Document:

exv10w23

 

Exhibit 10.23

FIRST AMENDMENT TO CREDIT AGREEMENT

     FIRST AMENDMENT (this “First Amendment”) dated June 30, 2005 to the Revolving Credit
Agreement dated as of June 30, 2004 (the “Credit Agreement”) among TELECOMUNICACIONES DE
PUERTO RICO, INC., a Puerto Rico corporation (the “Borrower”), PUERTO RICO TELEPHONE
COMPANY, INC., a Puerto Rico corporation (“PRTC” or the “Guarantor” and collectively with
each Significant Subsidiary, the “Guarantors”), the banks, financial institutions and other
institutional lenders (the “Lenders”) listed on the signature pages hereof, BANCO POPULAR
DE PUERTO RICO (“Banco Popular”), a Puerto Rico banking institution, as administrative
agent (in such capacity, the “Administrative Agent”) for the Lenders.

WITNESSETH

     WHEREAS, reference is made to the Credit Agreement, pursuant to which the Lenders made
available to the Borrower certain revolving credit facilities in a maximum aggregate principal
amount of up to $40,000,000 which are evidenced by the Note; and

     WHEREAS, the Borrower and the Guarantor wish to extend the effective period of the Commitments
as set forth in the Allonge to the Note to be executed by the parties hereto simultaneously with
the execution of this First Amendment, and, to that end, the Lenders have agreed to amend certain
of the terms of the Credit Agreement, subject to the terms and conditions herein set forth and
further subject to the condition that the transactions and amendments contemplated herein shall not
constitute nor be deemed to constitute novation of the obligations of the parties under the Credit
Agreement.

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

     SECTION 1. Defined Terms. Unless otherwise defined herein, the terms used in this
Agreement shall have the same meanings ascribed to them in the Credit Agreement, as amended by this
First Amendment.

     SECTION 2. Amendments to Credit Agreement. Subject to the satisfaction of the
conditions to effectiveness specified in Section 4 hereof, the Credit Agreement is hereby amended
as follows:

	 	(a)	 	Amendment to Section 1.01 of the Credit Agreement. Section 1.01 of the
Credit Agreement is hereby amended as follows:

     (i) The definition of the term “Termination Date” is hereby amended to read in
its entirety as follows:

 

 

     “Termination Date” means the earlier of June 30, 2006, and the date of
termination in whole of the Commitments pursuant to Section 2.04 or 6.01.

	 	(b)	 	Amendment to Section 4.01 of the Credit Agreement.

     (i) Section 4.01(e) is hereby amended to read in its entirety as follows:

“The Consolidated balance sheet of the Borrower and its Subsidiaries as at December
31, 2004, and the related Consolidated statements of income and cash flows of the
Borrower and its Subsidiaries for the fiscal year then ended, accompanied by an
opinion of Ernst & Young LLP, independent public accountants, copies of which have
been furnished to each Lender, fairly present, the Consolidated financial condition
of the Borrower and its Subsidiaries as at such date and the Consolidated results of
the operations of the Borrower and its Subsidiaries for the periods ended on such
date, all in accordance with generally accepted accounting principles consistently
applied.”

	 	(c)	 	Amendment to Schedules.

                    (i) Schedule 5.02(d) is hereby deleted in its entirety and replaced by Schedule 5.02(d)
attached hereto as Exhibit A.

     SECTION 3. Conditions to Effectiveness. The amendments and modifications set forth in
Section 2 hereof shall become effective as of the date first above written (the “Effective Date”),
notwithstanding the actual date of execution of this First Amendment by the parties hereto, so long
as each of the following conditions to effectiveness have been satisfied:

     (a) The Administrative Agent shall have received this First Amendment duly executed and
delivered by the Borrower, the Guarantor and the Lenders.

     (b) The Administrative Agent shall have received an allonge (the “Allonge”) to the Note duly
executed and delivered by the Borrower in favor of Banco Popular.

     (c) The Administrative Agent shall have received certified copies of the resolutions of the
Board of Directors of each Loan Party approving the transactions contemplated hereby and by the
Allonge, and of all documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this First Amendment and the Allonge.

     (d) A certificate of the Secretary of each Loan Party certifying the names and true signatures
of the officers of each Loan Party authorized to sign this First Amendment and the Allonge and the
other documents to be delivered hereunder.

     (e) A certificate of the Chief Financial Officer of each Loan Party, attesting to the Solvency
of each Loan Party after giving effect to the Borrowings contemplated hereunder.

     (f) A favorable opinion of Roberto García, General Counsel for the Loan Parties, substantially
in the form of Exhibit B hereto.

 

 

     (g) The Borrower shall have paid all invoiced fees and expenses of the Administrative Agent
and the Lenders (including the invoiced fees and expenses of Cancio Covas & Santiago LLP counsel to
the Administrative Agent).

