Exhibit 10.12
EMPLOYMENT AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into as of the
1st day of November, 1999 by and between Medical Staffing Network, Inc., a
Delaware corporation located at 0000 Xxxxx Xxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxx
Xxxxxxx, Xxxxxxx 00000 (the "Company"), and Xxxxxxx Xxxxxxxx, an individual
residing at 000 Xxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the "Employee").
1. EMPLOYMENT. As of the date of this Agreement, Company shall employ
Employee as Vice President of Operations for Allied Health Services at the
offices of Company located in North Aurora, Illinois.
2. DUTIES. Employee shall perform such duties as are reasonably
requested by Company from time to time. Employee shall perform such duties
during the business hours of Company, and as otherwise reasonably requested from
time to time by Company. In the event that additional time is required for
Employee to complete his duties hereunder, he shall not be entitled to any
additional salary or other payments. It is contemplated by the parties that
Employee shall devote substantially all of his time, attention and efforts
during Company's business hours in performing his duties hereunder. Employee
will devote his utmost knowledge and best skill to the duties entrusted to him
hereunder. Employee shall comply with all policies, standards and procedures of
Company. Employee acknowledges and agrees that during the term of this
Agreement, he shall not perform any services for or otherwise be employed by
Professional Search Network Recruiters, Inc.
3. PLACE OF EMPLOYMENT. Employee shall perform such duties set forth
above at Company's North Aurora, Illinois office and shall not be relocated by
Company without Employee's consent, which consent shall not be unreasonably
withheld; PROVIDED, HOWEVER, that Employee agrees to undertake such reasonable
business travel as may be required to fulfill the duties set forth above.
4. TERM. The term of this Agreement shall be thirty-six (36) months
commencing on November 1, 1999 and shall continue through and include October
31, 2002 (the "Term"), This Agreement may be renewed upon the mutual written
agreement of the parties hereto.
5. TERMINATE WITHOUT CAUSE. This Agreement shall terminate upon
Employee's physical disability or mental incapacity, by reason of sickness,
injury or any other cause that prevents Employee from performing his duties set
forth above for a period of more than thirty (30) days, or immediately upon
Employee's death. In addition, either party may terminate this Agreement without
cause upon thirty (30) days' written notice; PROVIDED, HOWEVER, that neither
party shall have the right
to terminate this Agreement without cause during the first twenty-four (24)
months of this Agreement.
6. TERMINATION FOR CAUSE.
(a) BY COMPANY. Company may immediately terminate this
Agreement, at any time, for cause. Cause for termination by Company
shall be limited to the following events:
(i) Employee's material breach of this Agreement or
the Confidential Information and Noncompete Agreement
("Confidential Information and Noncompete Agreement") of even
date among Company, MTS Staffing Resource, Inc., Xxxxxxx X.
Xxxxx, Xxxxx Xxxxx, G. Xxxxxx Xxxxx and Employee and, if such
breach is curable, Employee's failure to cure such breach
within ten (10) days of written notice thereof;
(ii) violation by Employee of any of Company's
policies set forth in written policy or personnel manuals and,
if such violation is curable, Employee's failure to cure such
violation within ten (10) days of written notice thereof;
(iii) Employee's willful failure to comply with all
laws of the United States, the State of Illinois, and all
other governmental bodies having jurisdiction over him (other
than Employee's failure to observe traffic laws which do not
involve the possible imposition of jail sentences);
(iv) acts of moral turpitude by Employee which may
damage his reputation or that of Company;
(v) Employee's failure, refusal or inability to
perform the duties set forth above, and, if such failure,
refusal or inability to perform is curable Employee's failure
to cure within ten (10) days of written notice thereof; or
(vi) fraud, misappropriation or embezzlement by
Employee.
(b) BY EMPLOYEE. Employee may terminate this Agreement, at any
time, for cause. Cause for termination by Employee shall be limited to
the following events:
(i) Employer's material breach of this Agreement; or
(ii) Employer's willful failure to comply with all
laws of the United States, the State of Illinois, and all
other governmental bodies having jurisdiction over it.
