AMENDED AND RESTATED EXECUTIVE
CHANGE OF CONTROL AGREEMENT
This Executive Change of Control Agreement (this
“ Agreement ”), made as of the 1st day of
January, 2007, by and between On Assignment, Inc., a Delaware
corporation (the “ Company ”), and James Brill
(the “ Executive ”), is amended and restated as
of December 11, 2008.
Recitals
A.
The Executive has been hired as of the date hereof to serve as the
Chief Financial Officer of the Company, in connection with which,
the Executive has entered into an Employment Agreement of even date
herewith providing for severance and termination benefits in
certain circumstances.
B.
Absent the execution and delivery of this Agreement, pursuant to
the Company’s Change in Control Severance Plan (the “
ASGN Severance Plan ”), the Executive would be
entitled to receive certain severance benefits in the event of a
change in control (within the meaning set forth in the ASGN
Severance Plan).
C.
The Board of Directors of the Company (the “ Board
”) has determined that it is in the best interests of the
Company and its stockholders to assure that the Company will have
the continued dedication of the Executive, notwithstanding the
possibility, threat or occurrence of a Change of Control (as
defined herein). The Board believes it is imperative to
diminish the inevitable distraction of the Executive by virtue of
the personal uncertainties and risks created by a pending or
threatened Change of Control and to encourage the Executive’s
full attention and dedication to the current Company in the event
of any threatened or pending Change of Control, and to provide the
Executive with compensation and benefits arrangements upon a Change
of Control that ensure that the compensation and benefits
expectations of the Executive will be satisfied and that are
competitive with those of other corporations. Therefore, in
order to accomplish these objectives, the Board has caused the
Company to modify the ASGN Severance Plan to eliminate its coverage
of the Executive and to enter into this Agreement and has provided
that this Agreement will supersede the Employment Agreement in the
event that the Executive becomes entitled to any compensation or
benefits under this Agreement.
Agreement
In consideration of the foregoing and the mutual
covenants and promises contained herein, the parties agree as
follows:
1.
Certain Definitions
. In addition to the terms defined elsewhere herein, the
following terms shall have the respective meanings set forth
below:
(a)
“ Accrued Compensation ” means an amount
including all amounts earned or accrued through the termination
date but not paid as of the termination date including
(i) Base Salary, (ii) reimbursement for reasonable and
necessary expenses incurred by you on behalf of the Company during
the period ending on the termination date, (iii) vacation and sick
leave pay (to the extent provided by Company policy or applicable
law), and (iv) incentive compensation (if any) earned in respect of
any period ended prior to the termination date. It is
expressly understood that incentive compensation shall have been
“earned” as of the time that the conditions to such
incentive compensation have been met, even if not calculated or
payable at such time.
(b)
“ Affiliated Company ” means any company
controlled by, controlling or under common control with the
Company.
(c)
“ Base Salary ” means the Executive’s
annual base salary at the rate in effect during the last regularly
scheduled payroll period immediately preceding the occurrence of
the Change in Control and does not include, for example, bonuses,
overtime compensation, incentive pay, fringe benefits, sales
commissions or expense allowances.
(d)
“ Cause ” means any of the following:
(i)
the Executive’s (A) conviction of a felony; (B) commission of
any other material act or omission involving dishonesty or fraud
with respect to the Company or any of its Affiliated Companies or
any of the customers, vendors or suppliers of the Company or its
subsidiaries; (C) misappropriation of material funds or assets of
the Company for personal use; or (D) engagement in unlawful
harassment or other discrimination with respect to the employees of
the Company or its subsidiaries;
(ii)
the Executive’s continued substantial and repeated neglect of
his duties, after written notice thereof from the Board, and such
neglect has not been cured within 30 days after the Executive
receives notice thereof from the Board;
(iii)
the Executive’s gross negligence or willful misconduct in the
performance of his duties hereunder that is materially and
demonstrably injurious to the Company; or
(iv)
the Executive’s engaging in conduct constituting a breach of
his written obligations to the Company in respect of
confidentiality and/or the use or ownership of proprietary
information.