     (h) The following statements shall be true and shall be deemed to have been represented by the
Borrower as being true on the date hereof:

     (i) The representations and warranties contained in Article IV of the Credit
Agreement were true and correct on and as of June 30, 2004 and are true and correct
on and as of the date hereof; and

     (ii) The covenants contained in Article V of the Credit Agreement have been
fully complied with in all material respects on and as of June 30, 2004 and on and
as of the date hereof; and

     (iii) No event has occurred and is continuing, or would result from the making
of the amendments effectuated hereunder or the other transactions contemplated
hereby, which constitutes an Event of Default or would constitute an Event of
Default but for the giving of notice or the lapse of time or both.

     SECTION 4. Miscellaneous.

     (a) On and after the Effective Date, each reference in the Credit Agreement to “this
Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit Agreement, and
each reference in the Notes to the “Credit Agreement”, “thereunder”, “thereof” or words of like
import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as
amended by this First Amendment.

     (b) The Credit Agreement and the Note, as specifically amended by this First Amendment,
including, without limitation, the Guaranty set forth in Article VII of the Credit Agreement, are
and shall continue to be in full force and effect and are hereby in all respects ratified and
confirmed. The execution, delivery and effectiveness of this First Amendment shall not, except as
expressly provided herein, operate as a waiver of any provision of the Credit Agreement, including,
without limitation, the Guaranty set forth in Article VII of the Credit Agreement, and, and shall
not operate as nor constitute or be deemed to constitute a novation of the obligations of the
parties thereto for any purpose.

     (c) This First Amendment may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same agreement. Delivery of
an executed counterpart of a signature page to this First Amendment by telecopier shall be
effective as delivery of a manually executed counterpart of this First Amendment.

     SECTION 5. Governing Law. This First Amendment and the Note shall be governed by,
and construed with, the laws of the Commonwealth of Puerto Rico.

 

 

     IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be executed by
their respective officers thereunto duly authorized, as of the date first above written.

	 	 	 	 	 
	 	 	TELECOMUNICACIONES DE PUERTO RICO, INC.
	 	 	as Borrower
	 
	 	 	 	 
	 

	 	By:
	 	/s/ María Elena de la Cruz
	 

	 	 	 	 
	 

	 	Name:
	 	María Elena de la Cruz
	 

	 	Title:
	 	Treasurer
	 
	 	 	 	 
	 	 	PUERTO RICO TELEPHONE COMPANY, INC.
	 	 	as Guarantor
	 
	 	 	 	 
	 

	 	By:
	 	/s/ María Elena de la Cruz
	 

	 	 	 	 
	 

	 	Name:
	 	María Elena de la Cruz
	 

	 	Title:
	 	Treasurer
	 
	 	 	 	 
	 	 	BANCO POPULAR DE PUERTO RICO,
	 	 	as Administrative Agent
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Héctor Becemberg
	 

	 	 	 	 
	 

	 	Name:
	 	Héctor Becemberg
	 

	 	Title:
	 	Assistant Vice President

 

 

	 	 	 	 	 
	 	 	     The Lenders
	 
	 	 	 	 
	Commitment: $40,000,000	 	BANCO POPULAR DE PUERTO RICO
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Héctor Becemberg
	 

	 	 	 	 
	 

	 	Name:
	 	Héctor Becemberg
	 

	 	Title:
	 	Assistant Vice President
	 
	 	 	 	 
	Applicable Lending Office(s):	 	209 Muñoz Rivera Avenue
	 	 	Hato Rey, Puerto Rico
	 
	 	 	 	 
	 	 	Attention: Manager — Corporate Banking Division
	 	 	Telecopier: 787.756.3909

 

 

ALLONGE

     That certain Promissory Note (the “Note”) in the maximum principal amount of $40,000,000.00
issued by TELECOMUNICACIONES DE PUERTO RICO, INC. (“Borrower”), a corporation organized under the
laws of the Commonwealth of Puerto Rico to the order of BANCO POPULAR DE PUERTO RICO on June 30,
2004, which as of the date hereof there is no outstanding principal balance thereon, nor any
accrued interest thereon, is hereby amended and modified as of the date hereof, as follows:

The first paragraph of the Note is hereby amended to read in its entirety as follows:

“FOR VALUE RECEIVED, the undersigned, TELECOMUNICACIONES DE PUERTO RICO, INC., a
Puerto Rico corporation (the “Borrower”), HEREBY PROMISES TO PAY to the
order of BANCO POPULAR DE PUERTO RICO (the “Lender”) for the account of its
Applicable Lending Office on the Termination Date (each as defined in the Credit
Agreement referred to below) the principal sum of U.S. $40,000,000.00 or, if less,
the aggregate amount of the Advances made by the Lender to the Borrower pursuant to
the Revolving Credit Agreement dated as of June 30, 2004 among the Borrower, Puerto
Rico Telephone Company, Inc., as Guarantor, the Lender and certain other lenders
parties thereto, and Banco Popular de Puerto Rico (“BPPR”), as
administrative agent (in such capacity, the “Administrative Agent”) for the
Lender and such other lenders, as amended by a First Amendment dated June 30, 2005,
among the Borrower, the Guarantor, the Administrative Agent and BPPR, as a Lender,
(and as further amended or modified from time to time, the “Credit
Agreement”; the terms defined therein being used herein as therein defined),
outstanding on the Termination Date.”

