Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34 Filing Table of Contents
Document/ExhibitDescriptionPagesSize
1: 10-K Annual Report HTML 995K
2: EX-10.15 Amended and Restated 2012 Employment Inducement HTML 165K
Incentive Award Plan
3: EX-10.29 Employment Agreement Between Theodore S. Hanson HTML 75K
and Apex Systems, Inc.
4: EX-10.30 Amendment No. 1 to the Employment Agreement HTML 38K
Between Theodore S. Hanson and Apex
5: EX-10.31 Amendment No. 2 to the Employment Agreement HTML 35K
Between Theodore S. Hanson and Apex
6: EX-10.32 Amendment No. 3 to the Employment Agreement HTML 83K
Between on Assignment, Inc., Theodor
7: EX-10.33 Amendment No. 4 to the Employment Agreement HTML 36K
Between on Assignment, Inc., Theodor
8: EX-10.35 Employment Agreement Between Rand Blazer and Apex HTML 77K
Systems, Inc., Dated January 8
9: EX-10.36 Amendment No. 1 to the Employment Agreement HTML 36K
Between Rand Blazer and Apex Systems
10: EX-10.37 Amendment No. 2 to the Employment Agreement HTML 34K
Between Rand Blazer and Apex Systems
11: EX-10.38 Amendment No. 3 to the Employment Agreement by and HTML 82K Between Rand Blazer, on Assig
12: EX-10.39 Amendment No. 4 to the Employment Agreement by and HTML 36K
Between Rand Blazer, on Assig
13: EX-10.41 Indemnification Agreement by and Between on HTML 105K
Assignment, Inc. and Rand Blazer, Da
14: EX-10.44 Indemnification Agreement by and Between on HTML 105K
Assignment, Inc. and Theodore S. Han
15: EX-10.45 Indemnification Agreement by and Between on HTML 105K
Assignment, Inc. and Edwin A. Sherid
16: EX-10.46 Indemnification Agreement by and Between on HTML 105K
Assignment, Inc. and Brian J. Callag
17: EX-10.47 Indemnification Agreement by and Between on HTML 110K
Assignment, Inc. and Jeffrey E. Veat
19: EX-21.1 Subsidiaries of the Registrant HTML 30K
20: EX-23.1 Consent of Independent Registered Public HTML 32K
Accounting Firm
18: EX-18 Preferability Letter of Independent Registered HTML 32K
Public Accounting Firm
21: EX-31.1 Certification of Peter T. Dameris, Chief Executive HTML 36K
Officer and President Pursuan
22: EX-31.2 Certification of Edward L. Pierce, Executive Vice HTML 37K
President and Chief Financial
23: EX-32.1 Certification of Peter T. Dameris, Chief Executive HTML 34K
Officer and President, and Ed
78: R1 Document and Entity Information HTML 60K
64: R2 Condensed Consolidated Balance Sheets HTML 154K
75: R3 Condensed Consolidated Balance Sheets HTML 60K
(Parenthetical)
80: R4 Condensed Consolidated Statements of Operations HTML 123K
and Comprehensive Income
99: R5 Condensed Consolidated Statements of Operations HTML 35K
and Comprehensive Income (Parenthetical)
66: R6 Consolidated Statements of Stockholders' Equity HTML 122K
74: R7 Condensed Consolidated Statements of Cash Flows HTML 195K
59: R8 Summary of Significant Accounting Policies HTML 63K
49: R9 Accounting Standards Updates HTML 46K
100: R10 Property and Equipment HTML 53K
82: R11 Acquisitions HTML 134K
81: R12 Long-Term Debt HTML 61K
87: R13 Goodwill and Identifiable Assets HTML 171K
88: R14 401(k) Retirement Savings Plan, Deferred HTML 51K
Compensation Plan and Change in Control Severance
Plan
85: R15 Commitments and Contingencies HTML 71K
89: R16 Income Taxes HTML 159K
76: R17 Earnings per share HTML 51K
79: R18 Stock-based Compensation: Incentive Award Plan and HTML 178K
Employee Stock Purchase Plan
84: R19 Business Segments HTML 159K
107: R20 Derivative Instruments HTML 75K
95: R21 Fair Value Measurements HTML 92K
70: R22 Subsequent Events HTML 33K
83: R23 Unaudited Quarterly Financial Results HTML 88K
72: R24 Schedule II - Valuation and Qualifying Accounts HTML 66K
40: R25 Summary of Significant Accounting Policies HTML 157K
(Policies)
96: R26 Property and Equipment (Tables) HTML 49K
103: R27 Acquisitions (Tables) HTML 113K
54: R28 Long-Term Debt (Tables) HTML 49K
53: R29 Goodwill and Identifiable Assets (Tables) HTML 167K
