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EXHIBIT
10.57
CHANGE IN CONTROL SEVERANCE
AGREEMENT
THIS
AGREEMENT is entered into as of this 13th day of March 2006,
by and between Gevity HR, Inc., a Florida corporation (the
"Company"), and Michael Collins ("Executive").
W I T N E S S E T H
WHEREAS,
the Company considers the establishment and maintenance of a sound
and vital management to be essential to protecting and enhancing
the best interests of the Company and its stockholders; and
WHEREAS,
the Company recognizes that, as is the case with many publicly held
corporations, the possibility of a change in control may arise and
that such possibility may result in the departure or distraction of
management personnel to the detriment of the Company and its
stockholders; and
WHEREAS,
the Board (as defined in Section 1) has determined that it is
in the best interests of the Company and its stockholders to secure
Executive’s continued services and to ensure
Executive’s continued dedication to his duties in the event
of any threat or occurrence of a Change in Control (as defined in
Section 1) of the Company; and
WHEREAS,
the Board has authorized the Company to enter into this
Agreement.
NOW,
THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, the Company and
Executive hereby agree as follows:
1.
Definitions. As used in this Agreement, the following terms
shall have the respective meanings set forth below:
(a)
"Board" means the Board of Directors of the Company.
(b)
"Bonus Amount" means the greater of (i) the average annual
incentive bonus earned by Executive from the Company (or its
affiliates) during the last three (3) completed fiscal years
of the Company immediately preceding
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Executive’s Date of Termination (annualized in the event
Executive was not employed by the Company (or its affiliates) for
the whole of any such fiscal year), and (ii) the
Executive’s target annual incentive bonus for the year in
which the Date of Termination occurs.
(c)
"Cause" means (i) the willful and continued failure of
Executive to perform substantially his duties with the Company
(other than any such failure resulting from Executive’s
incapacity due to physical or mental illness or any such failure
subsequent to Executive being delivered a Notice of Termination
without Cause by the Company or delivering a Notice of Termination
for Good Reason to the Company) after a written demand for
substantial performance is delivered to Executive by the Board
which specifically identifies the manner in which the Board
believes that Executive has not substantially performed
Executive’s duties, or (ii) the willful engaging by
Executive in illegal conduct or gross misconduct which is
demonstrably and materially injurious to the Company or its
affiliates. For purpose of this paragraph (c), no act or failure to
act by Executive shall be considered "willful", unless done or
omitted to be done by Executive in bad faith and without reasonable
belief that Executive’s action or omission was in the best
interests of the Company or its affiliates. Any act, or failure to
act, based upon authority given pursuant to a resolution duly
adopted by the Board, based upon the advice of counsel for the
Company or upon the instructions of the Company’s chief
executive officer or another senior officer of the Company shall be
conclusively presumed to be done, or omitted to be done, by
Executive in good faith and in the best interests of the Company.
Cause shall not exist unless and until the Company has delivered to
Executive a copy of a resolution duly adopted by three-quarters
(3/4) of the entire Board (excluding Executive if Executive is a
Board member) at a meeting of the Board called and held for such
purpose (after reasonable notice to Executive and an opportunity
for Executive, together with counsel, to be heard before the
Board), finding that in the good faith opinion of the Board an
event set forth in clauses (i) or (ii) has occurred and
specifying the particulars thereof in detail.
