1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
--------------
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from TO
-------------- --------------
Commission file number 1-5519
------
CDI CORP.
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Pennsylvania 23-2394430
- ------------------------- -----------------------
(State or other jurisdic- (I.R.S. Employer
tion of incorporation or Identification Number)
organization)
1717 Arch Street, 35th Floor, Philadelphia, PA 19103-2768
----------------------------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (215) 569-2200
--------------
Indicate whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes X No
----- -----
Outstanding shares of each of the Registrant's classes of common
stock as of April 29, 1998 were:
Common stock, $.10 par value 19,923,504 shares
Class B common stock, $.10 par value None
<PAGE>
2
PART 1. FINANCIAL INFORMATION
CDI CORP. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands)
March 31,
1998 December 31,
Assets (unaudited) 1997
- ------ --------- ------------
Current assets:
Cash $ 7,992 6,998
Accounts receivable, less allowance
for doubtful accounts of $4,604 -
March 31, 1998; $4,995 - December 31,
1997 292,387 259,415
Prepaid expenses 4,668 3,980
Deferred income taxes 3,684 6,990
Net assets of discontinued operations 11,723 12,202
------- -------
Total current assets 320,454 289,585
Fixed assets, at cost:
Computers 46,194 41,963
Equipment and furniture 26,526 26,127
Leasehold improvements 9,880 8,015
------- -------
82,600 76,105
Accumulated depreciation 54,644 49,718
------- -------
Net fixed assets 27,956 26,387
Deferred income taxes 5,534 5,759
Goodwill and other intangible assets, net 24,434 16,220
Other assets 10,121 10,886
------- -------
$ 388,499 348,837
======= =======
<PAGE>
3
CDI CORP. AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except share data)
March 31,
1998 December 31,
Liabilities and Shareholders' Equity (unaudited) 1997
- ------------------------------------ --------- ------------
Current liabilities:
Obligations not liquidated because
of outstanding checks $ 13,479 13,139
Accounts payable 23,270 25,127
Withheld payroll taxes 2,870 5,256
Accrued expenses 97,614 71,583
Currently payable income taxes 6,079 6,203
------- -------
Total current liabilities 143,312 121,308
Long-term debt 7,456 -
Deferred compensation 9,448 10,127
Minority interests 1,732 1,610
Shareholders' equity:
Preferred stock, $.10 par value -
authorized 1,000,000 shares; none
issued - -
Common stock, $.10 par value -
authorized 100,000,000 shares;
issued 19,951,300 shares - March 31,
1998; 19,950,800 shares - December 31,
1997 1,995 1,995
Class B common stock, $.10 par value -
authorized 3,174,891 shares; none
issued - -
Additional paid-in capital 15,988 16,014
Retained earnings 210,990 200,281
Unamortized value of restricted stock
issued (1,718) (1,819)
Less common stock in treasury, at cost -
27,796 shares - March 31, 1998; 27,265
shares - December 31, 1997 (704) (679)
------- -------
Total shareholders' equity 226,551 215,792
------- -------
$ 388,499 348,837
======= =======
<PAGE>
4
CDI CORP. AND SUBSIDIARIES
Consolidated Statements of Earnings
(In thousands, except per share data; unaudited)
Three months ended March 31,
----------------------------
1998 1997
------- -------
Revenues $ 378,766 360,461
Cost of services 286,757 278,519
------- -------
Gross profit 92,009 81,942
Operating and administrative costs 74,247 63,150
------- -------
Operating profit 17,762 18,792
Interest expense 6 704
------- -------
Earnings from continuing operations
before income taxes and minority
interests 17,756 18,088
Income taxes 6,925 7,236
------- -------
Earnings from continuing operations
before minority interests 10,831 10,852
Minority interests 122 111
------- -------
Earnings from continuing operations 10,709 10,741
Discontinued operations - -
------- -------
Net earnings $ 10,709 10,741
======= =======
Basic earnings per share:
Earnings from continuing operations $ .54 .54
Discontinued operations $ - -
Net earnings $ .54 .54
Diluted earnings per share:
Earnings from continuing operations $ .54 .54
Discontinued operations $ - -
Net earnings $ .54 .54
<PAGE>
5
CDI CORP. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In thousands; unaudited)
Three months ended March 31,
----------------------------
1998 1997
------ ------
Continuing Operations
Operating activities:
Earnings from continuing operations $ 10,709 10,741
Minority interests 122 111
Depreciation 2,811 2,301
Amortization of intangible assets 457 389
Income tax provision greater than
tax payments 3,407 5,746
Change in assets and liabilities
net of effects from acquisitions:
Increase in accounts receivable (32,272) (23,813)
Increase in payables and accrued
expenses 21,788 6,217
Other (1,214) (1,004)
------ ------
5,808 688
------ ------
Investing activities:
Purchases of fixed assets (3,980) (2,860)
Acquisition net of cash acquired (8,761) (65)
Other (372) 4
------ ------
(13,113) (2,921)
------ ------
Financing activities:
Borrowings long-term debt 7,456 10,313
Payments long-term debt - (13)
Obligations not liquidated because
of outstanding checks 340 2,033
Exercises of stock options 24 5
------ ------
7,820 12,338
------ ------
Net cash flows from continuing operations 515 10,105
Net cash flows from discontinued operations 479 (610)
------ ------
Increase in cash 994 9,495
Cash at beginning of period 6,998 6,066
------ ------
Cash at end of period $ 7,992 15,561
====== ======
<PAGE>
6
CDI CORP. AND SUBSIDIARIES
Comments to Financial Statements
Earnings used to calculate both basic and diluted earnings per
share are the reported earnings in the Company's consolidated statement
of earnings. Because of the Company's capital structure, all reported
earnings pertain to common shareholders and no other assumed
adjustments are necessary. The number of common shares used to
calculate basic and diluted earnings per share for the three months
ended March 31, 1998 and March 31, 1997 was determined as follows:
Basic 1998 1997
----- ---------- ----------
Average shares outstanding 19,923,652 19,836,904