57: R30 Commitments and Contingencies (Tables) HTML 57K
58: R31 Income Taxes (Tables) HTML 156K
60: R32 Earnings per share (Tables) HTML 51K
36: R33 Stock-based Compensation: Incentive Award Plan and HTML 131K
Employee Stock Purchase Plan Stock-based
Compensation: Incentive Award Plan and Employee
Stock Purchase Plan (Tables)
93: R34 Business Segments (Tables) HTML 159K
68: R35 Derivative Instruments (Tables) HTML 64K
71: R36 Fair Value Measurements (Tables) HTML 82K
44: R37 Unaudited Quarterly Financial Results (Tables) HTML 82K
106: R38 Summary of Significant Accounting Policies HTML 58K
(Details)
30: R39 Property and Equipment (Details) HTML 47K
61: R40 Property and Equipment (Narratives) (Details) HTML 39K
98: R41 Acquisitions (Schedule of Purchase Price HTML 62K
Allocation) (Details)
42: R42 Acquisitions (Schedule of Intangible Assets HTML 49K
Acquired as Part of Business Combination)
(Details)
52: R43 Acquisitions (Acquisitions Costs, by Acquisition) HTML 88K
(Details)
56: R44 Acquisitions (Business Acquisition, Pro Forma HTML 50K
Information) (Details)
65: R45 Long-Term Debt (Details) HTML 90K
35: R46 Goodwill and Identifiable Assets (Goodwill) HTML 93K
(Details)
48: R47 Goodwill and Identifiable Assets (Acquired HTML 67K
Intangible Assets) (Details)
32: R48 Goodwill and Identifiable Assets (Future HTML 54K
Amortization Expense) (Details)
97: R49 401(k) Retirement Savings Plan, Deferred HTML 62K
Compensation Plan and Change in Control Severance
Plan (Details)
41: R50 Commitments and Contingencies (Details) HTML 139K
94: R51 (Narratives)(Details) HTML 63K
45: R52 Income Taxes (Income Tax Components) (Details) HTML 81K
62: R53 Income Taxes (Income Before Tax) (Details) HTML 39K
31: R54 Income Taxes (Deferred Tax Assets And Liabilities) HTML 81K
(Details)
34: R55 Income Taxes (Tax Rate Reconciliation) (Details) HTML 65K
55: R56 Income Taxes (Unrecognized Tax Benefit) (Details) HTML 44K
38: R57 Earnings per share (Details) HTML 52K
101: R58 Stock-based Compensation: Incentive Award Plan and HTML 182K
Employee Stock Purchase Plan (Details)
67: R59 Stock-based Compensation: Incentive Award Plan and HTML 45K
Employee Stock Purchase Plan Stock-based
Compensation: Incentive Award Plan and Employee
Stock Purchase Plan (Assumptions) (Details)
86: R60 Stock-based Compensation: Incentive Award Plan and HTML 73K
Employee Stock Purchase Plan Stock-based
Compensation: Incentive Award Plan and Employee
Stock Purchase Plan (Range of Prices) (Details)
47: R61 Stock-based Compensation: Incentive Award Plan and HTML 93K
Employee Stock Purchase Plan Stock-based
Compensation: Incentive Award Plan and Employee
Stock Purchase Plan (Stock Options Activity)
(Details)
50: R62 Stock-based Compensation: Incentive Award Plan and HTML 71K
Employee Stock Purchase Plan Stock-based
Compensation: Incentive Award Plan and Employee
Stock Purchase Plan (RSU and RSAs) (Details)
92: R63 Business Segments (Segment Reporting Information) HTML 80K
(Details)
90: R64 Business Segments (Reconciliation of Assets from HTML 39K
Segment to Consolidated) (Details)
69: R65 Business Segments (Gross Accounts Receivable) HTML 38K
(Details)
91: R66 Business Segments (Revenue by Geographical Areas) HTML 43K
(Details)
46: R67 Business Segments (Long-Lived Assets) (Details) HTML 40K
73: R68 Derivative Instruments (Balance Sheet Disclosures) HTML 56K
(Details)
102: R69 Derivative Instruments (Statement of Operations HTML 47K
Disclosures) (Details)
33: R70 Fair Value Measurements (Fair Value Inputs, HTML 45K
Liabilities, Quantitative Information) (Details)
39: R71 Fair Value Measurements (Recurring Basis) HTML 43K
(Details)
63: R72 Fair Value Measurements (Liabilities Measured on HTML 47K
Recurring Basis, Unobservable Input
Reconciliation) (Details)
37: R73 Subsequent Events (Details) HTML 34K
105: R74 Unaudited Quarterly Financial Results (Details) HTML 64K
43: R75 Schedule II - Valuation and Qualifying Accounts HTML 42K
(Details)
