Exhibit 10-a
EMPLOYMENT AGREEMENT
This Employment Agreement is effective October 19, 2004 by and between
the following parties:
1. Care Recruitment Solutions International, Inc a Florida
corporation ("CRSI").
2. Xxxxxx X Xxxxxxx, an individual residing in Lancaster,
Pennsylvania ("Executive").
RECITAL
CRSI desires to obtain the services and employment of Executive and
Executive wishes to provide such services in accordance with the terms
and conditions provided herein.
AGREEMENTS
In consideration of the Recital and Agreements herein and for other
good and valuable consideration, the receipt and sufficiency of which
are acknowledged, the parties intend to be bound to the following:
1. EMPLOYMENT. CRSI agrees to employ Executive and Executive agrees
to be employed by and to serve CRSI, effective October 19, 2004
("Effective Date") on the terms and conditions set forth herein.
2. TERM. The Term of this Agreement shall commence on the
Effective Date and shall terminate on October 18, 2009 ("Initial
Term") unless extended. Commencing October 18, 2009 and on each
such anniversary date thereafter, the Term automatically shall
extend by one year ("Extended Term") unless six months prior
thereto Executive has received written notice from CRSI that
CRSI intends to terminate upon the next anniversary date. The
word "Term" in this Agreement includes both the Initial Term
and Extended Terms.
3. DUTIES.
a. Position And Duties. Executive shall serve as CRSI's
President and Chief Executive Officer and shall have such
responsibilities, duties and authority consistent with
such positions. Executive shall report directly to CRSI's
Board of Directors. Executive shall devote substantially
all of his working time to the business and affairs of
CRSI. The Executive shall be allowed to complete any and
all obligations in respect of the Executive's
accountability to his prior businesses namely, Sight 4
Kids, Inc, Medical Technology & Innovations, Inc,
Steridyne Industries, LLC, Growth Capital Resources, LLC
and any other prior businesses or interests of the Executive.
b. Indemnification. CRSI shall indemnify Executive, to the
fullest extent permitted by law and CRSI's articles of
incorporation and bylaws, for all amounts (including
without limitation judgments, fines, settlement payments,
losses, damages, costs and expenses, including reasonable
attorneys' fees), incurred or paid by Executive in
connection with any action, suit, investigation or other
proceeding, arising out of or relating to this Agreement,
Executive's employment with CRSI or performance of
services for CRSI, or his acting as a fiduciary of any
CRSI employee benefit plan, program or arrangement or
as a director, officer or employee of CRSI or any of
its subsidiaries or related companies. This provision
shall remain in effect following termination until all
potential claims are barred. CRSI shall provide adequate
liability insurance coverage for Executive on the same
terms and conditions as that being provided for any other
CRSI director and officer during the Term and for five
years following termination.
4. LOCATION. Executive shall maintain an Executive Office at
each CRSI location but will work primarily from his office in
Lancaster, PA or at such other mutually agreeable principal
executive office.
5. COMPENSATION AND RELATED MATTERS.
a. ANNUAL COMPENSATION.
i. Base Salary. CRSI shall pay to Executive an
initial annual base salary at a rate not less
than $250,000, to be paid in accordance with
CRSI's salaried employee policies. CRSI will
increase this salary at the rate of 25% per
year on each anniversary date of the Effective
Date.
ii. Annual Bonus. CRSI shall pay to Executive an
annual bonus payment equal to 8% of CRSI's
EBIDTA, to be paid by March 31 following the
end of the fiscal year for which the bonus is
calculated. CRSI shall pay the bonus in cash,
CRSI's common stock or a combination of both,
at the election of Executive. If the bonus is
paid in common stock of CRSI, the company
shall register the stock with the Securities
and Exchange Commission ("SEC") pursuant to an
S.8 registrations statement within 2 weeks of
issuing the stock to the executive. Stock
issued to Executive pursuant to this bonus
arrangement will be at a 50% discount to the
BID price of CRSI common stock price for the
preceding 30 days.