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Upon the termination of this Agreement pursuant to either Section 5 or Section 6
of this Agreement, all obligations of Company arising under this Agreement,
other than its obligation to pay, if applicable, (i) accrued but unpaid salary,
(ii) accrued vacation, personal or sick days, (iii) accrued but unpaid Incentive
Bonuses (as defined below) and (iv) accrued but unpaid New Allied Location
Bonuses (as defined below) (collectively, "Final Compensation") shall thereupon
cease. The Company shall pay the Employee the Final Compensation less any
federal, state, local or other taxes required to be withheld by the Company
pursuant to law or governmental regulation or ruling within 45 days after the
effective date of the Employee's termination
7. COMPENSATION. For all services rendered by Employee pursuant to this
Agreement, Company shall pay Employee salary payments equal to $125,000 per
year, payable in accordance with the Company's normal payroll practices. All
salary payments shall be subject to federal withholding and other applicable
taxes. If Employee's employment is terminated, the actual salary payments made
to Employee shall be pro-rated based upon the number of days that Employee is
actually employed by Company for such month.
Employee will be entitled to a bonus of $18,750 ("Incentive Bonus") for
each calendar quarter that the Company's MTS Division attains its quarterly
budgeted net income as set forth in a budget for the MTS Division approved by
the Company's Board of Directors. One-half of the Incentive Bonus for each
calendar quarter shall be paid to the Employee within 30 days after the end of
the quarter in which the Incentive Bonus is earned and one-half of the
Incentive Bonus for each calendar quarter shall be retained by the Company and
shall earn compounded interest at a rate of 6% per annum (the "Accumulated
Incentive Bonus") until the end of the Term. If the Employee remains employed by
the Company until the end of the Term, the Company shall pay the Accumulated
Incentive Bonus less any federal, state, local or other taxes required to be
withheld by the Company pursuant to law or governmental regulation or ruling to
the Employee within 30 days after the end of the Term.
In addition, Employee shall receive a bonus ("New Allied Location
Bonus") for each location where (i) Employee successfully introduces and
manages an allied staffing product line ("New Allied Location") and (ii) in any
fiscal quarter, quarterly sales for the applicable New Allied Location are equal
to or greater than $325,000 and gross margin for the applicable New Allied
Location is equal to or greater than 35% ("Bonus Objectives"). For each New
Allied Location satisfying the Bonus Objectives during fiscal years 2000, 2001
and 2002, the Company shall pay the Employee within 90 days after the Bonus
Objectives are met for the applicable year as follows:
Fiscal Year 2000 Bonus of $12,500 plus an option to purchase
2,500 shares of Common Stock of MSN
Holdings, Inc. at a price of $7.00 per share
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Fiscal Year 2001 Bonus of $12,500 plus an option to purchase
2,500 shares of Common Stock of MSN
Holdings, Inc. at a price of $8.00 per share
Fiscal Year 2002 Bonus of $12,500
All payments of New Allied Location Bonuses shall be net of any
federal, state, local or other taxes required to be withheld by the Company
pursuant to law or governmental regulation or ruling.
Upon the Employee's death or Disability (as defined below) or
termination of this Agreement pursuant to Section 6(b), the Company shall pay
any earned Accumulated Incentive Bonus and New Allied Location Bonuses not
previously paid to the Employee less any federal, state, local or other taxes
required to be withheld by the Company pursuant to law or governmental
regulation or ruling to the Employee or his estate, as the case may be, within
30 days after the effective date of the Employee's termination. If the
Employee's employment is terminated for any reason other than those described in
the previous sentence, Employee shall not be entitled to receive any of the
Accumulated Incentive Bonus. For purposes of this Agreement, "Disability" means
physical or mental disability, which disability is expected to be of long or
indefinite duration and prevents the Executive from performing his duties
under this Agreement. All determinations of Disability made by the Company
pursuant to the Company's Long Term Disability Insurance Policy, if any, shall
be determinative of Disability under this Agreement. If the Company does not
have a Long Term Disability Insurance Policy, Disability shall be determined by
the unanimous decision of two physicians, one selected by the Employee and one
selected by the Company. If the two physicians are unable to agree on the
determination, they shall appoint a third physician whose determination shall be
final and binding on the parties.
8. VACATIONS, PERSONAL, SICK OR CONTINUING EDUCATION LEAVES OF ABSENCE.
Employee shall be entitled to an aggregate fifteen (15) business days of paid
vacation, personal or sick days and continuing education leaves of absence each
year during the term of this Agreement. Such days shall be accrued by Employee
on a pro-rata basis over the actual period of his employment. Notwithstanding
the foregoing, Employee shall not be entitled to utilize any accrued vacation,
personal or sick days or continuing education leaves of absence for the first
month of the term of this Agreement. Employee shall submit all requests for
vacation or personal days and continuing education leaves of absence for a
continuous period of five (5) days or more to Company's President at least
fifteen (15) days prior to the proposed vacation or personal days or leaves of
absence and such requests shall be subject to the reasonable approval of the
Company's President. For the purposes of this paragraph, the term "business day"
is defined as a Monday through Friday during which Company is open for business.