104: XML IDEA XML File -- Filing Summary XML 149K
51: EXCEL IDEA Workbook of Financial Reports (.xls) XLS 2.29M
24: EX-101.INS XBRL Instance -- asgn-20121231 XML 3.37M
26: EX-101.CAL XBRL Calculations -- asgn-20121231_cal XML 301K
27: EX-101.DEF XBRL Definitions -- asgn-20121231_def XML 856K
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25: EX-101.SCH XBRL Schema -- asgn-20121231 XSD 204K
77: ZIP XBRL Zipped Folder -- 0000890564-13-000008-xbrl Zip 316K
‘EX-10.38’ — Amendment No. 3 to the Employment Agreement by and Between Rand Blazer, on Assig
THIS THIRD AMENDMENT TO EMPLOYMENT AGREEMENT (this “Third Amendment”), is made as of May 15, 2012, by and between Apex Systems, Inc. (the “Company”), On Assignment, Inc. (“OA”) and Rand Blazer (the “Employee”). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Employment
Agreement (as defined below).
The
Company has entered into an Agreement of Merger, dated as of March 20, 2012, by and among OA, OA Acquisition Corp., the Company and Jeffrey Veatch, as shareholder representative (the “Merger Agreement”), pursuant to which OA Acquisition Corp. will be merged with and into the Company at and as of the Effective Time (as defined in the Merger Agreement) such that the Company shall be the surviving corporation in the merger and shall become a wholly-owned indirect subsidiary of OA.
C.
In
connection with the closing of the transactions contemplated by the Merger Agreement, the Company, OA and the Employee wish to amend certain terms of the Employment Agreement.
AMENDMENT
The parties hereto hereby amend the Employment Agreement as follows, effective as of the Closing (as defined in the Merger Agreement). This Third Amendment shall become effective only if the Closing occurs and, in the event the Merger Agreement is terminated or Closing otherwise does not occur, this Third Amendment will have no force or effect.
1.Section 2. Section 2 of
the Employment Agreement is hereby deleted and replaced in its entirety with the following:
“Subject to the provisions for earlier termination hereinafter provided, the Employee’s employment hereunder shall continue until the second anniversary of the Closing Date (as defined in that certain Agreement of Merger, dated as of March 20, 2012, by and among OA, OA Acquisition Corp., the Company and Jeffrey Veatch, as shareholder representative) (such date, the “Initial Termination Date”); provided, that commencing on the Initial Termination Date, and on each subsequent anniversary thereof, the term of this Agreement shall automatically be extended for one additional year, unless either the Employee or the
Company elects not to so extend the term of this Agreement by
notifying the other party in accordance with the terms of the Agreement (in any case, the “Employment Period”).”
2.Section 3. The phrase “Chief Operating Officer” in Section 3 of the Employment Agreement is hereby deleted and replaced in its entirety with the word “President”.
3.Section 4.1. The
second and third sentences of Section 4.1 of the Employment Agreement are hereby deleted and replaced in their entirety with the following:
“The Company, during the Employment Period, shall pay to the Employee his salary in installments in accordance with the Company’s applicable payroll practices, as in effect from time to time. Payment of any bonus, to the extent that the Company determines to pay such bonus, will be contingent upon the Employee’s continued employment through the applicable payment date, which shall be no later than the date on which annual bonuses are paid generally to the
Company’s similarly situated executives. Notwithstanding the foregoing, the terms of any bonus to which the Employee is eligible to receive pursuant to the Company's 2010 Long Term Incentive Program or any successor long term incentive program, shall be subject to the terms and conditions regarding eligibility for and timing of payment, as set forth therein.”
