FOUNDING COMPANY EXECUTIVE
EMPLOYMENT AGREEMENT
(TECHNOLOGY PLUS)
This Employment Agreement (the "Agreement") is by and between Xxxxxxx
Xxxxxxx (the "Executive") and Technology Plus, Inc., a Kansas corporation (the
"Company") and a wholly-owned subsidiary of Nationwide Staffing, Inc., a
Delaware corporation ("Nationwide"), which parties agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ the Executive and the
Executive hereby accepts employment by the Company, upon the terms and subject
to the conditions hereinafter set forth.
2. DUTIES. The Executive shall serve as the President of the Company. The
Executive will perform the duties attendant to his executive position with the
Company under the direction of the Company's Board of Directors (the "Board").
The Executive agrees to (i) devote his full business time and best efforts to
the performance of his duties to the Company, (ii) devote his best efforts to
promote the success of the Company's business, and (iii) cooperate fully with
the Board in the advancement of the best interests of the Company. The Executive
shall faithfully adhere to, execute and fulfill all policies established by the
Company from time to time. If the Executive is elected as a director of the
Company or as a director or officer of any of its affiliates, the Executive will
fulfill his duties as such director or officer without additional compensation.
3. COMPENSATION. In consideration for the services of the Executive as an
executive officer of the Company, unless terminated sooner pursuant to the terms
hereof, the Company will pay the Executive an annual salary of $109,000 (the
"Salary"), which will be payable in equal periodic installments according to the
Company's historical payroll practices.
Furthermore, during the term of the Executive's employment, the Company
shall provide to the Executive group hospitalization, major medical, long-term
disability, vacation, life insurance coverages and pension, profit sharing, and
other employee benefit plans on substantially the same terms and conditions
these benefits are made available to the Company's other executive officers so
long as the Executive's physical or mental condition does not make it
commercially unreasonable for the Company to provide such benefit(s)
(collectively, the "Benefits").
If and to the extent that any of the insurance programs included within
the Benefits can be assumed by Executive upon termination of Executive's
employment with the Company, without expense or detriment to the Company or
Nationwide, then Executive shall be permitted to assume any of such insurance
programs, at the Executive's sole expense.
4. (A) TERM AND TERMINATION. The term of the Executive's employment
pursuant to this Agreement shall commence on the date of the consummation of
Nationwide's initial public offering of its common stock (the "IPO") and shall
continue until the third anniversary of the IPO (the "Initial Term"), and shall
continue thereafter on a year-to-year basis on the same terms and conditions
contained herein unless either party gives to the other written notice of
termination no fewer than 30 days prior to the expiration of the Initial Term or
any renewal term that the party does not wish to extend this Agreement. However,
the Executive's employment as an executive officer pursuant to this Agreement
shall also terminate earlier in any one of the following ways:
(i) upon the death of the Executive;
(ii) upon the disability of the Executive as established by the
expiration of the time periods specified in Section 4 (b) below, then
termination may occur at any time thereafter, upon notice from either
party to the other;
(iii) upon three months prior notice of resignation by the Executive
to the Company;
(iv) if such termination is approved by at least 80% of the members
of the Board of Directors of Nationwide ("Nationwide Board") (not counting
the Executive if the Executive is a member of the Nationwide Board) (an
"80% Vote"), upon notice by the Company to the Executive of termination
"without cause";
(v) upon notice by the Company to the Executive of termination "for
cause"; or
(vi) at the Executive's option, upon notice by the Executive to the
Company within 90 days following a Constructive Termination.
(B) DEFINITION OF DISABILITY. For purposes of Section 4(a)(ii), the
Executive will be deemed to have a "disability" if, for physical or mental
reasons, the Executive is unable to perform the Executive's duties under this
Agreement for 120 consecutive days or 180 days during any twelve month period.
