EXHIBIT 2.2
STOCK SALE AND TERMINATION AGREEMENT
This Stock Sale and Termination Agreement is made and entered
into as of the 28th day of October, 1996, by and between Xxxxx X. Xxxxxxxx
("Seller") and RHO Company, Inc., a Washington corporation (the "Company").
WHEREAS, Seller is the owner of 16,666.66 shares (the
"Shares") of Common Stock of the Company and has been employed as the Vice
President of the Company; and
WHEREAS, the Company has entered into a Subscription Agreement
(the "CTS Agreement") of even date herewith with COMFORCE Technical Services,
Inc. ("CTS"), a Delaware corporation, whereby CTS is to purchase 101,000 shares
of Common Stock of the Company, and
WHEREAS, it was a condition of the execution and delivery of
the CTS Agreement that Xxxxxxxx execute and deliver this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
Section 1. Purchase and Sale of Shares.
(a) Subject to the terms and conditions set forth herein, the
Seller agrees to and will sell, transfer, assign and deliver to the Company at
the Closing (as hereinafter defined), free and clear of all liens, options,
pledges, encumbrances, security interests or other claims, and the Company
agrees to and will purchase and accept from the Seller, the Shares.
(b) The total consideration payable for the Shares shall be
One Million Seven Hundred Thousand Dollars ($1,700,000) payable as follows:
(i) Five Hundred Sixty-Six Thousand Six Hundred
Sixty-Seven Dollars ($566,667) (the "Initial
Payment") has been paid to Seller by the Company on
the date hereof in immediately available funds. Said
payment to Seller is irrevocable and non-refundable.
(ii) The remainder, consisting of One Million One
Hundred Thirty-Three Thousand Three Hundred Thirty
Three Dollars ($1,133,333) (The
"Second Payment") shall be due and payable on the
Closing Date in immediately available funds by wire
transfer in accordance with Seller's written
instructions given to the Company at least two (2)
business days prior to the Closing Date.
Section 2. Closing. The Closing shall take place at the
principal offices of the Company at the date and time of the closing (the "CTS
Closing") of the transactions contemplated by the CTS Agreement or if the
Company, at its option, elects to consummate the transactions contemplated
hereby thereafter and prior to a termination as provided in Section 11, at such
other date and time as is designated by the Company by at least five (5) days'
advance written notice to Seller. Such event is referred to as the "Closing" and
such date and time are referred to as the "Closing Date." If the CTS Agreement
is terminated, either party may terminate this Agreement as provided in
Section 11.
Section 3. Termination of Employment at Closing.
(a) Until the Closing Date or termination of this Agreement
pursuant to Section 11 hereof, Seller shall be considered to be on vacation from
his position with the Company. He shall receive pay during such period as if he
were on vacation until he has fully utilized all of his accrued and unpaid
vacation, at which time he will be deemed to be on paid leave from his
employment with the Company. The Company shall not terminate Seller's employment
during such vacation and paid leave.
(b) Subject to receipt by Seller of all of the payments
described in Section 1 hereof and delivery of the promissory note as described
in subsection (c) below, Seller hereby resigns effective on the Closing Date as
an employee and/or consultant of the Company and from any and all positions,
directorships and offices Seller may have with the Company. The Employment
Agreement (the "Employment Agreement") dated as of January 6, 1996 between the
Seller and the Company and any and all other agreements or arrangements whereby
Seller has been employed by or provided services to the Company shall be
terminated as of the Closing Date. In the event that this Agreement is
terminated for any reason, Seller's employment with the Company shall be
unaffected by this Agreement. In addition, in consideration of Seller's
termination of his employment with the Company, as described in this subsection
(b), the Company releases Seller, effective as of said termination, from any and
all of the terms and conditions of the Employment Agreement relating to
non-competition and/or non-interference. Said release shall not affect Seller's
obligations under Section 6 hereof.
(c) In further consideration for the agreements of Seller set
forth in subsections (b) and (d) of this Section, the Company will deliver to
Seller on the Closing Date a Promissory Note (the "Note") in the form attached
as Exhibit A.
(d) Seller on the one hand, and the Company and J. Xxxxx Xxxx
("Xxxx") on the other hand, hereby release and forever discharge, effective on
the Closing Date, the Company,
2.
