2005 Equity Incentives Plan (the “Plan”) and
will vest, in accordance with the Plan, in equal installments over a five-year
period.  As provided by the Plan, vesting
of the Option shall accelerate in the event of a change of control as defined
in the Plan.

 

Series B-2 Contingent Preferred
Stock

 

·                       Executive will
be issued 12,500 shares of B-2 Preferred to be purchased by Executive at the
fair market value of $0.10 per share. 
The Company would use its reasonable best efforts to issue these
securities within 120 days of Executive’s start date.  The fact and timing of the issuance is
subject to final board approval and necessary shareholder votes.

·                       The B-2 would
be convertible into non-voting common stock of the Company based on the KRG ROI
being between 1.50x and 3.50x, with conversion pro rated within that
range.  No shares would convert to the
extent KRG’s IRR (as defined in the Third Amended and Restated Certificate of
Incorporation of CA Holding, Inc.) on its investment was less than 10%.  For example, if the KRG ROI was 2.50x at the time
of an exit (and assuming the 10% IRR had been achieved), one half of
Executive’s B-2 Preferred would convert into non-voting common stock and the
other half would be forfeited.   “KRG
ROI” shall mean the ratio determined by dividing (i) the total proceeds
received by KRG Capital Fund II, L.P. (“KRG”) for its investments in the
preferred and common equity securities of the Company measured as of a
Liquidity Event (as defined in the Third Amended and Restated Certificate of
Incorporation of CA Holding, Inc.), by (ii) the total capital invested by KRG
in the preferred and common equity securities of the Company.  For purposes of calculating the KRG ROI, any
transaction fees or management fees received by KRG Capital Management, L.P.
pursuant to the Management Agreement between Collect America, Ltd. and KRG
Capital Management, L.P. will not be included in the calculation.

·                       The B-2 will
“vest” based on a 5 year schedule with 20% vesting on each anniversary of
issuance.  Vesting would accelerate in a
Change of Control or IPO.  Vesting will
cease as of the date of any termination of employment for any reason.

 

 

Schedule A

Current List of Company Subsidiaries

 

Astrum Fianncial,
LLC

Autus, LLC

CA Acquisition Company

CA Holding, Inc.

CA Internet Marketing, LLC

CACH of NJ, LLC

CACH, LLC

CACV of  New
Jersey, LLC

CACV of Colorado, LLC

Candeo, LLC

Collect Air, LLC

Collect America Commercial Services, Inc.

Collect America of Canada, LLC

Collect America, Ltd.

Collect Canada, Ltd.

Healthcare Funding Solutions, LLC

Impulse Marketing Group, LLC

Metropolitan Legal Services, Inc.

Orsa, LLC

Preferred Credit Resources Limited

ReFinance America, Ltd.

Valesco Data Services, LLCExhibit 10.16

 

EXECUTION COPY

 

EXECUTIVE
EMPLOYMENT AGREEMENT

 

THIS EXECUTIVE EMPLOYMENT
AGREEMENT (this “Agreement”) is made and entered
into as of February 20, 2006 (the “Effective Date”),
between COLLECT AMERICA, LTD, a Delaware corporation (the “Company”),
and MICHAEL A. JONES (“Executive”).

 

1.0          RECITALS.

 

1.1          Executive and the Company
are entering into this Agreement setting forth the terms and conditions of
Executive’s continued employment with the Company.  The Company hereby employs Executive and Executive
hereby accepts employment with the Company upon the terms and conditions
contained in this Agreement.

 

1.2          As an executive officer
of the Company, Executive has access to valuable confidential and proprietary
information used in the business of the Company, including financial data,
customer data, operational data, trade secrets and other intellectual property
that if disclosed to or used by competitors or potential competitors would
cause irreparable harm to the Company.

 

1.3          Executive and the Company
desire to enter into this Agreement in order to provide the Company with
adequate protection from the  unauthorized
disclosure or use of the Company’s confidential and proprietary information.

 

NOW, THEREFORE, IN
CONSIDERATION of the foregoing facts, the mutual covenants and agreements
contained herein and other good and valuable consideration, the Company and
Executive agree as  follows:

 

2.0          DEFINITIONS.

 

2.1          Affiliate: “Affiliate” means, with respect to any
party, any corporation, limited liability company, partnership, joint venture,
firm and/or other entity which Controls, is Controlled by or is under common
Control with such party.

 

2.2          Board of Directors: “Board of Directors” shall mean the board of
directors of the Company.

 

2.3          Business: “Business” means (i) the providing of
operational assistance and/or software to collection law firms or collection
agencies, including without limitation the operation of a franchise network of
collection law firms, (ii) the purchasing of debt and/or (iii) the
collection of debt on a contingency basis or otherwise.

 

2.4          Compensation Committee: “Compensation Committee” shall mean a
committee of the Board of Directors which has been delegated responsibility for
employee compensation matters or, in the absence thereof, the entire Board of
Directors.