Whether the Executive is unable to perform his duties will be determined by a
medical doctor selected by written agreement of the Company and the Executive
upon the request of either party by notice to the other. If the Company and the
Executive cannot agree on the selection of a medical doctor, each of them will
select a medical doctor and the two medical doctors will select a third medical
doctor who will determine whether the Executive is unable to perform Executive's
duties under this Agreement. The determination of the medical doctor selected
under this Section 4 will be binding on both parties. The Executive must submit
to a reasonable number
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of examinations by the medical doctor making the determination under this
Section 4, and the Executive hereby authorizes the confidential disclosure and
release to the Company (and, if required by the Company's insurance carriers, to
such carriers) of such determination and all supporting medical records. If the
Executive is not legally competent or is otherwise unable to act, the
Executive's legal guardian or duly authorized attorney-in-fact will act in the
Executive's stead under this Section 4, for the purposes of selecting a medical
doctor, submitting the Executive to the examinations, and providing the
authorization of disclosure, required under this Section 4. The date on which
the medical doctor notifies the Company and the Executive that the Executive is
unable to perform Executive's duties under this Agreement shall be the starting
date from which such 120- days or 180-days, as the case may be, shall be
measured.
(C) DEFINITION OF TERMINATION FOR CAUSE. For purposes of Section 4(a)(v),
the Executive's termination "for cause" shall be defined to mean: (i) the
Executive's material breach of this Agreement, including, without limitation,
his failure to perform his obligations hereunder in a manner reasonably
satisfactory, provided that termination under this clause (i) must be approved
by an 80% Vote of the Nationwide Board (other than any such failure resulting
from incapacity or disability due to physical or mental reasons); (ii) the
appropriation (or attempted appropriation) of a material business opportunity of
the Company, including attempting to secure or securing a personal benefit in
connection with any transaction entered into on behalf of the Company; or (iii)
the Executive's fraud or dishonesty with respect to the business or affairs of
the Company or if the Executive is convicted of, indicted for (or its procedural
equivalent) or pleads nolo contendere or guilty to, any felony (or the
equivalent thereof) criminal offense or any civil offense involving fraud or
moral turpitude. If the Company determines that "cause" exists, prior to giving
notice of termination, the Company will so advise the Executive and provide
information supporting such determination.
(D) DEFINITION OF CONSTRUCTIVE TERMINATION. For purposes of Section
4(a)(vi), the term "Constructive Termination" shall be defined to mean: (i) a
material reduction in the Executive's duties and responsibilities without the
Executive's consent; (ii) a reduction in or the failure by the Company to pay
when due any portion of the Salary, (iii) the Company's material breach of this
Agreement, or (iv) without Executive's approval, he is required to relocate out
of the metropolitan area of his present residence.
(E) COMPENSATION IF TERMINATED BY DEATH. If Executive's employment is
terminated because of the Executive's death, the Executive will be entitled to
receive the portion of the Salary that is due at the end of the calendar month
in which his death occurs.
(F) COMPENSATION IF TERMINATED BY DISABILITY. If the Executive's
employment is terminated by either party as a result of the Executive's
disability, the Company will pay the Executive the portion of the Salary that is
due at the end of the calendar month during which such
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termination is effective and for the lesser of (i) six consecutive months
thereafter, or (ii) the period until disability insurance benefits, if any,
commence under the disability insurance coverage, if any, furnished by the
Company to the Executive.
(G) COMPENSATION IF TERMINATED BY EXECUTIVE'S RESIGNATION OR FOR CAUSE. If
the Company terminates the Executive's employment "for cause" or if the
Executive resigns his employment with the Company (other than in accordance with
Section 4(a)(vi) following a Constructive Termination), the Executive will be
entitled to receive the portion of the Salary that is due through the date such
termination is effective.
(H) COMPENSATION IF TERMINATED WITHOUT CAUSE OR BY CONSTRUCTIVE
TERMINATION. In the event the Executive's employment with the Company is
terminated by the Company "without cause" or by the Executive within 90 days
following a Constructive Termination, the Company will pay the Executive, as the
Executive's sole remedy in connection with such termination, a severance payment
in an amount equal to two times the annual Salary (the "Severance Payment"). The
Severance Payment shall be payable to the Executive in equal monthly payments
over a period of 24 months following the date of termination. The Company will
also pay the Executive the portion of the Salary that is accrued but unpaid from
the last payment date to the date of termination. In addition, the Company shall
make, at is sole cost and expense and without any offsets in the amounts owed to
the Executive, the insurance premium payments contemplated by COBRA for a period
of 18 months after such termination.