Restricted shares issued not vested (49,400) (7,500)
---------- ----------
19,874,252 19,829,404
========== ==========
Diluted
-------
Shares used for basic 19,874,252 19,829,404
Dilutive effect of stock options 95,655 62,605
Dilutive effect of restricted shares
issued not vested 4,137 -
---------- ----------
19,974,044 19,892,009
========== ==========
Revenues and operating profit attributable to the continuing
operations of the business segments of the Company for the three months
ended March 31, 1998 and 1997 follow ($000s):
1998 1997
------- -------
Revenues:
Technical Services $ 226,756 230,288
Information Technology Services 75,459 65,483
Temporary Services 49,920 43,727
Management Recruiters 26,631 20,963
------- -------
$ 378,766 360,461
======= =======
Operating profit:
Technical Services $ 8,941 10,712
Information Technology Services 4,713 4,769
Temporary Services 2,540 2,246
Management Recruiters 5,179 3,210
Corporate expenses (3,611) (2,145)
------- -------
$ 17,762 18,792
======= =======
<PAGE>
7
During the three months ended March 31, 1998, there were 500
shares of common stock issued upon the exercise of a stock option
granted under the Company's non-qualified stock option and stock
appreciation rights plan. As a result of the option exercise,
additional paid-in capital was increased by $24,000.
During 1997 shares of restricted common stock were issued to
certain officers of the Company under their employment agreements.
A portion of these shares will vest over time and the remainder will
vest depending upon the percentage achievement of predetermined goals.
The shares that will vest over time have a fixed value based upon the
market value of the shares when they were issued. The value for the
shares that vest based upon performance will fluctuate with changes in
their market value until there is a determination as to their vesting.
During the three months ended March 31, 1998, 5,469 of these
restricted shares vested and 531 shares related to performance-based
vesting did not vest and were forfeited. The forfeited shares were put
in treasury increasing treasury stock by $25,000 and decreasing
unamortized value of restricted stock issued by the same amount.
Also during the three months ended March 31, 1998, additional paid-in
capital and unamortized value of restricted stock issued were each
decreased by $50,000 for market price changes related to the shares
that will vest based upon performance. In addition, unamortized value
of restricted stock issued was decreased by $26,000 for charges to
earnings associated with the amortization of the value of the
restricted shares.
Through December 31, 1997 a reserve was established for estimated
costs and losses associated with the disposition of certain divisions
of a subsidiary serving the automotive industry that have been classi-
fied as discontinued operations in the Company's financial statements.
Charges against the reserve, primarily for operating losses, during the
three months ended March 31, 1998 totaled $1.9 million and were for
items that corresponded to those considered in establishing the
reserve. The net assets of discontinued operations as of March 31,
1998 were comprised of working capital, fixed assets and deferred
income taxes comparable in composition to December 31,1997. The
remaining wind-down and liquidation of the discontinued operations will
be completed in 1998.
The financial statements included in this report are unaudited
and reflect all adjustments which, in the opinion of management, are
necessary for a fair statement of the results for the periods
presented. All such adjustments are of a normal recurring nature.
These comments contain only the information which is required by
Form 10-Q. Further reference should be made to the comprehensive
disclosures contained in the Company's annual report on Form 10-K for
the year ended December 31, 1997.
<PAGE>
8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
---------------------
Consolidated revenues from continuing operations for the quarter
ended March 31, 1998 were 5% above the comparable quarter a year ago.
Operating profit margins from continuing operations were 4.7% of
revenues for the first quarter of this year compared to 5.2% for the
same period in 1997.
Total first quarter 1998 Technical Services' revenues from
continuing operations reflect a decrease of 2% from the first quarter a
year ago. First quarter 1997 results included $12 million of revenue
from non-strategic businesses divested in the third quarter of 1997.
Excluding revenue from divested businesses, first quarter 1998 revenues
increased 4% over comparable 1997 revenues. Operating profit margins
from continuing operations for Technical Services were 3.9% in the
first quarter of 1998 compared to 4.7% for the 1997 first quarter (The
non-strategic businesses did not have a material impact on margins in
the first quarter 1997). Technical Services in first quarter 1998 was
impacted by lower revenue and operating profit in its engineering
business which is primarily focused on the petrochemical sector. This
weakness had started to become evident during the first quarter of 1997
and became more pronounced in later quarters. The support cost
structure related to technical staffing was higher in 1998's first
quarter reflecting additional capacity put in place starting in 1997 to
service existing and expected demand from customers. The segment also
realized an unexpected increase in health care costs in one of its
units that is in the process of transitioning from a self-insurance
program to an indemnity program which will enable more effective
control of ongoing health care program costs.
Information Technology Services segment revenues increased 15%
over the first quarter a year ago. Operating profit margins for
Information Technology Services were 6.2% in the first quarter of 1998
compared to 7.3% for the 1997 first quarter. This segment also
increased its support cost structure during 1997 to service existing
and expected demand from customers. Revenue growth in the first
quarter of 1998 did not keep pace with the additional support cost
structure put into place starting in 1997.