 

2.5          Confidential and
Proprietary Information: “Confidential
and Proprietary  Information” means
all proprietary trade secrets and/or proprietary information and any idea in 

 

1

 

whatever form, tangible or intangible, pertaining
in any manner to the business of the Company of any Affiliate of the Company,
or to the Company’s clients, consultants, or business associates, unless  the information is or becomes publicly
known through lawful means (other than disclosure by Executive, unless such
disclosure by Executive is made in good faith in the course of performing
Executive’s duties under this Agreement, or with the express written consent of
the Board of Directors).

 

2.6          Control: “Control” means (i) in the case of
corporate entities, direct or indirect ownership of at least fifty percent
(50%) of the stock or participating assets entitled to vote for the election of
directors; and (ii) in the case of non-corporate entities (such as
individuals, limited liability companies, partnerships or limited
partnerships), either (A) direct or indirect ownership of at least fifty
percent (50%) of the equity interest, or (B) the power to direct the
management and policies of the noncorporate entity.

 

2.7          Covered Entity: “Covered Entity” means every Affiliate of
Executive, and every business, association, trust, corporation, partnership,
limited liability company, proprietorship
or other entity in which Executive has invested in (whether through debt or
equity securities), or has contributed any capital or made any advances to, or
in which any Affiliate of  Executive
has an ownership interest or profit sharing percentage, or a firm from which
Executive or any Affiliate of Executive receives or is entitled to receive
income, compensation or consulting fees in which Executive or any Affiliate of
Executive has an interest as a lender (other than solely as a trade creditor
for the sale of goods or provision of services that do not otherwise violate  the provisions of this Agreement).  The agreements of Executive contained herein
specifically apply to each entity which is presently a Covered Entity or which
becomes a Covered Entity subsequent to the  date
of this Agreement.  Notwithstanding the
foregoing, nothing contained in this Agreement prohibits Executive or any
Affiliate of Executive from owning less than five percent (5%) of any class of
voting securities registered under the Securities Exchange Act of 1934, as
amended, of any issuer, and no such issuer shall be considered a Covered Entity
solely by virtue of such ownership or the incidents thereof.  Further notwithstanding anything contained in
the foregoing provisions to the contrary, the term “Covered Entity” shall not
include the Company, any Subsidiary of the Company, or any Affiliate of the
Company or any such Subsidiary.

 

2.8          Discharge For Cause: “Discharge For Cause” shall mean termination
of employment for any one or more of the following: (i) willful
misfeasance or nonfeasance by Executive of his assigned duties, which includes
not following the reasonable written direction of the Board of Directors or any
committee thereof (other than  by
reason of disability), or repeated intentional refusal by Executive to perform
his assigned duties (other than by reason of disability)- which continues
uncured for thirty (30) days following receipt of written notice from the Board
of Directors, the Compensation Committee or the Chairman of the Board of
Directors; (ii) such Executive personally engaging in illegal conduct or
in any act of moral turpitude that causes material harm to the reputation of
the Company or any Affiliate of the Company; (iii) such Executive
breaching in any material respect any provision of this Agreement, (other than
by reason of disability) which continues uncured for thirty (30) days following
receipt of written notice from the Board of Directors, the Compensation
Committee or the Chairman of the Board of Directors; and (iv) such
Executive’s commencement of employment with another company while he is  an employee of the Company without the
prior consent of the Board of Directors.

 

2.9          Discharge Without Cause: “Discharge Without Cause” shall mean the
Company’s termination of Executive’s employment hereunder during the term
hereof for any reason 

 

2

 

other than a Discharge For Cause or due to
Executive’s death or Permanent Disability.

 

2.10        EBITDA: “EBITDA” shall mean earnings before
interest, taxes, depreciation and amortization, as determined by generally
accepted accounting principles, consistently applied, and including without
limitation, an accrual for bonuses of officers and employees (including the
Executive) for the year for which EBITDA is determined.

 

2.11        Permanent Disability: “Permanent Disability” shall mean Executive’s
inability to perform Executive’s duties hereunder due to a physical or mental
condition for a period of one hundred twenty (120) consecutive days or an
aggregate of one hundred eighty (180) days in any twelve (12) month period.

 

2.12        Subsidiary: “Subsidiary” shall mean any corporation,
trust, general or limited partnership, limited liability company, limited
liability partnership, firm, company or other business enterprise which is
Controlled by the Company through direct ownership of the stock or other
proprietary interests of such business enterprise or indirectly through the
ownership of stock or other proprietary interests in one (1) or more other
business enterprises which are connected with the Company by means of one (1) or
more chains of business enterprises that are
connected by ownership of stock or other proprietary interests.

 

2.13        Termination For Good
Reason: “Termination For Good Reason”
shall mean voluntary termination of this Agreement by Executive if, without the
prior consent of Executive: (i) there is a reduction by the Company in
Executive’s annual salary then in effect; (ii) the Company acts in any way
that would adversely affect Executive’s participation in or materially reduce
Executive’s benefit under any benefit plan of the Company in which Executive’s
is participating, except those
changes generally affecting similarly situated employees of the Company, and except any action not taken in bad faith
and which is remedied by the Company promptly upon receipt of notice thereof
given by Executive; (iii) the  Company
materially breaches the terms of this Agreement and such breach is not cured
within thirty (30) days after receipt of written notice thereof given by
Executive; (iv) there is a material diminution of Executive’s job title,
reporting relationship, job duties, responsibilities (which include, without
limitation, responsibilities in managing the Business) or requirements that are
inconsistent with the position or positions listed in Section 3.1; or (v) there
is a relocation of Executive to a facility or location more than twenty-five
(25) miles from the Company’s current location.