5. ACCRUED BENEFITS. The Executive's accrual of, or participation in plans
providing for, Benefits will cease at the effective date of the termination of
the Executive's employment and the Executive will be entitled to accrued
Benefits pursuant to such plans only as provided in such plans. Notwithstanding
anything herein to the contrary or in any plan, the Executive will not receive,
as part of his termination pay pursuant to Section 4, any payment or other
compensation for any vacation, holiday, sick leave, or other leave unused on the
date of termination.
6. EFFECT OF TERMINATION ON ANY OPTIONS. Any options to purchase
Nationwide stock held by the Executive will automatically and immediately expire
if the Executive's employment with the Company is terminated "for cause" or if
the Executive voluntarily leaves the employment of the Company. If the
Executive's employment with the Company ends for any reason other than
termination for cause, voluntary departure or due to death, then any options to
purchase Nationwide stock will remain exercisable and will vest and expire in
accordance with the terms of the applicable option agreements. If the Executive
dies while employed by the Company, then any options to purchase Nationwide
stock shall become fully exercisable on the date of his death and shall expire
twelve months thereafter.
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7. CONFIDENTIALITY. The Executive acknowledges that he will have access to
confidential information regarding the Company, Nationwide and Nationwide's
present and future direct and indirect subsidiaries (collectively the
"Nationwide Subsidiaries" and individually a "Nationwide Subsidiary") and their
businesses. The Executive agrees that he will not, during or subsequent to his
employment, divulge, furnish, or make available to any person (other than with
the prior written consent of the Board) any confidential information or plans of
the Company, Nationwide or any of the Nationwide Subsidiaries. However,
confidential information or plans shall exclude information or plans which: (i)
at the time of disclosure already is in the public domain or which, after
disclosure, is published or otherwise becomes part of the public domain through
no fault of the Executive; or (ii) the Executive can show was not held or
acquired, directly or indirectly, from the Company, Nationwide or any of the
Nationwide Subsidiaries, or from a third party under an obligation of
confidence.
8. NONCOMPETITION. During the period of the Executive's employment by or
with the Company and for two years after termination of the Executive's
employment hereunder, so long as the Company is not in breach of its obligations
under this Agreement, the Executive will not, for any reason whatsoever (i)
engage directly or indirectly, alone or as a shareholder, owner, partner,
officer, director, employee, sales representative, or consultant in, of or to
any temporary employment, "PEO" or staff leasing, permanent placement, or human
resource outsourcing or consulting business or other business activities which
are competitive with any business owned or operated or being actively considered
to be owned or operated by the Company, Nationwide or any Nationwide Subsidiary
prior to the Executive's termination or at the time of such termination (a
"Designated Business"), (ii) divert to any competitor of the Company, Nationwide
or any Nationwide Subsidiary in a Designated Business any customer of the
Company, Nationwide or any Nationwide Subsidiary, (iii) solicit or encourage any
officer, employee, or consultant of the Company, Nationwide or any Nationwide
Subsidiary to leave its employ for employment by or with any competitor of the
Company, Nationwide or any Nationwide Subsidiary in a Designated Business, or
(iv) call upon any prospective acquisition candidate, on the Executive's own
behalf or on behalf of any competitor, which candidate was, to the Executive's
knowledge, either called upon by the Company, Nationwide or any Nationwide
Subsidiary or which the Company, Nationwide or any Nationwide Subsidiary made an
acquisition analysis for the purposes of acquiring such entity ("Acquisition
Candidate"). If the Company, Nationwide or a Nationwide Subsidiary makes an
acquisition analysis of an entity as an Acquisition Candidate, but does not call
upon such Acquisition Candidate, then such entity shall cease to be an
Acquisition Candidate upon the expiration of 12 months after completion of the
acquisition analysis; provided that nothing herein shall limit the covenants and
agreements set forth above.
