Exhibit 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made as of August 10,
1998, by and between Preferred Healthcare Staffing, Inc., a Delaware
Corporation ("PHS" or the "Company") and Xxxxxxx X. XxXxxxxxxx
("XxXxxxxxxx"), an individual.
PRELIMINARY STATEMENTS:
A. PHS, on the one hand, and Xxxxxx Xxxxxx-Xxxxxxxx, Xxxxxx Xxxxx, Xxxxxx
Xxxxx and Xxxxxxx XxXxxxxxxx ("Sellers"), on the other hand, are parties
to a Stock Purchase Agreement dated as of July 10, 1998 (the "Stock
Purchase Agreement"). Pursuant to the Stock Purchase Agreement, PHS has
acquired one hundred percent (100%) of the stock of National Explorers
and Travelers Health Care, Inc., a Florida corporation ("NET").
X. XxXxxxxxxx was a five percent (5%) shareholder and Chief Operating
Officer of NET.
C. PHS wishes to employ XxXxxxxxxx as Vice President of Information
Technology of PHS subject to the terms and conditions hereof.
NOW, THEREFORE, in consideration of the premises and the mutual covenants,
agreements and promises hereinafter set forth, the parties hereto agree as
follows:
AGREEMENT
1. TERM; PRIOR AGREEMENTS. XxXxxxxxxx shall be employed by PHS commencing
on the date hereof and terminating one-year from such date, unless
sooner terminated in accordance with the terms of this Agreement (such
period or any renewal period are referred to herein as the "Term").
This Agreement can be renewed for successive one-year terms with the
mutual written consent of PHS and XxXxxxxxxx. This Agreement supercedes
all prior agreements between XxXxxxxxxx and NET or the Company, whether
the agreement is oral or in writing.
2. SERVICES TO BE PERFORMED BY XXXXXXXXXX. During the Term, XxXxxxxxxx
shall serve as Vice President of Information Technology and shall
perform those duties, including the interface with other senior
executives of the Company, delegated to him by the President of the
Company. Said duties shall include, but will not be limited to,
developing, designing and implementing a client/server system
specifically tailored to handle the business requirements of the Company
or, at Company's option, assist with the installation of a software
program purchased or licensed from an industry vendor.
3. COMPENSATION. (a) XxXxxxxxxx shall receive an annual salary of
$102,000.00 ("Annual Salary") during the Term, which shall be payable in
the same manner as the other executives of PHS. XxXxxxxxxx shall also
receive perquisites similar to those perquisites made available to other
executives of PHS.
(b) XxXxxxxxxx shall also receive a bonus 30 days from the end of the
initial Term equal to 20% of his Annual Salary if the objectives
set forth in section 2 of this Agreement are met, at the
discretion of the President of the Company.
4. CONFIDENTIALITY. XxXxxxxxxx acknowledges that during the course of his
ownership of the stock of Net and his duties as an employee and officer,
he has had and may in the future continue to be given access to or may
become acquainted with Confidential Information and Trade Secrets of
PHS, Preferred Employers Holdings, Inc., Preferred Employers Group, Inc.
and its affiliates (hereinafter collectively referred to as
"Preferred"). As used in this Section 4, Confidential Information and
Trade Secrets means all trade practices, customer lists, member or
beneficiary list for any employee staffing company, professional
employer organization (PEO), self-insurance fund or employee
organization serviced or proposed to be serviced by Preferred, all
marketing plans, financial information, Travel Nurse information, and
all other compilations of information that relate to the business of
Preferred, or its affiliates, travel nurses, customers or suppliers, and
which have not been disclosed by Preferred to the public. XxXxxxxxxx
acknowledges that the Confidential Information and Trade Secrets of
Preferred, as such may exist from time to time are valuable,
confidential, special and unique assets of Preferred, expensive to
produce and maintain and essential for the profitable operation of its
businesses. At all times from and after the date of this Agreement,
except with Preferred's express prior written consent, XxXxxxxxxx shall
not, directly or indirectly, communicate, disclose or divulge to any
person, or use for his benefit or the benefit of any person, in any
manner any Confidential Information and Trade Secrets acquired before or
during XxXxxxxxxx'x employment with PHS or NET, including, without
limitation, the terms of this Agreement, except as may be required by
law.