 

2.14        Territory: “Territory” means the United States and
Canada.

 

3.0          CAPACITIES AND DUTIES; INDEMNIFICATION.

 

3.1          Title: Executive is
hereby employed in the capacity of Chief Financial Officer of the Company.  Executive shall report directly to the
President and Chief Executive Officer of the Company and shall be subject to
his or her supervision, control and direction. 
Executive will at all times abide by the Company’s written personnel
policies applicable to similarly situated employees of the Company as in effect
from time to time and previously provided to Executive, and will faithfully,
industriously and to the best of Executive’s ability, experience and talents
perform all of the duties that may be required of and from Executive pursuant
to the terms hereof, consistent with Executive’s status as the Chief Financial
Officer of the Company.

 

3.2          Exclusive Services: During the Term,
Executive agrees to devote Executive’s 

 

3

 

best efforts and full business time to rendering
services to the Company. Executive is specifically restricted front being
employed by any other company, other than a Subsidiary or an Affiliate of the
Company, while under the Company’s employ pursuant to this Agreement; provided
that neither (i) Executive’s ownership of less than a five percent
(5%) ownership interest in another competing business entity (where such
ownership does not constitute Control and where Executive does not act as a
director, officer, consultant or otherwise provide services to such entity),
nor (ii) Executive’s service on the board of directors of any charitable,
non-profit or educational institution without compensation (other than
reimbursement of out-of-pocket expenses) or any entity that is not in direct
competition with the Business, nor (iii) managing Executive’s personal
investments and affairs and the personal investment and affairs of any of his
family members, nor (iv) acquiring any interest in any entity, whether or
not part of a Control group, that is directly or indirectly owned or
Controlled, in whole or in part, by Executive and/or one or more members of his
family, or a partnership, trust or other entity held by or for the benefit of
Executive and/or one or more members of his family, nor (v) performing
services for any entity, whether or not part of a Control group, that is
directly or indirectly owned or Controlled, in whole or in part, by Executive
and/or one or more members of his family, or a partnership, trust, or other
entity held by or for the benefit of Executive and/or one or more members of
his family, shall not be a violation of this Section 3.2, provided,
however, that any such services shall be insubstantial and shall not include
any active involvement in the management of such entity and provided further
that such service or ownership addressed in Sections 3.2(i) through (v) shall
not detract from Executive’s performance of his duties to the Company or,
except in the case of Section 3.2(i), be in direct competition with the
Business.

 

3.3          Indemnification: The Company
shall, to the maximum extent permitted by law, indemnify and hold harmless
Executive for any loss, injury, damage, expense (including reasonable attorneys’
fees, and costs), and claim or demand, arising out of, connected with, or in
any manner related to, any act, omission, or decision made in good faith while
performing services for the Company from and after the Effective Date.

 

4.0          TERM.

 

4.1          Term: Subject to
Sections 42, 4.3, 4.4, 4.5 and 4.6 the term of this Agreement shall be three (3) years
commencing on the Effective Date, unless  terminated
earlier pursuant to the terms herein (the “Initial
Term”); provided that, unless earlier terminated pursuant to the
terns herein, the Initial Term shall be automatically extended for additional
one-year terms (each, a “Renewal Term”)
upon the expiration of the Initial Term or any such Renewal Term unless the
Company or Executive delivers to the other at least thirty (30) days prior to
the expiration of the Initial Term or the then-current Renewal Term, as the
case may be, a written notice specifying that the term of Executive’s
employment will not be renewed at the end of the Initial Term or the
then-current Renewal Term, as. the case may be. 
The Initial Term or, in the event that Executive’s employment hereunder
is terminated earlier pursuant to the terms herein or renewed pursuant to this Section 4.1,
such shorter or longer period, as the case may be, is referred to herein as the
“Term.”

 

4.2          Discharge For Cause: Executive’s
employment under this Agreement may be terminated by the Company (subject to
the notice and cure period set forth in Section 2.8, if applicable), by
vote of a majority of the Board of Directors, specifically finding that an
action constituting a Discharge for Cause has occurred, without further
obligation by the Company, except for payment of any base salary compensation
and expense reimbursement accrued and unpaid through the effective date of
termination and except as otherwise required by law, upon written notice to
Executive of a Discharge For Cause.  The
Company shall provide Executive in such written 

 

4

 

notification such facts as shall be reasonably
necessary to apprise Executive of the basis for such Discharge For Cause and
for Executive to exercise Executive’s right to cure under Section 2.8, if
applicable.

