<PAGE>
As filed with the Securities and Exchange Commission on April 5, 2000
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------------------
FORM S-8
Registration Statement
Under
The Securities Act of 1933
-------------------------------------
USA TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Pennsylvania 7359 23-2679963
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Code Number) Identification No.)
incorporation or
organization)
200 Plant Avenue
Wayne, Pennsylvania 19087
(Address of principal executive offices and zip code)
- --------------------------------------------------------------------------------
KEY EMPLOYEE STOCK PLAN
(full title of the plan)
- --------------------------------------------------------------------------------
George R. Jensen, Jr.
Chief Executive Officer
USA Technologies, Inc.
200 Plant Avenue
Wayne, Pennsylvania 19087
(610) 989-0340
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Douglas M. Lurio, Esquire
Lurio & Associates, P.C.
One Commerce Square
2005 Market Street, Suite 2340
Philadelphia, PA 19103
(215) 665-9300
-----------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
to be to be Offering Price Aggregate Registration
Offered Registered Per share (1) Offering Price (1) Fee(1)
------- ---------- ------------- ------------------ --------
Common Stock 87,500 $2.85 $249,375 $68.33
(1) Estimated solely for purposes of calculating the registration fee. Pursuant
to Rule 457(h), the offering price is based upon the average of the bid and
asked price for the Common Stock on the OTC Electronic Bulletin Board on
March 31, 2000. The registration fee represents .000274 of the proposed
maximum aggregate offering price.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The documents listed in (a) through (e) below are incorporated by
reference in the Registration Statement and made a part hereof. All documents
subsequently filed by the Registrant pursuant to Section 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
prior to the filing of a post-effective amendment to this Registration Statement
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be part hereof
from the date of filing of such documents.
(a) The Registrant's annual report on Form 10-KSB for the fiscal year
ended June 30, 1999;
(b) The Registrant's current report on Form 8-K filed on November 2,
1999;
(c) The Registrant's current report on Form 8-K filed on December 2,
1999;
(d) The Registrant's Form 10-QSB Quarterly Report for the quarterly
period ended September 30, 1999; and
(e) The Registrant's Form 10-QSB Quarterly Report for the quarterly
period ended December 31, 1999.
Recent Developments
During the third quarter of fiscal year 2000, the Company continued to
incur operating losses. The Company anticipates incurring operating losses
through at least the end of fiscal year 2000.
Item 4. Description of Securities
The Company is proceeding with the registration of 87,500 shares of
Common Stock which are to be issued to five key management employees of the
Company as a bonus for services rendered and to be rendered to the Company
during calendar year 2000 pursuant to employment agreements with the Company.
The shares of Common Stock are being issued to the following employees: George
R. Jensen, Jr. (25,000 shares); Stephen P. Herbert (20,000 shares); Haven Brock
Kolls, Jr. (20,000 shares); Leland P. Maxwell (12,500 shares); and Michael
Lawlor (10,000 shares). The issuance of all of the foregoing shares of Common
Stock was approved by the Board of Directors of the Company in February, 2000.
The Company is authorized to issue up to 62,000,000 shares of Common
Stock, no par value ("Common Stock"), and 1,800,000 shares of undesignated
Preferred Stock, 1,200,000 of which has been designated Series A Convertible
Preferred Stock, no par value ("Series A Preferred Stock") and 350,000 shares of
which has been designated Series B Equity Participating Preferred Stock, no par
value ("Series B Preferred Stock").
As of December 31, 1999, there were 11,146,744 shares of Common Stock
issued and outstanding.
II-1
<PAGE>
The foregoing amount does not reflect shares of Common Stock issuable
by the Company upon the conversion of the Series A Preferred Stock or any
accrued and unpaid dividends thereon. As of December 31, 1999, 623,377 shares of
Series A Preferred Stock were issued and outstanding and are convertible into
623,377 shares of Common Stock. As of December 31, 1999, there were $3,692,784
of accrued and unpaid dividends on the Series A Preferred Stock which are
convertible into 369,278 shares of Common Stock. As of December 31, 1999, a
total of 487,773 shares of Series A Preferred Stock have been converted into
564,236 shares of Common Stock and accrued and unpaid dividends thereon have
been converted into 218,491 shares of Common Stock. As of December 31, 1999
there were no shares of Series B Preferred Stock issued and outstanding.
The foregoing amount also does not include the Common Stock issuable
upon the exercise of the remaining 67,300 1995 Warrants, 86,800 1996 Warrants,
4,000 1996-B Warrants, 1,500 1997 Warrants, 4,000 1998-A Warrants, 5,000 1998-B
Warrants, 157,900 1999-A Warrants, 3,560,000 1999-B Warrants, or the 100,000
Warrants held by affiliates and/or consultants to GEM Advisors, Inc., issued and
outstanding as of December 31, 1999. From January 1, 2000 through March 31,
2000, 150,900 shares of Common Stock were issued upon the exercise of 1999-A
Warrants at $.50 per share and 117,750 shares of Common Stock were issued upon
the exercise of 1999-B Warrants at $2.00 per share.
The foregoing does not include 1,867,200 shares of Common Stock
issuable upon conversion of the $4,668,000 principal amount of the Senior Notes
or 150,000 shares of Common Stock issuable upon the exercise of warrants issued
to a consultant which were outstanding on December 31, 1999. From January 1,
2000 through March 31, 2000, $525,000 principal amount of the Senior Notes have
been converted at the rate of $2.50 per share into 210,000 shares of Common
Stock and 34,000 shares of Common Stock were issued upon exercise of the
warrants at $2.50 per share.
The foregoing amount also does not include the Common Stock issuable
upon the exercise of the outstanding stock options or purchase rights to acquire
Common Stock. As of December 31, 1999, there was a total of 11,740 Common Stock
Purchase Rights outstanding at a price of $10.00 per share. As of December 31,
1999, there was a total of 1,001,267 options outstanding to purchase Common
Stock at exercise prices ranging from $.50 to $5.00 per share, of which 821,267
were vested. Many of the options and purchase rights granted were issued at or
above fair market value on the date of grant, and those that were issued below
fair market value have resulted in an appropriate charge against earnings during
the period the options were issued. From January 1, 2000 through March 31, 2000,
10,000 shares of Common Stock have been issued upon the exercise of stock
options at $1.50 per share.