Xxxx and the Company's stockholders, directors, officers, employees, agents,
representatives, successors and assigns (the "Related Persons") on the one hand,
and Seller on the other hand, from any and all obligations arising from all
agreements with respect to Seller's employment with the Company or Seller's
provision of services to the Company, whether written or oral, including but not
limited to, the Employment Agreement. Seller on the one hand, and the Company
and Xxxx on the other hand, hereby release and forever discharge, effective on
the Closing Date, any claim Seller on the one hand, and the Company and Xxxx on
the other hand, may now have, or may hereafter have, in connection with Seller's
employment or the termination of his employment with the Company. Seller on the
one hand, and the Company and Xxxx on the other hand, hereby confirm and agree
that it is Seller's intention on the one hand, and the Company's and Xxxx'x on
the other hand, by this release to release, effective on the Closing Date, the
Company, Xxxx and the Related Persons on the one hand, and Seller on the other
hand, from any and all claims, demands, damages, actions, suits of any and every
nature, known or unknown, relating to Seller's employment with or provision of
services to the Company to the date of this release, including, but not limited
to, claims arising under federal or state statutes or common law, for breach of
contract or for incentive compensation, bonuses, vacation or severance pay.
Notwithstanding the foregoing, this release shall not release any party from its
obligations under this Agreement or the Note.
(e) If either party terminates this Agreement pursuant to
Section 11 hereof, all the provisions of this Section shall thereafter be of no
further force or effect.
(f) Until the Closing Date, nothing in this Section shall be
deemed to release or waive, or to constitute an admission with respect to, any
rights of Seller against or with respect to the Company or Xxxx on the one hand,
or any rights of the Company and Xxxx against or with respect to Seller on the
other hand, or the Employment Agreement or the Stock Redemption Agreement, as
defined below.
Section 4. Escrow of Shares.
(a) On the date hereof, Seller has deposited the stock
certificate evidencing the Shares and a stock power endorsed by Seller in blank
with Lillick & Xxxxxxx LLP (the "Escrow Agent") to be held in accordance with an
escrow agreement in the form attached hereto as Exhibit B (the "Escrow
---------
Agreement") among the Seller, the Company and the Escrow Agent.
(b) Seller shall retain all voting rights and rights to cash
dividends and distributions with respect to the Shares and all rights and
interests of any kind and nature whatsoever in the Stock Redemption Agreement,
as defined below, and in any other agreement relating to the Shares until the
Closing and until the Note and all payments payable pursuant to Section 1 have
been received by Seller.
3.
(c) On the Closing Date, upon tender of the Second Payment and
the Note by the Company to the Seller, Seller shall join with the Company in
giving the Escrow Agent written instructions to release the Certificate and
Stock Power to the Company.
Section 5. Stock Redemption Agreement; Consent to CTS
Agreement. The terms of the Stock Redemption and Purchase Agreement (the "Stock
Redemption Agreement") dated as of February 6, 1991 among Seller, the Company
and Xxxx are hereby waived to the extent they in any way conflict with or
prohibit any action taken or transaction consummated or to be consummated
hereunder. Subject to the receipt by Seller of all payments described in Section
1 hereof and delivery of the Note, Seller shall have no further obligation or
right under the Stock Redemption Agreement. Seller consents to the execution and
delivery by Xxxx and the Company of the CTS Agreement.
Section 6. Covenants of Seller.
(a) The Seller will not for a period of three (3) years from
the date of this Agreement either directly or indirectly on his own account, or
as agent, stockholder, owner, employer, employee, or otherwise, solicit any
business from any party: (i) that is a client of the Company on the date hereof
or on the Closing Date, or (ii) that is a potential client of the Company that
Seller may have contacted or been assigned to at any time during his period of
employment with the Company other than prior to the Closing Date on behalf of
the Company.
(b) The Seller agrees that he shall not for a period of three
(3) years after the date hereof, either directly or indirectly for his own
individual purposes or those of another, contact or communicate with any
employee of the Company without regard to his/her location, for the purpose of
attempting to or actually soliciting or hiring that employee on Seller's own
account or on the account of another.