4.Section 4.2. Section 4.2 of the Employment Agreement is hereby deleted and replaced in its entirety with the following:
“[INTENTIONALLY OMITTED]”
5.Section 5. Section
5 of the Employment Agreement is hereby deleted and replaced in its entirety with the following:
“Vacation. During the Employment Period, the Employee shall be entitled to four (4) weeks of paid vacation per calendar year, pro-rated for any service by the Employee during any partial calendar year, provided, that the Employee shall not accrue any vacation time in excess of four (4) weeks (for the avoidance of doubt, vacation shall stop accruing at four (4) weeks and accrual shall not re-commence until accrued vacation falls below four (4) weeks, but up to four (4) weeks of accrued vacation may be carried forward to any succeeding calendar year.”
6.Section 6. Section 6 of the Employment Agreement
is hereby deleted and replaced in its entirety with the following:
“6.1 Benefit Plans. During the Employment Period, the Employee and the Employee’s legal dependents shall be eligible to participate in the welfare benefit plans, policies and programs (including, if applicable, medical, dental, disability, life and accidental death insurance plans and programs) maintained by the Company for its senior executives. In addition, the Employee shall be eligible to participate in such incentive, savings and retirement plans, policies and programs as are made available to similarly situated
executives
of the Company, provided, that the Company shall have no obligation, in any case, to adopt, maintain or continue any such plans, policies or programs.
6.2 Additional Perquisites. In addition, subject to Section 24 below, during the Employment Period, the Company shall pay or reimburse the Employee for actual, properly substantiated expenses incurred by the Employee in connection with (a) the lease or purchase of an automobile, not to exceed five hundred dollars ($500) per month; (b) an annual physical examination, not to exceed one thousand, five hundred dollars ($1,500) per calendar
year; and (iii) tax preparation and financial planning, not to exceed two thousand, five hundred dollars ($2,500) per calendar year. On all international and all transcontinental North American airplane flights, the Employee shall be entitled to fly business class or, if any such flight offers only two classes of service, first class.
6.3 Expenses. During the Employment Period, the Employee shall be entitled to receive prompt reimbursement of all reasonable business expenses incurred by the Employee in accordance with the Company expense reimbursement policy applicable to senior executives of the Company, as in effect from time to time, provided that the Employee
properly substantiates such expenses in accordance with such policy.”
7.Section 7. Section 7 of the Employment Agreement (together with its subsections) is hereby deleted and replaced in its entirety with the following:
“Relocation Expenses. The Employee acknowledges and agrees that, as of the Closing, (a) the Company has satisfied in full its obligations with respect to Section 7 of the Employment Agreement as in effect prior to this Third Amendment, and (b) the Employee has no further right, claim, entitlement or interest in or to any Relocation Expenses (as defined in the Employment Agreement as in effect
prior to this Third Amendment) or other payments or benefits under Section 7 of the Employment Agreement as in effect prior to this Third Amendment.”
8.Section 8. Section 8 of the Employment Agreement (together with its subsections) is hereby deleted and replaced in its entirety with the following:
“8. Termination of Employment. Either the Company or the Employee may terminate the Employee’s employment at any time for any reason or no reason. The following provisions shall control any such termination of the Employee’s employment.