b. STOCK OPTIONS. CRSI will offer to Executive the
opportunity to participate in its executive employee
stock option programs. The opportunity for Executive
shall be no less than 5% of the number of CRSI's issued
and outstanding shares at the time of the grant(s),
shall be exercisable at a purchase price equal to the
closing bid price of CRSI common shares on the date of
the grant(s) and shall be exercisable anytime during the
period of ten years following the date of the grant(s).
c. OTHER BENEFITS. Executive shall be entitled to
participate in all other current and future CRSI
employee benefit plans, programs and arrangements that
apply to CRSI's executive or general employees.
d. VACATIONS AND OTHER LEAVES. Executive shall be entitled
to (1) an aggregate paid vacation of not less than six
weeks and five personal leave days for each twelve-month
period of the Term and (2) paid holidays in accordance
with CRSI policy covering executive employees.
e. EXPENSES. Executive shall be entitled to be reimbursed
within ten business days for all reasonable and customary
expenses incurred by Executive in performing services
hereunder, including all expenses of travel and
accommodations while away on CRSI business.
f. SERVICES FURNISHED. CRSI shall furnish Executive with a
car allowance to lease a company vehicle (up to $1200
per month in lease expense), plus office space,
furnishings, office equipment and stenographic
assistance at each of CRSI locations and at the
Executive's home office and such other facilities and
services as are suitable to Executive's position and
adequate for the performance of his duties hereunder.
6. TERMINATION BY CRSI.
a. DEATH. Executive's employment shall terminate upon his death.
b. DISABILITY. Executive's employment shall terminate at
the end of the Term if, as a result of Executive's
incapacity due to physical or mental illness,
Executive is absent from his duties on a full time
basis for the entire period of twelve consecutive months
and he does not return to such duties within thirty days
after his receipt of written notice hereof.
c. CAUSE. CRSI may terminate Executive's employment thirty
days from Executive's receipt of notice in reasonable
detail of the following:
i. Conviction of a felony.
ii. Gross misconduct that did not cease within ten
business days after Executive's receipt of
written notice from CRSI of the specific
conduct at issue and a demand to rectify the
conduct.
iii. Willful misconduct that is intended to and does
have a material adverse impact on CRSI.
d. DISPUTE. If Executive notifies CRSI within thirty days
after receipt of a notice of termination that a dispute
exists concerning the termination, the termination shall
be abated and Executive shall be entitled to receive the
compensation defined in Paragraph 5 hereof until the
dispute is finally resolved.
7. TERMINATION BY EXECUTIVE.
a. Executive may terminate his employment voluntarily upon
thirty days' prior written notice to CRSI.
b. Executive may terminate his employment immediately for
the following:
i. CRSI's material breach of this Agreement that is
not cured within ten business days of its receipt
of notice from Executive of the specific conduct
at issue and a demand to rectify the conduct.
ii. Diminution of Executive's title or authority.
iii. After a "Change in Control", which occurs when any
of the following occurs:
(a) Any "person" (as used in Paragraphs 13(d) and
14(d) of the Securities Exchange Act of 1934) is
or becomes the "beneficial owner" (as used in
Rule 13d-3 thereunder), directly or indirectly,
of CRSI securities representing 30% or more of
the combined voting power of CRSI's then
outstanding voting securities.
(b) Upon a reorganization, merger or
consolidation where the shareholders owning CRSI
voting shares prior thereto do not own 50% of
CRSI voting shares immediately thereafter.
(c) CRSI shareholders approve a plan of complete
liquidation of CRSI or an agreement for the sale
or disposition by CRSI of all or substantially
all of its assets.