The foregoing also does not include the following which occurred from
January 1, 2000 through March 31, 2000: 1,213,500 shares of Common Stock were
sold by the Company at $2.00 per share pursuant to a private placement offering;
45,000 shares of Common Stock were issued to consultants; and 1,260 shares of
Common Stock were issued to an employee of the Company for services rendered to
the Company.
The holder of each share of Common Stock is entitled to one vote on all
matters submitted to a vote of the shareholders of the Company, including the
election of directors. There is no cumulative voting for directors.
The holders of Common Stock are entitled to receive such dividends as
the Board of Directors may from time to time declare out of funds legally
available for payment of dividends. No dividends may be paid on the Common Stock
until all accumulated and unpaid cumulative dividends on the Series A Preferred
Stock have been paid. Upon any liquidation, dissolution or winding up of the
Company, holders of shares of Common Stock are entitled to receive pro rata all
assets of the Company available for distribution, subject to the liquidation
preference of the Series A Preferred Stock of $10.00 per share and any unpaid
and accumulated dividends on the Series A Preferred Stock. Shareholders of the
Company do not have any preemptive rights to subscribe for or purchase shares,
obligations, warrants, or other securities of the Company.
II-2
<PAGE>
Item 5. Interests of Named Experts and Counsel
Douglas M. Lurio, Esquire, President of Lurio & Associates, P.C,
general counsel to the Company, serves as a Director of the Company. Mr. Lurio
is the beneficial owner of 63,213 shares of Common Stock.
Item 6. Indemnification of Directors and Officers
Section 1746 of the Pennsylvania Business Corporation Law of 1988, as
amended ("BCL"), authorizes a Pennsylvania corporation to indemnify its
officers, directors, employees and agents under certain circumstances against
expenses and liabilities incurred in legal proceedings involving such persons
because of their holding or having held such positions with the Company and to
purchase and maintain insurance of such indemnification. The Company's By-laws
substantively provide that the Company will indemnify its officers, directors,
employees and agents to the fullest extent provided by Section 1746 of the BCL.
Section 1713 of the BCL permits a Pennsylvania corporation, by so
providing in its By-laws, to eliminate the personal liability of a director for
monetary damages for any action taken unless the director has breached or failed
to perform the duties of his office and the breach or failure constitutes
self-dealing, willful misconduct or recklessness. In addition, no such
limitation of liability is available with respect to the responsibility or
liability of a director pursuant to any criminal statute or for the payment of
taxes pursuant to Federal, state or local law. The Company's By-laws eliminate
the personal liability of the directors to the fullest extent permitted by
Section 1713 of the BCL. The Company maintains a director and officer liability
insurance policy covering each of the Company's directors and executive
officers.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
The following Exhibits are filed as part of this Registration
Statement:
5 Opinion of Lurio & Associates, P.C.
10.1 Second Amendment to Employment and Non-Competition Agreement between
George R. Jensen, Jr. and USA Technologies, Inc. dated February 22,
2000.
10.2 First Amendment to Employment and Non-Competition Agreement between
Stephen P. Herbert and USA Technologies, Inc. dated February 22, 2000.
10.3 Third Amendment to Employment and Non-Competition Agreement between
Haven Brock Kolls, Jr. and USA Technologies, Inc. dated February 22,
2000.
10.4 Second Amendment to Employment and Non-Competition Agreement between
Leland P. Maxwell and USA Technologies, Inc. dated February 22, 2000.
10.5 First Amendment to Employment and Non-Competition Agreement between
Michael Lawlor and USA Technologies, Inc. dated February 22, 2000.
23.1 Consent of Lurio & Associates, P.C. (included in the opinion filed as
Exhibit 5 hereto.)
23.2 Consent of Ernst & Young LLP, Independent Auditors.
II-3
<PAGE>
Item 9. Undertakings
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or most recent post-effective
amendment thereof) which, individually in the aggregate, represent a fundamental
change in the information in the registration statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
Except that, subparagraph (i) and (ii) of this paragraph do not apply
provided that the information required in a post-effective amendment is
incorporated by reference from periodic reports filed by the issuer under the
Securities Exchange Act of 1934.
(2) That for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be treated as a
new registration statement relating to the securities offered herein, and shall
treat the offering of such securities at that time as the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) That for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of
II-4
<PAGE>
the Securities Exchange Act 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in Wayne, Pennsylvania, on April 5, 2000.
USA TECHNOLOGIES, INC.
By: /s/ George R. Jensen, Jr.
-------------------------------------
George R. Jensen, Jr.,
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been duly signed below by the following persons in
the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ George R. Jensen, Jr. Chairman of the Board April 5, 2000
- --------------------------- and Chief Executive Officer,
George R. Jensen, Jr. (Principal Executive Officer)
/s/ Stephen P. Herbert President, Chief Operating April 5, 2000
- --------------------------- Officer, Director
Stephen P. Herbert
/s/ Leland P. Maxwell Senior Vice President, Chief April 5, 2000
- --------------------------- Financial Officer, Treasurer
Leland P. Maxwell (Principal Accounting Officer)
/s/ William W. Sellers
- --------------------------- Director April 5, 2000
William W. Sellers
/s/ Peter G. Kapourelos Director April 5, 2000
- ---------------------------
Peter G. Kapourelos
Director April __, 2000
- ---------------------------
Henry B. duPont Smith
Director April __, 2000
- ---------------------------
William L. Van Alen, Jr.
Director April __, 2000
- ---------------------------
Steven Katz
/s/ Douglas M. Lurio Director April 5, 2000
- ---------------------------
Douglas M. Lurio
Director April __, 2000
- ---------------------------
Edwin R. Boynton
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C> <C>
5 Opinion of Lurio & Associates, P,C.
10.1 Second Amendment to Employment and Non-Competition Agreement
between George R. Jensen, Jr. and USA Technologies, Inc. dated
February 22, 2000.