 

4.3          Discharge Without Cause
and Payments Upon Expiration of Term: Executive’s employment
under this Agreement may be immediately terminated by the Company upon written
notice to Executive of a Discharge Without Cause.  Upon termination pursuant to this Section 4.3,
the Company shall continue to pay to Executive an amount equal to Executive’s
base salary, as provided in Section 5.1, at the annual rate in effect at
the time of termination, for a period equal to twelve (12) months from the date
of such termination (“Without Cause Severance
Pay”).  Without Cause Severance Pay shall also
include, in addition to the foregoing, (i) all amounts of base salary
compensation and expense reimbursement accrued to the effective date of
termination and a bonus equal to a pro rata portion of the bonus amount that
would have been paid to Executive for the current bonus period had Executive
not been terminated, which bonus amount is determined by multiplying the bonus
that would have been earned for the then-current twelve (12) month bonus period
assuming the Company’s EBITDA continued at the same rate per month as
experienced from the beginning of the current period through the date of
termination, by a fraction (y) the numerator of which is number of
calendar days in the then-current bonus period that have elapsed as of the date
of termination and (z) the denominator of which is 365; and (ii) the
Company shall continue to pay or provide to Executive the medical, dental, life
and disability insurance benefits pursuant to Section 5.4 until the later
to occur of twelve (12) months from the date of such termination or (ii) the
Noncompete Term as defined in that certain Noncompetition and Nonsolicitation
Agreement dated as of the Effective Date between Company and Executive;
provided, however, the Company’s obligation to pay or provide the benefits in
clause (ii) above shall be subject to Section 4.11.  Other than the foregoing, Executive shall not
be entitled to any payment for subsequent periods upon Executive’s termination
of employment upon a Discharge Without Cause. 
Without Cause Severance Pay shall be payable to Executive, in accordance
with the Company’s general payroll practices as the same may exist from time to
time, upon Executive’s termination of employment upon a Discharge Without Cause.  Other than Executive’s claims for amounts
required to be paid pursuant to this Section 4.3, as a condition to
receiving Without Cause Severance Pay, Executive shall execute a release of
claims in the form attached hereto as Exhibit A.

 

4.4          Termination For Good
Reason: This Agreement may be immediately terminated by Executive, subject to
the notice and time limitations set forth in Section 2.13, upon written
notice to the Company of a Termination For Good Reason.  Upon termination pursuant to this Section 4.4,
the Company shall continue to pay Executive an amount equal to Executive’s base
salary, as provided in Section 5.1, at the annual rate in effect at the
time of termination, for a period equal to twelve (12) months from the elate of
such termination (“Good Reason Severance Pay”).  Good Reason Severance Pay shall also include,
in addition to the foregoing, (i) all amounts of base salary compensation
and expense reimbursement accrued to the effective date of termination and a
bonus equal to the pro rata portion of the bonus amount that would have been
paid to Executive for the current bonus period had Executive not been
terminated, which bonus amount is determined by multiplying the bonus that
would have been earned for the then-current twelve (12) month bonus period
assuming the Company’s EBITDA continued at the same rate per month as
experienced from the beginning of the current period through the date of
termination, by a fraction (y) the numerator of which is number of
calendar days in the then-current bonus period that have elapsed as of the date
of termination and (z) the denominator of which is 365; and (ii) the
Company shall continue to pay or provide to Executive the medical, dental, life
and disability insurance benefits pursuant to Section 5.4 until the later
to occur of twelve (12) months from the date of such termination or the
Noncompete 

 

5

 

Term as defined in that certain Noncompetition and
Nonsolicitation Agreement dated as of the Effective Date between Company and
Executive; provided, however, that the Company’s obligation to pay or provide
the benefits in clause (ii) above shall be subject to Section 4.11.  Other than the foregoing, Executive shall not
be entitled to any payment upon Executive’s termination of employment upon a
Termination For Good Reason.  Good Reason
Severance Pay shall be payable in accordance with the Company’s general payroll
practices as the same may exist from time to time upon Executive’s termination
of employment upon a Termination For Good Reason.  Other than Executive’s claims for amounts
required to be paid pursuant to this Section 4.4, as a condition to
receiving Good Reason Severance Pay, Executive shall execute a release of
claims in the form attached hereto as Exhibit A.

 

4.5          Termination Upon Death: This Agreement
shall be immediately terminated without action or notice by either party upon
the death of Executive and without further obligation by the Company, except
for payment of all amounts of base salary compensation and expense
reimbursement accrued to the effective date of termination, and except as
otherwise required by law.

 

4.6          Termination Upon
Permanent Disability: Executive’s employment under this Agreement may
be immediately terminated by the Company upon written notice of a termination
for the Permanent Disability of Executive. 
Upon termination pursuant to this Section 4.6, the Company shall
continue to pay to Executive an amount equal to Executive’s base salary, as
provided in Section 5.1, at the annual rate in effect at the time of
termination, for a period equal to three (3) months from the date of
termination (“Permanent Disability
Severance Pay”).  Permanent Disability Severance Pay shall also
include, in addition to the foregoing, all amounts of base salary compensation
and expense reimbursement accrued to the effective date of termination.  Permanent Disability Severance Pay shall be
reduced by the amount of any disability benefits paid during and for the same
period to Executive under airy disability insurance policy provided by the
Company as a benefit to Executive. 
Permanent Disability Severance Pay shall be payable to Executive, in
accordance with the Company’s general payroll practices as the same may exist
from time to time, upon Executive’s termination pursuant to this Section 4.6.  Other than Executive’s claims for amounts
required to be paid pursuant to this Section 4.6, as a condition to
receiving Permanent Disability Severance Pay, Executive shall execute a release
of claims in the form attached hereto as Exhibit A.