Temporary Services' revenues were up 14% over last year s first
quarter. Operating profit margins for Temporary Services were 5.1% for
both the first quarter of 1998 and 1997. Temporary Services benefitted
from the continued strong demand for office/clerical services and the
pursuit of its targeted expansion of services for legal and financial
temporary staffing.
Management Recruiters' revenues for the first quarter of 1998 grew
27% over last year's first quarter due to the continuing strong demand
for middle management search and recruiting services. As a result,
operating profit margins were 19.4% of revenues for the first quarter
of this year and 15.3% for the first quarter of last year.
9
The wind-down and liquidation of the discontinued operations is
continuing and will be completed in 1998. Costs and losses incurred
during the quarter ended March 31, 1998 of $1.9 million, primarily for
operating losses, were charged against a reserve for discontinued
operations established through December 31, 1997 for such costs and
losses.
Interest expense in the first quarter of 1998 was lower than the
first quarter of 1997 because of lower levels of debt outstanding.
The Company continues to pursue modifications to existing software
and converting to new software in addressing the potential for software
failures due to processing errors arising from calculations using the
Year 2000 date. There has been no change in the Company's assessment
of its risks associated with this issue from that described in its
report on Form 10-K for the year ended December 31, 1997.
Financial Condition
-------------------
The ratio of current assets to current liabilities was 2.2 to 1
as of March 31, 1998 and 2.4 to 1 as of December 31, 1997. The ratio
of long-term debt to total capital (long-term debt plus shareholders'
equity) was 3% as of March 31, 1998. No debt was outstanding as of
December 31, 1997. The Company believes that capital resources
available from operations and financing arrangements are adequate to
support the Company's businesses.
New Accounting Standards
------------------------
The Company has adopted Statement of Position 98-1, Accounting for
the Cost of Computer Software Developed or Obtained for Internal Use.
The amount of cost capitalized has not been significant.
In June, 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 131, Disclosures about
Segments of an Enterprise and Related Information. Statement No. 131
supersedes Statement of Financial Accounting Standards No. 14,
Financial Reporting for Segments of a Business Enterprise, and
establishes new standards for reporting information about operating
segments in annual financial statements and requires selected
information about operating segments in interim financial reports.
Statement 131 also establishes standards for related disclosures about
products and services, geographic areas and major customers. Statement
131 is effective for periods beginning after December 15, 1997 with
initial implementation required in financial statements for the annual
period ending after December 15, 1997. This Statement affects
reporting in financial statements only and will not have
impact upon results of operations, financial condition or long-term
liquidity. The Company will adopt the standards established by this
Statement as required.
<PAGE>
10
In February, 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 132, Employers'
Disclosures about Pensions and Other Postretirement Benefits.
Statement No. 132 supersedes several previously issued Statements and
establishes revised standards for disclosures surrounding pensions and
other postretirement benefits. Statement No. 132 is effective for
years beginning after December 15, 1997. This Statement affects
reporting in financial statements only and will not have impact upon
results of operations, financial condition or long-term liquidity. The
Company will adopt the standards established by this Statement as
required.
Forward-looking Information
---------------------------
Certain information in this report, including Management's
Discussion and Analysis of Financial Condition and Results of
Operations, contains forward-looking statements as such term is defined
in Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Certain forward-looking statements
can be identified by the use of forward-looking terminology such as,
"believes," "expects," "may," "will," "should," "seeks,"
"approximately," "intends," "plans," "estimates," or "anticipates" or
the negative thereof or other comparable terminology, or by discussions
of strategy, plans or intentions. Forward-looking statements involve
risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. These include
risks and uncertainties such as competitive market pressures, material
changes in demand from larger customers, availability of labor, the
Company's performance on contracts, changes in customers attitudes
toward outsourcing, government policies adverse to the staffing
industry, changes in economic conditions, unforeseen events associated
with divestiture of discontinued operations and delays or unexpected
costs in making modifications to existing software and converting to
new software to resolve issues related to Year 2000. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. The Company
assumes no obligation to update such information.
<PAGE>
11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3.(i) Articles of incorporation of the Registrant,
incorporated herein by reference to the
Registrant's report on Form 10-Q for the
quarter ended June 30, 1990 (File No. 1-5519).
(ii) Bylaws of the Registrant, incorporated herein
by reference to the Registrant's report on
Form 10-Q for the quarter ended June 30, 1990
(File No. 1-5519).
10.a. CDI Corp. Non-Qualified Stock Option and Stock
Appreciation Rights Plan, incorporated herein
by reference to the Registrant's report on Form
10-Q for the quarter ended June 30, 1997 (File
No. 1-5519). (Constitutes a management contract
or compensatory plan or arrangement)
b. Supplemental Pension Agreement dated April 11,
1978 between CDI Corporation and Walter R.
Garrison, incorporated herein by reference to
the Registrant's report on Form 10-K for the
year ended December 31, 1989 (File No. 1-5519).
(Constitutes a management contract or compensa-
tory plan or arrangement)
c. Non-competition and Consulting Agreement by and
between Registrant and Christian M. Hoechst
dated October 17, 1995, incorporated herein by
reference to Registrant's report on Form 10-K
for the year ended December 31, 1995 (File No.