10.2 First Amendment to Employment and Non-Competition Agreement
between Stephen P. Herbert and USA Technologies, Inc. dated
February 22, 2000.
10.3 Third Amendment to Employment and Non-Competition Agreement
between Haven Brock Kolls, Jr. and USA Technologies, Inc. dated
February 22, 2000.
10.4 Second Amendment to Employment and Non-Competition Agreement
between Leland P. Maxwell and USA Technologies, Inc. dated
February 22, 2000.
10.5 First Amendment to Employment and Non-Competition Agreement
between Michael Lawlor and USA Technologies, Inc. dated
February 22, 2000.
23.1 Consent of Lurio & Associates, P,C. (included in the opinion
filed as Exhibit 5 hereto)
23.2 Consent of Independent Auditors
</TABLE>
<PAGE>
Exhibit 5
April 5, 2000
USA Technologies, Inc.
200 Plant Avenue
Wayne, PA 19087
Attn: Mr. George R. Jensen, Jr., Chief Executive Officer
Re: USA Technologies, Inc. -
Registration Statement on Form S-8
----------------------------------
Dear Mr. Jensen:
We have acted as counsel to USA Technologies, Inc., a
Pennsylvania corporation (the "Company"), in connection with a Registration
Statement on Form S-8, filed with the Securities and Exchange Commission on the
date hereof (the "Registration Statement"). The Registration Statement covers
87,500 shares of Common Stock of the Company to be issued to key management
employees of the Company as a bonus for services rendered and to be rendered to
the Company for calendar year 2000 pursuant to employment agreements between the
employees and the Company (the "Employment Agreements").
In rendering this opinion, we have examined (i) the Articles
of Incorporation, as amended, and By-laws of the Company; (ii) the resolutions
of the Board of Directors evidencing the corporate proceedings taken by the
Company to authorize the issuance of the Common Stock pursuant to the
Registration Statement; (iii) the Registration Statement (including all exhibits
thereto); (iv) the Employment Agreements; and (v) such other documents as we
have deemed appropriate or necessary as a basis for the opinion hereinafter
expressed.
In rendering the opinion expressed below, we assumed the
authenticity of all documents and records examined, the conformity with the
original documents of all documents submitted to us as copies and the
genuineness of all signatures.
Based upon and subject to the foregoing, and such legal
considerations as we deem relevant, we are of the opinion that, when sold as
contemplated by the Registration Statement and the
<PAGE>
USA Technologies, Inc.
April 5, 2000
Page 2
Employment Agreements, and subject to compliance with applicable state
securities laws, the Common Stock will be legally issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an Exhibit
to the Registration Statement.
Sincerely,
LURIO & ASSOCIATES, P.C.
/s/ Lurio & Associates, P.C.
<PAGE>
SECOND AMENDMENT TO EMPLOYMENT AND
NON-COMPETITION AGREEMENT
This Second Amendment is made as of the 22nd day of February 2000, by
and between GEORGE R. JENSEN, JR. ("Jensen"), and USA TECHNOLOGIES, INC., a
Pennsylvania corporation ("USA").
Background
USA and Jensen entered into an Employment And Non-Competition Agreement
dated November 20, 1997, and a First Amendment thereto dated June 17, 1999
(collectively, the "Agreement"). As more fully set forth herein, the parties
desire to amend the Agreement in certain respects.
Agreement
NOW, THEREFORE, in consideration of the covenants set forth herein, and
intending to be legally bound hereby, the parties agree as follows:
1. Amendments.
A. Subparagraph (a) of Section 1. Employment of the Agreement is hereby
deleted and the following new subparagraph (a) is hereby substituted in its
place:
(a) USA shall employ Jensen as Chairman and Chief Executive Officer
commencing on June 17, 1999, and continuing through June 30, 2002
(the "Employment Period") and Jensen hereby accepts such employment.
Unless terminated by either party hereto upon at least 60-days
notice prior to end of the original Employment Period ending June
30, 2002, or prior to the end of any one year extension of the
Employment Period, the Employment Period shall not be terminated and
shall automatically continue in full force and effect for
consecutive one year periods.
<PAGE>
B. Subparagraph (c) of Section 1. Employment of the Agreement is hereby
deleted and the following new subparagraph (c) is hereby substituted in its
place:
(c) Nothing contained in subparagraph 1.(b) hereof shall prohibit
Jensen from investing his personal assets in businesses which do not
compete with USA, where the form or manner of such investments will
not require more than minimal services on the part of Jensen in the
operation of the affairs of the business in which such investments
are made, or in which his participation is solely that of a passive
investor; or from serving as a member of boards of directors, boards
of trustees, or other governing bodies of any organization, provided
that USA approves such activities in advance; or from participating
in trade associations, charitable, civic and any similar activities
of a not-for- profit, philanthropic or eleemosynary nature; or from
attending educational events or classes. It is understood and agreed
that any such permitted activities which shall occur during business
hours shall be limited to no greater than forty hours per year.
C. Subparagraph (a) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (a) is hereby
substituted in its place:
(a) In consideration of his services rendered, commencing March 1,
2000, USA shall pay to Jensen a base salary of $135,000 per year
during the Employment Period, subject to any withholding required by
law. Jensen's base salary may be increased from time to time in the
discretion of the Board of Directors.
2
<PAGE>
D. Subparagraph (b) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (b) is hereby
substituted in its place:
(b) (i) In addition to the base salary provided for in subparagraph
(a), Jensen shall be eligible to receive such bonus or bonuses as
the Compensation Committee of the Board of Directors may, in their
sole discretion, pay to Jensen from time to time based upon his
performance and/or the performance of USA. All awards in this regard
may be made in cash or in Common Stock of USA ("Common Stock").
(ii) As of the date of this Second Amendment, USA shall issue to
Jensen 25,000 shares of fully vested Common Stock as a bonus on
account of calendar year 2000. Such shares of Common Stock shall be
registered under the Securities Act of 1933, as amended ("Act"),
pursuant to a Form S-8, at USA's cost and expense.
