EXHIBIT 10.12
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of the 1st day of September , 1995 (the "Effective Date"), between Hospital
Staffing Services, Inc., a Florida corporation, whose address is 0000 X. Xxxxxxx
Xxxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, XX 00000 (the "Company"), and Xxxxxxx
Xxxxxxxx, whose address is 000 X. X. 000 Xxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 (the
"Employee").
RECITALS
A. The Company is principally engaged in the business, inter alia, of
(1) providing home health care; (2) acting as a professional recruiter of
registered nurses and other professional medical personnel for provision to
hospitals on an interim staffing basis (the "Business").
B. The Company has established a valuable reputation and goodwill in
its Business, with expertise in all aspects of the Business.
C. The Company presently employs the Employee and desires to continue
to employ the Employee and the Employee desires to continue in the employ of the
Company.
D. In consideration for the Employee's continued employment with the
Company, the Company wishes to provide certain benefits to the Employee upon
certain events of termination of the Employee's employment with the Company, as
described more fully in this Agreement.
E. The Employee, by virtue of the Employee's employment by the Company,
shall become familiar with and possessed with the manner, methods, trade secrets
and other confidential information pertaining to the Company's Business,
including the Company's client base.
NOW THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Employee do hereby agree as follows:
1. Recitals. The above recitals are true, correct, and are herein
incorporated by reference.
2. Employment. The Company hereby employs the Employee in the capacity
as the Company's Vice President of Health Services, Operations and
Reimbursement, and the Employee hereby accepts such employment, upon the terms
and conditions hereinafter set forth.
3. Authority and Power During Employment Period. The duties of the
Employee shall be subject to the direction of the Company and the Employee shall
perform all duties as shall be directed by the Company. The Employee shall
devote full attention and render exclusive, full time services to the Company
and shall be employed solely by the Company according to the terms of this
Agreement. Employee's job title is subject to change by the Board of Directors.
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4. Compensation and Benefits.
a. Base Salary. For all services rendered by the Employee pursuant to
the terms of this Agreement and in consideration of the execution of this
Agreement by the Employee, the Company shall pay the Employee a base salary as
is set forth on Exhibit A of this Agreement.
b. Additional Compensation. The Employee shall be entitled to receive
such additional compensation as set forth on Exhibit B of this Agreement.
c. Employee Benefits. The Employee shall be entitled to participate in
all benefit programs of the Company currently existing or hereafter made
available to senior executives and/or other salaried employees.
d. Automobile Allowance. The Employee shall be entitled to receive an
automobile allowance as set forth on Exhibit C of this Agreement.
e. Business Expense Reimbursement. During the Employee's employment,
the Employee shall be entitled to receive proper reimbursement for all
reasonable, out-of-pocket expenses incurred by the Employee (in accordance with
the policies and procedures established by the Company for its executives) in
performing services hereunder, provided the Employee properly accounts therefor.
5. Term. The Term of employment hereunder will commence on the
Effective Date as set forth above and continue for a period of twelve (12)
months from the Effective Date. The Term shall be automatically renewed for
successive twelve (12) month periods unless otherwise terminated pursuant to
Section 6 hereof.
6. Termination.
a. Termination by the Company for Cause.
(1) Nothing herein shall prevent the Company from terminating Employee
for "Cause," as hereinafter defined.
(2) "Cause" shall mean (i) committing or participating in an injurious
act of fraud, gross neglect, misrepresentation, embezzlement or dishonesty
against the Company; (ii) committing or participating in any other injurious act
or omission wantonly, willfully, recklessly or in a manner which was grossly
negligent against the Company, monetarily or otherwise; (iii) engaging in a
criminal enterprise involving moral turpitude; (iv) conviction of a felony under
the laws of the United States or any state thereof; (v) if applicable, loss of
any state or federal license required for the Employee to perform the Employee's
material duties or responsibilities for the Company; provided, however, that
this Subsection 6(a)(2) shall not be applicable if such loss of license shall be
a result of any actions or inactions outside the Employees
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control; (vi) failure or refusal of Employee to perform the lawful orders or
instructions of his superiors; or (vii) any assignment of this Agreement in
violation of Section 16 of this Agreement.