 

4.7          Confidential and
Proprietary Information: Executive agrees that he will not, either
directly or indirectly, and Executive will not permit any Covered Entity which
is Controlled by Executive to, either directly or indirectly, divulge to any
person or use any of the Confidential and Proprietary Information, except (i) as
required in connection with the performance of such Executive’s duties to the
Company, (ii) as required to be included in any report, statement or
testimony requested by any municipal, state or national regulatory body having
jurisdiction over Executive or any Covered Entity which is Controlled by
Executive, (iii) as required in response to any summons or subpoena or in
connection with any litigation, (iv) to the extent necessary in order in
comply with any law, order, regulation, ruling or governmental request
applicable to Executive or any Covered Entity which is Controlled by Executive,
(v) as required in connection with an audit by any taxing authority, or (vi) is
made with the express written consent attic Board of Directors.  In the event that Executive or any such
Covered Entity which is Controlled by Executive is required to disclose
Confidential and Proprietary Information pursuant to the foregoing exceptions,
Executive shall promptly notify the Company of such pending disclosure and
assist the Company (at the Company’s expense) in seeking a protective order or
in objecting to such request, summons or subpoena with regard to the
Confidential and Proprietary Information. 
If the Company does not 

 

6

 

obtain such relief after a period that is
reasonable under the circumstances, Executive (or such Covered Entity) may
disclose that portion of the Confidential and Proprietary Information which
counsel to such party advises such party that they are legally compelled to
disclose or else stand liable for contempt or suffer censure or penalty. In
such eases, Executive shall promptly provide the Company with a copy of the
Confidential and Proprietary Information so disclosed.

 

4.8          Non-Compete and Non-Solicitation:

 

(i)            During the term of Executive’s
employment with the Company or any Affiliate of the Company and for one (1) year
thereafter, Executive shall not either directly or indirectly, and will not
permit any Covered Entity which is Controlled by Executive to either directly
or Indirectly, participate in, assist, aid or advise in any way, any
competitive business or enterprise that competes with the Business in the
Territory.  For purposes of this
Agreement, the Company shall be deemed to be conducting the Business in the
Territory if the applicable collection account debtors are located in the
Territory or if the applicable franchisees or other customers (or such franchisee’s
or customer’s respective collection account debtors) are located in the
Territory, regardless of whether the collection activities or services are
performed from locations outside of the Territory.

 

(ii)           During the term of Executive’s
employment with the Company or any Affiliate of the Company and one (1) year
thereafter, Executive will not, either directly or indirectly and will not
permit any Covered Entity which is Controlled by Executive to, either directly
or indirectly, (a) (1) attempt in any manner to solicit the business
of any franchisee of the Company or Affiliates of the Company, or (2) solicit
the business of any financial institution or other creditors with which the
Company or its Affiliates has had a relationship; or (b) hire, solicit
take away, or attempt to hire, solicit or take away (either on such Executive’s
behalf or on behalf of any other person or
entity) any person (1) who is then an employee of the Company or
any Affiliate of the Company or an employee or a franchisee of the Company; or (2) who
has terminated his or her employment with the Company or any Affiliate of the
Company within the previous ninety (90) days.

 

(iii)          Executive agrees that the payment of
any Without Cause Severance Pay or Good Reason Severance Pay is conditioned on
Executive’s compliance with this Section 4.8 and that the Company will
have the right to withhold payment if Executive is in breach of this Section 4,8.

 

(iv)          Notwithstanding the provisions of
Sections 4.8(i) and (ii) above, (a) Executive’s ownership of
less than a five percent (5%) ownership interest in another competing business
entity (where such ownership does not constitute Control and where Executive
does not act as a director, officer, consultant or otherwise provide services
to such entity), (b) Executive’s service on the board of directors of any
charitable, non-profit or educational institution without compensation (other
than reimbursement of out-of-pocket expenses) or any entity that is not in
direct competition with the Business, (c) managing Executive’s persona’
investments and affairs and the personal investment and affair of any of his
family members, (d) acquiring any interest in any entity, whether or not
part of a Control group, that is directly or indirectly owned or Controlled, in
whole or in part, by Executive and/or one or more members of his family, or a
partnership, trust or other entity held by or for the benefit of Executive
and/or one or more members of his family, (e) performing services for any
entity, whether or not part of a Control group, that is directly or indirectly
owned or Controlled, in whole or In part, by Executive and/or one or more
members of his family, or a partnership, trust, or other entity held by or for
the benefit of Executive and/or one or more members of his family, shall not be
considered a violation of Sections 4.8(i) and (ii), provided, however,
that 

 

7

 

any such services or ownership addressed in
this Section 4.8(iv) shall not detract front Executive’s performance
of his duties to the Cowpony during the term of his employment with the Company
or, except in the case of Section 4.8(iv)(a), be in direct competition
with the Business.