(iii) Jensen shall also be eligible to receive an additional bonus
of up to 25,000 shares of Common Stock on account of the 2000
calendar year. The determination of the number of shares to be
awarded to Jensen shall be made by the Compensation Committee of the
Board of Directors, in their sole discretion, and shall be based
upon the performance of USA and/or the performance of Jensen during
the 2000 calendar year. USA shall issue to Jensen any such shares of
Common Stock during January 2001. Such shares of Common Stock shall
be registered under the Act pursuant to a Form S-8, at USA's cost
and expense.
(iv) Provided that Jensen is an employee of USA at the end of the
original Employment Period hereunder (i.e., on June 30, 2002), and
further provided that Jensen has not materially breached any
provision of this Agreement if he is so employed, then USA shall
issue to Jensen 40,000 fully vested shares of Common Stock. USA
shall issue to Jensen such shares of Common Stock during July 2002.
All of such shares shall be registered under the Act pursuant to a
Form S-8, at the cost and expense of USA.
3
<PAGE>
Jensen shall not be entitled to any such shares of Common
Stock if for any reason whatsoever he is not an employee of
USA on June 30, 2002. The number of shares of Common Stock
issuable to Jensen shall be equitably adjusted from time to
time to reflect any stock splits, stock combinations, stock
subdivisions, stock recapitilizations, reverse stock splits,
stock dividends paid on, and other similar events involving
the Company's Common Stock occurring prior to and as of June
30, 2002.
E. The following new subparagraph (d) is hereby added to Section 7.
Business Secrets of the Agreement:
(d) All documents, data, know-how, designs, products, ideas,
equipment, inventions, names, devices, marketing information, method
or means, materials, software programs, hardware, configurations,
information, or any other materials or data of any kind developed by
Jensen on behalf of USA or at its direction or for USA's use, or
otherwise devised, developed, created, or invented in connection
with Jensen's employment with USA or Jensen's affiliation with USA,
and whether before or after the date of this Agreement, are and
shall remain the sole and exclusive property of USA, and Jensen has
and shall have no right or interest whatsoever thereto. Jensen
hereby renounces and disclaims the work-for-hire doctrine and
acknowledges that all such rights to intellectual property shall
belong exclusively to USA and not to Jensen. Any and all rights of
ownership in connection with any of the foregoing shall belong
solely to USA, and all copyright, patent, trademark, or similar
rights or interests shall be the sole and exclusive property of USA.
Jensen hereby assigns, transfers, and conveys to USA all of Jensen's
right, title and interest in and to any and all such inventions,
discoveries, improvements, modifications and other intellectual
property rights and agrees to take all such actions as may be
required by USA at any time and with respect to any such invention,
discovery, improvement, modification or other intellectual property
4
<PAGE>
rights to confirm or evidence such assignment, transfer and
conveyance. At USA's direction and request, Jensen shall execute and
deliver any and all forms, documents, or applications required under
any applicable copyright, patent, trademark, or other law, rule or
regulation.
2. Modification. Except as otherwise specifically set forth in
Paragraph 1, the Agreement shall not be amended or modified in any respect
whatsoever and shall continue in full force and effect.
3. Capitalized Terms. Except as specifically provided otherwise herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
4. Original Part. The amendments to the Agreement made in Paragraph 1
hereof shall be deemed to have been an original part of the Agreement and to
have been effective from and after the date of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment as of the day and year first above written.
USA TECHNOLOGIES, INC.
By: /s/ Stephen P. Herbert
-------------------------
Stephen P. Herbert,
President
/s/ George R. Jensen, Jr.
-------------------------
GEORGE R. JENSEN, JR.
5
<PAGE>
FIRST AMENDMENT TO EMPLOYMENT AND
NON-COMPETITION AGREEMENT
This First Amendment is made as of the 22nd day of February 2000, by
and between STEPHEN P. HERBERT ("Herbert"), and USA TECHNOLOGIES, INC., a
Pennsylvania corporation ("USA").
Background
USA and Herbert entered into an Employment And Non-Competition
Agreement dated April 4, 1996 (the "Agreement"). As more fully set forth herein,
the parties desire to amend the Agreement in certain respects.
Agreement
NOW, THEREFORE, in consideration of the covenants set forth herein, and
intending to be legally bound hereby, the parties agree as follows:
1. Amendments.
A. Subparagraph (a) of Section 1. Employment of the Agreement is hereby
deleted and the following new subparagraph (a) is hereby substituted in its
place:
(a) USA shall employ Herbert as President and Chief Operating
Officer commencing on June 17, 1999 and continuing through June 30,
2002 (the "Employment Period") and Herbert hereby accepts such
employment. Unless terminated by either party hereto upon at least
60-days notice prior to end of the original Employment Period ending
June 30, 2002, or prior to the end of any one year extension of the
Employment Period, the Employment Period shall not be terminated and
shall automatically continue in full force and effect for
consecutive one year periods.
<PAGE>
B. Subparagraph (c) of the Section 1. Employment is hereby deleted and
the following new subparagraph (c) is hereby substituted in its place:
(c) Nothing contained in subparagraph 1.(b) hereof shall
prohibit Herbert from investing his personal assets in
businesses which do not compete with USA, where the form or
manner of such investments will not require more than minimal
services on the part of Herbert in the operation of the
affairs of the business in which such investments are made, or
in which his participation is solely that of a passive
investor; or from serving as a member of boards of directors,
boards of trustees, or other governing bodies of any
organization, provided that USA approves such activities in
advance; or from participating in trade associations,
charitable, civic and any similar activities of a not-for-
profit, philanthropic or eleemosynary nature; or from
attending educational events or classes. It is understood and
agreed that any such permitted activities which shall occur
during business hours shall be limited to no greater than
forty hours per year.
C. Subparagraph (a) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (a) is hereby
substituted in its place:
A. In consideration of his services rendered, commencing March 1,
2000, USA shall pay to Herbert a base salary of $125,000 per year
during the Employment Period, subject to any withholding required by
law. Herbert's base salary may be increased from time to time in the
discretion of the Board of Directors.