7. COMPENSATION UPON TERMINATION.
a. DISABILITY.
i. CRSI shall pay to Executive (1) all unpaid
amounts to which Executive is entitled as of
the termination date within ten business days
of that date and (2) all other unpaid amounts
under any compensation or benefit plan or
program in accordance with the terms of the
applicable plan or program (collectively,
"Accrued Obligations").
ii. CRSI shall pay Executive an amount equal to three
times the sum of (1) Executive's annual base
salary at the rate in effect on the date of
termination and (2) the average of the annual
bonuses earned by Executive in the three fiscal
years ended immediately prior to the date of
termination, in thirty-six equal consecutive
monthly installments beginning on the date of
termination ("Severance Payments").
iii. CRSI shall maintain in force for a period of five
years following the date of termination the
same medical, life, directors and officers and
all other insurance coverage as existed
immediately prior to the date of termination
("Insurance Coverage").
b. DEATH. If employment is terminated by death, CRSI shall
pay the Accrued Obligations and the Severance Payments
to the representative of Executive's estate.
c. CAUSE. If employment is terminated for a cause as set forth
in Paragraph 6(c), CRSI shall in any event pay the
Accrued Obligations and all unexercised stock options
previously awarded to Executive. If any amount is deemed
by CRSI to be payable to the company as a result of an
activity which precipitated the Executive's termination
for cause, such amount shall:
i. Be offset against any amounts due Executive from
the payment of Accrued Obligations and,
ii. Be placed in escrow until such time that the
matter is resolved between the parties.
d. CHANGE OF CONTROL. If employment is terminated either
following a Change in Control or while a Potential Change
in Control (defined below) is pending, CRSI shall pay, in
addition to Accrued Obligations and Insurance Coverage, a
Change in Control Severance Payment to be paid in a lump
sum within five business days after the date of termination
in an amount equal to the sum of the Executive's base
salary at the rate in effect as of the date of termination
and the average of the annual bonuses earned by the
Executive in the three fiscal years ended immediately prior
to the date of termination, multiplied by three. The
Executive has the option of receiving this payment in cash
or CRSI stock or any combination thereof. If the Executive
elects to accept CRSI stock in payment of amounts due him,
such stock shall be valued at a 50% discount to the average
closing bid price for the thirty (30) trading days
immediately prior to the payment date. A "Potential Change
in Control" occurs when any of the following has occurred:
i. CRSI enters into an agreement, the consummation
of which would result in the occurrence of a
Change in Control.
ii. CRSI or any Person (defined in Paragraph 7
hereof) publicly announces an intention to take
or to consider taking actions that if consummated
would constitute a Change in Control.
iii. Any such Person becomes the Beneficial Owner
(defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of CRSI
representing 20% or more of either the then
outstanding shares of CRSI common stock or the
combined voting power thereof.
iv. The Board adopts a resolution that a Potential
Change in Control has occurred.
e. OTHER TERMINATION. If employment is terminated for any
other reason, CRSI shall pay the Accrued Obligations and
shall provide Executive with outplacement services
commensurate with his position.
f. ANY TERMINATION OTHER THAN CAUSE.
i. Executive or his representative shall be entitled
to immediate exercise of all outstanding stock
options for a period of one year following the
date of termination.
ii. Unvested stock options shall immediately become
fully vested and exercisable for a period of
one year and any unvested restricted shares
shall become fully vested.
iii. CRSI shall pay Executive, at the same time that
bonuses are paid to other CRSI executives, a
bonus payment equal to 5% of CRSI's EBITDA for
such fiscal year pro-rated to reflect the
number of days of employment in such fiscal
year through and including the date of termination.
iv. If Executive so elects, CRSI shall purchase
within ten business days all of Executive's
shares, options, warrants and any other rights
relating to CRSI stock at the closing bid price
on the date of Executive's election.
8. DEFERRED LIABILITY
Executive and CRSI agree that, if during the Term hereof
Executive continues to perform his duties and accepts a lower
base salary, a consulting fee, bonus or benefits all as defined
in Paragraph 5 above in order to conserve cash for CRSI, the
difference between such amount due to Executive in accordance
with this agreement and amounts actually received by him shall be
recorded as a liability ("Deferred Liability") of CRSI and shall
remain a liability of CRSI until paid. Executive has the right
to accept cash, CRSI stock or CRSI stock options or any
combinations thereof in payment of this Deferred Liability. If
Executive agrees to accept CRSI stock in full or partial payment
of this Deferred Liability due him, the CRSI stock shall be
valued at the average closing bid price for the thirty (30)
trading days immediately prior to the payment date less a
discount of 50%. If Executive agrees to accept CRSI stock
options in full or partial payment of this Deferred Liability due
him, the CRSI stock options shall be purchased at the higher of:
(i) the lowest price offered by the Company to any
employee or third party within the past twelve (12)
months prior to the payment date, or
(ii) $.01 per share.