8.1 Termination
by the Company Without Cause. The Company may terminate the Employee’s employment without Cause (as defined below) at any time during the Employment Period upon written notice to the Employee provided in accordance with Section 17 below. If the Employee’s employment is terminated as provided in this Section 8.1, the Company shall pay to the Employee (a) the Employee’s earned but unpaid salary accrued through the Date of Termination (as defined below), (b) accrued but unpaid vacation time through the Date of Termination, (c) reimbursement of any properly submitted business expenses incurred by the Employee prior to the Date of
Termination
that are reimbursable under Sections 6.2 or 6.3 above, and (d) any vested benefits and other amounts due to the Employee under any plan, program or policy of the Company (together, all of these benefits shall be referred to as the “Accrued Obligations”). The Accrued Obligations described in clauses (a) – (c) above will be paid to the Employee as soon as practicable on or after the Date of Termination, but in any event within thirty (30) days following the Date of Termination (or such earlier date as may be required by applicable law), provided, in the case of reimbursable expenses, that such expenses have been properly substantiated in accordance with applicable Company policy within fourteen (14) calendar days following the Date of Termination. The Accrued Obligations described in clause (d) above shall be paid to the Employee as such
obligations become due to the Employee in accordance with the applicable plan or program. In addition, subject to Sections 8.8 and 24 below, the Employee’s execution and non-revocation of a binding Release (as defined below) in accordance with Section 8.8 below and the Employee’s continued compliance with the Confidentiality Agreement (as defined below) and Sections 9 – 11 below, the Employee shall be entitled to the following payments and benefits from the Company (referred to collectively as the “Severance”):
(x)payment of one hundred percent (100%) of the Employee’s annual salary at the rate in effect as of the Date of Termination, payable in substantially equal installments for a period of twelve (12) months following the
Date of Termination, in accordance with the Company’s normal payroll procedures applicable to senior executives of the Company, as in effect from time to time (but no less often than monthly), provided that, consistent with the provisions of Treasury Regulation Section 1.409A-3(d), the Company hereby determines in its sole discretion to make any such payments that are otherwise scheduled to be paid during the period beginning on the Date of Termination and ending on the first regularly scheduled payroll date occurring on or after the thirtieth (30th) day following the Date of Termination (the “First Payroll Date”)
on a later date, provided that the Company shall make such payments on or before the earlier of (i) the First Payroll Date or (ii) the 15th day of the third calendar month following the otherwise scheduled payment date, and such payments shall be treated as made upon the otherwise scheduled payment date pursuant to Treasury Regulation Section 1.409A-3(d). If the Date of Termination and the First Payroll Date are in different calendar years, the Company shall make any such payments that are otherwise scheduled to be made in the calendar year that includes the Date of Termination on the First Payroll Date to the extent permitted by Treasury Regulation Section 1.409A-3(d). In all events, the parties intend that any and all amounts delayed
until the First Payroll Date (or earlier date described above) shall be treated for purposes of Code (as defined below) Section 409A as payments made upon their originally scheduled dates in accordance with Treasury Regulation Section 1.409A-3(d), and the originally scheduled date(s) of any such payment(s) shall continue to constitute the “designated payment date(s)” for such payment(s) (within the meaning of Code Section 409A) for all purposes of Code Section 409A. If, under applicable law, the Employee is afforded forty-five (45) days to execute a Release rather than twenty-one (21) days, Severance payments described in this Section 8.1(x) will commence on the date or dates determined above
whether
or not the Employee has executed the Release and the applicable revocation period has expired (subject to the Company’s right to recoup any such payments if the Employee ultimately fails to timely execute or revokes the Release); and
(xi)subject to the Employee’s proper election to continue healthcare coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), for a period of twelve (12) months from the Date of Termination, the Company will pay the Employee no less frequently than monthly (unless otherwise agreed by the Company
and the Employee in a manner that is permissible under Code Section 409A) the difference between the Employee’s COBRA premiums (in respect of COBRA benefits to be provided through third-party insurance maintained by the Company under the Company’s benefit plans for the Employee and his legal dependents to the extent each such individual received healthcare coverage provided by the Company immediately prior to such termination of employment), and the cost to the Employee of such coverage immediately prior to such termination (subject to premium increases affecting participants in such plan(s) generally). The Company shall provide this
premium cost offset in a manner that causes such COBRA benefits to be exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), provided, that if during such twelve (12) month period, (i) any plan pursuant to which such benefits are to be provided is not, or ceases to be, exempt from the application of Section 409A under Treasury Regulation Section 1.409A-1(a)(5), (ii) the Company cannot provide such COBRA benefits without violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), or (iii) the Company is otherwise unable under applicable law to continue to cover the Employee and/or the Employee’s dependents under its group health plans without violating a prohibition on such coverage or incurring penalties and/or additional
taxes as a result of such coverage, then, in any such case, an amount equal to each such remaining premium cost offset shall thereafter be paid to the Employee as currently taxable compensation in substantially equal monthly installments over the remainder of the twelve (12) month period; following such twelve (12)-month continuation period, any further continuation of such coverage under applicable law shall be at the Employee’s sole expense. For the avoidance of doubt, Severance payments described in this Section 8.1(y) will commence on the date or dates determined above whether or not the Employee has executed the Release and the applicable revocation period has expired (subject to the Company’s right to recoup any such payments if the Employee ultimately fails to timely execute or revokes the Release).