D. Subparagraph (b) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (b) is hereby
substituted in its place:
2
<PAGE>
(b) (i) In addition to the base salary provided for in subparagraph
(a), Herbert shall be eligible to receive such bonus or bonuses as
the Compensation Committee of the Board of Directors may, in their
sole discretion, pay to Herbert from time to time based upon his
performance and/or the performance of USA. All awards in this regard
may be made in cash or in Common Stock of USA ("Common Stock").
(ii) As of the date of this First Amendment, USA shall issue to
Herbert 20,000 shares of fully vested Common Stock as a bonus on
account of calendar year 2000. Such shares of Common Stock shall be
registered under the Securities Act of 1933, as amended ("Act"),
pursuant to a Form S-8, at USA's cost and expense.
(iii) Herbert shall also be eligible to receive an additional bonus
of up to 20,000 shares of Common Stock on account of the 2000
calendar year. The determination of the number of shares to be
awarded to Herbert shall be made by the Compensation Committee of
the Board of Directors, in their sole discretion, and shall be based
upon the performance of USA and/or the performance of Herbert during
the 2000 calendar year. USA shall issue to Herbert any such shares
of Common Stock during January 2001. Such shares of Common Stock
shall be registered under the Act pursuant to a Form S-8, at USA's
cost and expense.
(iv) Provided that Herbert is an employee of USA at the end of the
original Employment Period hereunder (i.e., on June 30, 2002), and
further provided that Herbert has not materially breached any
provision of this Agreement if he is so employed, then USA shall
issue to Herbert 40,000 fully vested shares of Common Stock. USA
shall issue to Herbert such shares of Common Stock during July 2002.
All of such shares shall be registered under the Act pursuant to a
Form S-8, at the cost and expense of USA. Herbert shall not be
entitled to any such shares of Common Stock if for any reason
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<PAGE>
whatsoever he is not an employee of USA on June 30, 2002. The number
of shares of Common Stock issuable to Herbert shall be equitably
adjusted from time to time to reflect any stock splits, stock
combinations, stock subdivisions, stock recapitilizations, reverse
stock splits, stock dividends paid on, and other similar events
involving the Company's Common Stock occurring prior to and as of
June 30, 2002.
E. The following new subparagraph (d) is hereby added to Section 5.
Business Secrets of the Agreement:
D. All documents, data, know-how, designs, products, ideas,
equipment, inventions, names, devices, marketing information, method
or means, materials, software programs, hardware, configurations,
information, or any other materials or data of any kind developed by
Herbert on behalf of USA or at its direction or for USA's use, or
otherwise devised, developed, created, or invented in connection
with Herbert's employment with USA or Herbert's affiliation with
USA, and whether before or after the date of this Agreement, are and
shall remain the sole and exclusive property of USA, and Herbert has
and shall have no right or interest whatsoever thereto. Herbert
hereby renounces and disclaims the work-for-hire doctrine and
acknowledges that all such rights to intellectual property shall
belong exclusively to USA and not to Herbert. Any and all rights of
ownership in connection with any of the foregoing shall belong
solely to USA, and all copyright, patent, trademark, or similar
rights or interests shall be the sole and exclusive property of USA.
Herbert hereby assigns, transfers, and conveys to USA all of
Herbert's right, title and interest in and to any and all such
inventions, discoveries, improvements, modifications and other
intellectual property rights and agrees to take all such actions as
may be required by USA at any time and with respect to any such
invention, discovery, improvement, modification or other
intellectual property rights to confirm or evidence such
4
<PAGE>
assignment, transfer and conveyance. At USA's direction and request,
Herbert shall execute and deliver any and all forms, documents, or
applications required under any applicable copyright, patent,
trademark, or other law, rule or regulation.
2. Modification. Except as otherwise specifically set forth in
Paragraph 1, the Agreement shall not be amended or modified in any respect
whatsoever and shall continue in full force and effect.
3. Capitalized Terms. Except as specifically provided otherwise herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
4. Original Part. The amendments to the Agreement made in Paragraph 1
hereof shall be deemed to have been an original part of the Agreement and to
have been effective from and after the date of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the day and year first above written.
USA TECHNOLOGIES, INC.
By: /s/ George R. Jensen, Jr.
-------------------------
George R. Jensen, Jr.,
Chief Executive Officer
/s/ Stephen P. Herbert
-------------------------
STEPHEN P. HERBERT
5
<PAGE>
THIRD AMENDMENT TO EMPLOYMENT AND
NON-COMPETITION AGREEMENT
This Third Amendment is made as of the 22nd day of February 2000, by
and between HAVEN BROCK KOLLS, JR. ("Kolls"), and USA TECHNOLOGIES, INC., a
Pennsylvania corporation ("USA").
Background
USA and Kolls entered into an Employment And Non-Competition Agreement
dated May 1, 1994, and a First Amendment thereto dated May 1, 1995, and a Second
Amendment thereto dated March 30, 1996 (collectively, the "Agreement"). As more
fully set forth herein, the parties desire to amend the Agreement in certain
respects.
Agreement
NOW, THEREFORE, in consideration of the covenants set forth herein, and
intending to be legally bound hereby, the parties agree as follows:
1. Amendments.
A. Subparagraph A. of Section 1. Employment of the Agreement is hereby
deleted and the following new subparagraph A. is hereby substituted in its
place:
A. USA shall employ Kolls as Senior Vice President - Research and
Development commencing on December 12, 1997 and continuing through
June 30, 2002 (the "Employment Period") and Kolls hereby accepts
such employment. Unless terminated by either party hereto upon at
least 60-days notice prior to end of the original Employment Period
ending June 30, 2002, or prior to the end of any one year extension
of the Employment Period, the Employment Period shall not be
terminated and shall automatically continue in full force and effect
for consecutive one year periods.
<PAGE>
B. The following new subparagraph C. is hereby added to Section 1.
Employment of the Agreement:
C. Nothing contained in subparagraph 1.B. hereof shall prohibit
Kolls from investing his personal assets in businesses which do not
compete with USA, where the form or manner of such investments will
not require more than minimal services on the part of Kolls in the
operation of the affairs of the business in which such investments
are made, or in which his participation is solely that of a passive
investor; or from serving as a member of boards of directors, boards
of trustees, or other governing bodies of any organization, provided
that USA approves such activities in advance; or from participating
in trade associations, charitable, civic and any similar activities
of a not-for- profit, philanthropic or eleemosynary nature; or from
attending educational events or classes. It is understood and agreed
that any such permitted activities which shall occur during business
hours shall be limited to no greater than forty hours per year.