1-5519). (Constitutes a management contract or
compensatory plan or arrangement)
d. Employment Agreement dated March 11, 1997,
including Restricted Stock Agreement and Non-
Qualified Stock Option Agreement, by and between
Registrant and Mitchell Wienick, incorporated
herein by reference to the EDGAR filing made by
the Registrant on April 1, 1997 in connection
with the Registrant's definitive Proxy Statement
for its annual meeting of shareholders held on
April 28, 1997 (File No. 1-5519). (Constitutes
a management contract or compensatory plan or
arrangement)
e. Consulting Agreement dated as of April 7, 1997
by and between Registrant and Walter R. Garrison,
incorporated herein by reference to Registrant's
<PAGE>
12
report on Form 10-Q for the quarter ended June
30, 1997 (File No. 1-5519). (Constitutes a
management contract or compensatory plan or
arrangement)
f. Employment Agreement, Restricted Stock Agreement
and Non-Qualified Stock Option Agreement all
dated August 4, 1997, by and between Registrant
and Robert J. Mannarino, incorporated herein by
reference to the Registrant's report on Form 10-Q
for the quarter ended September 30, 1997. (File
No. 1-5519). (Constitutes a management contract
or compensatory plan or arrangement)
g. Supplemental Retirement Agreement dated as of
April 7, 1997 by and between Registrant and
Mitchell Wienick, incorporated herein by
reference to the Registrant's report on Form
10-K for the year ended December 31, 1997
(File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
h. Employment Agreement dated October 29, 1997,
Restricted Stock Agreement dated November 10,
1997 and Non-Qualified Stock Option Agreement
dated November 10, 1997 each by and between
Registrant and John D. Sanford, incorporated by
reference to the Registrant's report on Form
10-K for the year ended December 31, 1997
(File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
i. Supplemental Retirement Agreement dated as of
November 18, 1997 by and between Registrant and
Robert J. Mannarino, incorporated herein by
reference to the Registrant's report on Form
10-K for the year ended December 31, 1997
(File No. 1-55519). (Constitutes a management
contract or compensatory plan or arrangement)
j. Supplemental Retirement Agreement dated as of
November 20, 1997 by and between Registrant and
John D. Sanford, incorporated herein by reference
to the Registrant's report on Form 10-K for the
year ended December 31, 1997 (File No. 1-5519).
(Constitutes a management contract or
compensatory plan or arrangement)
k. Consulting Agreement dated as of December 3, 1997
by and between Registrant and Edgar D. Landis,
incorporated herein by reference to the
Registrant's report on Form 10-K for the year
ended December 31, 1997 (File No. 1-5519).
(Constitutes a management contract or compensa-
tory plan or arrangement)
13
l. Employment Agreement dated July 8, 1997,
including Restricted Stock Agreement and Non-
Qualified Stock Option Agreement, by and between
Registrant and Brian J. Bohling. (Constitutes a
management contract or compensatory plan or
arrangement)
m. Supplemental Retirement Agreement dated November
18, 1997 by and between Registrant and Brian J.
Bohling. (Constitutes a management contract or
compensatory plan or arrangement)
n. Employment Agreement effective January 1, 1998 by
and between Registrant and Joseph R. Seiders.
(Constitutes a management contract or compensa-
tory plan or arrangement)
o. CDI Corp. 1998 Non-Qualified Stock Option Plan,
incorporated herein by reference to the EDGAR
filing made by the Registrant on April 3, 1998 in
connection with the Registrant's definitive Proxy
Statement for its annual meeting of shareholders
held on May 5, 1998 (File No. 1-5519).
(Constitutes a management contract or compensa-
tory plan or arrangement)
p. CDI Corp. Performance Share Plan. (Constitutes
a management contract or compensatory plan or
arrangement)
q. CDI Corp. Management Stock Purchase Plan.
(Constitutes a management contract or compensa-
tory plan or arrangement)
27. Financial Data Schedule.
(b) The Registrant has not filed a Form 8-K during the quarter
ended March 31, 1998.
<PAGE>
14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
CDI CORP.
--------------------------------------
May 12, 1998 By: /s/ John D. Sanford
--------------------------------------
JOHN D. SANFORD
Executive Vice President and Chief
Financial Officer
(Duly authorized officer and
principal financial officer of
Registrant)
<PAGE>
15
INDEX TO EXHIBITS
Number Exhibit Page
- ------- ----------------------------------------------------- ----
3.(i) Articles of incorporation of the Registrant,
incorporated herein by reference to the Registrant's
report on Form 10-Q for the quarter ended June 30,
1990 (File No. 1-5519).
(ii) Bylaws of the Registrant, incorporated herein by
reference to the Registrant's report on Form 10-Q for
the quarter ended June 30, 1990 (File No. 1-5519).
10.a. CDI Corp. Non-Qualified Stock Option and Stock
Appreciation Rights Plan, incorporated herein by
reference to the Registrant's report on Form 10-Q
for the quarter ended June 30, 1997 (File No. 1-5519).
(Constitutes a management contract or compensatory
plan or arrangement)
b. Supplemental Pension Agreement dated April 11, 1978
between CDI Corporation and Walter R. Garrison,
incorporated herein by reference to the Registrant's
report on Form 10-K for the year ended December 31,
1989 (File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
c. Non-competition and Consulting Agreement by and
between Registrant and Christian M. Hoechst dated
October 17, 1995, incorporated herein by reference to
Registrant's report on Form 10-K for the year ended
December 31, 1995 (File No. 1-5519). (Constitutes a
management contract or compensatory plan or
arrangement)
d. Employment Agreement dated March 11, 1997, including
Restricted Stock Agreement and Non-Qualified Stock
Option Agreement, by and between Registrant and
Mitchell Wienick, incorporated herein by reference to
the EDGAR filing made by the Registrant on April 1,
1997 in connection with the Registrant's definitive
Proxy Statement for its annual meeting of share-
holders held on April 28, 1997 (File No. 1-5519).