8.2 Disability.
If the Employee’s employment is terminated due to the Employee’s Disability (as defined below) during the Employment Period, the Employee shall be entitled to receive the Accrued Obligations in the manner described in Section 8.1 above. In addition, subject to Sections 8.8 and 24 below, the Employee’s execution and non-revocation of a binding Release in accordance with Section 8.8 below and the Employee’s continued compliance with the Confidentiality Agreement and Sections 9 – 12 below, the Employee shall be entitled to receive:
(a) a monthly payment during the period commencing on the Date of Termination and ending on the twelve
(12)-month anniversary of the Date of Termination in an amount equal to (i) the Employee’s monthly base salary as in effect on the Date of Termination, reduced, on a direct, dollar-for-dollar basis, by (ii) to the extent that the limitation under this clause (ii) qualifies as a nondiscretionary, objective formula or a specified amount that is not under the effective control of the service provider and is not subject to the exercise of discretion by the service recipient (in each case within the meaning of Treasury Regulation Section 1.409A-3(i)(1)(ii)), any bona fide disability insurance payments which the Employee receives for such month under the Company’s applicable disability insurance policies established before the Employee became disabled. Any amounts that become payable to the Employee under this Section 8.2(a) shall be paid at the time and in the manner described in Section
8.1(x) above. Notwithstanding the foregoing, if any such disability insurance payments become payable during the one (1)-year period following the Date of Termination but are actually paid to the Employee after the twelve (12)-month anniversary of the Date of Termination, the Employee shall promptly pay such amounts to the Company; and
(b)
the benefits described in Section 8.1(y) above.
8.3 Death. If the Employee dies during the Employment Period, the Employee or the Employee’s estate
shall be entitled to receive the Accrued Obligations in the manner described in Section 8.1(d) above. In addition, subject to Sections 8.8 and 24 below, the Employee’s estate’s execution and non-revocation of a binding Release in accordance with Section 8.8 below the Employee’s estate shall be entitled to receive the Severance, payable as set forth in Section 8.1 above.
8.4 Voluntary Termination. The Employee may voluntarily terminate the Employee’s employment upon ninety (90) days’ notice to the Company provided in accordance with Section 17 below, subject to the Company’s right to waive any or all of such notice period. If the Employee so terminates the Employee’s
employment, the Employee shall be entitled to receive the Accrued Obligations in the manner described in Section 8.1 above. If the Company elects to waive all or any portion of the notice period provided for in this Section 8.4, the Employee shall terminate employment effective immediately prior to the commencement of the waived period and shall, subject to Sections 8.8 and 24 below, the Employee’s execution and non-revocation of a binding Release in accordance with Section 8.8 below and the Employee’s continued compliance with the Confidentiality Agreement and Sections 9 – 11 below, be entitled to payment of an amount equal to the salary that would otherwise become payable in respect of such waived period absent the Company’s waiver, payable over the waived period in substantially equal installments
in accordance with the Company’s normal payroll procedures applicable to senior executives of the Company, as in effect from time to time (but no less often than monthly), provided, that such payments shall be paid in the manner described in Section 8.1(x) above.
8.5 Cause. If the Employee’s employment becomes terminable by the Company
for Cause (as defined below), then the Company shall provide the Employee with written notice setting forth in reasonable detail the nature of such Cause and, to the extent capable of cure, the Employee shall have a period of fifteen (15) days to cure such Cause (or such longer period as may be permitted under the definition of Cause below). If the Employee has not cured such Cause within the applicable cure period (to the extent capable of cure), then the Company may terminate the Employee’s employment immediately and the Employee shall be entitled to receive the Accrued Obligations in the manner described in Section 8.1 above.