The parties hereto acknowledge that the Executive's noncompetition
obligations hereunder will not preclude the Executive from owning less than 1%
of the common stock of any publicly traded corporation conducting business
activities in a Designated Business. The Executive will
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continue to be bound by the provisions of this Section 8 until their expiration
and will not be entitled to any compensation from the Company with respect
thereto. If at any time the provisions of this Section 8 are determined to be
invalid or unenforceable, by reason of being vague or unreasonable as to area,
duration or scope of activity, this Section 8 will be considered divisible and
will become and be immediately amended to only such area, duration and scope of
activity as will be determined to be reasonable and enforceable by the
arbitration panel, court or other body having jurisdiction over the matter; and
the Executive agrees that this Section 8 as so amended will be valid and binding
as though any invalid or unenforceable provision had not been included herein.
9. REIMBURSEMENT OF EXPENSES. The Company will reimburse the Executive for
all reasonable out-of-pocket costs and expenses incurred by him in connection
with his employment hereunder (the "Reimbursable Expenses"). Such Reimbursable
Expenses shall include the Executive's out-of-pocket costs and expenses for
travel, hotel rooms, business entertainment, long-distance telephone calls,
delivery charges, parking fees and copying charges. On or about the last day of
each month, the Executive will submit a report to the Company describing in
reasonable detail the Reimbursable Expenses to be reimbursed. All such invoices
shall include adequate supporting documentation, including receipts where
appropriate. All such invoices will be reimbursed by the Company within 30 days
of the Company's receipt of the report.
10. ARBITRATION. Except as otherwise permitted in Section 12, any dispute
between the Company and the Executive arising out of or related to this
Agreement or breach thereof shall be settled by binding arbitration in
accordance with the commercial arbitration rules of the American Arbitration
Association. The arbitration shall be conducted by three neutral arbitrators.
Any award made by such arbitrators shall be binding and conclusive for all
purposes, may include injunctive relief, as well as orders for specific
performance, and may be entered as a final judgment in any court of competent
jurisdiction. No arbitration arising out of or relating to this Agreement shall
include, by consolidation or joinder or in any other manner, parties other than
the Company, the Executive and other persons substantially involved in common
question of fact or law whose presence is required if complete relief is to be
afforded in arbitration. The cost and expenses of such arbitration shall be
borne in accordance with the determination of the arbitrators and may include
reasonable attorneys' fees. Each party hereby further agrees that service of
process may be made upon it by registered or certified mail or personal service
at the address provided for herein. The arbitrators will not have the power to
alter or amend the terms of this Agreement.
11. RETURN OF DOCUMENTS. The Executive agrees that all documents, plans,
records, financial statements, manuals, lists, computer programs, computer
disks, equipment, computers, notes, drawings, models and other materials
(whether or not secret or confidential) that he receives, prepares or otherwise
acquires during his employment with the Company, and which pertain to the
business or affairs of the Company, Nationwide or any of the Nationwide
Subsidiaries, are the property of the appropriate company. The Executive will
promptly deliver to the Company all
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originals and all copies of such materials in his possession or under his
control without request by the Company, Nationwide, or any Nationwide Subsidiary
upon termination of the Executive's employment. In the event of his termination
of employment with the Company for whatever reason, the Executive shall produce
to the Company for its inspection all such materials then in his possession or
under his control.
12. EQUITABLE RELIEF. In the event of a breach by the Executive of any of
the provisions of Sections 7, 8 or 11, the Company shall, in addition to any
other rights and remedies existing in its favor, be entitled to receive from any
court of law or equity of competent jurisdiction order(s) for specific
performance and injunctive or other relief in order to enforce or prevent any
violations of the provisions thereof.
13. SURVIVAL. The rights and obligations of the parties hereto shall
survive the term of the Executive's employment under this Agreement to the
extent that any performance is required under this Agreement after the
expiration of the Executive's employment.
14. MISCELLANEOUS.
14.1 ENTIRE AGREEMENT. This Agreement and the Agreement and Plan
dated as of September __, 1997 (the "Merger Agreement") among Nationwide, the
Company and the Company's stockholders (including Executive) constitute the
entire agreement between the parties with respect to the subject matter hereof.
