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EXHIBIT 10.3
EXECUTIVE AGREEMENT
THIS EXECUTIVE AGREEMENT (this "Agreement") entered into as of
______________________, 19____, by and between STAFF LEASING, INC. (the
"Company"), a corporation organized under the laws of the State of Florida, and
____________ (the "Executive").
W I T N E S S E T H
WHEREAS, the Company has recognized the important contributions made by
the Executive to the Company in the past and, to assure that the Company will
continue to have the Executive's services available to the Company, desires to
provide the Executive with monetary benefits upon certain contingencies;
NOW, THEREFORE, in consideration of the foregoing, the continued
employment of the Executive and for other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged, the parties hereto
hereby agree as follows:
1. DEFINITIONS
(a) "Affiliate" shall mean a person that directly or indirectly,
through one or more intermediaries, controls, or is controlled by, or is under
common control with, a specified person.
(b) "Associate" shall mean (1) any corporation, partnership or other
organization of which a specified person is an officer or partner, or is,
directly or indirectly, the beneficial owner of ten percent (10%) or more of any
class of equity securities thereof, (2) any trust or other estate in which the
specified person has a substantial beneficial interest or as to which the
specified person serves as trustee or in a similar fiduciary capacity, (3) any
relative or spouse of such specified person, or any relative of such spouse, who
has the same home as such specified person and (4) any person who is a trustee,
officer or partner of such specified person or of any corporation, partnership
or other entity which is an Affiliate of such specified person.
(c) "Beneficial Owner" shall be defined by reference to Rule 13d-3
under Securities Exchange Act of 1934, as amended (the "Exchange Act"), as such
Rule is in effect on the date hereof; provided, however, that any individual,
corporation, partnership, Group (as hereinafter defined), association or other
person or entity which, directly or indirectly, owns or has the right to acquire
any of the Company's outstanding securities entitled to vote generally in the
election of directors at any time in the future, whether such right is
contingent, absolute, direct or indirect, pursuant to any agreement, arrangement
or understanding or upon exercise of conversion rights, warrants or options, or
otherwise, shall be deemed the Beneficial Owner of such securities.
(d) "Board" shall mean the Board of Directors of the Company.
(e) "Cause" shall mean conduct of the Executive amounting to fraud,
dishonesty, conviction of a felony, gross negligence or willful misconduct.
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(f) "Change of Control" of the Company shall be deemed to have occurred
if and when, (1) any individual, corporation, partnership, Group, association or
other person or entity, together with his, its or their Affiliates or Associates
(other than a trustee or other fiduciary holding securities under an employee
benefit plan of the Company) is or becomes the Beneficial Owner of securities of
the Company representing twenty-five percent (25%) or more of the combined
voting power of the Company's then outstanding securities entitled to vote
generally in the election of directors or (2) the Continuing Directors (as
hereinafter defined) shall at any time fail to constitute a majority of the
members of the Board; provided, however, that the provisions of the foregoing
clause (1) shall not apply to the acquisition of securities by any person who,
as of ___________, 1997, together with his or its affiliates, is the Beneficial
Owner of more than [INSERT NUMBER WHICH IS 20% OF OUTSTANDING SHARES OF COMMON
STOCK] shares of Common Stock, $.01 par value per share.
(g) "Continuing Directors" shall mean the directors who either are
members of the Board on the date hereof, or who become members of the Board
subsequent to such date and whose election, or nomination for election by the
Company's shareholders, was Duly Approved by the Continuing Directors at the
time of such nomination or election, either by a specific vote or by approval of
the proxy statement issued by the Company on behalf of the Board in which such
person is named as nominee for director, without due objection to such
nomination.
(h) "Duly Approved by the Continuing Directors" shall mean an action
approved by the vote of at least a majority of the Continuing Directors then on
the Board, except, if the votes of such Continuing Directors in favor of such
action would be insufficient to constitute an act of the Board if a vote by all
of its members were to have been taken, then such term shall mean an action
approved by the unanimous vote of the Continuing Directors then on the Board so
long as there are at least three Continuing Directors on the Board at the time
of such unanimous vote.
(i) "Group" shall mean persons who act in concert as described in
Section 13(d)(3) of the Exchange Act as in effect on the date hereof.