C. Subparagraph A. of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph A. is hereby
substituted in its place:
A. In consideration of his services rendered, commencing March 1,
2000, USA shall pay to Kolls a base salary of $120,000 per year
during the Employment Period, subject to any withholding required by
law.
D. Subparagraph B. of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph B. is hereby
substituted in its place:
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<PAGE>
B. (i) In addition to the base salary provided for in subparagraph
A., Kolls shall be entitled to receive such bonus or bonuses as the
Compensation Committee of the Board of Directors may, in their sole
discretion, pay to Kolls from time to time based upon his
performance or the performance of USA. All awards in this regard may
be made in cash or in Common Stock of USA ("Common Stock").
(ii) As of the date of this Third Amendment, the Company shall issue
to Kolls 20,000 shares of fully vested Common Stock as a bonus on
account of calendar year 2000. Such shares of Common Stock shall be
registered under the Securities Act of 1933, as amended ("Act"),
pursuant to a Form S-8, at USA's cost and expense.
(iii) Kolls shall also be entitled to receive an additional bonus of
up to 25,000 shares of Common Stock on account of the 2000 calendar
year. The determination of the amount of shares to be awarded to
Kolls shall be made by the Compensation Committee of the Board of
Directors, in their sole discretion, and shall be based upon the
performance of USA and the performance of Kolls during the 2000
calendar year. USA shall issue to Kolls any such shares of Common
Stock during January 2001. Such shares of Common Stock shall be
registered under the Act pursuant to a Form S-8, at USA's cost and
expense.
(iv) Provided that Kolls is an employee of USA at the end of the
original Employment Period hereunder (i.e., on June 30, 2002), and
further provided that Kolls has not materially breached any
provision of this Agreement if he is so employed, then USA shall
issue to Kolls 40,000 fully vested shares of Common Stock. USA shall
issue to Kolls such shares of Common Stock during July 2002. All of
such shares shall be registered under the Act pursuant to a Form
S-8, at the cost and expense of USA. Kolls shall not be entitled to
any such shares of Common Stock if for any reason whatsoever he is
not an employee of USA on June 30, 2002. The number of shares of
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<PAGE>
Common Stock issuable to Kolls shall be equitably adjusted from time
to time to reflect any stock splits, stock combinations, stock
subdivisions, stock recapitilizations, reverse stock splits, stock
dividends paid on, and other similar events involving the Company's
Common Stock occurring prior to and as of June 30, 2002.
E. The following new subparagraph D. is hereby added to Section 5
Business Secrets of the Agreement:
D. All documents, data, know-how, designs, products, ideas,
equipment, inventions, names, devices, marketing information, method
or means, materials, software programs, hardware, configurations,
information, or any other materials or data of any kind developed by
you on behalf of USA or at its direction or for USA's use, or
otherwise devised, developed, created, or invented in connection
with your employment with USA or your affiliation with USA, and
whether before or after the date of this Agreement, are and shall
remain the sole and exclusive property of USA, and you have and
shall have no right or interest whatsoever thereto. You hereby
renounce and disclaim the work-for-hire doctrine and acknowledge
that all such rights to intellectual property shall belong
exclusively to USA and not to you. Any and all rights of ownership
in connection with any of the foregoing shall belong solely to USA,
and all copyright, patent, trademark, or similar rights or interests
shall be the sole and exclusive property of USA. You hereby assign,
transfer, and convey to USA all of your right, title and interest in
and to any and all such inventions, discoveries, improvements,
modifications and other intellectual property rights and agree to
take all such actions as may be required by USA at any time and with
respect to any such invention, discovery, improvement, modification
or other intellectual property rights to confirm or evidence such
assignment, transfer and conveyance. At USA's direction and request,
you shall execute and deliver any and all forms, documents, or
applications required under any applicable copyright, patent,
trademark, or other law, rule or regulation.
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<PAGE>
2. Modification. Except as otherwise specifically set forth in
Paragraph 1, the Agreement shall not be amended or modified in any respect
whatsoever and shall continue in full force and effect.
3. Capitalized Terms. Except as specifically provided otherwise herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
4. Original Part. The amendments to the Agreement made in Paragraph 1
hereof shall be deemed to have been an original part of the Agreement and to
have been effective from and after the date of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Third
Amendment as of the day and year first above written.
USA TECHNOLOGIES, INC.
By: /s/ George R. Jensen, Jr.
--------------------------
George R. Jensen, Jr.
Chief Executive Officer
/s/ Haven Brock Kolls, Jr.
--------------------------
HAVEN BROCK KOLLS, JR.
5
<PAGE>
SECOND AMENDMENT TO EMPLOYMENT AND
NON-COMPETITION AGREEMENT
This Second Amendment is made as of the 22nd day of February 2000, by
and between LELAND P. MAXWELL ("Maxwell"), and USA TECHNOLOGIES, INC., a
Pennsylvania corporation ("USA").
Background
USA and Maxwell entered into an Employment And Non-Competition
Agreement dated February 24, 1997, and a First Amendment thereto dated as of
February 24, 1998 (collectively, the "Agreement"). As more fully set forth
herein, the parties desire to amend the Agreement in certain respects.
Agreement
NOW, THEREFORE, in consideration of the covenants set forth herein, and
intending to be legally bound hereby, the parties agree as follows:
1. Amendments.
A. Subparagraph (a) of Section 1. Employment of the
Agreement is hereby deleted and the following new subparagraph (a) is hereby
substituted in its place:
(a) USA shall employ Maxwell as Chief Financial Officer, Senior Vice
President and Treasurer commencing on the date hereof and continuing
through June 30, 2001 (the "Employment Period") and Maxwell hereby
accepts such employment. Unless terminated by either party hereto
upon at least 60- days notice prior to end of the original
Employment Period ending June 30, 2001, or prior to the end of any
one year extension of the Employment Period, the Employment Period
shall not be terminated and shall automatically continue in full
force and effect for consecutive one year periods.
