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 wishes to employ the Employee and the Employee
wishes to be employed by the Company, pursuant to the terms and conditions set
forth in this Agreement.
D. In consideration for the Employee's 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 Finance, 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.
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
including, without limitation, those set forth on Exhibit C of the Agreement.
d. AUTOMOBILE ALLOWANCE. The Employee shall be entitled
to receive an automobile allowance as set forth on Exhibit D 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 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 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).
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 three (3) 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 three (3) 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
(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 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 the 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 he 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.
(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 his employees,
if applicable, to relinquish all rights he 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 he 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
twelve (12) months 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 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.
a. 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.
b. The covenants by Employee contained in Sections 5
and 6 shall survive the expiration of this Agreement if the Employee continues
to work for the Company, in any manner, without renewing this Agreement. The
Employee further agrees that the covenants set forth in Sections 8 and 9 of this
Agreement shall continue to be in effect following the expiration or termination
of the Employee's employment with the Company.
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.
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 attorney's 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.
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 X. XXXXXXXX
--------------------------------
Xxxxxxx X. Xxxxxxxx
EXHIBIT A
BASE SALARY
The base salary is $130,000 per year.
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.
EXHIBIT C
EMPLOYEE BENEFITS
The Employee shall be entitled to
a. family health benefits;
b. Employee disability benefits;
c. a $100,000 term life insurance policy (standard premium); and
d. three (3) weeks paid vacation per year, commencing one (1)
year after the Effective Date.
EXHIBIT D
AUTOMOBILE ALLOWANCE
The Automobile Allowance is $6,000 per year.