(j) "Trust" shall mean the Trust specifically established for purposes
of receipt and payment of the payment provided for in Section 2(c) hereof.
2. EXECUTIVE'S RIGHTS UPON CHANGE OF CONTROL
(a) This Agreement shall be effective immediately upon execution of
this Agreement by the parties hereto and shall remain in effect so long as the
Executive remains employed by the Company and thereafter until all payments to
which the Executive is entitled under this Agreement have been made.
(b) If a Change of Control occurs while the Executive is employed by
the Company and if, within eighteen (18) months after the date of a Change of
Control, the Executive's employment is terminated involuntarily, or voluntarily
by the Executive based on material changes in the nature or scope of the
Executive's duties or employment or a reduction of compensation of the Executive
made without the Executive's consent, the Executive may, in his sole discretion,
give written notice within thirty (30) days after the date of termination of
employment to the Secretary of the Company
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that he intends to exercise his rights hereunder and to receive the payments
provided for hereunder (the "Notice of Exercise").
(c) If the Executive gives a Notice of Exercise to receive the payments
provided for hereunder, the Company shall pay to the Trust for the benefit of
the Executive, a single cash payment (the "Executive Payment") in an amount
which, if paid to the Executive in [EIGHTEEN (18) OR] consecutive equal monthly
installments commencing on the date set forth in Section 2(i) hereof, will have
a present value equal to the amount by which 299% of the Executive's "base
amount" (as defined by Section 280G of the Internal Revenue Code of 1986, as
amended (the "Code")) exceeds the aggregate present value of all other parachute
payments (as defined by Section 280G of the Code) received by the Executive.
"Present value" shall be determined in accordance with Section 280G(d)(4) of the
Code.
(d) Within thirty (30) days after the date of giving of the Notice of
Exercise by the Executive, the Company shall provide written notice to the
Executive setting forth the Company's computation of the amount that would be
payable pursuant to the Executive's election hereunder, accompanied by the
written opinion of the Company's independent certified public accountants
confirming the Company's computation. If the Executive takes exception to the
Company's computation of such amount, the Executive shall have forty-five (45)
days from the date of the giving of the Notice of Exercise to give a further
written notice to the Company (the "Notice of Exception") setting forth in
reasonable detail the Executive's exceptions to the Company's computation,
accompanied by the written opinion of the Executive's tax advisor confirming the
basis for such exceptions.
(e) Forty-five (45) days after the date of giving of the Notice of
Exercise by the Executive, the Company shall make the payment provided for in
Section 2(c) hereof unless the Executive has given a Notice of Exception to the
Secretary of the Company, in which event, the Company and the Executive shall
submit their respective computations and tax opinions to a third tax advisor,
mutually agreeable to each, whose determination of the matter shall be final and
binding on the Company and the Executive. After such final determination, the
Company shall have five (5) business days to make the payment provided for in
Section 2(c).
(f) The Company shall, within the time periods described in Section
2(e), deliver to the Trust for the benefit of the Executive, its certified or
cashier's check in the amount payable pursuant to Section 2(c) and payment of
such Executive Payment shall not terminate the Executive's rights to receive any
and all other payments, rights or benefits arising pursuant to this Agreement or
from any other agreement, plan or policy which by its terms or by operation of
law provides for the continuation of such payments, rights or benefits after the
termination of the Executive's relationship with the Company.
(g) The Executive Payment shall be in addition to and shall not be
offset or reduced by (1) any other amounts that have accrued or have otherwise
become payable to the Executive or his beneficiaries, but not have been paid by
the Company at the time the Executive gives the Notice of Exercise including,
but not limited to, salary, severance pay, consulting fees, disability benefits,
termination benefits, retirement benefits, life and health insurance benefits or
any other compensation or benefit payment that is part of any valid previous,
current or future contract, plan or agreement,
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written or oral, and (2) any indemnification payments that may have accrued but
not paid or that may thereafter become payable to the Executive pursuant to the
provisions of the Company's Certificate of Incorporation, By-laws or similar
policy, plan or agreement relating to the indemnification of directors and
officers of the Company under certain circumstances.