(Constitutes a management contract or compensatory
plan or arrangement)
e. Consulting Agreement dated as of April 7, 1997 by
and between Registrant and Walter R. Garrison,
incorporated herein by reference to Registrant's
report on Form 10-Q for the quarter ended June 30,
1997 (File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
<PAGE>
16
INDEX TO EXHIBITS
Number Exhibit Page
- ------- ----------------------------------------------------- ----
f. Employment Agreement, Restricted Stock Agreement and
Non-Qualified Stock Option Agreement all dated August
4, 1997, by and between Registrant and Robert J.
Mannarino, incorporated herein by reference to the
Registrant's report on Form 10-Q for the quarter
ended September 30, 1997 (File No. 1-5519).
(Constitutes a management contract or compensatory
plan or arrangement)
g. Supplemental Retirement Agreement dated as of April 7,
1997 by and between Registrant and Mitchell Wienick,
incorporated herein by reference to the Registrant's
report on Form 10-K for the year ended December 31,
1997 (File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
h. Employment Agreement dated October 29, 1997,
Restricted Stock Agreement dated November 10, 1997
and Non-Qualified Stock Option Agreement dated
November 10, 1997 each by and between Registrant and
John D. Sanford, incorporated by reference to the
Registrant's report on Form 10-K for the year ended
December 31, 1997 (File No. 1-5519). (Constitutes
a management contract or compensatory plan or
arrangement)
i. Supplemental Retirement Agreement dated as of
November 18, 1997 by and between Registrant and
Robert J. Mannarino, incorporated herein by reference
to the Registrant's report on Form 10-K for the year
ended December 31, 1997 (File No. 1-55519).
(Constitutes a management contract or compensatory
plan or arrangement)
j. Supplemental Retirement Agreement dated as of
November 20, 1997 by and between Registrant and John
D. Sanford, incorporated herein by reference to the
Registrant's report on Form 10-K for the year ended
December 31, 1997 (File No. 1-5519). (Constitutes a
management contract or compensatory plan or
arrangement)
k. Consulting Agreement dated as of December 3, 1997 by
and between Registrant and Edgar D. Landis,
incorporated herein by reference to the Registrant's
report on Form 10-K for the year ended December 31,
1997 (File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
<PAGE>
17
INDEX TO EXHIBITS
Number Exhibit Page
- ------- ----------------------------------------------------- ----
l. Employment Agreement dated July 8, 1997, including 18
Restricted Stock Agreement and Non-Qualified Stock
Option Agreement, by and between Registrant and
Brian J. Bohling. (Constitutes a management contract
or compensatory plan or arrangement)
m. Supplemental Retirement Agreement dated November 18, 42
1997 by and between Registrant and Brian J. Bohling.
(Constitutes a management contract or compensatory
plan or arrangement)
n. Employment Agreement effective January 1, 1998 by 45
and between Registrant and Joseph R. Seiders.
(Constitutes a management contract or compensatory
plan or arrangement)
o. CDI Corp. 1998 Non-Qualified Stock Option Plan,
incorporated herein by reference to the EDGAR filing
made by the Registrant on April 3, 1998 in connection
with the Registrant's definitive Proxy Statement for
its annual meeting of shareholders held on May 5,
1998 (File No. 1-5519). (Constitutes a management
contract or compensatory plan or arrangement)
p. CDI Corp. Performance Share Plan. (Constitutes a 58
management contract or compensatory plan or
arrangement)
q. CDI Corp. Management Stock Purchase Plan. 65
(Constitutes a management contract or compensatory
plan or arrangement)
27. Financial Data Schedule. 71
<PAGE>
18
CDI CORP.
EMPLOYMENT AGREEMENT
--------------------
This EMPLOYMENT AGREEMENT (the "Agreement") is entered into as
of this ____ day of July, 1997 between CDI Corp., a Pennsylvania
corporation (the "Company"), and Brian J. Bohling ("Executive").
The Company desires to employ Executive, and Executive is willing
to be employed by the Company, upon the terms and subject to the
conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, and intending to be legally bound hereby, the parties agree as
follows:
TERMS
-----
SECTION 1. Employment.
----------
The Company hereby employs Executive, and Executive hereby accepts
such employment and agrees to serve as the Company's Senior Vice
President, Human Resources and to render services to the Company and
its subsidiaries, divisions and affiliates, during the Employment
Period set forth in Section 3, subject to the terms and conditions
hereinafter set forth.
SECTION 2. Duties.
------
Executive shall carry out such duties as are customarily
associated with the position of Senior Vice President, Human Resources,
including but not limited to employee relations, organizational
development, selection and staffing, compensation and benefits,
strategic human resource planning, change management and senior
management development. Executive shall perform these duties under the
direction of the Company's President and Chief Executive Officer ("the
President").
SECTION 3. Term.
----
The term of Executive's employment under this Agreement (the
"Employment Period") shall commence as of July 21, 1997 and, unless
sooner terminated pursuant to Section 7 of this Agreement, shall
continue until the close of business on the second anniversary of the
date hereof. At the end of such original period, the Employment Period
shall be automatically extended thereafter for successive one-year
periods unless sooner terminated pursuant to Section 7 of this
Agreement or unless either party notifies the other party in writing at
least 90 days prior to the scheduled expiration of the Employment
Period that it does not wish to extend the Employment Period for any
additional one-year periods. This Agreement survives any termination
of the Employment Period.