All other terms of the Note shall continue in full force and effect.

It is hereby understood and agreed by each of the parties hereto that this Allonge is not intended
to cause an extinctive novation of the terms and conditions of, and the obligations under, the
Credit Agreement and the Note, but is exclusively intended to reflect that the Credit Agreement has
been amended by a First Amendment, and shall not affect any of the obligations of Borrower under
the Credit Agreement or under the Note (as amended hereby), all of which obligations shall continue
in full force and effect as if originally incurred by Borrower as herein set forth. Capitalized
terms not otherwise defined herein shall have the meanings given to such terms in the Note.

[Remainder of Page Intentionally Left Blank]

 

 

Executed in San Juan, Puerto Rico, on June 30, 2005.

	 	 	 	 	 
	 	 	TELECOMUNICACIONES DE PUERTO RICO, INC.,
	 	 	as Borrower
	 
	 	 	 	 
	 

	 	By:
	 	/s/ María Elena de la Cruz
	 

	 	 	 	 
	 

	 	 	 	María Elena de la Cruz
	 

	 	 	 	Treasurer
	 
	 	 	 	 
	 	 	BANCO POPULAR DE PUERTO RICO,
	 	 	as Lender
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Héctor Becemberg
	 

	 	 	 	 
	 

	 	 	 	Héctor Becemberg
	 

	 	 	 	Assistant Vice President
	 
	 	 	 	 
	 	 	BANCO POPULAR DE PUERTO RICO, as
	 	 	Administrative Agent
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Héctor Becemberg
	 

	 	 	 	 
	 

	 	 	 	Héctor Becemberg
	 

	 	 	 	Assistant Vice President
	 
	 	 	 	 
	 	 	ACKNOWLEDGED:
	 	 	PUERTO RICO TELEPHONE COMPANY, INC.,
	 	 	as Guarantor
	 
	 	 	 	 
	 

	 	By:
	 	/s/ María Elena de la Cruz
	 

	 	 	 	 
	 

	 	 	 	María Elena de la Cruz
	 

	 	 	 	Treasurerexv10w1

 

EXHIBIT 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

          THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into this
6th  day of June, 2005, to be effective as of the date of execution, by and between
John F. Glaser (the “Executive”), an individual, and Cash Systems, Inc. (the
“Company “ ), a Delaware corporation.

RECITALS:

A. The Company desires to employ the Executive as the Company’s Executive Vice-
President of Sales & Marketing.

B. The Executive desires to be employed by the Company upon the terms and
conditions set forth in this Agreement.

AGREEMENTS:

          NOW THEREFORE, in consideration of the foregoing Recitals, and for other
good, fair and valuable consideration, receipt and sufficiency of which are acknowledged,
the Company and the Executive agree:

ARTICLE I

EMPLOYMENT AND DUTIES

          1.1 EMPLOYMENT AND DUTIES. The Company hereby employs the Executive as the Executive
Vice-President of Sales & Marketing of the Company (the “Position”) and the Executive hereby
accepts such employment. The Executive shall perform

 

 

service in the Position with all of the rights, duties, powers and fiduciary obligations
implied by the titles of the Position. Executive will also have and perform such implied by the
titles of the Position. Executive will also have and perform such other powers,
responsibilities and duties as are commensurate with the Position and as may be assigned to the
Executive by the Board of Directors of the Company (the “Board”) from time to time. The
Executive shall devote his full, exclusive, complete and undivided time and attention and best
efforts to performance of the duties of the Position, except for those activities authorized in
Section 5.7 of this Agreement. The Executive, at all times during employment with the Company,
shall comply with the Company’s rules, regulations, policies and directives as the same may be
in effect from time to time.

          1.2 PERFORMANCE LOCATION. The Executive shall perform the duties of the Position at the
Company’s offices in Las Vegas, Nevada. The Company shall not, without the Executive’s prior
written agreement, change the location at which the duties of the Position are performed.

          1.3 TERM OF EMPLOYMENT. Subject to the provisions for termination, as set
forth in Article III, the term of this Agreement and performance of the Executive’s
services in the Position shall commence upon the date stated on the first page of this Agreement and shall
continue for a period of two (2) years thereafter (the “Term”). Upon the expiration of the
Term or any renewal term, the Executive and the Company may agree in writing to renew
the Term for subsequent renewal terms.