(3) Notwithstanding anything else contained in this Agreement, this
Agreement will not be deemed to have been terminated for Cause unless and until
there shall have been delivered to the Employee a notice of termination stating
that the Employee committed one of the types of conduct set forth in Section
6(a) of this Agreement and specifying the particulars thereof and the Employee
shall be given a thirty (30) day period to cure such conduct set forth in
Section 6(a)(2); provided that the conduct set forth in clause (vi) is subject
to only one thirty (30) notice and cure period.
b. Constructive Termination of Employment. A termination by the Company
Without Cause under Section 7 shall be deemed to have occurred upon the
occurrence of one or more of the following events without the express written
consent of the Employee:
(1) a significant change in the nature or scope of the authorities,
powers, functions, duties or responsibilities attached to the Employee's
position as described in Section 2; or
(2) a five percent (5%) reduction in the Employee's salary below the
salary in effect immediately prior to such reduction; or
(3) a material breach of this Agreement by the Company;
(4) failure by a successor company to assume the obligations under the
Agreement; or
(5) change in the Employee's principal office to a location outside the
Dade-Broward-Palm Beach County, Florida area.
Anything herein to the contrary notwithstanding, the Employee shall give written
notice to the Board of Directors of the Company that the Employee believes an
event has occurred which would result in a Constructive Termination of the
Employee's employment under this Section 6(b), which written notice shall
specify the particular act or acts, on the basis of which the Employee intends
to so terminate the Employee's employment, and the Company shall then be given
the opportunity, within fifteen (15) days of its receipt of such notice to cure
said event.
c. Termination Following a Change of Control.
(1) In the event that a "Change in Control," as hereinafter defined, of
the Company shall occur at any time during the Term or any renewal thereof, the
Employee shall have the right to terminate his employment under this Agreement
upon thirty (30) days written notice given at any time within one (1) year after
the occurrence of such event, and such
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termination of the Employee's employment with the Company pursuant to this
Section 6(c)(1), then, in any such event, such termination shall be deemed to be
a termination by the Company Without Cause.
(2) For purposes of this Agreement, a "Change in Control" of the
Company shall mean a change in control (i) as set forth in Section 280G of the
Internal Revenue Code or (ii) of a nature that would be required to be reported
in response to Item 1 of the current report on Form 8K, as in effect on the date
hereof, pursuant to Section 13 or 15(d) of the Securities Exchange Act of 0000
(xxx "Xxxxxxxx Xxx"); provided that, without limitation, such a change in
control shall be deemed to have occurred at such time as:
(a) any "person," other than the Employee (as such term is used in
Section 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or
more of the combined voting power of the Company's outstanding securities then
having the right to vote at elections of directors; or,
(b) the individuals who, at the commencement date of the Agreement
constitute the Board of Directors, cease for any reason to constitute a majority
thereof unless the election, or nomination for election, of each new director
was approved by a vote of at least two thirds of the directors then in office
who were directors at the commencement of the Agreement; or
(c) there is a failure to elect a number of directors as would
constitute a majority of the Board of Directors' candidates nominated by
management of the Company to the Board of Directors; or
(d) the business of the Company for which the Employee's services are
principally performed is disposed of by the Company pursuant to a partial or
complete liquidation of the Company, a sale of assets (including stock of a
subsidiary of the Company) or otherwise.
Anything herein to the contrary notwithstanding, this Section 6(c)(2) will not
apply where the Employee gives the Employee's explicit written waiver stating
that for the purposes of this Section 6(c)(2), a Change in Control shall not be
deemed to have occurred. The Employee's participation in any negotiations or
other matters in relation to a Change in Control shall in no way constitute such
a waiver which can only be given by an express written waiver as provided in the
preceding sentence.
(3) Anything in this Section 6(c) to the contrary notwithstanding, in
no event will any action or non-action by the Employee at any time prior to the
first anniversary date of the applicable Change in Control be deemed consent to
any of the events described in this Section 6(c).
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7. Termination Without Cause; Termination as a Result of Change of
Control and Severance Benefits.
a. If the Employee is terminated Without Cause, and subject to
Employee's compliance with the provisions of Sections 8 and 9 hereof or as
otherwise provided in this Agreement, following the effective date of the
Employee's effective date of termination of his employment, the Employee shall
continue to receive (1) the base salary which existed at the time of the
Employee's termination as set forth on Exhibit "A" of this Agreement (the
"Severance Compensation") for a period of twelve (12) months thereafter; and (2)
all accrued but unused vacation through the date of termination.