(d)
"Change in Control" means the occurrence of any one of the
following events:
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(i) individuals
who, on the date hereof, constitute the Board (the "Incumbent
Directors") cease for any reason to constitute at least a majority
of the Board, provided that any person becoming a director
subsequent to the date hereof, whose election or nomination for
election was approved by a vote of at least two-thirds of the
Incumbent Directors then on the Board (either by a specific vote or
by approval of the proxy statement of the Company in which such
person is named as a nominee for director, without written
objection to such nomination) shall be an Incumbent Director;
provided , however , that no individual initially
elected or nominated as a director of the Company as a result of an
actual or threatened election contest with respect to directors or
as a result of any other actual or threatened solicitation of
proxies or consents by or on behalf of any person other than the
Board shall be deemed to be an Incumbent Director;
(ii) any
"person" (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934 (the "Exchange Act") and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or
becomes a "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the
Company representing 25% or more of the combined voting power of
the Company’s then outstanding securities eligible to vote
for the election of the Board (the "Company Voting Securities");
provided , however , that the event described in this
paragraph (ii) shall not be deemed to be a Change in Control
by virtue of any of the following acquisitions: (A) by the
Company or any Subsidiary, (B) by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any
Subsidiary, (C) by any underwriter temporarily holding
securities pursuant to an offering of such securities,
(D) pursuant to a Non-Qualifying Transaction (as defined in
paragraph (iii)), or (E) unless otherwise approved by the
Board, pursuant to any acquisition by Executive or any group of
persons including Executive (or any entity controlled by Executive
or any group of persons including Executive);
(iii) the
consummation of a merger, consolidation, statutory share exchange
or similar form of corporate transaction involving the Company or
any of its Subsidiaries that requires the approval of the
Company’s stockholders, whether for such transaction or
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the issuance of securities in the transaction (a "Business
Combination"), unless immediately following such Business
Combination: (A) more than 50% of the total voting power of
(x) the corporation resulting from such Business Combination
(the "Surviving Corporation"), or (y) if applicable, the
ultimate parent corporation that directly or indirectly has
beneficial ownership of 100% of the voting securities eligible to
elect directors of the Surviving Corporation (the "Parent
Corporation"), is represented by Company Voting Securities that
were outstanding immediately prior to such Business Combination
(or, if applicable, is represented by shares into which such
Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such
Company Voting Securities among the holders thereof immediately
prior to the Business Combination, (B) no person (other than
any employee benefit plan (or related trust) sponsored or
maintained by the Surviving Corporation or the Parent Corporation),
is or becomes the beneficial owner, directly or indirectly, of 25%
or more of the total voting power of the outstanding voting
securities eligible to elect directors of the Parent Corporation
(or, if there is no Parent Corporation, the Surviving Corporation)
and (C) at least a majority of the members of the board of
directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation) following the consummation
of the Business Combination were Incumbent Directors at the time of
the Board’s approval of the execution of the initial
agreement providing for such Business Combination (any Business
Combination which satisfies all of the criteria specified in (A),
(B) and (C) above shall be deemed to be a "Non-Qualifying
Transaction"); or
(iv) the stockholders of the
Company approve a plan of complete liquidation or dissolution of
the Company or a sale of all or substantially all of the
Company’s assets.
Notwithstanding
the foregoing, a Change in Control of the Company shall not be
deemed to occur solely because any person acquires beneficial
ownership of more than 25% of the Company Voting Securities as a
result of the acquisition of Company Voting Securities by the
Company which reduces the number of Company Voting Securities
outstanding;
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provided that , if after such acquisition by the Company
such person becomes the beneficial owner of additional Company
Voting Securities that increases the percentage of outstanding
Company Voting Securities beneficially owned by such person, a
Change in Control of the Company shall then occur.
(e)
"Date of Termination" means (1) the effective date on which
Executive’s employment by the Company terminates as specified
in a prior written notice by the Company or Executive, as the case
may be, to the other, delivered pursuant to Section 10 or
(2) if Executive’s employment by the Company terminates
by reason of death, the date of death of Executive.
(f)
"Disability" means termination of Executive’s employment by
the Company due to Executive’s absence from Executive’s
duties with the Company on a full-time basis for at least one
hundred eighty (180) consecutive days as a result of
Executive’s incapacity due to physical or mental illness.