Section 7. Seller's Representation and Warranty. The Seller
represents and warrants to the Company that, except for certain restrictions on
the sale of the Shares under that certain Stock Redemption Agreement, which,
subject to the conditions described in Section 5 hereof, have been effectively
waived and released, he is the owner, free and clear of any liens, options,
pledges, encumbrances, security interests or other claims (collectively,
"Liens"), of all of the Shares and that, upon release of the Certificate and
Stock Power to the Company, the Company shall receive good title to the Shares,
free of any and all Liens.
Section 8. Company's Representation and Warranty. All
necessary action has been taken to authorize execution and delivery hereof by
the Company and its consummation of the transactions contemplated hereby and the
execution, delivery and performance of this Agreement are not in violation of
the Company's governing documents or any other document to which it is a party
or bound, nor do they require the consent or approval of any party that has not
been obtained.
4.
Section 9. Conditions to Seller's Obligation to Close. The
obligation of the Seller to sell the Shares shall be subject to the fulfillment
at or prior to the Closing Date of each of the following conditions:
(a) The representations and warranties of the Company
contained in this Agreement shall have been true and correct at and as of the
date hereof, and they shall be true and correct at and as of the Closing Date
with the same force and effect as though made at and as of that time.
(b) There shall not have been issued an effective order of any
court or other governmental body which shall restrain, prohibit or invalidate
the sale of the Shares to the Company.
(c) The Company shall have tendered all payments to Seller as
described in Section 1 hereof and shall have delivered the Note to Seller.
(d) Any personal guaranties of the Seller relating to
indebtedness of the Company shall have been released by the beneficiaries
thereof, in such documented form as is reasonably acceptable to Seller, or the
obligations of the Company supported by the guaranties shall have been paid in
full.
Section 10. Conditions to Company's Obligation to Close. The
obligation of the Company to purchase the Shares shall be subject to the
fulfillment at or prior to the Closing Date of each of the following conditions:
(a) The representations and warranties of the Seller contained
in this Agreement shall be true and correct at and as of the Closing Date with
the same force and effect as though made at and as of that time.
(b) There shall not have been issued an effective order of any
court or other governmental body which shall restrain, prohibit or invalidate
the sale of the Shares to the Company.
(c) The CTS Closing shall have occurred.
Section 11. Termination. In the event the Closing Date does
not occur on the earlier of (a) the CTS Closing Date or, if the CTS Agreement is
terminated, on the date sixty (60) days after the date of such termination or
(b) April 30, 1997, Seller or the Company may, by written notice to the other
party hereto, terminate this Agreement and, at such time the Company shall join
with Seller in giving instructions to the Escrow Agent to release all of the
Shares to Seller. In such case Seller shall be entitled to retain the Initial
Payment and this Agreement shall be terminated and be null and void for all
purposes and the Company and Seller shall have no further obligations hereunder,
except for any monetary damage claim either one of them may have
5.
against the other as a result of the breach of this Agreement or a material
misrepresentation in this Agreement, it being understood that the irrevocable
and non-refundable nature of the Initial Payment shall in no way limit any such
claim.
Section 12. Release of the Company and CTS. CTS and the
Company and their respective affiliates hereby release and forever discharge,
effective on the Closing Date, Seller and his heirs, successors and assigns from
any and all obligations or claims any of them may now have, or may hereafter
have, in connection with the CTS Agreement and the transactions contemplated
thereby.
Section 13. Distribution of Profits.
(a) On or before the Closing Date, the Company shall
distribute and pay in readily available funds to the Seller a distribution of
his share of the reasonably estimated profits of the Company anticipated to be
reported or actually reported to Seller on his IRS Form K-1 from the Company for
1996. In the event there is a dispute between Seller and the Company regarding
the amount payable to Seller under this Section that cannot be resolved on or
before the date the transactions contemplated by the CTS Agreement are otherwise
ready to close, said dispute shall not delay the Closing, it being understood
that said dispute shall be resolved after the Closing as described herein and
that, provided that the CTS Closing has occurred, COMFORCE Corporation has
guaranteed payment of any and all amounts payable to Seller under this Section.