5. TIME COMMITMENT. During the Term, XxXxxxxxxx shall devote 100% of his
full working time to the operations of PHS.
6. NONCOMPETITION. XxXxxxxxxx shall be bound by the provisions of Section
4.12 COVENANT NOT TO COMPETE, in the Stock Purchase Agreement.
7. STOCK OPTIONS. On the date hereof, Preferred Employers Holdings, Inc.
("PEH") will grant to XxXxxxxxxx stock options to purchase up to 20,000
shares of PEH common stock. Such stock options are subject to the
vesting schedule and other terms and conditions contained in the
Company's Stock Option Agreement by
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and between PEH and XxXxxxxxxx, a copy of which is attached hereto as
Exhibit A.
8. BENEFIT PLANS. XxXxxxxxxx shall be entitled to participate in PHS'
benefit plans in the same manner and subject to the same terms and
conditions as the other executives of PHS.
9. RELIANCE. XxXxxxxxxx acknowledges that his compliance with the terms
and conditions of this Agreement is an essential component of the
transactions contemplated by the Stock Purchase Agreement. XxXxxxxxxx
further acknowledges that his compliance with the provisions of Sections
4 and 6 of this Agreement (hereinafter referred to as the "Restrictive
Covenants") is a material element of the consideration bargained for by
PHS hereunder and under the Stock Purchase Agreement, especially in view
of the information disclosed to XxXxxxxxxx and in connection with the
Stock Purchase Agreement. XxXxxxxxxx agrees to be bound by the
provisions of Sections 4 and 6 of this Agreement to the maximum extent
permitted by law, it being the intent and spirit of the parties that the
provisions of Sections 4 and 6 of this Agreement shall be enforceable
even after the Term. However, the parties further agree that if any
portion of any of the Restrictive Covenants or their application is
construed to be invalid or unenforceable, then the other portions
thereof and the other Restrictive Covenants and their application shall
not be affected thereby and shall be enforceable. If any of the
Restrictive Covenants and their application shall for any reason be held
to be excessively broad as to duration, geographical scope, property,
subject or similar factor, then the court making such determination
shall have the power to reduce or limit such scope, duration, area or
other factor so as to be enforceable to the maximum extent compatible
with applicable law, and such Restrictive Covenant shall then be
enforceable in its reduced or limited form.
10. TERMINATION. (a) This Agreement may be terminated by PHS at any time
"For Cause". For purposes of this Agreement, "For Cause" shall mean the
following: (i) XxXxxxxxxx has failed to devote 100% of his full working
time to the operations of PHS, (ii) XxXxxxxxxx has been convicted of
(whether or not subject to appeal) or plead "nolo contendere" or has
made any similar plea to any criminal offense involving a violation of
federal or state securities laws or regulations, embezzlement, fraud,
wrongful taking or misappropriation of property, theft, or any other
crime involving dishonesty, (iii) XxXxxxxxxx has violated or breached
any provision of this Agreement, (iv) XxXxxxxxxx has taken any action
which directly or indirectly causes PHS to have any license, permit or
other authorization necessary for the operations of its business (a
"License") to be suspended or revoked, (v) PHS has received any notice
from any governmental or other agency which regulates the operations of
PHS which indicates that XxXxxxxxxx'x employment with PHS could have an
adverse effect on the ability of PHS to retain or obtain any License or
to otherwise conduct its operations in the manner then conducted, and/or
(vi) XxXxxxxxxx has repeatedly failed to
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demonstrate the ability to achieve the objectives set forth in section 2
of this Agreement.
11. DISABILITY; DEATH.
(a) If, during the Term, XxXxxxxxxx becomes physically or mentally
disabled, whether by injury, illness or otherwise, so that he is
unable to perform his duties for a period of 90 days in any 180
day period, then PHS may, at its option, terminate this Agreement
upon ten days' written notice to XxXxxxxxxx without further
obligation.
(b) In the event of XxXxxxxxxx'x death during the Term, this
Agreement shall terminate and be of no further force and effect,
provided that XxXxxxxxxx shall be entitled to all salary and
other benefits to which he is entitled through his date of death.
