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EXHIBIT 10.8
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into as of
October 1, 1996, among StaffMark, Inc., a Delaware corporation (hereinafter
referred to as "StaffMark"), Xxxxxxx Staffing, Inc., an Oklahoma corporation
(hereinafter referred to as the "Company"), and Xxxx Xxx Xxxxxxx (hereinafter
referred to as "Employee").
W I T N E S S E T H
WHEREAS, Employee has been a shareholder of, and has been employed as
an executive officer by, the Company; and
WHEREAS, the Company and its shareholders have entered into an
Agreement and Plan of Reorganization dated as of June 17, 1996 (the
"Reorganization Agreement") with StaffMark, Inc., a Delaware corporation,
whereby the Company has agreed to merge with a subsidiary of StaffMark, Inc.;
and
WHEREAS, the Company is desirous of the continuation of Employee's
employment with the Company; and
WHEREAS, in the course of building the business of the Company, and in
his capacity as an executive officer thereof, Employee has gained knowledge of
the business, affairs, customers and methods of the Company, and Employee will
gain similar knowledge with respect to StaffMark, Inc. and each of StaffMark,
Inc.'s direct and indirect subsidiaries during his employment with the Company,
has had and will have access to lists of the Company, StaffMark, Inc. and their
affiliates' customers and their needs, and had and will become personally known
to and acquainted with the Company, StaffMark, Inc. and their affiliates'
customers thereby establishing a personal relationship with such customers for
the benefit of the Company.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein, the parties hereto agree as follows:
1. TERM OF AGREEMENT. The term of this Agreement shall commence
on the date hereof and terminate on September 30, 2001. During the term of
this Agreement, each twelve month period commencing on October 1 and ending on
the following September 30 shall be referred to herein as a "Compensation
Year."
2. DUTIES AND PERFORMANCE.
(a) During the term of this Agreement, Employee shall be
employed by the Company on a full-time basis as its Employee and shall
have such authority and shall
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perform such duties consistent with his position as may be reasonably
assigned to him by, and shall report to, the Chief Executive Officer,
the Board of Directors of the Company or any other member of senior
management designated by the Board of Directors or the Chief Executive
Officer; provided, however, that without the approval of the Board of
Directors of the Company and StaffMark, Inc., Employee may not, on
behalf of the Company (A) enter into term employment arrangements for
the Company's employees of terms longer than those in place on the
date hereof, (B) borrow funds or make material capital expenditures or
commitments, (C) alter or adopt any employee benefit plans, or (D)
adopt or maintain any employee policy or program materially different
from those utilized by StaffMark, Inc. and its operating subsidiaries.
Employee shall use all reasonable efforts to further the interests of
the Company and shall devote substantially all of his business time
and attentions to his duties hereunder; provided, however, that
Employee shall not be required to locate outside the Tulsa area
without Employee's consent.
(b) Employee shall be entitled to be reimbursed in
accordance with the policies of the Company, as adopted and amended
from time to time, for all reasonable and necessary expenses incurred
by him in connection with the performance of his duties of employment
hereunder; provided Employee shall, as a condition of such
reimbursement, submit verification of the nature and amount of such
expenses in accordance with the reimbursement policies from time to
time adopted by the Company.
3. BASE SALARY. The Company shall pay to Employee a base salary
at the rate of $75,000 per annum through the expiration of the term of the
Agreement, payable bi-weekly as per normal pay practices of the Company.
4. BENEFITS.
(a) When eligible under non-discriminatory standards,
Employee shall be entitled to participate in any employee benefit plan
maintained by the Company for its full time employees and shall be
entitled to four (4) weeks vacation per annum and such holidays as the
Company may establish as company policy.
(b) The Company shall pay to Employee on or about the
first (1st) day of each month an automobile allowance in the amount of
$500 per month which shall be used to pay all automobile related
expenses. The Company may, at its discretion, provide equivalent
automobile arrangements as it deems appropriate with sixty (60) days'
written notice to Employee. Employee shall maintain with respect to
any automobile used for business purposes such insurance coverage as
may be reasonably required by the Company, the cost of which shall be
paid by Employee from such monthly allowance.
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Employee shall provide the Company with a copy of such insurance
policy, which policy shall name the Company as an additional insured
party.