8.6 Non-Renewal of Employment Period. If
the Company elects not to renew the Employment Period (or any extension thereof), the Employee shall be entitled to receive the Accrued Obligations in the manner described in Section 8.1 above. In addition, if, at the time of the Employee’s receipt of the Company’s notice of election not to renew the Employment Period (or any extension thereof), the Employee is willing and able to extend the Agreement and continue providing services on terms and conditions substantially similar to those contained in this Agreement, then subject to Sections 8.8 and 24 below, the Employee’s execution and non-revocation of a binding Release in accordance with Section 8.8 below and the Employee’s continued compliance with the Confidentiality Agreement and Sections 9 – 11 below, the Employee shall be entitled to receive
the Severance in the manner describe in Section 8.1 above, except that (a) the cash component of the Severance shall equal fifty percent (50%) of the Employee’s annual salary at the rate in effect as of the Date of Termination (rather than one hundred percent (100%)) and shall be payable in substantially equal installments for a period of six (6) months following the Date of Termination (rather than twelve (12) months), and (b) subsidized COBRA benefits shall continue for a period of six (6) months (rather than twelve (12) months).
8.7 Change in Control Benefits. During the Employment Period, the Employee shall be eligible to participate in the On Assignment, Inc. Amended and Restated Change in Control Severance Plan (the “CIC Plan”) at the level of “Division President”, as such
plan may be amended from time to time in accordance with its terms; provided, however, that notwithstanding anything to the contrary contained in the CIC Plan (but subject to the provisions therein relating to a “Potential Six-Month Delay”), if the Employee becomes entitled to receive benefits under the CIC Plan, a portion of the “Annual Base Pay” (as defined in the CIC Plan) equal to three (3) months’ of the Employee’s annualized base salary at the rate in effect during the last regularly scheduled payroll period immediately preceding the occurrence of the change in control (i.e., the severance that would have been payable under the Employment Agreement as in effect immediately prior to this Third Amendment) shall be paid in substantially equal installments over a period of three (3) months following the Date of Termination
(i.e., in the manner provided under the Employment Agreement as in effect immediately prior to this Third Amendment) in accordance with the Company’s normal payroll procedures applicable to senior executives of the Company, as in effect from time to time (but no less often than monthly) (and, for the avoidance of doubt, all remaining amounts that become payable
under the CIC Plan shall be paid as set forth in the CIC Plan). For the avoidance of doubt, the preceding
sentence applies only to the timing of payments under the CIC Plan and shall in no way increase the amount of payments or benefits to which the Employee may become entitled under the CIC Plan. In the event that the Employee actually receives benefits under the CIC Plan, such benefits shall be in lieu and full replacement of any benefits to which the Employee would otherwise become entitled under this Section 8 and the Employee shall not be entitled to receive any of the benefits described in this Section 8.
8.8 Release; Exclusivity of Benefits. Notwithstanding anything in this Agreement to the contrary, it shall be a condition to the Employee’s right to receive or retain, as applicable, the Severance (as defined above) that the Employee (or his estate) execute and deliver to the
Company a general release of claims in a form reasonably prescribed by the Company and (the “Release”) within twenty-one (21) days (or, to the extent required by law, forty-five (45) days) following the Date of Termination and that the Employee not revoke such Release during any applicable revocation period. Except as expressly provided in this Agreement and/or required by applicable law, upon the termination of the Employee’s employment, the Company shall have no obligation to the Employee in connection with the Employee’s employment with the Company or the termination thereof.
8.9 Definitions.
(a)
“Cause” means (i) the Employee’s willful breach of duty unless waived by the Company (which willful breach is limited to the Employee’s deliberate and consistent refusal to perform the Employee’s duties or the Employee’s deliberate and consistent refusal to conform to or follow any reasonable policy adopted by the Company provided the Employee has had prior written notice of such refusal and an opportunity of at least thirty (30) days to cure such refusal); (ii) the Employee’s unauthorized use or disclosure of confidential information or trade secrets of the Company; (iii) the Employee’s breach of an applicable non-competition or non-solicitation agreement; (iv) the Employee’s
conviction of a felony under the laws of the United States or any state thereof; or (v) the Employee’s gross negligence.
(b)“Code” shall mean the Internal Revenue Code of 1986, as amended.
(c)“Date of Termination” shall mean the date on which the Employee experiences a Separation from Service.