12. AUTHORITY; NO CONFLICT. XxXxxxxxxx represents and warrants to PHS that
(a) he has the full power and authority to enter into this Agreement and
to perform his obligations hereunder, and (b) the execution, delivery
and performance by XxXxxxxxxx of this Agreement will not (i) violate,
conflict with, or result in a breach of any contract or other agreement
by which XxXxxxxxxx is bound, (ii) require XxXxxxxxxx to obtain the
consent of, or give any notice to, or make any filing with, any Federal,
state, or local government, or any agency thereof (a "Governmental
Body"), or any other third person, or (iii) violate any law, statute or
other requirement of any Governmental Body.
13. EQUITABLE RELIEF AND OTHER REMEDIES. XxXxxxxxxx acknowledges that any
breach by XxXxxxxxxx of any of the Restrictive Covenants will result in
irreparable injury to PHS, for which money damages could not provide
adequate compensation. In the event of any such breach, PHS shall be
entitled, in addition to all other rights and remedies which PHS may
have at law or in equity, to have an injunction issued by any competent
court enjoining and restraining XxXxxxxxxx and all other persons
involved therein from continuing such breach. PHS shall be entitled to
such injunction without the necessity of posting any bond, but if a bond
is nonetheless required by the court entertaining the motion for
injunction, the parties hereto agree that a bond in the amount of
$1,000.00 is appropriate. The existence of any claim or cause of action
which XxXxxxxxxx, or any other Person, may have against PHS or Preferred
shall not constitute a defense or bar to the enforcement of any of the
Restrictive Covenants. If PHS resorts to litigation to enforce any of
the Restrictive Covenants which has a fixed term, then such term shall
be extended for a period of time equal to the period of such breach,
beginning on the date of a final court order (without further right of
appeal) acknowledging the validity of such Restrictive Covenant or, if
later, the last day of the original fixed term of the Restrictive
Covenant.
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14. ACKNOWLEDGEMENTS BY XXXXXXXXXX. XxXxxxxxxx acknowledges and confirms
that the length of the term of the Restrictive Covenants and the
geographical restrictions contained therein are fair and reasonable and
are not the result of overreaching, duress or coercion of any kind.
XxXxxxxxxx further acknowledges and confirms that the full, uninhibited
and faithful observance of each of the Restrictive Covenants contained
in this Agreement shall not cause any undue hardship, financial or
otherwise. XxXxxxxxxx acknowledges and confirms that his special
knowledge of the Confidential Information and Trade Secrets of NET and
PHS is such as would cause PHS serious injury and loss if he was to use
such knowledge for the benefit of a competitor of PHS or were to compete
with PHS.
15. NONDISPARAGEMENT. XxXxxxxxxx agrees not to engage in any conduct that
is injurious to the reputation or interest of Preferred, including but
not limited to disparaging (or inducing or encouraging others to
disparage) Preferred or its officers, directors, employees or
shareholders. As used herein, the term "disparage" includes, without
limitation, comments or statements to the press, any of Preferred's
employees or any person with whom Preferred has a business relationship
which would adversely affect in any manner the reputation of Preferred
or any of its officers, directors, employees or shareholders.
16. INTELLECTUAL PROPERTY AS SOLE PROPERTY OF THE COMPANY. (a) XxXxxxxxxx
agrees promptly to disclose to PHS any and all intellectual property,
computer software, discoveries, improvements, trade secrets, formulas,
techniques, processes, and know-how, whether or not patentable and
whether or not reduced to practice, conceived or learned by him during
the period of his employment, either alone or jointly with others, which
relate to or result from the actual or anticipated business, work,
research or investigations of NET or PHS, or which result, to any
extent, from use of NET or PHS's premises or property (the work being
hereinafter collectively referred to as the "INTELLECTUAL PROPERTY").
(b) XxXxxxxxxx acknowledges and agrees that all the Intellectual
Property shall be the sole property of PHS, and he hereby assigns to PHS
his entire right of interest in and to all the Intellectual Property.