9. NONSOLICITATION; NONCOMPETE.
c. Executive shall not during the Term:
i. Solicit CRSI executive employees with the intent of
inducing them to leave CRSI. (unless following a
Change in Control).
ii. Engage in a business that is in direct competition
with CRSI without CRSI's prior written consent, which
consent shall not unreasonably be withheld, provided
that Executive may engage in investment banking and
passive investment activities, and may also (1)
engage in noncompetitive businesses of an entity that
also operates a business that is in competition with
CRSI and (2) serve as an outside director of an entity
that operates a business that is in competition with
CRSI, if the competitive business does not account for
more than 10% of the consolidated revenues of such
entity.
10. PROTECTION OF CONFIDENTIAL INFORMATION.
a. Executive shall during the Term and for one year thereafter:
i. Keep secret all confidential CRSI information that is
not otherwise in the public domain.
ii. Disclose such information only to those to whom
disclosure is reasonably necessary or appropriate in
connection with the performance of his duties for
CRSI or in compliance with legal process.
iii. Deliver to CRSI on termination of employment all
memoranda, notes, records, customer lists, reports
and other documents (and all copies thereof) in his
possession that contain confidential CRSI information
that was obtained while employed by CRSI.
b. CRSI has the right to have such provisions specifically
enforced by a court because a breach or threatened breach
of these provisions will cause irreparable injury to CRSI
that money damages cannot adequately remedy.
11. SUCCESSORS; BINDING AGREEMENT.
a. This Agreement is not assignable.
b. CRSI will require any successor expressly to assume this
Agreement. The failure to so assume is a material breach
under Paragraph 6d.
c. This Agreement and all rights of Executive hereunder shall
inure to the benefit of and be enforceable by Executive's
personal or legal representatives, executors,
administrators, successors, heirs, distributes, devisees and
legatees, to whom any amounts payable to Executive hereunder
shall be paid in accordance with the terms of this Agreement.
12. ARBITRATION. The parties shall settle all disputes related to
this Agreement by good faith mediation and, failing that, by
binding arbitration under the rules of the American
Arbitration Association in Lancaster, Pennsylvania. Arbitration
must be initiated within one year of the conduct or omission
giving rise to the claim or the claim is barred. No punitive or
similar damages may be awarded. CRSI shall advance the
arbitration costs and the prevailing party may seek
reimbursement from the other party of its fees and expenses in
arbitration. Judgment may be entered on the arbitrator's award
in any court having jurisdiction.
13. NOTICE. Notices shall be in writing and shall be delivered by
any means by which delivery is verified to the following
addresses:
If to CRSI:
Care Recruitment Solutions International, Inc
Administration and Executive Division
0000 Xxxx Xxxx Xxxxx Xx
Xxxxxxxxx, XX 00000
Attention: Chairman of the Board
If to Executive:
Xxxxxx X Xxxxxxx
0000 Xxxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
14. MISCELLANEOUS.
a. This Agreement may be amended if in writing signed by both
parties.
b. A waiver of any breach hereof shall not be deemed a waiver
of the same or other provisions.
c. This Agreement sets forth the entire agreement of the
parties with respect to its subjects and there are no
agreements with respect to the subject matter hereof that
are not set forth expressly in this Agreement.
d. This Agreement shall be governed by the laws of the State
of Florida without regard to its conflicts of law principles.
e. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement,
which shall remain in full force and effect.
f. This Agreement may be executed in one or more counterparts
and by facsimile signature each of which shall be deemed to
be an original but all of which together will constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as set forth
below.
CARE RECRUITMENT SOLUTIONS INTERANATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Print name and title:
Xxxxxx X. Xxxxxxx
Sole Director and Chief Executive Officer
EXECUTIVE: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X Xxxxxxx
[End]