(c) The Company shall reimburse Employee up to $250 per
month for club dues actually incurred by Employee, provided that such
club is used at least 50 percent of the time for business purposes and
such usage is subject to audit by the Company or StaffMark, Inc..
(d) Employee shall be eligible to participate in the
incentive compensation plans of StaffMark, Inc. and its affiliates.
5. TERMINATION OF AGREEMENT.
(a) The Company, with the approval of a 75% vote of the
Board of Directors of StaffMark, shall be entitled to terminate
Employee's services, in any of the following circumstances:
(i) For "cause," which shall mean by reason of
any of the following: (A) Employee's conviction of, or plea
of nolo contendere to, any felony or to any crime or offense
causing substantial harm to StaffMark, Inc., the Company or
any of their affiliates (whether or not for personal gain) or
involving acts of theft, fraud, embezzlement, moral turpitude
or similar conduct, (B) Employee 's violation of the Company's
substance abuse policy, (C) malfeasance in the conduct of
Employee's duties, including but not limited to (i) willful
and intentional misuse or diversion of StaffMark, Inc., the
Company, or any of their affiliates' funds, (ii) embezzlement,
and/or (iii) fraudulent, willful or material
misrepresentations or concealments on any written reports
submitted to StaffMark, Inc., the Company or their affiliates,
(D) material failure to perform the duties of such person's
employment, (E) material failure to follow or comply with the
reasonable and lawful directives of the Chief Executive
Officer, any member of senior management designated by the
Board of Directors of StaffMark, Inc., or the Board of
Directors of StaffMark, Inc. or the Company, (F) a material
breach by Employee of the provisions of the Reorganization
Agreement or this Agreement (including without limitation any
breach of Section 6 of this Agreement), or (G) the occurrence
of an event or series of events which lead the Chief Executive
Officer of the Company to the reasonable conclusion that
Employee has materially breached or damaged their trust in his
character and integrity sufficiently to impair his standing
with StaffMark, Inc. and the Company; provided, however, that
in the case of the foregoing clauses (D) and (E), Employee
shall have been informed, in writing, of such material failure
referred to in the foregoing clauses (D) and (E),
respectively;
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(ii) If, for any reason, Employee is unable to
perform the essential functions of such person's duties, with
or without reasonable accommodation, for a consecutive period
of sixty (60) days or a non-consecutive period of one hundred
twenty (120) days during any twelve month period, or such
other period as may be required by applicable employment laws;
or
(iii) The death of Employee.
(b) In the event of the termination of Employee's
employment:
(i) For cause, except as provided in Section
5(b)(ii), or in the event of the resignation of Employee, then
as of the date of such termination all of the Company's
obligations hereunder, including, without limitation, the
Company's obligations to pay Employee's base salary accruing
after the date of such termination, and any benefits (except
as otherwise required by applicable law), other than those
obligations which have accrued but remain unpaid as of the
date of such termination (such as accrued but unpaid salary,
expense reimbursements, health insurance premiums, retirement
plan contributions, if any, vacation pay, sick pay, etc.),
shall cease and Employee shall not be entitled to receive any
incentive compensation for the Compensation Year of such
termination;
(ii) By reason of Employee's death or inability to
perform the essential functions of such person's position as
provided in Section 5(a)(ii) and (iii) hereof or for cause
only as provided in Section 5(a)(i)(D) and (E), then the
Company shall continue to pay Employee's base salary and to
provide for the continuation of any Company health insurance
benefits for which he would be eligible but for such
termination, until the first to occur of (A) September 30,
1998 or (B) Employee shall have sold shares of StaffMark, Inc.
in a public offering in which Employee received cash in excess
of $500,000 for such shares sold;
(iii) By the Company for any other reason other
than for the reasons set forth in clauses (i) and (ii) above,
then in such event the Company shall continue to pay
Employee's base salary (without offset for any compensation
received by Employee from any subsequent employment by any
person other than by an affiliate of the Company or in
violation of Section 6 hereof) and to provide for the
continuation of any Company health insurance benefits for
which he would be eligible but for such termination, for a
period which is the greater of (A) sixty (60) days from the
date of such termination, or (B) the remaining term of this
Agreement.
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6. COVENANT NOT TO COMPETE; CONFIDENTIALITY.