ARTICLE II

COMPENSATION AND FRINGE BENEFITS

 

 

          2.1 COMPENSATION AND FRINGE BENEFITS. For all the services rendered by
the Executive to the company in the Position, the Executive shall be compensated the
company in accordance with this Article II. Such compensation and benefits shall be paid in
accordance with the Company’s customary payroll practices, and shall be subject to
withholding required by federal, state and local laws and otherwise with the consent of the
Executive.

          2.2 BASE COMPENSATION. The Company shall pay the Executive a base
salary (the “Base Compensation”) at the rate of One Hundred Fifty Thousand Dollars
($150,000) per year of the first year of the Term and One Hundred Seventy Thousand
($170,000) for the second year of the Term..

          2.3 BONUS COMPENSATION. During the Term and any renewal term, the Executive
shall be entitled to receive such bonus compensation (“Bonus Compensation”) as a part of
the Executive Bonus Program as adopted by the Board of Directors. Bonus Compensation with
respect to a calendar year during the Term shall be payable on February 15 of the immediately
following calendar year.

          2.4 STOCK OPTIONS. On execution of this Agreement the Board will grant or cause
the Executive to be granted options to purchase One Hundred Thousand (100,000) shares of the
company’s common stock at the “fair market value” of such stock on the date of such grant (the
“Stock Options”) all pursuant to the company’s 2001 Stock Option Plan (the “Option Plan “). The
Stock Options to be granted pursuant to this Section and the Option Plan will expire ten (10)

 

 

years from the date of grant and, subject to Article IV, will be exercisable according to the
following schedule:

a.) On and after the first anniversary of the date of grant Fifty Thousand
(50,000) shares; and

b.) On and after the second anniversary of the date of grant Fifty Thousand
(50,000) shares.

Executive and the company will enter into an appropriate Stock Option agreement in
accordance with the Option Plan to further document the provisions of this section and to
comply with the Option Plan.

          2.5 OTHER BENEFITS. During the Term and any renewal term, the Executive shall be
entitled to participate in and to be covered by any accident insurance, life insurance, long-term
disability insurance, short-term disability insurance, hospitalization or other employee benefit
plan effective with respect to corporate officers of the company generally, subject to the
eligibility and qualification requirements of such plans as they generally apply to executive officers.
Without limiting the generality of the foregoing, if the company adopts a restricted share
incentive plan, the Executive shall be entitled to participate in such plan as determined by the
Compensation Committee of the Board, subject to applicable law and regulations. Additionally,
if the Company adopts a sales commission program, the Executive shall be entitled to participate
in such plan as determined by Management of the Company.

          2.6 REIMBURSEMENT OF AUTHORIZED EXPENSES. During the Term and

 

 

any renewal term, the Company will reimburse the Executive for all ordinary and necessary
business expenses incurred by the Executive in connection with the business of the Company.
Payment or reimbursement to the Executive will be made upon submission by the Executive of
vouchers, receipts or other evidence of such expenses in a form reasonably satisfactory to the
Company and in compliance with applicable requirements of the taxing authorities.

          2.7 FREQUENT FLYER MILES. Notwithstanding any existing Company policy to the contrary,
the Company shall allow the Executive to retain the Frequent Flyer miles acquired as a
result of travel on behalf of the Company.

          2.8 VACATIONS. During the Term and any renewal term, the Executive will be entitled to
such vacations as the Board and Executive may determine from time to time, but in no event will
Executive be entitled to less than four (4) weeks paid vacation. Executive may not utilize more
than two consecutive weeks of paid vacation.

ARTICLE III

TERMINATION OF AGREEMENT

          3.1 DEATH OF EXECUTIVE. This Agreement shall automatically terminate if the Executive dies
during the Term and any renewal term.

          3.2 PERMANENT DISABILITY. The Company may terminate the Term as a result of the
Executive’s “Permanent Disability,” which for purposes of this Agreement shall mean the
disability of the Executive, due to illness, accident or any other physical or mental
incapacity, to discharge or perform the Executive’s normal and customary day-to-day business
and employment obligations and functions on behalf of the Company for at least One

 

 

Hundred (100) business days (calendar days minus Saturdays, Sundays and national holidays), in
the aggregate, within any given period of One Hundred Twenty-Five (125) consecutive business
days.