(b) If there is a dispute as to the distribution required to
be made hereunder to Seller, the Company shall cause Coopers & Xxxxxxx,
COMFORCE's independent accountants, Xxxxxx Xxxxxxxx & Co, which has been the
Company's independent accountants, or another "Big 6" firm of independent
accountants to determine the amount payable to Seller hereunder. Said
determination, which shall be made in writing and delivered to Seller promptly
after it is received by the Company together with any amount payable under this
Section, shall be conclusive and binding on the parties.
Section 14. Notices. Notices, requests, instructions, demands
and other communications hereunder shall be in writing and shall be deemed to
have been given when delivered personally by first class registered or certified
mail, recognized overnight delivery service, charges prepaid, or confirmed fax,
as follows:
(a) If to Seller, to:
Xxxxx X. Xxxxxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Fax No.:714/000-0000
6.
and to:
Xxxxxx X. Xxxxxx
Lillick & Xxxxxxx LLP
Xxx Xxxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Fax No.: (000) 000-0000
(b) If to the Company, to:
RHO Company, Inc.
0000-000xx Xxxxxx X.X.
Xxxxxxx, XX 00000
ATTENTION: ______________________
Fax No. ___________________________
with copies to:
Miller, Nash, Wiener, Hager & Xxxxxxx
0000 Xxx Xxxxx Xxxxxx
000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
FAX No.: (000) 000-0000
and to:
COMFORCE Corporation
0000 Xxxxxx Xxxxxx
Xxxx Xxxxxxx, XX 00000
FAX No.:
and to:
Xxxxx X. Xxxxxx
Doepken Keevican & Xxxxx
Professional Corporation
37th Floor, USX Tower
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Fax No.: (000) 000-0000
7.
or to such other address as any party shall have specified by
written notice to the other parties hereto.
Section 15. Amendment and Modification. The parties hereto may
amend, modify and supplement this Agreement in such manner as may be agreed upon
by them and COMFORCE in writing.
Section 16. Binding Effect No Assignment. The Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors, assignees, heirs and legal representatives. Seller shall
not be entitled to assign his rights hereunder except with the Company's prior
written consent.
Section 17. Entire Agreement. This instrument contains the
entire agreement of the parties hereto with respect to the purchase of the
Shares and the other transactions contemplated herein, and supersedes all prior
understandings and agreements of the parties with respect to the subject matter
hereof.
Section 18. Headings. The descriptive headings in this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
Section 19. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original.
Section 20. Governing Law. This Agreement shall be governed by
and interpreted in accordance with the laws of the State of Washington
applicable to contracts made and to be performed therein, without regard to the
conflicts of law principles thereof.
Section 21. Specific Performance. The parties hereto
acknowledge and agree that the failure of either the Company or the Seller to
fulfill their respective covenants and agreements hereunder will cause
irreparable injury to the other party for which damages, even if available, will
not be an adequate remedy. Accordingly, each party hereto does hereby consent to
the issuance of injunctive relief by any court of competent jurisdiction to
compel performance of its obligations and to the granting by any such court of
the remedy of specific performance by it of its obligations hereunder.
Section 22. Attorney's Fees. In any action at law or suit in
equity in relation to this Agreement, the prevailing party in such action or
suit shall be entitled to receive a reasonable sum for attorney's fees and all
other reasonable costs and expenses incurred in such action or suit.
8.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
/s/ Xxxxx X. Xxxxxxxx
---------------------------------
Xxxxx X. Xxxxxxxx
RHO COMPANY, INC.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
/s/ Xxxxx X. Xxxxxxxx
----------------------------
Xxxxx X. Xxxxxxxx
RHO COMPANY, INC.
By: /s/ X.X. Xxxx
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Name: X.X. Xxxx
----------------------------
Title: President
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J. Xxxxx Xxxx hereby executes this document solely to consent
and to agree to Section 5 hereof and the release contained in
Section 3(d) hereof.
/s/ X.X. Xxxx
---------------------------------
J. Xxxxx Xxxx
COMFORCE Corporation, a Delaware corporation, hereby executes
this Agreement solely to agree to the terms of Section 13(b),
which terms shall be of no force or effect with respect to
COMFORCE Corporation unless and until the CTS Closing occurs.
COMFORCE CORPORATION
By: /s/ Xxxxxxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxxxxxx X. Xxxxxx
----------------------------
Title: Executive Vice President
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