b. If the Employee is terminated as a result of a Change of Control as
defined herein and subject to Employee's compliance with the provisions of
Sections 8 and 9 hereof or as otherwise provided in this Agreement, following
the effective date of the Employee's effective date of termination of his
employment, the Employee shall continue to receive, for a period of twelve (12)
months following the effective date of termination, (1) the base salary which
existed at the time of the Employee's termination as set forth on Exhibit A (the
"Severance Compensation"); (2) all accrued but unused vacation; (3) the
Employee's pro-rata share of Additional Compensation for the year, as described
in Section 4(b) and on Exhibit B and (payable through month-end of the last full
month prior to the date of termination); (4) a Car Allowance in the amount set
forth on Exhibit C; and (5) each and every one of the benefits of any employee
of the Company which existed at the time of the Employee's termination
(collectively the "Severance Compensation and Benefits").
c. All Severance Compensation shall be payable to the Employee weekly;
provided that in the event the Employee is entitled to receive the Severance
Compensation and Benefits as a result of a Change of Control, at the Employee's
option, the Employee may receive either (i) a lump sum equal to the Compensation
and Benefits due to the Employee pursuant to Section 7(a) reduced to present
value, as set forth in Section 280G of the Internal Revenue Code or (ii) weekly.
8. Covenant Not to Compete. The Employee acknowledges and recognizes
the highly competitive nature of the Company's business and the goodwill,
continued patronage, and specifically the names and addresses of the Company's
Clients (as hereinafter defined) constitute a substantial asset of the Company
having been acquired through considerable time, money and effort. Accordingly,
in consideration of continued employment and compensation by the Company, the
Employee agrees to the following:
a. That during the Restricted Period (as defined herein) and within the
Restricted Area (as defined herein), the Employee will not, individually or in
conjunction with others, directly or indirectly, engage in any Business
Activities (as hereinafter defined) other than on behalf of the Company and as
agreed by the Company and the Employee, whether as an officer, director,
proprietor, employer, partner, independent contractor, investor, stockholder
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(other than as a holder of less than one percent (1%) of the outstanding capital
stock of a publicly traded corporation), consultant, advisor, agent or
otherwise. Except that during the term of Employee's employment with the
Company, the foregoing limitations as to Restricted Area shall not be
applicable.
b. That during the Restricted Period and within the Restricted Area (as
defined herein), the Employee will not, indirectly or directly, compete with the
Company by soliciting, inducing or influencing any of the Company's Clients
which have a business relationship with the Company at any time during the
Restricted Period to discontinue or reduce the extent of such relationship with
the Company. Except that during the term of the Employee's employment with the
Company, the foregoing limitations as to Restricted Area shall not be
applicable.
c. At no time during the Employee's employment with the Company and for
any time thereafter, the Employee will not (i) directly or indirectly recruit,
solicit or otherwise influence any employee or agent of the Company to
discontinue such employment or agency relationship with the Company, or (ii)
employ or seek to employ, or cause or permit any business which competes
directly or indirectly with the Business Activities of Company (the "Competitive
Business") to employ or seek to employ for any Competitive Business any person
who is then (or was at any time within six (6) months prior to the date the
Employee or the Competitive Business employs or seeks to employ such person)
employed by the Company.
d. That during the Restricted Period, the Employee will not interfere
with, disrupt or attempt to disrupt any past, present or prospective
relationship, contractual or otherwise, between the Company and any Company's
client, employee, agent, vendor, supplier or customer.
9. Non-Disclosure of Confidential Information.
a. The Employee acknowledges that the Company's trade secrets, private
or secret processes, methods and ideas, as they exist from time to time,
customer lists and information concerning the Company's products, services,
business records and plans, inventions, product design information, price
structure, discounts, costs, computer programs and listings, source code and/or
subject code, copyright, trademark, proprietary information, formulae,
protocols, forms, procedures, training methods, development, technical
information, marketing activities and procedures, method for operating the
Company's Business, credit and financial data concerning the Company and the
Company's Clients and Client Lists, which Client Lists shall not only mean one
or more of the names and addresses of the Clients of the Company but it shall
also encompass any and all information whatsoever regarding them, including
their needs, and marketing and advertising practices and plans and information
which is embodied in written or otherwise recorded form, but it shall also
include information which is mental, not physical (collectively, the
"Confidential Information") as valuable, special and unique assets of the
Company, access to and knowledge of which are essential to the performance of
the Employee hereunder. In light of the highly competitive nature of the
industry in which the Company's
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business is conducted, the Employee agrees that all Confidential Information,
heretofore or in the future obtained by the Employee as a result of the
Employee's association with the Company, shall be considered confidential.