(h) The Executive Payment, when paid into the Trust is intended to be
tax-deferred until actual receipt of such monies by the Executive. All cost of
establishing the Trust, including but not limited to legal fees and trustee
fees, shall be the responsibility of and paid by the Company.
(i) The trustee of the Trust shall hold such monies constituting the
Executive Payment and pay installments thereof to the Executive as required
hereunder pursuant to the terms of the trust agreement governing the Trust.
Beginning on the first day of the first full month after the payment of the
Executive Payment to the Trust and for each month thereafter that the Executive
remains unemployed, the trustee of the Trust will pay, in cash, to the
Executive, at the address set forth for the Executive at the end of this
Agreement, a portion of the Executive Payment equal to one-thirtysixth (1/36) of
the total Executive Payment, so that the Executive shall receive equal monthly
installments of the Executive Payment on the first day of each month of the
period he remains so unemployed.
(j) In the event that the Executive shall accept employment with a
person, firm or corporation other than the Company (including becoming
self-employed), following the exercise by the Executive of his right to receive
the Executive Payment, the Executive shall, within five (5) business days of his
acceptance of such new employment, notify the Company and the trustee of the
Trust of such re-employment and the amount of compensation to be paid in
connection therewith. From and after the date that compensation begins to accrue
to the Executive in connection with such new employment, if the Executive's new
monthly compensation is less than the amount of the installment of the Executive
Payment that would otherwise be due and payable, the Executive shall be entitled
to a partial payment of such installment of Executive Payment in an amount equal
to the difference between said installment of Executive Payment and the new
monthly compensation (the "Compensation Differential"). In the event the
Executive's new monthly compensation shall exceed the amount of the installment
of Executive Payment due and payable, the difference shall be carried over by
the Trustee and deducted from any Compensation Differential to be paid in any
subsequent month. The Executive shall deliver to the trustee within fifteen (15)
days after the first of each month during the term of this Agreement
certification, in the form attached hereto, as to the amount of new monthly
compensation received or to which the Executive is entitled for the preceding
month. In the event such certification shows a Compensation Differential, within
five (5) business days of receipt of such certification, the trustee of the
Trust will make the partial payment of the installment of Executive Payment
(adjusted as herein provided) to the Executive. The trustee shall return and pay
to the Company any portion of an Executive Payment installment for each month
not paid to the Executive as provided for herein.
In the event that during the term of this Agreement the Executive dies,
the Executive's legal representative shall be entitled to receive the entire
Executive Payment provided for hereunder in the manner and as if the Executive
had not died.
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3. EXECUTIVE'S EXPENSES
All costs and expenses (including reasonable legal, accounting and
other advisory fees) incurred by the Executive to (a) defend the validity of
this Agreement, (b) contest any determinations by the Company concerning the
amounts payable by the Company to the Executive under this Agreement, (c)
determine in any tax year of the Executive the tax consequences to the Executive
of any amounts payable (or reimbursable) hereunder or (d) prepare responses to
an Internal Revenue Service audit of, and otherwise defend, his personal income
tax return for any year which is the subject of any such audit or an adverse
determination, administrative proceeding or civil litigation arising therefrom
that is occasioned by or related to an audit by the Internal Revenue Service of
the Company's income tax returns are, upon written demand by the Executive, to
be promptly advanced or reimbursed to the Executive or paid directly, on a
current basis, by the Company or its successors.
If at any time during the term of this Agreement or afterwards there
should arise any dispute as to the validity, interpretation or application of
any term or condition of this Agreement, the Company agrees, upon written demand
by the Executive (and the Executive shall be entitled, upon application to any
court of competent jurisdiction, to the entry of a mandatory injunction, without
the necessity of posting any bond with respect thereto, compelling the Company)
promptly to provide sums sufficient to pay on a current basis (either directly
or by reimbursing the Executive) the Executive's costs and reasonable attorneys'
fees (including expenses of investigation and disbursements for the fees and
expenses of experts, etc.) incurred by the Executive in connection with any such
dispute or any litigation, regardless of whether the Executive is the prevailing
party in such dispute or litigation; provided, that, the court in which such
litigation is first initiated determines, with respect to this obligation, upon
application of either party hereto, that the Executive did not initiate such
litigation frivolously. Under no circumstances shall the Executive be obligated
to pay or reimburse the Company for any attorneys' fees, costs or expenses
incurred by the Company. The provisions of this subsection shall survive the
expiration or termination of this Agreement.