(d)“Disability” shall mean that a physician licensed to practice medicine in Virginia, as chosen by the Company, opines in
writing to the Board of Directors of the Company that the Employee has suffered an accident, physical illness or mental illness which will cause the Employee to be, for a period more than twelve (12) months, unable to fulfill his normal duties and responsibilities as an officer and/or
employee of the Company by reason of such accident, physical illness or mental illness. If the Employee disputes such physician’s opinion, the Employee shall choose another physician licensed to practice medicine in Virginia who
shall render a separate written opinion to the Board of Directors of the Company with reasonable speed, which shall be controlling on the issue in question upon its receipt by the Board of Directors of the Company if the opinion of the second physician is in agreement with the opinion of the first physician. In the event the two opinions are at a variance, such two physicians shall be asked to agree on a third physician licensed to practice medicine in Virginia to render a third or final opinion to the Board of Directors of the Company with reasonable speed. The written opinion of such third physician shall be controlling on the issue in question upon its receipt by the Board of Directors of the
Company. The fees of any or all of such physicians shall be paid by the Company. Notwithstanding anything to the contrary above, in the event that the Company maintains a long-term disability insurance policy covering the Employee, and if the Employee has not yet been designated as having experienced a Disability as provided hereunder, the Employee shall be deemed to have a Disability for purposes of this Agreement on the date that he is deemed disabled under the aforementioned insurance policy. The effective date of the Employee’s termination hereunder due to Disability shall be the earlier of (i) the date on which the applicable controlling physician opinion (determined in accordance with this Section 8.9(d)) is delivered to the Board of Directors of the
Company or (ii) the date the Employee is deemed disabled under an insurance policy described above.
(e)“Separation from Service” has the meaning assigned pursuant to Section 409A(a)(2)(A)(i) of the Code, and Treasury Regulation Section 1.409A-1(h).”
9.Section 12A. The following Section 12A is hereby added to the Employment Agreement immediately after Section 12 thereof:
“12A. Restrictive Covenants. The parties acknowledge and agree that OA and the Employee have entered into a Confidentiality, Noncompetition, Nonsolicitation and
Nondisclosure Agreement (the “Confidentiality Agreement”), and that such Confidentiality Agreement shall be additional to, and not in limitation of, the covenants contained in this Agreement, and shall remain in full force and effect in accordance with its terms. The compensation and benefits provided under this Agreement, together with compensation and benefits provided under the Merger Agreement, any Severance obligations arising hereunder and other good and valuable consideration are hereby acknowledged by the parties hereto to constitute adequate consideration for the Employee’s entering into the Confidentiality Agreement.”
10.Section 13. Reference to the phrase “Sections 9, 10, 11 and 12 above” in Section 13 of the Employment Agreement is hereby deleted and replaced in its
entirety with the phrase “Sections 9, 10, 11, 12 and 12A above”.
11.Section 24. The following language is hereby added to the end of Section 24 of the Employment Agreement:
“Notwithstanding anything to the contrary in this Agreement, no compensation or benefits shall be paid to the Employee during the six (6)-month period following the Employee’s Separation from Service to the extent the Board of Directors of the
Company reasonably determines the Employee is a “specified employee” at the time of such Separation from Service (within the meaning of Code Section 409A) and that paying such amounts at the time or times indicated in this Agreement would be a prohibited distribution under Code Section 409A(a)(2)(b)(i) and/or cause the Employee to incur additional taxes under Code Section 409A. If the payment of any such amounts is delayed as a result of the previous sentence, then on the first business day following the end of such six (6)-month period, (or such earlier date upon which such amount can be paid under Code Section 409A without being subject to such additional taxes, including as a result of the Employee’s death), the Company shall pay the Employee a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Employee during such six (6)-month
period, without interest thereon. Notwithstanding any provision of this Agreement to the contrary, in the event that following the effective date hereof, the Company determines that any payments or benefits hereunder (or, with respect to the Employee, under the CIC Plan) are not either exempt from or compliant with the requirements of Section 409A of the Code and related Department of Treasury guidance, the Company may adopt such amendments to this Agreement or adopt such other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to preserve the intended tax treatment and economic benefits
of the payments and benefits provided hereunder, including any such actions intended (a) to exempt such payments and benefits from Section 409A of the Code and/or (b) to cause such payments and benefits to comply with the requirements of Section 409A of the Code and related Department of Treasury guidance.”
12.This Third Amendment shall be and, as of its effectiveness, is hereby incorporated in and forms a part of, the Employment Agreement.
13.Except as expressly provided herein, all terms and conditions of the Employment Agreement shall remain in full force and effect.
(signature page follows)
IN
WITNESS WHEREOF, the parties hereto have executed this Third Amendment as of the date first written above.