Unused vacations or leaves of absence may not be carried over from one
employment year to another and may not be used after the date that this
Agreement terminates. Additional compensation will not be paid for unused
vacation, personal or sick days or continuing education leaves of absence.
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9. OTHER BENEFITS.
(a) REIMBURSABLE EXPENSES. Company shall reimburse Employee for
ordinary and necessary business expenses incurred by Employee in the performance
of his duties hereunder if such expenses have been pre-approved by the
Company's president or if reimbursement is otherwise appropriate in accordance
with the Company's established policies and if Employee provides verification of
such expenses as Company may require.
(b) AUTOMOBILE ALLOWANCE. The Company shall pay the Employee a monthly
automobile allowance of $350, plus fuel, maintenance and insurance costs
incurred by the Employee in connection with his automobile.
(c) EQUIPMENT. The Company shall provide and pay the monthly charges
arising in connection with the Employee's business use of a cellular telephone,
pager and personal computer.
(d) EMPLOYEE BENEFITS. The Company shall provide health, life and
disability insurance coverage and other benefits to the Employee on a basis
consistent with that provided by the Company to its other executive employees.
10. COMPANY'S AUTHORITY. Company shall exercise direction over and give
support to Employee with respect to standards, policies, record keeping,
procedures, and fees to be charged.
11. CONFIDENTIAL INFORMATION AND NONCOMPETE AGREEMENT.
Contemporaneously with the execution of this Agreement, Employee and Company
have also entered into the Confidential Information and Noncompete Agreement
which limits Employee's ability to utilize Company's confidential information
and procedures and Employee's ability to compete with Company. The parties
acknowledge and agree that the terms and conditions of the Confidential
Information and Noncompete Agreement shall survive the termination of this
Agreement, for any reason whatsoever, and that Employee's execution of the
Confidential Information and Noncompete Agreement was a material inducement to
Company's execution of this Agreement.
12. "KEY MAN" INSURANCE. Employee agrees to cooperate in connection
with any application by Company to obtain "key man" insurance on the life of
Employee.
13. MISCELLANEOUS PROVISIONS.
(a) INTERPRETATION. This Agreement shall be governed by and construed
in accordance with the laws of the State of Florida, and venue of any legal
proceeding seeking enforcement of any provision of this Agreement shall lie
exclusively in Broward County, Florida. If any provision of this Agreement is
deemed to be invalid, the invalidity of such provision shall not affect or
invalidate the other provisions of this Agreement. This
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Agreement cannot be altered or modified except by a written instrument signed by
all of the parties. Time is of the essence of this Agreement.
(b) ATTORNEYS' FEES. In connection with any litigation, including
trial, appellate or bankruptcy proceedings in connection with this Agreement,
the prevailing party shall be entitled to recover reasonable attorneys' fees and
costs from the non-prevailing party.
(c) MULTIPLE COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be considered to be an original agreement, but
all of which, when taken together, shall constitute one and the same agreement.
(d) NOTICES. Any notice or other communication between the parties with
respect to this Agreement shall be written and shall become operative when it is
hand delivered or three days after it has been mailed by certified mail,
return receipt requested to the addresses set forth above, or such other
address as may be designated and noticed to the other party by the addressee.
(e) ASSIGNMENT. This Agreement binds and inures to the benefit of the
heirs, personal representatives, successors and assigns of the parties,
including any survivor of Company by merger, consolidation, share exchange or
combination with any other entity. Notwithstanding the foregoing, the assignment
or delegation by Employee of any of his rights or obligations hereunder is
expressly prohibited.
(f) ENTIRE AGREEMENT. This Agreement, together with the Confidential
Information and Noncompete Agreement, constitute the entire agreement of the
parties and supersede and replace any previous verbal or written agreements.
[SIGNATURES ON NEXT PAGE.]
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EXECUTED as of the date first recited above.
MEDICAL STAFFING NETWORK, INC.
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxx Xxxxxxxx
------------------------------------ ------------------------------------
Xxxxxx X. Xxxxxxx, President Xxxxxxx Xxxxxxxx, Individually
FOR PURPOSES OF THE OBLIGATION TO
AWARD STOCK OPTIONS CONTAINED IN
SECTION 7 ONLY:
MSN HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxx, President
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