          3.3 TERMINATION BY THE COMPANY FOR CAUSE. The Company may
terminate the Term for cause by written notice to the Executive, stating the grounds therefore
and the effective date of such termination. In the event the Company duly terminates this
Agreement for Cause, the Executive shall be deemed to have forfeited any and all rights to
receive Base Compensation, or Bonus Compensation, in any form and at any
time from and after the date of such termination. The term “Cause” as used in this Agreement
shall mean:

	a.	 	The Executive’s demonstrable and repeated failure to perform the duties of
the Position after prior written notice of such failure(s) and a reasonable opportunity to cure the same.
	 
	b.	 	The Executive’s breach of a material provision of this Agreement, not encompassed
by the preceding section, after prior written notice of such breach and a reasonable
opportunity to cure the same.
	 
	c.	 	The conviction of the Executive for a felony or other crime of moral turpitude by a court
of competent jurisdiction.
	 
	d.	 	The written confession by the Executive to the commission of a felony or other crime of
moral turpitude.
	 
	e.	 	Embezzlement or misappropriation of funds of the company or any of its affiliates by the
Executive.
	 
	f.	 	Demonstrable, material dishonesty in connection with the Executive’s performance
of services to the Company.

 

 

The items of “Cause” defined in sections c. through f. shall be deemed not curable.

          3.4 RESIGNATION BY THE EXECUTIVE. The Executive may terminate the Term upon not less than
sixty (60) days prior written notice of resignation to the Company (the “Executive Required
Termination Notice Period”).

ARTICLE IV

PAYMENTS IN THE EVENT OF EARLY TERMINATION OF TERM

          4.1 DEATH OR PERMANENT DISABILITY OF THE EXECUTIVE. In the event
the Term terminates as a result of the Executive’s death or Permanent Disability, as
described in
sections 3.1 and 3.2, Executive will not be entitled to any Base Compensation, Bonus
Compensation, or benefits following the date of the Executive’s death or the
one hundredth day of the Executive’s Permanent Disability.

          4.2 TERMINATION FOR CAUSE, If the Term is duly terminated by the Company for cause, the
Company will pay the Executive the Base Compensation and benefits only through the effective date
of termination, and the Executive will:

a. not be entitled to any other compensation or benefits, except
expressly required by applicable law;

b. will forfeit any and all benefits arising or accruing after the
effective ate of the termination;

 

 

c. stock options which were not exercisable at the time of termination
shall not there after be exercisable; and,

d. stock options which were exercisable at the time of termination shall be
exercisable only for the period permitted by the Option Plan.

          4.3 TERMINATION WITHOUT CAUSE. If the Company terminates the Term for no
reason or a reason which is not defined as cause in section 4.2, the Company shall pay the
Executive the Base Compensation, Bonus Compensation, and benefits for one year from the
effective date of the termination. Stock Options which were not exercisable at the time of
termination shall immediately become exercisable and shall continue to be exercisable for the
period permitted by the Option Plan. A “Change in Control” (defined in the Option Plan) which is
not approved by the Board or the Company’s discontinuation of business or bankruptcy shall
constitute termination without cause within the meaning of this section.

          4.4 RESIGNATION BY THE EXECUTIVE. If the Executive terminates the Term by resigning, the
Company shall pay the Executive the Base Compensation and benefits until the end of the Executive
Required Termination Notice Period. The Executive shall be entitled to retain any stock options
which have vested and such options shall continue to be exercisable for the period permitted by
the Option Plan. The Executive will not be entitled to any other compensation or benefits
following the end of the Executive Required Termination Notice Period, except as expressly
required by applicable law. The company reserves the right to relieve the Executive of the
obligation to perform the duties of the Position immediately upon delivery of the Executive’s
notice of resignation or at any other time during the Executive Required Termination Notice
Period.

 

 

ARTICLE V

NON-DISCLOSURE AND NON-COMPETITION OBLIGATIONS OF THE EXECUTIVE

          5.1 DEFINITIONS.

a. “Confidential Information” shall mean any information, compilation of information, knowledge
and know-how that the Executive receives from the company or any of its affiliates, becomes aware
of, learns of or develops during the course of his employment which is not generally known or
readily ascertainable by proper means by persons who are not employees of the Company. It includes,
but is not limited to, information relating to any of the trade secrets, technological information,
products, design or research, information relating to any of the business affairs of the Company or
any of its affiliates, pricing information, marketing information, selling information, leasing
information, servicing and financing information, compensation information, forecasts, expansion,
customer and client information, customer lists, manuals, training material, correspondence,
research and development, engineering and other manufacturing processes, and any other material
relating to the business of the Company or any of its affiliates.

b. “Innovations” shall mean any invention, improvement, discovery or idea and, whether or not
shown or described in writing or reduced to practice, and works of authorship, whether or not
patent able or copyright able, which (i) relate directly to the business of the Company or any of
its affiliates, (ii) relate to the actual or demonstrably anticipated research and development of
the Company or any of its affiliates, (iii) result from any work performed by the Company’s

 

 

employees, agents, independent contractors, shareholders or officers of the Company or any of its
affiliates, or (iv) are developed or conceived through the use of confidential Information or
equipment, supplies or facilities of the Company or any of its affiliates.

c. “Company Product” shall mean any product, product line or service, including any component
thereof or research to develop information useful in connection with a product or service, that
is or is being designed, developed, manufactured, marketed or sold by the Company or any of its
affiliates or with respect to which the Company or any of its affiliates has acquired
confidential Information which it intends to use in the design, development, manufacture,
marketing or sale of a product or service.

d. “Competitive Product” shall mean any product, product line or service, including any
component thereof or research to develop information useful in connection with a product or
service, that is being designed, developed, manufactured or sold by any person other than the
Company or any of its affiliates and is of the same general type, performs similar functions,
or is used for the same purpose as a Company Product.