b. Excluded from the Confidential Information, and therefore not
subject to the provisions of this Agreement, shall be any information which:
(1) At the time of disclosure, is in the public domain as evidenced by
printed publications;
(2) After the disclosure, enters the public domain by way of printed
publication through no fault of the Employee or those in privity with it;
(3) Employee can show by written documentation was in its possession at
the time of disclosure and which was not acquired directly or indirectly from
the Company; or
(4) Employee can show by written documentation was acquired, after
disclosure, from a third party who did not receive it from the Company, and who
had the right to disclose the information without any obligation to hold such
information confidential.
c. The Employee acknowledges that, as between the Company and the
Employee, the Confidential Information and any and all rights and privileges
provided under the trademark, copyright, trade secret and other laws of the
United States, the individual states thereof, and jurisdictions foreign thereto,
and the goodwill associated therewith, are and at all times will be the property
of the Company.
d. Employee agrees that it shall:
(1) Hold in confidence and not disclose or make available to any third
party any such Confidential Information unless so authorized in writing by the
Company;
(2) Exercise all reasonable efforts to prevent third parties from
gaining access to the Confidential Information;
(3) Not use, directly or indirectly, the Confidential Information in
any respect of its business, except as necessary to evaluate the information;
(4) Restrict the disclosure or availability of the Confidential
Information to those of Employee's employees who have read and understand this
Agreement and who have a need to know the information in order to achieve the
purposes of this Agreement;
(5) Not copy or modify any Confidential Information without prior
written consent of the Company.
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(6) Take such other protective measures as may be reasonably necessary
to preserve the confidentiality of the Confidential Information; and
(7) Relinquish and require all of its employees to relinquish all
rights it and its employees may have in any matter, such as drawings, documents,
models, samples, photographs, patterns, templates, molds, tools or prototypes,
which may contain, embody or make use of the Confidential Information; promptly
deliver to the Company any such matter as the Company may direct at any time;
and not retain any copies or other reproductions thereof.
e. Employee further agrees:
(1) That it shall promptly disclose in writing to the Company all
ideas, inventions, improvements and discoveries which may be conceived, made or
acquired by Employee or its employees as the direct or indirect result of the
disclosure by the Company of the Confidential Information to Employee;
(2) That all such ideas, inventions, improvements and discoveries
conceived, made or acquired by Employee, alone or with the assistance of others,
relating to the Confidential Information, shall be the property of the Company
and shall be treated as Confidential Information in accordance with the
provisions hereof and that the Employee shall not acquire any intellectual
property rights under this Agreement except the limited right to use set forth
in this Agreement.
(3) That Employee and its employees shall assist in the preparation and
execution of all applications, assignments and other documents which the Company
may deem necessary to obtain patents, copyrights and the like in the United
States and in jurisdictions foreign thereto, and to otherwise protect the
Company.
f. Upon written request of the Company, Employee shall return to the
Company all written materials containing the Confidential Information. Employee
shall also deliver to the Company written statements signed by the Employee
certifying all materials have been returned within five (5) days of receipt of
the request.
10. Company's Clients. The "Company's Clients" shall be deemed to be
any persons, partnerships, corporations, professional associations or other
organizations for whom the Company has performed Business Activities.
11. Restrictive Period. The "Restrictive Period" shall be deemed to be
during the Employee's employment with the Company and for a period of one (1)
year following termination of the Employee's employment, regardless of the
reason for termination.
12. Restricted Area. The Restricted Area shall be deemed to mean within
the restricted area and shall be limited to any county in the United States or
in any country throughout the world
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where Company or any of its subsidiaries are engaged in the homecare business as
may be conducted by Company or any of its subsidiaries as of the date of this
Agreement or during the term of the Employee's employment with the Company.
13. Business Activities. "Business Activities" shall be deemed to
include any activities which are included in the Company's Business now or
during the effective period of this Agreement.
14. Covenants as Essential Elements of this Agreement. It is understood
by and between the parties hereto that the foregoing covenants by Employee
contained in Sections 8 or 9 of this Agreement shall be construed to be
agreements independent of any other element of the Employee's employment with
the Company. The existence of any other claim or cause of action, whether
predicated on any other provision in this Agreement, or otherwise, as a result
of the relationship between the parties shall not constitute a defense to the
enforcement of the covenants in the Agreement against the Employee.