<PAGE>
19
SECTION 4. Extent of Services.
------------------
During the Employment Period, Executive shall devote his full time
and attention and give his best efforts, skills and abilities
exclusively to the performance of his duties hereunder, to the
operations of the Company and its business and to the business of its
subsidiaries, divisions and affiliates. Executive shall perform his
services hereunder at the Company's offices in Philadelphia,
Pennsylvania and at such other places as are required for the effective
management of the Company and its business and the business of its
subsidiaries, divisions and affiliates.
SECTION 5. Compensation and Benefits.
-------------------------
(a) Base Salary. During the Employment Period, Executive shall
receive as compensation for his services a salary at the rate of Two
Hundred Twenty-Five thousand Dollars ($225,000) per annum payable in
equal installments at such intervals as the Company pays its senior
executive officers generally (the "Base Salary"). The Base Salary
shall be reviewed annually by the President and may be increased if so
determined by the President in his absolute and sole discretion.
(b) Restricted Stock. As of the commencement of the Employment
Period, Executive shall be granted 3,500 restricted shares of the
Company's Common Stock (the "Restricted Stock") in two Groups (1,500 in
"Group A" and 2,000 in "Group B") pursuant to the terms of the
Restricted Stock Agreement attached hereto as Exhibit A. Pursuant to
Section 6 of the Restricted Stock Agreement, Executive shall not be
able to sell, transfer or otherwise benefit from any of the Restricted
Stock until such shares vest pursuant to Section 4 of the Restricted
Stock Agreement. One-half of the shares in each Group will vest
pursuant to the bonus awards provision in Section 5(d) of this
Agreement. Any share of Restricted Stock that does not vest on the
first date that such share was eligible to vest because Executive did
not receive the Maximum Bonus Award shall be forfeited on that date and
shall never vest. The other half of the shares in each Group will vest
over time as described in Section 4 of the Restricted Stock Agreement.
(c) Non-qualified Stock Options. As of the commencement of the
Employment Period, Executive shall be granted non-qualified stock
options to purchase 11,700 shares of the Company's Common Stock in two
Groups (5,200 shares in Group A and 6,500 shares in Group B) pursuant
to the terms of the Non-Qualified Stock Option Agreement attached
hereto as Exhibit B.
(d) Bonus Awards. Executive shall be eligible to receive bonus
compensation during the Employment Period. Such bonus awards shall be
based upon the Company's annual financial results, as reflected in the
Company's audited financial statements for such period, and shall
consist of a cash payment and a vesting of Restricted Stock. The
maximum bonus award for any calendar year would be a cash payment of
$112,500 (to be adjusted, however, to 50% of annual salary if the
Executive's annual salary rate is increased) and a vesting of up to
<PAGE>
20
the total number of shares of Restricted Stock available from "Group A"
and/or "Group B" for such year as set forth in the following table:
For Performance
In Calendar Year "Group A" Shares "Group B" Shares
- ---------------- ---------------- ----------------
1997 - -
1998 375 -
1999 375 500
2000 - 500
The maximum cash bonus award of $112,500 and the vesting of the maximum
number of shares of Restricted Stock available in a given year are,
together, referred to as the "Maximum Bonus Award" for that year.
However, after all of the above shares of Restricted Stock have either
been vested or forfeited, the Maximum Bonus Award shall consist solely
of an annual cash payment of $112,500 plus the vesting of any
additional shares of restricted stock that the Company may determine to
make available to Executive. The bonus award during Executive's
employment with the Company shall be determined as follows:
(i) 1997. The bonus, if any, for the period beginning as
of the date of this Agreement and ending December 31, 1997 shall be
determined in accordance with the performance goals set forth below.
The Maximum Bonus Award for 1997 shall not be reduced to reflect that
this period is less than a full calendar year and half the cash award
($56,250) shall be guaranteed. The maximum bonus that Executive may
earn in 1997 is referred to herein as the "1997 Maximum Bonus Award"
and shall be determined as follows:
(A) Executive shall have the opportunity to receive
up to 75% of the 1997 Maximum Bonus Award based on the President's
determination of whether the qualitative goals set forth on Exhibit C
to this Agreement have been met during 1997;
(B) Executive shall have the opportunity to receive
up to one-eighth of the 1997 Maximum Bonus Award based on the Company's
achievement of its revenue target as provided in the Company's 1997
operational plan ("1997 Revenue Target"). Executive shall receive a
portion of the 1997 Maximum Bonus Award under this Section 7(d)(i)(B)
equal to 12.5% multiplied by the "Revenue Factor." The Revenue Factor
shall be a percentage ranging from 0% to 100%, with 100% representing
that the Company's 1997 revenue is equal to or exceeds the 1997 Revenue
Target, and with 0% representing that the Company's 1997 revenue is
equal to or less than the Company's 1996 revenue. If the Company's
1997 revenue is greater than its 1996 revenue, but less than its 1997
Revenue Target, the Revenue Factor shall equal a fraction, the
numerator of which is the Company's 1997 revenue minus the Company's
1996 revenue, and the denominator of which is the 1997 Revenue Target
minus the Company's 1996 revenue; and
(C) Executive shall have the opportunity to receive
up to one-eighth of the 1997 Maximum Bonus Award based on the Company's
achievement of its earnings before interest and taxes
<PAGE>
21
("EBIT") target as provided in the Company's 1997 operational plan
("1997 EBIT Target"). Executive shall receive a portion of the 1997
Maximum Bonus Award under this Section 7(d)(i)(C) equal to 12.5%
multiplied by the "EBIT Factor." The EBIT Factor shall be a percentage
ranging from 0% to 100%, with 100% representing that the Company's 1997
EBIT is equal to or exceeds the 1997 EBIT Target, and with 0%
representing that the Company's 1997 EBIT is equal to or less than the
Company's 1996 EBIT. If the Company's 1997 EBIT is greater than its
1996 EBIT, but less than its 1997 EBIT Target, the EBIT Factor shall
equal a fraction, the numerator of which is the Company's 1997 EBIT
minus the Company's 1996 EBIT, and the denominator of which is the 1997
Target EBIT minus the Company's 1996 EBIT.