4. TAX INDEMNITY
Should any of the payments or reimbursements that are provided for
hereunder to be paid to or for the benefit of the Executive or payments or
benefits under any other plan, agreement or arrangement between the Executive
and the Company, be determined or alleged to be subject to an excise or similar
purpose tax pursuant to Code Section 4999 or any successor other comparable
federal, state or local tax laws, the Company shall pay to the Executive such
additional compensation as is necessary (after taking into account all federal,
state and local income taxes payable by the Executive as a result of the receipt
of such additional compensation) to place the Executive in the same after-tax
position (including federal, state and local taxes) he would have been in had no
such excise or similar purpose tax (or any interest or penalties thereon) been
paid or incurred by the Executive.
If the Executive intends to make any payments with respect to any such
excise or similar purpose tax as a result of an adjustment to the Executive's
tax liability by any federal, state or local
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tax authority, the Company will pay such additional compensation by delivering
its certified or cashier's check payable in such amount to the Executive within
fifteen (15) business days after the Executive notifies the Company of his
intention to make such payment. Without limiting the obligation of the Company
hereunder, the Executive agrees, in the event the Executive makes any payment
pursuant to the preceding sentence, to negotiate with the Company in good faith
with respect to procedures reasonably requested by the Company which would
afford the Company the ability to contest the imposition of such excise tax;
provided, however, that the Executive will not be required to afford the Company
any right to contest the applicability of any such excise tax to the extent that
the Executive reasonably determines (based upon the opinion of his tax counsel)
that such contest is inconsistent with the overall tax interests of the
Executive.
In the event that the Executive intends to file a tax return which
takes the position that such excise or similar purpose tax is due and payable,
in reliance upon a written opinion of the Executive's tax counsel that it is
more likely than not that such excise tax is due and payable, the Executive
shall, at least forty-five (45) days in advance of the due date (including
extensions) of filing of his tax return, notify and submit to the Company his
computations and tax counsel's opinion to such effect. The Company shall have
thirty (30) days from its receipt of such notice to examine, along with its tax
advisors, the computations and advise the Executive of its recommendation
(evidenced by the written opinion of its tax advisors) as to the merits of such
a position. The Executive hereby agrees to then file his tax return on the basis
of such recommendation. No payment shall be made by the Company pursuant to the
indemnification provided for herein unless and until, in the case of the
non-audited return circumstance discussed in the immediately preceding two
sentences, the notice and computations provided for therein have been timely
delivered to the Company.
5. GENERAL PROVISIONS
(a) Severability. In case any one or more of the provisions of this
Agreement shall, for any reason, be held or found by final judgment of a court
of competent jurisdiction to be invalid, illegal or unenforceable in any respect
(1) such invalidity, illegality or unenforceability shall not affect any other
provisions of this Agreement, (2) this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein, and
(3) if the effect of a holding or finding that any such provision is either
invalid, illegal or unenforceable is to modify to the Executive's detriment,
reduce or eliminate any compensation, reimbursement, payment, allowance or other
benefit to the Executive intended by the Company and Executive in entering into
this Agreement, the Company shall promptly negotiate and enter into an agreement
with the Executive containing alternative provisions (reasonably acceptable to
the Executive), that will restore to the Executive (to the extent legally
permissible) substantially the same economic, substantive and income tax
benefits the Executive would have enjoyed had any such provision of this
Agreement been upheld as legal, valid and enforceable. Failure to insist upon
strict compliance with any provision of this Agreement shall not be deemed a
waiver of such provision or of any other provision of this Agreement.
(b) Entire Agreement. The Executive acknowledges receipt of a copy of
this Agreement (together with any attachments hereto), which has been executed
in duplicate and agrees that, with
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respect to the subject matter hereof, this is the entire agreement with the
Company. Any other oral or any written representations, understandings or
agreements with the Company or any of its officers or representatives covering
the same subject matter which are in conflict with this Agreement hereby are
merged into and superseded by the provisions of this Agreement.
(c) No Set-off. The Company shall have no right of set-off or
counterclaim in respect of any debt or other obligation of the Executive to the
Company against any payment or other obligation of the Company to the Executive
provided for in this Agreement.