 

4.9          Enforcement Remedies: Executive
acknowledges that Executive’s expertise in the Business is of a special and
unique character which gives this expertise a particular value, and that a
breach of Sections 4.7 or 4.8 by Executive will cause serious and potentially
irreparable harm to the Company. 
Executive therefore acknowledges that a breach a Sections 4.7 or 4.8 by
Executive cannot be adequately compensated in an action for damages at law, and
equitable relief would be necessary to protect the Company from a violation of
this Agreement and from the harm which this Agreement is intended to
prevent.  By reason thereof; Executive
acknowledges that the Company is entitled, in addition to any other remedies it
may have under this Agreement or otherwise, to preliminary and permanent injunctive
and other equitable relief to prevent or curtail any breach of this
Agreement.  Executive acknowledges,
however, that no specification in this Agreement of a specific legal or
equitable remedy may be construed as a waiver of or prohibition against
pursuing other legal or equitable remedies in the event of a breach of this
Agreement by Executive.  Executive’s sole
and exclusive remedy in the event of a breach of this Agreement by the Company
shall be payment of the Without Cause Severance Pay or Good Reason Severance
Pay.

 

4.10        COBRA: If, following a
Termination For Good Reason by Executive or a Discharge Without Cause by the
Company, Executive elects continued coverage under the Company’s health plan
pursuant to the Comprehensive Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”), then the
Company shall continue to pay the premium for Executive’s continued coverage
under the Company’s health plan until the first to occur of (i) twelve
(12) months from the date of termination; (ii) Executive is employed by a
third party, or (iii) Executive elects to cease such coverage or fails to
pay his portion of the premium. If the Company changes its insurance provider
or the amounts or terms of such coverage for its employees during such period,
including changes and contribution percentages or costs, the Company may
provide such substitute or changed coverage to Executive in full satisfaction
of its obligations under this Section 4.10.

 

4.11        Severance Pay Benefit
Conditions: If, following a Termination For Good Reason by
Executive or a Discharge Without Cause by the Company, Executive is no longer
entitled to the medical, dental, life and disability insurance benefits
referenced in Section 4.3(ii) and Section 4.4(ii) because
Executive is no longer an employee of the Company, then the Company shall first
attempt to resolve the eligibility issue by paying Executive a nominal (no less
than minimum wage) salary, less applicable tax withholdings, during the period
for which Executive is entitled to the benefit under Section 4.3(ii) or
Section 4.4(11).  If the Company’s
attempt to resolve the eligibility issue in the previous sentence is not
permitted by the applicable benefit plan or policy, then Company shall pay to
Executive a monthly amount equal to the monthly premium that the Company paid
under the applicable benefit plan, or policy with respect to the Executive’s
benefits in the month prior to the termination of Executive’s employment with
the Company.  The monthly payments
described in the foregoing sentence shall be paid for the period during which
Executive was otherwise entitled to receive the benefits under Section 4.3(ii) or,
Section 4.4(11).

 

5.0          COMPENSATION AND BENEFITS.  For Executive’s services, the Company agrees to pay
Executive compensation as follows:

 

5.1          Salary: Base compensation
equal to an annual salary of $285,000 (Two Hundred Eighty Five Thousand
Dollars) to be paid according to the Company’s general payroll 

 

8

 

practices as same may exist from time to time.
Executive’s base compensation will be subject to annual reviews and increases
as approved by the Board of Directors and the Compensation Committee. Such
annual reviews will be conducted on or about Executive’s normal anniversary
date of hire in accordance with past practice of the Company.

 

5.2          Incentive Compensation
Program: During the Term, Executive shall be eligible for an annual
discretionary performance-based bonus of up to 100% of the base salary based
upon the actual performance of the Company in relation to projected EBITDA
milestones and management objectives to be agreed upon. by the Compensation
Committee of the Board of Directors (the “Compensation
Committee”) or the Board of Directors.  The Compensation Committee or the Board of
Directors will set such milestones on or before Decembers 31st of each year of
the Term, and within 30 days following the Closing Date (as detailed in the
Merger Agreement) for fiscal 2005.  Any
bonus payable as a performance bonus shall be in the amount, and paid at the
time and in the manner, as determined by the Compensation Committee or the
Board of Directors.  Executive shall not
be entitled to any bonus for the calendar year in which Executive’s employment
with the Company is terminated for any reason, except as provided in Section 4.3
(Discharge Without Cause) or Section 4.4 (Termination For  Good Reason).

 

5.3          Reimbursement of Expenses: The Company shall
reimburse Executive for any reasonable business expenses incurred by Executive
in the ordinary course of the Company’s business in accordance with the Company’s
reimbursement policies then in effect. 
These expenses shall be substantiated by invoices and receipts, to be
submitted by Executive within thirty (30) days after incurrence.