15. Remedies.
a. The Employee acknowledges and agrees that the Company's remedy at
law for a breach or threatened breach of any of the provisions of Sections 8 or
9 herein would be inadequate and the breach shall be per se deemed as causing
irreparable harm to the Company. In recognition of this fact, in the event of a
breach by the Employee of any of the provisions of Sections 8 or 9, the Employee
agrees that, in addition to any remedy at law available to the Company,
including, but not limited to monetary damages, the Company, without posting any
bond, shall be entitled to obtain, and the Employee agrees not to oppose the
Company's request for, equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction or any other
equitable remedy which may then be available to the Company.
b. The Employee acknowledges that the granting of a temporary
injunction, temporary restraining order or permanent injunction merely
prohibiting the use of Confidential Information would not be an adequate remedy
upon breach or threatened breach of Sections 8 or 9 and consequently agrees,
upon proof of any such breach, to the granting of injunctive relief prohibiting
any form of competition with the Company. Nothing herein contained shall be
construed as prohibiting the Company from pursuing any other remedies available
to it for such breach or threatened breach.
c. In the event that the Employee shall be in violation of the
aforementioned restrictive covenants, then the time limitation during which
breach or breaches should occur, and in the event the Company should be required
to seek relief from such breach in any court or other tribunal, then the
covenant shall be extended for a period of time equal to the pendency of such
proceedings, including appeal.
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16. Binding Effect/Assignment. This Agreement shall be binding upon the
parties hereto, their heirs, legal representatives, successors and assigns. This
Agreement shall not be assignable by the Employee but shall be assignable by the
Company in connection with the sale, transfer or other disposition of its
business or to any of the Company's affiliates controlled by or under common
control with the Company.
17. Miscellaneous Provisions. Any notice required or permitted to be
given under the terms of this Agreement shall be sufficient if in writing and if
sent postage prepaid by registered or certified mail, return receipt requested;
by overnight delivery; by courier; or by confirmed telecopy, in the case of the
Employee to the Employee's last place of business or residence as shown on the
records of the Company, or in the case of the Company to its principal office as
set forth in the introductory paragraph, or such other place as it may
designate. This Agreement sets forth the entire understanding of the parties
relating to the subject matter hereof, and supersedes and cancels any prior
communications, understandings and agreements between the parties. This
Agreement cannot be modified or changed, nor can any of its provisions be
waived, except by written agreement signed by all parties. This Agreement shall
be governed by the laws of the State of Florida. Venue shall be Broward County,
Florida. In the event of any dispute as to the terms of this Employment
Agreement, the prevailing party in any litigation shall be entitled to
reasonable attorneys' fees.
18. Construction. This Agreement shall be construed within the fair
meaning of each of its terms and not against the party drafting the document.
19. Severability. This Agreement shall be deemed severable, and the
invalidity or enforceability of any term or provision hereof shall not affect
the validity or enforceability of this Agreement or of any other term or
provision hereof. Furthermore, in lieu of any such invalid or unenforceable term
or provision, the parties hereto intend that there shall be added as a part of
this Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.
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THE PARTIES TO THIS AGREEMENT HAVE READ THIS AGREEMENT, UNDERSTAND ITS TERMS AND
CONDITIONS, HAVE HAD THE OPPORTUNITY TO CONSULT WITH INDEPENDENT COUNSEL OF
THEIR OWN CHOICE AND AGREE TO BE BOUND BY ITS TERMS AND CONDITIONS.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written in Broward County, Florida.
WITNESS: THE COMPANY
HOSPITAL STAFFING SERVICES, INC.
/s/ Xxxxxxx Xxxxxx BY: /s/ Xxxxx X. Xxxxxxx
NAME: Xxxxx X. Xxxxxxx
Its: Corporate Counsel/Secretary
THE EMPLOYEE
/s/ Xxxxxxx X. Xxxxxx
/s/ Xxxxxxx Xxxxxxxx
Xxxxxxx Xxxxxxxx
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EXHIBIT A
BASE SALARY
The base salary is $130,000 per year.
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EXHIBIT B
ADDITIONAL COMPENSATION
The Employee shall be entitled to receive
a. Eight percent (8%) of the Employee's base salary in deferred
compensation, pursuant to the Company's deferred compensation plan.
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EXHIBIT C
AUTOMOBILE ALLOWANCE
The Automobile Allowance is $6,000 per year.
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