          5.2 NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. There may be made
available to the Executive Confidential Information. The Executive hereby acknowledges that
the Confidential Information, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Company. The Executive shall not, during or after the Term and any
renewal term, make any use of any Confidential Information, or disclose any Confidential
Information to any person, firm, corporation, associate, person or entity for any reason or
purpose whatsoever, other than in connection with the normal performance of the Executive’s
duties. The obligations of this section shall not apply (i) to any information that has been
disclosed in publicly available sources of information; (ii) to any information, through no
fault of

 

 

the Executive, hereafter disclosed by the Company in publicly available sources of information;
or (iii) to any information generally related to and determinable in the technical fields of interest
to the Company, but not specifically derived from the Company’s research and development
activities or results of such activities.

          5.3 AGREEMENT NOT TO USE CONFIDENTIAL INFORMATION OF OTHERS. The
Executive agrees that he will not, during or after the Term and any renewal term, wrongfully
utilize any proprietary material of any other party in the Executive’s work for the Company, will
not knowingly infringe on the patent, copyright or trademark of any other party in the
Executive’s work for the Company, and is not bound or restricted in the Executive’s work for the
Company as a result of any non-competition, confidentiality, non-disclosure or other agreement
or agreements to which the Executive is bound.

          5.4 ASSIGNMENT OF INNOVATIONS. The Executive hereby assigns to the Company
all of the Executive’s rights, title and interests in and to the Innovations made,
authored or conceived by the Executive either individually or jointly with others, during the Term and any
renewal term. The Executive shall promptly and fully disclose and describe Innovations to the
Company, and shall acknowledge and deliver to the Company such written instruments and do
such other acts as may be necessary in the opinion of the Company to preserve the Company’s
property rights to the Innovations against forfeiture, abandonment or loss, and to obtain and
maintain letters, patents and copyrights to the Innovations, if applicable, and to vest the entire
right, title and interest thereto in the Company. The obligations of section 5.4 shall continue
beyond the Term and any renewal term with respect to Innovations generated, conceived of or

 

 

reduced to practice by the Executive during the Term and any renewal term, and shall be binding
upon the Executive’s assigns, executors, administrators and other legal representatives.

          5.5 DOCUMENTS AND TANGIBLE ITEMS. All documents and tangible items, including, but not limited to,
manuals, written descriptions and other documentary evidence or manifestations of confidential
Information and Innovations, provided to the Executive by the Company or any of its affiliates, or
created by the Executive for use in connection with his employment with the Company are the
property of the Company. upon expiration of or the termination of the Term, the Executive shall
promptly return all such documents and tangible items together with all copies, recordings,
abstracts, notes, computer diskettes, computer or computer assisted data storage or reproductions
of any kind made from or about the documents and tangible items or the information they contain.

          5.6 TRADE SECRETS ACT, The Executive acknowledges that he has been given a copy of and has
reviewed Chapter 600A of the Nevada Revised Statues, the Nevada Uniform Trade Secrets Act (the
“ACT”), and acknowledges that violation of the Act or of the Executive’s
agreements, covenants and representations contained in this Agreement may give rise to a cause
of action in favor of the Company against the Executive for general and special damages,
exemplary damages, injunctive relief and attorney’s fees.

          5.7 OTHER BUSINESS ACTIVITIES. During the Term and any renewal term, the Executive will
not, without the express prior written permission of the Company, engage in any substantial
private business activities, whether or not they are entered into for profit, outside or
separate from Executive’s employment with the Company that would in any way interfere with the
fulfillment of his obligations hereunder; provided, nothing hereunder shall prohibit Executive

 

 

from engaging in the following activities in the same manner as currently engaged in by
Executive, provided that such activities do not result in a conflict of interest with the
Company or restrict the ability of the Executive to perform his duties for the Company:

                    (i) provision of consulting and marketing services (list of existing clients is attached
as Confidential Exhibit A).