<PAGE>
B. Subparagraph (a) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (a) is hereby
substituted in its place:
A. In consideration of his services rendered, commencing March 1,
2000, USA shall pay to Maxwell a base salary of $108,000 per year
during the Employment Period, subject to any withholding required by
law. Maxwell's base salary may be increased from time to time in the
discretion of the Board of Directors.
C. Subparagraph (b) of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new subparagraph (b) is hereby
substituted in its place:
(b) (i) In addition to the base salary provided for in subparagraph
(a), Maxwell shall be eligible to receive such bonus or bonuses as
the Compensation Committee of the Board of Directors may, in their
sole discretion, pay to Maxwell from time to time based upon his
performance and/or the performance of USA. All awards in this regard
may be made in cash or in Common Stock of USA ("Common Stock").
(ii) As of the date of this Second Amendment, USA shall issue to
Maxwell 12,500 shares of fully vested Common Stock as a bonus on
account of calendar year 2000. Such shares of Common Stock shall be
registered under the Securities Act of 1933, as amended ("Act"),
pursuant to a Form S-8, at USA's cost and expense.
(iii) Maxwell shall also be eligible to to receive, at the
discretion of the Compensation Committee of the Board of Directors,
an additional bonus for calendar year 2000 in an amount of up to 65%
of his base salary. Such additional bonus shall be payable
2
<PAGE>
in either cash or Common Stock in the discretion of the Compensation
Committee. The amount of the bonus to be awarded to Mr. Maxwell
shall be based upon the performance of the Company and/or Mr.
Maxwell during calendar year 2000. The Company shall deliver to Mr.
Maxwell any such bonus during January 2001. Any shares of Common
Stock payable as part of any such bonus shall be registered under
the Act pursuant to a Form S-8, at the Company's cost and expense.
D. The following new subparagraph (d) is hereby added to Section 5.
Business Secrets of the Agreement:
(d) All documents, data, know-how, designs, products, ideas,
equipment, inventions, names, devices, marketing information, method
or means, materials, software programs, hardware, configurations,
information, or any other materials or data of any kind developed by
Maxwell on behalf of USA or at its direction or for USA's use, or
otherwise devised, developed, created, or invented in connection
with Maxwell's employment with USA or Maxwell's affiliation with
USA, and whether before or after the date of this Agreement, are and
shall remain the sole and exclusive property of USA, and Maxwell has
and shall have no right or interest whatsoever thereto. Maxwell
hereby renounces and disclaims the work-for-hire doctrine and
acknowledges that all such rights to intellectual property shall
belong exclusively to USA and not to Maxwell. Any and all rights of
ownership in connection with any of the foregoing shall belong
solely to USA, and all copyright, patent, trademark, or similar
rights or interests shall be the sole and exclusive property of USA.
Maxwell hereby assigns, transfers, and conveys to USA all of
Maxwell's right, title and interest in and to any and all such
inventions, discoveries, improvements, modifications and other
intellectual property rights and agrees to take all such actions as
may be required by USA at any time and with respect to any such
invention, discovery, improvement, modification or other
3
<PAGE>
intellectual property rights to confirm or evidence such assignment,
transfer and conveyance. At USA's direction and request, Maxwell
shall execute and deliver any and all forms, documents, or
applications required under any applicable copyright, patent,
trademark, or other law, rule or regulation.
2. Modification. Except as otherwise specifically set forth in
Paragraph 1, the Agreement shall not be amended or modified in any respect
whatsoever and shall continue in full force and effect.
3. Capitalized Terms. Except as specifically provided otherwise herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
4. Original Part. The amendments to the Agreement made in Paragraph 1
hereof shall be deemed to have been an original part of the Agreement and to
have been effective from and after the date of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment as of the day and year first above written.
USA TECHNOLOGIES, INC.
By: /s/ George R. Jensen, Jr.
-------------------------
George R. Jensen, Jr.,
Chief Executive Officer
/s/ Leland P. Maxwell
-------------------------
LELAND P. MAXWELL
4
<PAGE>
FIRST AMENDMENT TO EMPLOYMENT AND
NON-COMPETITION AGREEMENT
This First Amendment is made as of the 22nd day of February 2000, by
and between MICHAEL LAWLOR ("Lawlor"), and USA TECHNOLOGIES, INC., a
Pennsylvania corporation ("USA").
Background
USA and Lawlor entered into an Employment And Non-Competition Agreement
dated June 7, 1996 (the "Agreement"). As more fully set forth herein, the
parties desire to amend the Agreement in certain respects.
Agreement
NOW, THEREFORE, in consideration of the covenants set forth herein, and
intending to be legally bound hereby, the parties agree as follows:
1. Amendments To Agreement.
A. Paragraph A. of Section 1. Employment of the Agreement is hereby
deleted and the following new Paragraph A. is hereby substituted in its place:
A. USA shall employ Lawlor as Vice President of Marketing and Sales
commencing on the date hereof and continuing through June 30, 2001
(the "Employment Period") and Lawlor hereby accepts such employment.
Unless terminated by either party hereto upon at least 60-days
notice prior to the end of the Employment Period ending June 30,
2001, or prior to the end of any one year extension of the
Employment Period, the Employment Period shall not be terminated and
shall automatically continue in full force and effect for
consecutive one year periods.
<PAGE>
B. Paragraph A. of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new Paragraph A. is hereby
substituted in its place:
A. In consideration of his services rendered, commencing on March 1,
2000, USA shall pay to Lawlor a base salary of $100,000 per year
during the Employment Period, subject to any withholding required by
law. Lawlor's base salary may be increased from time to time in the
discretion of the Board of Directors.
C. Paragraph B. of Section 2. Compensation and Benefits of the
Agreement is hereby deleted and the following new Paragraph B. is hereby
substituted in its place:
B. (i) In addition to the base salary provided for in Paragraph A.,
Lawlor shall be eligible to receive such bonus or bonuses as the
Compensation Committee of the Board of Directors may, in their sole
discretion, pay to Lawlor from time to time based upon his
performance and/or the performance of USA. All awards in this regard
may be made in cash or in Common Stock of USA ("Common Stock").