(a) Employee acknowledges that in the course of his
employment by the Company he has and will become privy to various
economic and trade secrets and relationships of the Company,
StaffMark, Inc. and its affiliates. Therefore, in consideration of
this Agreement and of the merger by the Company and a subsidiary of
StaffMark, Inc., Employee hereby agrees that neither he nor his spouse
nor any member of his immediate family that resides with him will,
directly or indirectly, except for the benefit of the Company or its
affiliates or subsidiaries, or with the prior written consent of the
Board of Directors of the Company, which consent may be granted or
withheld at the sole discretion of the Company's Board of Directors:
(i) During the Noncompetition Period (as
hereinafter defined), become an officer, director,
stockholder, partner, member, manager, associate, employee,
owner, agent, creditor, independent contractor, co-venturer,
consultant or otherwise, or be interested in or associated
with any other person, corporation, firm or business engaged
in providing temporary or permanent staffing services,
outsourcing or medical or clinical staffing or recruiting (a
"StaffMark, Inc. Services Business") in the State of Oklahoma
and, outside the State of Oklahoma, within a radius of fifty
(50) miles from any office operated during the Noncompetition
Period by the Company, StaffMark, Inc. or any of their
affiliates (collectively, the "Territory") or in any
StaffMark, Inc. Services Business directly competitive with
that of the Company, StaffMark, Inc. or any of their
affiliates, or itself engage in such business; provided,
however, that
(A) Nothing herein shall be construed to
prohibit Employee from owning not more than five
percent (5%) of any class of securities issued by an
entity which is subject to the reporting requirements
of the Securities Exchange Act of 1934, as amended,
or which is traded over the counter;
(B) The foregoing shall not restrict
Employee with respect to businesses, other than
StaffMark, Inc. Services Businesses, engaged in by
the Company or its affiliates during the
Noncompetition Period unless Employee either is or
was substantially involved in such other businesses
of the Company or such affiliates or had access to
Confidential Information (as hereinafter defined)
with respect to such other businesses; or
(ii) During the Noncompetition Period, in the
Territory, solicit, cause or authorize, directly or
indirectly, to be solicited for or on behalf of himself or
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third parties, from parties who are or were customers of the
Company or its affiliates, any StaffMark, Inc. Services
Business transacted by or with such customer by the Company or
its affiliates; or
(iii) During the Noncompetition Period, in the
Territory, accept or cause or authorize, directly or
indirectly, to be accepted for or on behalf of himself or for
third parties, any such StaffMark, Inc. Services Business from
any such customers of the Company or its affiliates; or
(iv) During the Noncompetition Period, use,
publish, disseminate or otherwise disclose, directly or
indirectly, any information heretofore or hereafter acquired,
developed or used by the Company or its or StaffMark, Inc.'s
affiliates relating to their business or the operations,
employees or customers of the Company or its or StaffMark,
Inc.'s affiliates which constitutes proprietary or
confidential information of the Company or its or StaffMark,
Inc.'s affiliates ("Confidential Information"), including
without limitation any Confidential Information contained in
any customer lists, mailing lists and sources thereof,
statistical data and compilations, patents, copyrights,
trademarks, trade names, inventions, formulae, methods,
processes, agreements, contracts, manuals or any other
documents; and (B) from and after the date hereof, use,
publish, disseminate or otherwise disclose, directly or
indirectly, any information heretofore or hereafter acquired,
developed or used by the Company or its affiliates which
constitutes Confidential Information, but excluding any
Confidential Information which has become part of common
knowledge or understanding in the StaffMark, Inc. Services
Business industry or otherwise in the public domain (other
than from disclosure by Employee in violation of this
Agreement); provided, however, this subparagraph (iv) shall
not be applicable to the extent Employee is required to
testify in a judicial or regulatory proceeding pursuant to the
order of a judge or administrative law judge after Employee
requests that such Confidential Information be preserved; or
(v) During the Noncompetition Period, in the
Territory,
(A) Solicit, entice, persuade or induce,
directly or indirectly, any employee (or person who
within the preceding ninety (90) days was an
employee) of the Company or its or StaffMark, Inc.'s
affiliates or any other person who is under contract
with or rendering services to the Company or its or
StaffMark, Inc.'s affiliates, to terminate his or her
employment by, or contractual relationship with, such
person or to refrain from extending or renewing the
same (upon the same or new terms) or to refrain from
rendering services to or for such person or to become
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employed by or to enter into contractual relations
with any persons other than such person or to enter
into a relationship with a competitor of the Company
or its affiliates;
(B) Approach any such employee for any
of the foregoing purposes; or
(C) Authorize or knowingly approve or
assist in the taking of any such actions by any
person other than the Company or its affiliates.