          5.8 COVENANT NOT TO COMPETE. During the Term and any renewal term, and for a period of
twelve (12) months after the expiration of the Term and any renewal term or the earlier
termination of the Term or renewal term other than terminations that are not for cause as
defined in section 4.2, the Executive shall not, directly or indirectly, engage or participate
in or assist, as owner, part owner, partner, manager, director, officer, trustee, employee,
agent, consultant or in any other capacity, any person, business or other organization
designing, developing, manufacturing, licensing, providing, selling or marketing any product,
process, system or service, then in existence or under development and which is the same or
similar to, competes with, or has a usage allied to, a product, process, system or service
offered by the Company or any of its affiliates. The foregoing restriction shall apply only
where any part of such activities takes place at, or is managed, supported, or administered
from a place of business located within a market in which the company maintains an office or
actively promotes and markets its products, processes, systems or services, directly or
indirectly, including, without limitation, the United States, Canada and Mexico. The Executive
expressly agrees that the time period and the described scope of this section are the
reasonable and necessary time and scope needed to protect the legitimate business interests of
the Company.

          5.9 COVENANT NOT TO RECRUIT. During the Term and any renewal term,
and for a period of twelve (12) months after the expiration of the Term and any renewal term or

 

 

the earlier termination of the Term or any renewal term other than terminations that are not
for cause as defined in section 4.2, the Executive shall not, directly or indirectly, hire, attempt to
hire, solicit, recruit, employ or retain the services of any individual, in any capacity,
whether as an employee, independent contractor, consultant, agent or other wise, of the Company or any
customers or prospective customer of the Company, affiliates of the Company, or any individual
providing services to the company, whether as an employee, independent contractor, consultant
or agent, as of the date hereof or at any time hereafter, without prior written approval of the
Company.

          5.10 REMEDIES. The Executive agrees that all of the provisions contained in Article V are
necessary to protect the legitimate business interests of the Company, and to prevent the
unauthorized dissemination and use of confidential Information and Innovations to and by
competitors of the Company. The Executive also agrees that the Company will be irreparably
harmed, and that damages alone cannot adequately compensate the Company if there is a violation
or breach by the Executive of Article V, and that injunctive relief is essential for the
protection of the Company. The Executive therefore agrees that the Company shall have the
right, in addition to any other rights and remedies existing in its favor, to enforce its
rights and the obligations under Article V not only by an action or actions for damages, but
also by an action or actions for specific performance, injunction and/or other equitable relief
without posting any bond or security to enforce or prevent any violations, whether
anticipatory, continuing or future, of the provisions of this Article, including, without
limitation, the extension of the periods hereunder by a period equal to (i) the length of the
violation of sections 5.7, 5.8 and/or 5.9 plus (ii) the length of any court proceedings
necessary to stop such violation.

 

 

          5.11 PUBLIC POLICY. It is the desire and intent of the Company and the Executive
that the provisions contained in Article V be enforced to the fullest extent permissible under the
laws and public policy applied in each jurisdiction in which enforcement is sought. Accordingly,
if, at the time of enforcement of Article V, a court shall hold that the duration, scope or area
restrictions stated in this Agreement are unreasonable under circumstances then existing, the
parties agree that the maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area.

          5.12 INDEPENDENT COVENANTS; SURVIVAL OF COVENANTS. The covenants
or the part of the Executive contained in Article V shall be construed as an agreement independent
of any other provisions of this Agreement, and it is agreed that relief for any claim or cause of
action of the Executive against the Company, whether predicated on this Agreement or otherwise,
shall be measured in damages, and shall not constitute a defense to enforcement by the Company of
those covenants. The provisions contained in Article V, together with the other covenants,
agreements, and obligations of the Executive set forth elsewhere in this Agreement, shall, in all
events, survive the expiration of the Term and any renewal term or the earlier termination of the
Term.

ARTICLE VI

EXECUTIVE’S REPRESENTATIONS

          6. EXECUTIVE’S REPRESENTATIONS. As a material inducement to the Company
to enter into this Agreement, the Executive represents and warrants to the Company as follows:

 

 

     a. The information the Executive provided to the Company in connection with this
Agreement is true, complete and accurate in all respects and does not contain any untrue
statements of a material fact or omit to state a material fact necessary in order to make
the statements contained therein or in this Agreement not misleading.

     b. The execution, delivery and performance by the Executive of this Agreement will not
violate any provision of any indenture, agreement or other instrument to which the Executive
is a party or is bound, or be in conflict with, result in a breach of or constitute a default
under
any such indenture, agreement or other instrument.

ARTICLE VII

MISCELLANEOUS

          7.1 NOTICES. All notices given hereunder shall be in writing, and shall be personally
served or sent by registered or certified mail, return receipt requested. Notices to the
Company shall be given to the Company at its corporate headquarters, which as of the date of this
Agreement is 289 Pilot Road, Suite A, Las Vegas, Nevada, 89119, attention CEO. Notices to
Executive shall be addressed to the Executive at the Executive’s residence address as the same
appears on the records of the Company . Notices to the Company or the Executive shall be sent
to such other addresses as the Company or the Executive shall specify in writing to the other.