(e)
“ Change of Control ” shall be deemed to occur
upon the consummation of any of the following
transactions:
(i)
a merger or consolidation in which the Company is not the surviving
entity, except for a transaction the principal purpose of which is
to change the state of the Company’s incorporation or a
transaction in which 50% or more of the surviving entity’s
outstanding voting stock following the transaction is held by
holders who held 50% or more of the Company’s outstanding
voting stock prior to such transaction; or
(ii)
the sale, transfer or other disposition of all or substantially all
of the assets of the Company; or
(iii)
any reverse merger in which the Company is the surviving entity,
but in which 50% or more of the Company’s outstanding voting
stock is transferred to holders different from those who held the
stock immediately prior to such merger; or
(iv)
the acquisition by any person (or entity) directly or indirectly of
50% or more of the combined voting power of the outstanding shares
of Company capital stock; or
(v)
during any period of two (2) consecutive years (not including any
period prior to the date of this Agreement), individuals who at the
beginning of such period constitute the Board (and any new
director, whose election by the Company’s stockholders was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning of
the period or whose election or nomination for election was so
approved), cease for any reason to constitute a majority thereof;
provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for
election by the Company’s stockholders, was approved by a
vote of at least a majority of the directors then comprising the
Board on the date hereof (the “ Incumbent Board
”) shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for purposes of this
proviso, any such individual whose initial assumption of office
occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board.
(f)
“ Change of Control Period ” means the period
commencing on the date hereof and ending on the third anniversary
of the date hereof; provided, however, that, commencing
on
the date two
years after the date hereof, and on each annual anniversary of such
date (such date and each annual anniversary thereof, the “
Renewal Date ”), the Change of Control Period shall be
automatically extended so as to terminate two years from such
Renewal Date, unless at least 60 days prior to the Renewal Date the
Company gives notice to the Executive that the Change of Control
Period shall not be extended.
(g)
“ Date of Termination ” means the date on which
the Executive experiences a Separation from Service.
(h)
“ Good Reason ” means either of the
following:
(i)
the failure of the Company to pay an amount owing to the Executive,
which amount constitutes salary, bonus or other compensatory amount
related to his employment, after the Executive has provided the
Board with written notice of such failure and such payment has not
thereafter been made within 15 days of the delivery of such written
notice; or
(ii)
the relocation of the Executive from the corporate headquarters
metropolitan area (as of the date of this Agreement) without his
consent.
(i)
“ Involuntary Termination ” shall mean the
termination of Executive’s employment with the Company (or,
if applicable, successor entity) other than by reason of death or
disability:
(i)
upon Executive’s involuntary discharge or dismissal other
than for Cause,
(ii)
upon Executive’s resignation for Good Reason within 30 days
after the occurrence of the facts constituting Good
Reason,
(iii)
upon Executive’s resignation following (A) a reduction in
Executive’s level of Base Salary or any Target Bonus (unless,
in the case of a reduction in any Target Bonus, there is a
corresponding increase in the level of Base Salary such that, in
the aggregate, Executive is no worse off) or (B) a material
reduction in Executive’s benefits, provided and only
if such change or reduction is effected without
Executive’s written concurrence, or
(iv)
upon Executive’s resignation following a change in the
Executive’s position with the Company (or, if applicable,
with the successor entity) that is effected without the
Executive’s consent and that materially reduces his level of
responsibility or authority, other than reductions attributable to
the Company ceasing to be a publicly held company or becoming a
subsidiary or division of another company.
Except as
provided in Section 2(b), for purposes of this Agreement any
determination of “Involuntary Termination” made by the
Company or the Executive shall be made in good faith. Any dispute
regarding same shall be promptly resolved by arbitration in
accordance with the provisions of Sections 8(g)
and (h) below.
(j)
“ Pro Rata Bonus ” means an amount equal to 100%
of the Target Bonus that the Executive would have been eligible to
receive for the Company’s fiscal year in which the
Executive’s employment terminates following a Change of
Control, multiplied by a fraction, the numerator of which is the
number of days in such fiscal year through the Termination Date and
the denominator of which is 365.
(k) “
Separation from Service ” means a “separation
from service” within the meaning of Section 409A(a)(2)(A)(i)
of the Code, and Treasury Regulation Section
1.409A-1(h).
(l) “
Target Bonus ” shall mean the bonus which would have
been paid to
the Executive
for full achievement of the Company’s base business plan or
budget and/or for the attainment of specific performance objectives
pertaining to the business of the Company or any of its specific
business units or divisions, or to individual performance criteria
applicable to the Executive or his position, which objectives have
been established by the Board of Directors (or the Compensation
Committee thereof) for the Executive relating to such plan or
budget for the year in question. “ Target Bonus
” shall not mean the “maximum bonus” which the
Executive might have been paid for overachievement of such
plan.
2.
Involuntary Termination of
Employment Following a Change in Control .