PHS shall be the sole owner of all domestic and foreign rights
pertaining to the Intellectual Property. XxXxxxxxxx further agrees as
to all the Intellectual Property to assist PHS in every way (at PHS's
expense) to obtain and from time to time enforce patents on the
Intellectual Property in any and all countries. To that end, by way of
illustration but not limitation, XxXxxxxxxx will testify in any suit or
other proceeding involving any of the Intellectual Property, execute all
documents which PHS reasonably determines to be necessary or convenient
for use in applying for and obtaining patents thereon and enforcing
same, and execute all necessary assignments thereof to PHS or persons
designated by it. XxXxxxxxxx'x obligation to assist PHS in obtaining
and enforcing patents for the Intellectual Property shall continue
beyond the termination of his employment, but PHS agrees to compensate
XxXxxxxxxx at a reasonable rate after such termination for the time
actually spent by XxXxxxxxxx at PHS's request on such assistance.
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(c) All inventions, if any, which XxXxxxxxxx made prior to his
employment by NET or PHS, all of which are set forth as Exhibit B
attached hereto, are excluded from the scope of this Agreement.
XxXxxxxxxx represents and warrants that Exhibit B sets forth a complete
list of all Intellectual Property, discoveries, or improvements which
have been made by XxXxxxxxxx prior to his employment with PHS.
17. MISCELLANEOUS
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject
matter hereof and supersedes all prior negotiations,
understandings, agreements, arrangements and understandings, both
oral and written, between the parties hereto with respect to such
subject matter.
(b) AMENDMENT. This Agreement may not be amended or modified in any
respect, except by the mutual written agreement of the parties
hereto.
(c) WAIVERS AND REMEDIES. The waiver by any of the parties hereto of
any other party's prompt and complete performance, or breach or
violation, of any provision of this Agreement shall not operate
nor be construed as a waiver of any subsequent breach or
violation, and the failure by any of the parties hereto to
exercise any right or remedy which it may possess hereunder shall
not operate nor be construed as a bar to the exercise of such
right or remedy by such party upon the occurrence of any
subsequent breach or violation.
(d) DESCRIPTIVE HEADINGS. Descriptive headings contained herein are
for convenience only and shall not control or affect the meaning
or construction of any provision of this Agreement.
(e) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the separate parties hereto in separate
counterparts, each of which shall be deemed to be one and the
same instrument.
(f) NOTICES. All notices, consents, requests, instructions,
approvals and other communications provided for herein and all
legal process in regard hereto shall be in writing and shall be
deemed to have been duly given, when delivered by hand or Federal
Express or (2) days after deposited in the United States mail, by
registered or certified mail, return receipt requested, postage
prepaid, as follows:
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If to PHS, one copy to:
Preferred Healthcare Staffing, Inc.
00000 Xxxxxxxx Xxxxxxxxx, 00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Mr. Xxx Xxxxxx
With a copy to:
Preferred Healthcare Staffing, Inc.
00000 Xxxxxxxx Xxxxxxxxx, 00xx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxx X. Xxxxxxxx, Esq.
If to XxXxxxxxxx, one copy to:
Xx. Xxxxxxx X. XxXxxxxxxx
0000 Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxx 00000
Or to such other address as any party hereto may from time to time
designate in writing delivered in a like manner.
(g) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their
respective personal representatives, heirs, successors and
assigns.
(h) APPLICABLE LAW. This Agreement shall be governed by, and shall
be construed, interpreted and enforced in accordance with, the
laws of the State of Florida without regard to its conflict of
law principles to the extent that such principles would require
the application of laws other than the State of Florida.
(i) CONSENT TO JURISDICTION. Each of the parties hereto irrevocably
consents to the exclusive jurisdiction of the federal and state
courts located in Dade County, Florida in any and all actions
between or among any of the parties hereto, whether arising
hereunder or otherwise.
(j) ATTORNEYS' Fees. If any legal action is brought for the
enforcement of any of the provisions of this Agreement, the
prevailing party shall be entitled to recover upon final
judgement on the merits reasonable attorneys' fees (including
attorneys' fees for any appeal) incurred in bringing such action.
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IN WITNESS WHEREOF, the parties hereto have placed their hands as of the
day and year first above written.
PREFERRED HEALTHCARE STAFFING, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name:
Title:
By: /s/ Xxxxxxx X. XxXxxxxxxx
--------------------------------
Xxxxxxx X. XxXxxxxxxx
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