          7.2 ENTIRE AGREEMENT. This Agreement is the entire agreement between the parties
concerning the subject matter hereof, and supersedes and replaces any existing agreement

 

 

between the parties hereto relating to the Executive’s employment, and the Company and the
Executive hereby acknowledge that there are no other agreements or understandings of any
nature, oral or written, regarding the Executive’s employment, apart from this Agreement.

          7.3 MODIFICATION OF AGREEMENT. No provision of this Agreement may be modified, waived or
discharged unless such modification, waiver or discharge is agreed to in writing signed by the
Executive and the Company.

          7.4 WAIVER. No waiver by either party at any time of any breach for noncompliance with any
condition or provision of this Agreement to be performed by the other party shall be deemed a
waiver of similar or dissimilar provisions or conditions at the same or any prior or subsequent
time. No failure on the part of the company to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any
right hereunder by the Company preclude any other or further exercise thereof or the exercise
of any other right.

          7.5 SEVERABILITY. If any part, term or provision of this Agreement is held unenforceable
in the jurisdiction in which either party seeks enforcement of the Agreement, this Agreement
shall be construed as if not containing the invalid provision or provisions. Invalidity or
unenforceability of any portion or provision of this Agreement shall not affect the validity or
enforceability of the remaining provisions of this Agreement, which shall remain in full force
and effect, and shall govern the rights and obligations of the parties.

          7.6 RIGHT TO CONSULT COUNSEL. The Executive acknowledges that he has had an opportunity to
consult with independent legal counsel of the Executive’s choosing with regard to the terms of
this Agreement, or has been advised by the Company of his right to seek

 

 

such consultation, and that the Executive has entered into this Agreement pursuant to such
independent legal consultation or notwithstanding his decision not to seek such consultation,
as the case may be.

          7.7 GOVERNING LAW. This Agreement will be performed by the Executive in the State of
Nevada and shall be governed by, construed and interpreted in accordance with the laws of the
United States of America and the State of Nevada, without regard to principles of conflict of
laws. All judicial actions, suits or proceedings brought by or against the Company, the
Executive, or their respective permitted successors and assigns, with respect to their rights,
obligations, liabilities or any other matter under or arising out of or in connection with this
Agreement or for recognition or enforcement of any judgment rendered in any such proceedings
shall be brought in any state or federal court in the State of Nevada. By execution and
delivery of this Agreement, the Company and the Executive, on behalf of themselves and their
permitted successors and assigns, accept, generally and unconditionally, the nonexclusive
jurisdiction of the aforesaid courts and irrevocably agree to be bound by any final judgment
rendered thereby in connection with this Agreement from which no appeal has been taken or is
available. The Company and the Executive, on behalf of themselves an their permitted successors
and assigns, each hereby irrevocably waive any objections, including without limitation any
objection to the laying of venue or based on the grounds that the forum is not convenient
(known as the doctrine of “forum non conveniens”), which they may now or hereafter have to the
bringing of any such action or proceeding in any such jurisdiction. The Company and the
Executive, on behalf of themselves and their permitted successors and assigns, acknowledge that
final judgment against it in any action, suit or proceeding referred to in this section shall
be conclusive and may be

 

 

enforced in any other jurisdiction by suit on the judgment, a certified or exemplified copy of
which shall be conclusive evidence of the same. The Company and the Executive, on behalf of
themselves and their permitted successors and assigns, waive their right to trial by jury in
any action, suit or proceeding brought with respect to this Agreement.

          7.8 ATTORNEY’S FEES, PREVAILING PARTY. Should any action, proceeding or
litigation be commenced between the parties hereto on any matters whatsoever arising out of, or
in any way connected with, this Agreement, the party hereto prevailing in such litigation shall
be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for
its attorney’s fees and costs incurred in such litigation which shall be determined by the court in
such litigation or in a separate action brought for that purpose.

          7.9 PERSONAL AGREEMENTS. This Agreement is personal in nature, cannot be assigned and
shall be binding upon the heirs and personal representatives of the Executive and the
successors or assigns of the Company.

          7.10 COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which together shall constitute one and the
same agreement.

          7.11 HEADINGS; RECITALS; ARTICLES AND SECTIONS. The headings in this
Agreement are inserted for convenience or reference only, and are not a part of this Agreement.
The preliminary Recitals set forth above on the initial page of this Agreement, and this Agreement
shall be construed in light thereof. References to “Article”, “Articles”, “Section” or
“Sections” shall mean and refer to the Articles or sections of this Agreement unless the context expressly states
otherwise.

 

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
date first written above.

	 	 	 	 	 	 	 
	 	 	Cash Systems, Inc	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Michael Rumbolz	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Its Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ John F. Glaser	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	John F. Glaser

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}]]