(a)
Subject to the terms of this Agreement, the Executive shall be
entitled to receive severance payments from the Company for
services previously rendered to the Company and its Affiliated
Companies if all of the following conditions are met:
(1) a Change of Control occurs during the Change of Control
Period, (2) the Executive’s employment is terminated
under circumstances constituting an Involuntary Termination, and
(3) the Date of Termination occurs during the period
commencing upon such Change of Control and ending on the date that
is six (6) calendar months and ten (10) business days following the
Change of Control. In such event, the severance provisions of
this Agreement shall control and take precedence over any
inconsistent terms of any currently existing employment or
severance arrangement between the Company and the Executive, and
the Company shall, subject to Section 8 below:
(i)
within 30 days after the Date of Termination (or such earlier date
as may be required by applicable law), pay to the Executive the
Executive’s Accrued Compensation and Pro-Rata
Bonus;
(ii)
within 30 days after the Date of Termination (with the exact
payment date to be determined in the sole discretion of Company),
pay to the Executive the amount equal to the product of
(i) 2.50 and (ii) the sum of (A) the
Executive’s Base Salary and (B) the Executive’s
Target Bonus;
(iii) for
a period of eighteen (18) months after the Date of Termination,
continue to provide the Executive with his car allowance as in
effect immediately prior to the Change of Control, payable in
substantially equal monthly installments commencing on the Date of
Termination, provided, however that if the Executive becomes
reemployed with another employer and is eligible to receive a car
allowance, the Company shall be relieved of its obligation to pay
the Executive’s car
allowance;
(iv) for
eighteen (18) months after the Date of Termination, or such longer
period as may be provided by the terms of the appropriate plan,
program, practice or policy, subject to the Executive’s
proper election to continue healthcare coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“ COBRA ”), the Company will pay
the the Executive and/or the Executive’s COBRA
premiums in respect of COBRA benefits to be provided at the levels
being provided to the Executive and/or the Executive’s family
immediately prior to the Change of Control, through third-party
insurance maintained by the Company under the Company’s
benefit plans 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,
however , that if the Executive becomes reemployed with another
employer and is eligible to receive medical or other welfare
benefits under another employer provided plan, the benefits
described in this Section 2(a)(iv) shall be secondary to those
provided under such other plan during such applicable period of
eligibility; and provided further, that if
during the period of continuation coverage, any plan pursuant to
which such benefits are to be provided ceases to be exempt from the
application of Section 409A under Treasury Regulation Section
1.409A-1(a)(5), then an amount equal to each such remaining premium
shall thereafter be paid to the Executive as currently taxable
compensation in substantially equal monthly installments over the
remainder of the continuation coverage period.
(v) within
30 days after the Date of Termination (with the exact payment date
to be determined in the sole discretion of the Company), subject to
Section 8(c) below, pay to the Executive a cash amount equal to the
aggregate premiums that the Company would have paid for basic life
insurance, accidental death and dismemberment insurance and long-
and short-term disability insurance, each as in effect on the Date
of Termination, had the Executive remained employed by the
Company for eighteen (18) months after the Date of
Termination;
(vi) during
the eighteen (18) month period immediately following the Date of
Termination, pay to Executive, in substantially equal monthly
installments, an amount equal to the aggregate contribution (if
any) to the Company’s Deferred Compensation Plan and other
retirement plans that the Company would
have made on behalf of the Executive (including matching
contributions) if the Executive’s employment
continued for eighteen (18) months after the Date of Termination,
assuming for this purpose that all benefits under such retirement
plans are fully vested and that the Executive’s compensation
during such eighteen (18) months were the same as it had been
immediately prior to the Change of Control; and
(vii)
provide the Executive, at the Company’s expense, with
outplacement services reasonably selected by the Executive,
provided, however, that the cost to
the Company shall not exceed $15,000 and such services shall be
provided to Executive no later than the end of the second calendar
year following that in which the Date of Termination
occurs.
(b)
Anything in this Agreement to the contrary notwithstanding, a
termination of employment by the Executive for any reason or for no
reason during the period commencing on the date that is six months
after the date of a Change of Control and ending ten (10) business
days thereafter shall be deemed to be an “Involuntary
Termination” for all purposes of this Agreement.
3.
Termination of Employment
Following a Change of Control for Cause or Other Than in Connection
with an Involuntary Termination . If following a Change
of Control the Executive’s employment is terminated for Cause
or the Executive resigns other than in connection w