(g)
"Good Reason" means, without Executive’s express written
consent, the occurrence of any of the following events after a
Change in Control:
(i) (A) any change in the
duties or responsibilities (including reporting responsibilities)
of Executive that is inconsistent in any material and adverse
respect with Executive’s position(s), duties,
responsibilities or status with the Company immediately prior to
such Change in Control (including any material and adverse
diminution of such duties or responsibilities) or (B) a
material and adverse change in Executive’s titles or offices
(including, if applicable, membership on the Board) with the
Company as in effect immediately prior to such Change in
Control;
(ii) a reduction by the Company in
Executive’s rate of annual base salary or annual target bonus
opportunity (including any material and adverse change in the
formula for such annual bonus target) as in effect immediately
prior to such Change in Control or as the same may be increased
from time to time thereafter;
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(iii) any requirement of the
Company that Executive (A) be based anywhere more than fifty
(50) miles from the office where Executive is located at the
time of the Change in Control or (B) travel on Company
business to an extent substantially greater than the travel
obligations of Executive immediately prior to such Change in
Control;
(iv) the failure of the Company to
(A) continue in effect any employee benefit plan, compensation
plan, welfare benefit plan or material fringe benefit plan in which
Executive is participating immediately prior to such Change in
Control or the taking of any action by the Company which would
adversely affect Executive’s participation in or reduce
Executive’s benefits under any such plan, unless Executive is
permitted to participate in other plans providing Executive with
substantially equivalent benefits in the aggregate (at
substantially equivalent cost with respect to welfare benefit
plans), or (B) provide Executive with paid vacation in
accordance with the most favorable vacation policies of the Company
(and its affiliated companies) as in effect for Executive
immediately prior to such Change in Control, including the
crediting of all service for which Executive had been credited
under such vacation policies prior to the Change in Control; -
(v) any purported termination of
Executive’s employment which is not effectuated pursuant to
Section 10(b) (and which will not constitute a termination
hereunder); or
(vi) the failure of the Company to
obtain the assumption agreement from any successor as contemplated
in Section 9(b).
An
isolated, insubstantial and inadvertent action taken in good faith
and which is remedied by the Company within ten (10) days
after receipt of notice thereof given by Executive shall not
constitute Good Reason. Executive’s right to terminate
employment for Good Reason shall not be affected by
Executive’s incapacities due to mental or physical illness
and Executive’s continued employment shall not constitute
consent to, or a waiver of rights with respect to, any event or
condition constituting Good Reason; provided, however, that
Executive must provide notice of termination of employment within
ninety (90) days following Executive’s knowledge of an
event constituting Good Reason or such event shall not constitute
Good Reason under this Agreement.
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(h)
"Qualifying Termination" means a termination of Executive’s
employment (i) by the Company other than for Cause or
(ii) by Executive for Good Reason. Termination of
Executive’s employment on account of death, Disability or
Retirement shall not be treated as a Qualifying Termination.
(i)
"Retirement" means Executive’s mandatory retirement (not
including any mandatory early retirement) in accordance with the
Company’s retirement policy generally applicable to its
salaried employees, as in effect immediately prior to the Change in
Control, or in accordance with any retirement arrangement
established with respect to Executive with Executive’s
written consent.
(j)
"Subsidiary" means any corporation or other entity in which the
Company has a direct or indirect ownership interest of 50% or more
of the total combined voting power of the then outstanding
securities or interests of such corporation or other entity
entitled to vote generally in the election of directors or in which
the Company has the right to receive 50% or more of the
distribution of profits or 50% of the assets or liquidation or
dissolution.
(k)
"Termination Period" means the period of time beginning with a
Change in Control and ending two (2) years following such
Change in Control. Notwithstanding anything in this Agreement to
the contrary, if (i) Executive’s employment is
terminated prior to a Change in Control for reasons that would have
constituted a Qualifying Termination if they had occurred following
a Change in Control; (ii) Executive reasonably demonstrates
that such termination (or Good Reason event) was at the request of
a third party who had indicated an intention
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