(ii) Calendar Years 1998 and Thereafter. Within a mutually
agreeable time period before the beginning of each calendar year, the
President shall establish goals for Executive for the next calendar
year based on the final operational plan and budget of the Company for
such year, and Executive shall be entitled to receive a percentage of
the Maximum Bonus Award, up to 100%, depending on whether the Company
attains all or a portion of such goals. As in 1997, the goals in these
years will be both qualitative and quantitative in nature and will be
established in a manner comparable to that used for other senior
executives in the Company.
Any of the Company's financial results that are used to calculate
bonuses under this Section 5(d) shall be taken only from the Company's
audited financial statements for the applicable year.
(iii) Payment of Bonuses and Vesting of Restricted Stock.
All cash bonuses payable under this Section 5(d) shall be paid to
Executive within two weeks after the delivery of audited financial
statements to the Company for the prior calendar year. Any shares of
Restricted Stock that vest as a result of Executive receiving all or
a portion of the Maximum Bonus Award shall become vested on the same
date that the cash bonus is paid to Executive. In the event that
Executive's employment with the Company is terminated by the Company
other than for Cause, Executive will be paid a proportionate amount of
the cash bonus for the year during which the termination occurs. This
proportionate amount will be a percentage of the maximum cash bonus
available for such year which will be equal to the percentage of the
year during which Executive was employed by the Company.
(e) Employee Benefits. During the Employment Period, Executive
shall be entitled to participate in all employee benefit plans and
programs as the Company shall provide generally to other senior
executive officers of the Company from time to time, other than any
bonus plans applicable to such other executives and with the exception
that, rather than the vacation schedule generally offered to such other
executives, Executive shall receive two weeks paid vacation in 1997 and
four weeks paid vacation during each calendar year thereafter. If
there is an overall revision in the Company's compensation structure or
benefits, Executive will participate in the revised structure and
benefits in a manner comparable to the other senior executives of the
Company.
<PAGE>
22
(f) All payments to Executive or his estate made pursuant to this
Agreement shall be subject to such withholding as may be required by
any applicable laws.
SECTION 6. Expense Reimbursements.
----------------------
During the Employment Period, the Company shall reimburse
Executive for all reasonable and itemized out-of-pocket expenses
incurred by Executive in the ordinary course of the Company's business
pursuant to the terms of the Company's business expense reimbursement
policy and provided such expenses are properly reported to the Company
in accordance with its accounting procedures.
SECTION 7. Termination.
-----------
(a) The Employment Period may be terminated by either the
President on behalf of the Company or the Executive at any time or
for any reason, as provided in this Section 7(a). In addition to the
scheduled expiration of the Employment Period set forth in Section 3,
the Employment Period shall terminate upon the earliest to occur of the
following:
(i) the Executive's death or Disability;
(ii) delivery by the Company to Executive of a written
notice of the Company's election to terminate Executive's employment
hereunder, for any reason whatsoever; or
(iii) the close of business on the day which is 90 days
after the date on which the Executive shall have delivered to the
Company written notice of Executive's election to terminate Executive's
employment hereunder.
(b) For purposes of this Agreement, "Disability" shall have the
same meaning as "Total Disability" under the CDI Corporation Long Term
Disability Benefits Program, or such other comparable program as may
then be in effect that provides long term disability coverage to the
Company's management employees.
(c) For purposes of this Agreement, "Cause" means any one or more
of the following bases for termination of Executive's employment with
the Company:
(i) Executive's conviction or commission of (but only if
Executive admits to committing or if a reasonable person would
conclude, based upon all available evidence, that Executive committed)
a felony or other crime involving moral turpitude;
(ii) Executive's refusal to perform such services as may be
reasonably delegated or assigned to Executive, consistent with his
position, by the President; provided, however, that a termination under
this Section 7(c)(ii) shall not be for Cause unless the Company
provides written notice to Executive of its intention to terminate
Executive for Cause under this Section 7(c)(ii), and Executive fails,
<PAGE>
23
to the reasonable satisfaction of the Company, to cure the defects
stated in such written notice within ten days after the notice was
given to Executive;
(iii) Executive's willful misconduct or gross negligence in
connection with the performance of his duties under this Agreement that
materially adversely affects Executive's ability to perform his duties
for the Company or materially adversely affects the Company;
(iv) Executive's material breach of any of the terms or
conditions of this Agreement; provided, however, that a termination
under this Section 7(c)(iv) shall not be for Cause unless the Company
provides written notice to Executive of its intention to terminate
Executive for Cause under Section 7(c)(iv), and Executive fails, to the
reasonable satisfaction of the Company, to cure the defects stated in
such written notice within ten days after the notice was given to
Executive;
(v) receipt of notice from Executive of Executive's
intention to terminate his employment with the Company; or
(vi) receipt of reliable information from another source of
Executive's intention to terminate his employment with the Company
unless Executive delivers a written statement to Company providing that
he does not intend to terminate his employment with the Company as long
as such statement is delivered to the Company no later than 48 hours
after the Company has asked Executive whether its information regarding
his intended termination is accurate.