 

5.4          Relocation: Upon the
Effective Date, the Company shall pay to the Executive a lump sum payment in
the amount of $90,000 (net of all applicable withholding) to cover the cost of
the Executive’s relocation.

 

5.5          Benefits: During the Term,
Executive shall be entitled to receive all benefits of employment generally
available to the Company’s other executive employees when and as such benefits,
if any, become available and Executive becomes eligible for them, including any
vacation and sick leave, medical, dental, life and disability insurance
benefits, long term incentive plan, stock option plan, pension plan and/or
profit-sharing plan, and parking.  In
addition, Executive shall receive, within sixty (60) days following the
Effective Date, the right to purchase restricted stock under Holding’s Equity
Incentive Plan for up to 34,540 shares (subject to the approval by the Board of
Directors within sixty (60) days following the Effective Date) of Series B-1
Contingent Preferred Stock at a price per share equal to $0.10 per share.

 

5.6          Vacation: During the Term,
Executive shall be entitled to four (4) weeks (160 hours) of paid vacation
each year during the Term.  Executive
will use his reasonable efforts to schedule vacation, periods to minimize
disruption of the Company’s business. 
Except upon Discharge Without Cause or Termination for Good Reason, the
Company will not reimburse Executive for any unused vacation.

 

5.7          Withholding: Executive
authorizes the Company to make any and all applicable withholdings of Meted and
state taxes and other items the Company may be required to deduct, as such
items may exist under this Agreement or otherwise from time to time.

 

6.0          SUCCESSORS AND ASSIGNS.  This
Agreement is intended to bind and inure to 

 

9

 

the benefit of and be enforceable by Executive, the
Company and their respective heirs, successors and assigns, except that
Executive shall not have any right
to assign or otherwise transfer this Agreement, or any of Executive’s rights,
duties or any other interest herein to any party without the prior written
consent of the Company, and any such purported assignment shall be null and
void.

 

7.0          SURVIVAL OF RIGHTS AND OBLIGATIONS.  The
rights and obligations of the parties as stated herein shall survive the
termination of this Agreement.

 

8.0          ENTIRE AGREEMENT.

 

8.1          Sole Agreement: This Agreement
(including any attachments and exhibits hereto), any non-competition,
non-solicitation., confidentiality or proprietary information agreement contain
the parties’ sole and entire agreement regarding the subject matter hereof, and
supersedes any and all other agreements, statements and representations of the
parties, including but not limited to any employment agreement or other
agreement regarding Executive’s compensation or terms of employment entered
into prior to the Effective Date.

 

8.2          No Other Representations: The parties
acknowledge and agree that no party has made any representations (i) concerning
the subject matter hereof, or (ii) inducing the other party to execute and
deliver this Agreement, except those representations specifically referenced
herein.  The parties have relied on their
own judgment in entering into this Agreement.

 

9.0          MODIFICATIONS OR WAIVERS. 
Waivers or modifications of this Agreement, or of any covenant, condition,
or limitation contained herein, are valid only if in writing duly executed by
the parties hereto.

 

10.0        GOVERNING LAW.  This
Agreement shall be governed pursuant to the laws of the State of Colorado.

 

11.0       SEVERABILITY.  If any
part, clause, or condition of this Agreement is held to be partially or wholly
invalid, unenforceable, or inoperative for any reason whatsoever, such shall
not affect any other provision or portion hereof, which shall continue to be
effective as though such invalid, unenforceable or inoperative part, clause or
condition had not been made.

 

12.0        INTERPRETATION.

 

12.1        Section headings: The section and
subsection heading of this Agreement are included for purposes of convenience
only, and shall not affect the construction or interpretation of any of its
provisions.

 

12.2        Gender and Number: Whenever required
by the context, the singular shall include the plural, the plural shall include
the singular, and the masculine gender shall include the neuter and feminine
genders and vice versa.

 

13.0        NOTICES.  All notices
and other communications under or in connection with this Agreement shall be in
writing and shall be deemed given (1) if delivered personally, upon
delivery, (ii) if delivered by registered or certified mail (return
receipt requested), upon the earlier of actual delivery or three (3) days
after being mailed, (iii) if given by overnight courier with receipt
acknowledgment requested, the next business day following the date sent, or (iv) if
given by 

 

10

 

telecopy, upon confirmation of transmission by
telecopy, in each case to the parties at the following addresses:

 

	
  To the Company:

  	
  Collect America, Ltd.

  
	
   

  	
  5000 Republic Plaza 

  
	
   

  	
  370 Seventeenth Street 

  
	
   

  	
  Denver, CO 80202

  
	
   

  	
  Attention:

  	
  President

  
	
   

  	
  Facsimile:

  	
  (303) 296-8538

  
	
   

  	
   

  
	
  with a copy to:

  	
  KRG Capital Partners, LLC

  
	
   

  	
  1515 Arapahoe Street

  
	
   

  	
  Tower One, Suite 1500

  
	
   

  	
  Denver, Colorado 80202

  
	
   

  	
  Facsimile: (303) 390-5015

  
	
   

  	
  Attention:

  	
  Mark M. King

  
	
   

  	
   

  	
  Christopher J. Bock

  
	
   

  	
   

  
	
  with a copy to:

  	
  Paul, Hastings, Janofsky & Walker LLP

  
	
   

  	
  695 Town Center Drive, 17th Floor

  
	
   

  	
  Costa Mesa, California 92626

  
	
   

  	
  Facsimile: (714) 979-1921

  
	
   

  	
  Attention: William J. Simpson, Esq.