(b) For purposes of this Agreement, the term
"Noncompetition Period" shall mean the period commencing on the date
hereof and ending twenty-four (24) months after the date Employee
ceases to be an officer or employee of, or consultant to, StaffMark,
Inc., the Company, or any of their affiliates; provided, however, that
the Noncompetition Period shall end immediately upon a termination of
the employment of Employee by the Company under this Agreement which
is not for cause.
(c) The invalidity or non-enforceability of this Section
6 in any respect shall not affect the validity or enforceability of
this Section 6 in any other respect or of any other provisions of this
Agreement. In the event that any provision of this Section 6 shall be
held invalid or unenforceable by a court of competent jurisdiction by
reason of the geographic or business scope or the duration thereof,
such invalidity or unenforceability shall attach only to the scope or
duration of such provision and shall not affect or render invalid or
unenforceable any other provision of this Agreement, and, to the
fullest extent permitted by law, this Agreement shall be construed as
if the geographic or business scope or the duration of such provision
had been more narrowly drafted so as not to be invalid or
unenforceable and further, to the extent permitted by law, such
geographic or business scope or the duration thereof may be re-written
by a court of competent jurisdiction to make such sufficiently limited
to be enforceable.
(d) Employee acknowledges that the Company's remedy at
law for any breach of the provisions of this Section 6 is and will be
insufficient and inadequate and that the Company shall be entitled to
equitable relief, including by way of temporary and permanent
injunction, in addition to any remedies the Company may have at law.
(e) The provisions of this Section 6 shall survive
termination of this Agreement.
(f) In the event of any conflict between the terms and
provisions of this Section 6 and the provisions of Section 13 of the
Reorganization Agreement, then the terms and provisions of such
Section 13 of the Reorganization Agreement shall govern;
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provided, however, that the invalidity or unenforceability of all or
any part of such section shall not have any effect upon the validity
or enforceability of this Section 6.
7. DIVISIBILITY OF AGREEMENT. In the event that any term,
condition or provision of this Agreement is for any reason rendered void, all
remaining terms, conditions and provisions shall remain and continue as valid
and enforceable obligations of the parties hereto.
8. NOTICES. Any notices or other communications required or
permitted to be sent hereunder shall be in writing and shall be duly given if
personally delivered or sent postage prepaid by certified or registered mail,
return receipt requested, or sent by prepaid overnight courier service,
delivery confirmed, as follows:
(a) If to Employee:
Xxxx Xxx Xxxxxxx
0000 Xxxx 00xx Xxxxx
Xxxxx, Xxxxxxxx 00000
(b) If to the Company:
Xxxxx X. Xxxxxx
c/o StaffMark, Inc.
000 X. Xxxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
Either party may change his or its address for the sending of notice to such
party by written notice to the other party sent in accordance with the
provisions hereof.
9. COMPLETE AGREEMENT. This Agreement contains the entire
understanding of the parties with respect to the employment of Employee and
supersedes all prior arrangements or understandings with respect thereto. This
Agreement may not be altered or amended except by a writing, duly executed by
the party against whom such alteration or amendment is sought to be enforced.
10. ASSIGNMENT. This Agreement is personal and non-assignable by
Employee. It shall inure to the benefit of any corporation or other entity with
which the Company shall merge or consolidate or to which the Company shall
lease or sell all or substantially all of its assets and may be assigned by the
Company to any affiliate of the Company or to any corporation or entity with
which such affiliate shall merge or consolidate or which shall lease or acquire
all or substantially all of the assets of such affiliate.
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11. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be an original and all of which together shall constitute
one and the same instrument.
12. GOVERNING LAW. This Agreement shall in all respects be
construed according to the laws of the State of Delaware.
IN WITNESS WHEREOF, each of the parties hereto has executed this
Agreement in multiple counterparts as of the day and year first above written.
EMPLOYEE
/s/ XXXX XXX XXXXXXX
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Xxxx Xxx Xxxxxxx
/s/ [ILLEGIBLE]
-----------------------------------
Witness
STAFFMARK, INC.
By: /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx, President
XXXXXXX STAFFING, INC.
By: /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx, Vice President
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