(ii) As of the date of this First Amendment, USA shall issue to
Lawlor 10,000 shares of fully vested Common Stock as a bonus on
account of calendar year 2000. Such shares of Common Stock shall be
registered under the Securities Act of 1933, as amended ("Act"),
pursuant to a Form S-8, at USA's cost and expense.
(iii) Lawlor shall also be eligible to receive, at the discretion of
the Compensation Committee of the Board of Directors, an additional
bonus for calendar year 2000 in an amount of up to 65% of his base
salary. Such additional bonus shall be payable in either cash or
Common Stock in the discretion of the Compensation Committee. The
2
<PAGE>
amount of the bonus to be awarded to Mr. Lawlor shall be based upon
the performance of the Company and/or Mr. Lawlor during calendar
year 2000. The Company shall deliver to Mr. Lawlor any such bonus
during January 2001. Any shares of Common Stock payable as part of
any such bonus shall be registered under the Act pursuant to a Form
S-8, at the Company's cost and expense.
D. The following new Section 2.A. Lawlor Relocation is hereby added to
the Agreement:
2.A. Lawlor Relocation.
A. Lawlor agrees that he and his family shall relocate to the
Philadelphia, Pennsylvania area on or before March 15, 2000. All of
the reasonable and customary costs and expenses of such relocation
to the Philadelphia, Pennsylvania area, including moving expenses,
shall be paid for by USA. Such costs and expenses shall be payable
in either cash or Common Stock in the discretion of USA. Any such
shares of Common Stock shall be registered under the Act pursuant to
a Form S-8, at the Company's cost and expense.
B. In addition to the payment by USA of Lawlor's relocation costs
and expenses, and in order to assist Lawlor to purchase a residence
in the Philadelphia, Pennsylvania area prior to the closing of the
sale of his current residence in Texas, USA shall make available to
Lawlor a bridge loan in an amount of up to $70,000. The bridge loan
shall be repaid by Lawlor upon the earlier to occur of the closing
of the sale of his Texas residence or August 1, 2000. The bridge
loan shall not bear any interest. The bridge loan shall be evidenced
by a promissory note signed by Lawlor and his spouse and upon
request of USA shall be secured by a mortgage on Lawlor's Texas
residence. Lawlor and his spouse shall execute any other instruments
or documents reasonably required by USA or its counsel.
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<PAGE>
C. Commencing on the first month in which Lawlor is required to make
a mortgage payment in connection with his new residence located in
the Philadelphia, Pennsylvania area, and provided that he has not
yet sold his Texas residence, USA shall, until his Texas residence
has been sold, advance to Lawlor the monthly mortgage payment due in
connection with his Texas residence. Such monthly payment is in the
approximate amount of $950. Lawlor shall not be required to repay
USA for any such advances.
E. The following new sentence shall be added to the end of Paragraph B.
of Section 5.Business Secrets of the Agreement:
Notwithstanding this Section 5.B. or Section 6 hereof, during the
one year period following the termination of the Employment Period,
or during the one year period following the termination of Lawlor's
employment hereunder if earlier, Lawlor may nevertheless solicit,
serve, or sell to any customer or account of USA, provided that any
such solicitation, sale or serving shall not be in connection with
any product, service or business that is in competition, in whole or
in part, with the products, services or business of USA as presently
or as hereinafter existing or conducted.
F. The following new Paragraph D. is hereby added to Section 5.
Business Secrets of the Agreement:
4
<PAGE>
D. All documents, data, know-how, designs, products, ideas,
equipment, inventions, names, devices, marketing information, method
or means, materials, software programs, hardware, configurations,
information, or any other materials or data of any kind developed by
Lawlor on behalf of USA or at its direction or for USA's use, or
otherwise devised, developed, created, or invented in connection
with Lawlor's employment with USA or Lawlor's affiliation with USA,
and whether before or after the date of this Agreement, are and
shall remain the sole and exclusive property of USA, and Lawlor has
and shall have no right or interest whatsoever thereto. Lawlor
hereby renounces and disclaims the work-for-hire doctrine and
acknowledges that all such rights to intellectual property shall
belong exclusively to USA and not to Lawlor. Any and all rights of
ownership in connection with any of the foregoing shall belong
solely to USA, and all copyright, patent, trademark, or similar
rights or interests shall be the sole and exclusive property of USA.
Lawlor hereby assigns, transfers, and conveys to USA all of Lawlor's
right, title and interest in and to any and all such inventions,
discoveries, improvements, modifications and other intellectual
property rights and agrees to take all such actions as may be
required by USA at any time and with respect to any such invention,
discovery, improvement, modification or other intellectual property
rights to confirm or evidence such assignment, transfer and
conveyance. At USA's direction and request, Lawlor shall execute and
deliver any and all forms, documents, or applications required under
any applicable copyright, patent, trademark, or other law, rule or
regulation.
2. Modification. Except as otherwise specifically set forth in
Paragraph 1, the Agreement shall not be amended or modified in any respect
whatsoever and shall continue in full force and effect.
3. Capitalized Terms. Except as specifically provided otherwise herein,
all capitalized terms used herein shall have the meanings ascribed to them in
the Agreement.
5
<PAGE>
4. Original Part. The amendments to the Agreement made in Paragraph 1
hereof shall be deemed to have been an original part of the Agreement and to
have been effective from and after the date of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the day and year first above written.
USA TECHNOLOGIES, INC.
By: /s/ Stephen P. Herbert
-----------------------
Stephen P. Herbert,
President
/s/ Michael Lawlor
-----------------------
MICHAEL LAWLOR
6
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-00000) pertaining to the registration of 87,500 shares of Common
Stock of USA Technologies, Inc. of our report dated September 14, 1999, with
respect to the consolidated financial statements of USA Technologies, Inc.
included in its Annual Report (Form 10-KSB) for the year ended June 30, 1999,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
April 5, 2000