This Agreement and the Merger Agreement supersede all letters, memoranda and
term sheets previously prepared in connection with the negotiations surrounding
the execution of this Agreement and the Merger Agreement. The provisions of
Section 8 of this Agreement are cumulative with and in addition to the
provisions of Section 13 of the Merger Agreement. All provisions of this
Agreement and of the Merger Agreement shall be given full effect. No provision
of the Merger Agreement shall be deemed to have been superseded by this
Agreement and no provision of this Agreement shall be deemed to have been
superseded by the Merger Agreement. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and
assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any third party any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except for Nationwide and the
Nationwide Subsidiaries and otherwise except as expressly provided in this
Agreement.
14.2 NOTICES. Any notices permitted or required to be given under
the terms of this Agreement shall be in writing and shall be deemed given if
delivered to the party to be notified at the address specified below, by first
class mail, overnight courier or fax with hard copy being sent by first class
mail or overnight courier. Such notice shall be deemed received 24 hours after
it is sent via fax (with receipt confirmed) or overnight courier. Any notice
given in any other manner shall be effective only if and when received.
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The Executive: Xxxxxxx Xxxxxxx
c/o Xxxxxxx Xxxx Xxxxx and Xxxxxx LLP
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. XxXxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
The Company: Technology Plus, Inc.
c/o Xxxxxxx Xxxx Xxxxx and Xxxxxx LLP
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. XxXxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to: Nationwide Staffing, Inc.
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: President
The address of any party may be changed by notice given in the manner provided
in this Section 14.2.
14.3 GOVERNING LAW. THE VALIDITY, CONSTRUCTION AND ENFORCEMENT OF
THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF KANSAS WITHOUT
GIVING EFFECT TO CHOICE OF LAW OR CONFLICTS OF LAWS PRINCIPLES.
14.4 WITHHOLDING. All payments required to be made by the Company
under this Agreement to the Executive will be subject to the withholding of such
amounts, if any, relating to federal, state and local taxes as may be required
by law.
14.5 PRESERVATION OF BUSINESS; FIDUCIARY RESPONSIBILITY. Throughout
the term of the Executive's employment hereunder, the Executive shall use his
best efforts to preserve the business and organization of the Company,
Nationwide and the Nationwide Subsidiaries, to keep available to the Company,
Nationwide and the Nationwide Subsidiaries the services of their employees and
to preserve the business relations of the Company, Nationwide and the Nationwide
Subsidiaries with suppliers, customers and others. The Executive shall not
commit any act which would injure the Company, Nationwide or any of the
Nationwide Subsidiaries. In addition, the
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Executive shall observe and fulfill proper standards of fiduciary responsibility
attendant upon his service and office.
14.6 SEVERABILITY. If a provision of this Agreement is declared
unenforceable by a court of last resort, such provision shall be enforced to the
greatest extent permitted by law, and such declaration shall not affect the
validity of any other provision of this Agreement.
14.7 REPRESENTATION BY SEPARATE COUNSEL. The Executive acknowledges
that he has been advised to retain separate legal counsel to represent his
interests under this Agreement and he has done so.
14.8 AMENDMENTS AND WAIVERS. This Agreement may be amended only by a
written instrument designated as an "amendment" to this Agreement and signed by
the parties hereto, and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument signed by the person specifically
waiving such observance.
14.9 MULTIPLE COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original but all of
which shall be deemed one instrument.
Executed this the __th day of September, 1997.
THE EXECUTIVE:
By:________________________________________
XXXXXXX XXXXXXX
(Name Printed)
THE COMPANY:
Technology Plus, Inc.
By:________________________________________
________________________________________
(Name Printed) (Title)
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JOINDER BY NATIONWIDE
Nationwide joins in this Agreement solely for the purpose of guaranteeing to
Executive that the Salary, Benefits and Severance Payment, if any, will be paid
and provided in accordance with the terms thereof.
NATIONWIDE:
Nationwide Staffing, Inc.
By:________________________________________
________________________________________
(Name Printed), (Title)
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