  
	
   

  	
   

  
	
  To Executive:

  	
  To the address listed or the signature
  page hereto.

  

 

14.0        JOINT PREPARATION.  All parties
to this Agreement have negotiated it at length, and have had the opportunity to
consult with and be represented by their own competent counsel.  This Agreement is therefore deemed to have
been jointly .prepared by the parties, and any uncertainty
or ambiguity existing in it shall not be interpreted against any party, but
rather shall be interpreted according to the rules generally governing the
interpretation of contracts.

 

15.0        THIRD-PARTY BENEFICIARIES.  No
term or provision of this Agreement is intended to be, or shall be, for the
benefit of any person, firm, organization or corporation not a party hereto,
and no such other person, firm, organization or corporation shall have any
right or cause of action hereunder.

 

16.0        ARBITRATION.

 

(i)            Any controversy, claim or dispute
involving the parties (or their affiliated persons) directly or indirectly
concerning this Agreement, or the subject matter thereat shall be finally
settled by arbitration held in Denver, Colorado by one (1) arbitrator in
accordance with the rules of employment arbitration, then followed by the
American Arbitration Association or any successor to the functions
thereof.  The arbitrator shall apply
Colorado law in the resolution of all controversies, claims and. disputes and
shall have the right and authority to determine how his or her decision or
determination as to each issue or matter in dispute may be implemented or
enforced.  Any decision or award of the
arbitrator shall be final and conclusive on the parties to this Agreement and
their respective affiliates, and there shall be no appeal therefrom other than
from gross negligence or willful misconduct. 
Notwithstanding the foregoing, claims of employment 

 

11

 

discrimination, worker’s compensation and
unemployment compensation benefits shall not be subject to arbitration under
this Agreement.  The Company shall bear
all costs of the arbitrator in any action brought under this Section 16.0.

 

(ii)           The parties hereto agree that any
action to compel arbitration pursuant to this Agreement may be brought in the
appropriate Colorado court and in connection with such action to compel the
laws of the State of Colorado shall control. 
Application may also be made to such court for confirmation of any
decision or award of the arbitrator, for an order of the enforcement and for
any other remedies which may be necessary to effectuate such decision or
award.  The parties hereto hereby consent
to the jurisdiction of the arbitrator and of such court and waive any objection
to the jurisdiction of such arbitrator and court.

 

(iii)          Notwithstanding the foregoing
provisions of this Section 16.0, nothing contained herein shall be deemed
to preclude any party from bringing an action for injunctive relief in any
court having jurisdiction.

 

17.0        COOPERATION AND FURTHER ACTIONS.  The
parties agree to perform any and all acts and to execute and deliver any and
all documents necessary or convenient to carry out the terms of this Agreement.

 

18.0        ATTORNEYS’ FEES.  In the
event of any dispute related to or based upon this Agreement, the prevailing
party shall be entitled to recover from the other party its reasonable
attorneys’ fees and costs.

 

19.0        COUNTERPARTS.  This
Agreement may be executed in one or more counterparts, including electronically
transmitted counterparts, each of which shall be deemed an original and all of
which shall be considered one and the same instrument.

 

20.0        CONSENT TO JURISDICTION.  Each party
to this Agreement hereby (a) consents to the jurisdiction of the United
States District Court for the District of Colorado or, if such court does not
have jurisdiction over such matter, the applicable Colorado State or County
Court that has jurisdiction, (b) irrevocably agrees that all actions or
proceedings arising out of or relating to this Agreement which are not subject
to arbitration as set forth in Section 16.0(f) shall be litigated in
such court and (c) consents to personal jurisdiction within the City and
County of Denver, Colorado. Each party to this Agreement accepts for itself and
in connection with its properties, generally and unconditionally, the exclusive
jurisdiction and venue of the aforesaid courts and waives any defense of lack
of, personal jurisdiction or inconvenient forum or any similar defense, and
irrevocably agrees to be bound by any non-appealable judgment rendered thereby
in connection with this Agreement.

 

[SIGNATURE
PAGE FOLLOWS]

 

12

 

[SIGNATURE
PAGE TO EXECUTIVE EMPLOYMENT AGREEMENT]

 

IN WITNESS WHEREOF, the
parties hereto have executed, or caused their duly authorized representatives
to execute, this Agreement as of the Effective Date.

 

	
   

  	
  COLLECT AMERICA, LTD.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ P. Scott Lowery

  
	
   

  	
  Name: P. Scott Lowery

  
	
   

  	
  Title: 
  President & CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Michael A. Jones

  
	
   

  	
  Michael A. Jones

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Facsimile:

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