(d) Modification and Waiver. No provision of this Agreement may be
amended, modified or waived unless such amendment, modification or waiver shall
be agreed to in writing and signed by the Executive and by a person duly
authorized by the Board.
(e) No Assignment of Compensation. No right to or interest in any
compensation or reimbursement payable hereunder shall be assignable or divisible
by the Executive; provided, however, that this provision shall not preclude the
Executive from designating one or more beneficiaries to receive any amount that
may be payable after his death and shall not preclude his executor or
administrator from assigning any right hereunder to the person or persons
entitled thereto.
(f) No Attachment. Except as required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation,
alienation, sale, assignment, encumbrances, charge, pledge or hypothecation, or
to execution, attachment, levy or similar process or assignment by operation of
law, and any attempt, voluntary or involuntary, to affect any such action shall
be null, void and of no effect.
(g) Headings. The headings of Sections and subsections hereof are
included solely for convenience of reference and shall not control the meaning
or interpretation of any of the provisions of this Agreement.
(h) Governing Law. This Agreement shall be construed in accordance with
and governed for all purposes by the laws of the State of Florida.
(i) No Assignment of Agreement. This Agreement may not be assigned,
partitioned, subdivided, pledged, or hypothecated in whole or in part without
the express prior written consent of the Executive and the Company. This
Agreement shall not be terminated either by the voluntary or involuntary
dissolution or the winding up of the affairs of the Company, or by any merger or
consolidation wherein the Company is not the surviving entity, or by any
transfer of all or substantially all of the Company's assets on a consolidated
basis. In the event of any such merger, consolidation or transfer of assets, the
provisions of this Agreement shall be binding upon the surviving entity or to
the entity to which such assets shall be transferred.
(j) Interest on Amounts Payable. If any amounts which are required or
determined to be paid or payable or reimbursed or reimbursable to the Executive
under this Agreement (or after a Change of Control, under any other plan,
agreement, policy or arrangement with the Company) are not so paid promptly at
the times provided hereon or therein, such amounts shall accrue interest
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at an annual percentage rate of ten percent (10%) from the date such amounts
were required or determined to have been paid or payable or reimbursed or
reimbursable to the Executive until such amounts and any interest accrued
thereon are finally and fully paid; provided, however, that in no event shall
the amount of interest contracted for, charged or received hereunder exceed the
maximum non-usurious amount of interest allowed by applicable law.
(k) Notices. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
delivered in person, by telecopy or when deposited in the U.S. mail, postage
prepaid, to the respective addresses set forth on the signature pages of this
Agreement, unless a party changes his or its address for receiving notices by
giving notice in accordance with this subsection, in which case, to the address
specified in such notice.
(l) Federal Income Tax Withholding. The Company may withhold from any
benefits payable under this Agreement all federal, state, city or other taxes as
shall be required pursuant to any law or governmental regulation or ruling.
IN WITNESS WHEREOF, the parties have executed and delivered this
Executive Agreement as of the day and year indicated above.
STAFF LEASING, INC.
600 000 Xxxxxxxxx Xxxx
Xxxxx 000
Xxxxxxxxx, Xxxxxxx 00000
By:
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Name:
---------------------------------
Title:
--------------------------------
(SEAL)
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(Executive's Signature)
Executive's Address:
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CERTIFICATION
The undersigned hereby certifies, pursuant to Section 2(j) of the
Executive Agreement between STAFF LEASING, INC. and the undersigned dated as of
_______________, 19___ (the "Executive Agreement"), that he is entitled to
receive $___________ as new employment compensation for the period beginning
_________________, 19___ [AND THAT BECAUSE SAID AMOUNT IS LESS THAN THE
INSTALLMENT OF EXECUTIVE PAYMENT DUE THE UNDERSIGNED UNDER THE EXECUTIVE
AGREEMENT FOR THE SAME PERIOD, THE UNDERSIGNED IS ENTITLED TO RECEIVE THE
COMPENSATION DIFFERENTIAL AS PROVIDED IN THE EXECUTIVE AGREEMENT]. [ADD
BRACKETED LANGUAGE AS APPROPRIATE.]
Dated: _______________________, 19____.
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Executive