(d) Following any termination of Executive's employment
hereunder, all obligations of the Company under this Agreement shall
terminate except (i) any obligations with respect to the payment of
accrued and unpaid salary or expense reimbursements under Sections 5 or
6 hereof through the date of Executive's termination of employment
hereunder, and (ii) any obligations as set forth in Section 7(e).
(e) In the event of any termination of Executive's employment by
the Company other than for Cause, by Executive for Good Reason (as
hereinafter defined) or as a result of Executive's death or Disability,
the Company shall continue to pay Executive his Base Salary in the same
intervals and amounts that were in effect immediately prior to
termination, until the later of (i) one year from the date of such
termination or (ii) the next scheduled expiration of the Employment
Period, without regard for any renewals that would or might have taken
place but for Executive's termination of employment. In addition, all
unvested and unforfeited Restricted Stock and all unvested Stock
Options will immediately vest as of the date of termination. The
period during which the Company is required to continue to pay
Executive his Base Salary under this Section 7(e) is referred to as the
"Severance Period." During the Severance Period, the Company shall
continue to pay for medical benefit plans and programs for Executive
comparable to those in which Executive participated and for which the
Company paid immediately prior to Executive's termination (except to
the extent Executive receives
<PAGE>
24
comparable benefits from another employer). Notwithstanding the above,
no amounts shall be paid or become payable to Executive during the
Severance Period until Executive has executed a valid release and
waiver of all claims and potential claims against the Company and other
related parties in a form that is reasonably satisfactory to the
Company, and any required waiting period under such release and waiver
has expired and Executive has not revoked the release during such
waiting period.
(i) "Good Reason" exists if the Executive voluntarily
terminates employment with the company at any time after: (A) Executive
is assigned duties that are demeaning or otherwise materially
inconsistent with the duties currently performed by Executive, or (B)
Executive's place of employment with the Company is moved outside the
Philadelphia metropolitan area, or a request is made to Executive to
make such a move, and Executive is unwilling to make such a move, or
(C) Mitch Wienick involuntarily ceases to be President and Chief
Executive Officer of the Company, or (D) there is a Change in Control,
as defined below. Before the Executive terminates for Good Reason, he
must notify the Company in writing of his intention
to terminate and the Company shall have 15 days after receiving such
written notice to remedy the situation, if possible.
(ii) "Change in Control" shall mean a change in control
of a nature that would be required to be reported in response to Item 1
of Form 8-K promulgated under the Securities Exchange Act of 1934, as
amended (the "Act"), provided, that, without limitation, such a change
in control shall be deemed to have occurred if (A) any "person" (as
such term is used in Sections 13(d) and 14(d) of the Act), other than
the Company or any "person" who on the date hereof is a director or
officer of the Company, is or becomes the "beneficial owner," (as
defined in Rule 13d-3 under the Act), directly or indirectly, of
securities of the Company representing more than 50% of the combined
voting power of the Company's then outstanding securities; or (B)
during any period of two consecutive years during the term of this
Agreement, individuals who at the beginning of such period constitute
the Board (the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board, unless the election of each director who
was not a director at the beginning of such period has been approved in
advance by directors representing at least a majority of the directors
then in office who were members of the Incumbent Board or whose
election was approved by the Incumbent Board.
(f) Any termination by the Company or by Executive of Executive's
employment hereunder shall be communicated by written notice.
(g) Any severance compensation granted in this Section 7 shall be
the sole and exclusive compensation or benefit due to Executive upon
termination of Executive's employment.
<PAGE>
25
SECTION 8. Representations, Warranties and Acknowledgments of
Executive.
--------------------------------------------------
(a) Executive represents and warrants that his experience and
capabilities are such that the provisions of Section 9 will not prevent
him from earning his livelihood, and acknowledges that it would cause
the Company serious and irreparable injury and cost if Executive were
to use his ability and knowledge in competition with the Company or to
otherwise breach the obligations contained in Section 9.
(b) Executive acknowledges that (i) during the term of
Executive's employment with the Company, Executive will have access
to Confidential Information; (ii) such Confidential Information is
proprietary, material and important to the Company and its non-
disclosure is essential to the effective and successful conduct of
the Company's business; (iii) the Company's business, its customers'
business and the businesses of other companies with which the Company
may have commercial relationships could be damaged by the unauthorized
use or disclosure of this Confidential Information; and (iv) it is
essential to the protection of the Company's goodwill and to the main-
tenance of the Company's competitive position that the Confidential
Information be kept secret, and that Executive not disclose the
Confidential Information to others or use the Confidential Information
to Executive's advantage or the advantage of others.
(c) Executive acknowledges that as the Company's Senior Vice
President, Human Resources, Executive will be put in a position of
trust and confidence and have access to Confidential Information, will
be supervising certain operations and employees of the Company, will be
in contact with customers and prospective customers and will
participate in the preparation and implementation of the Company's
strategic plans and its policies and procedures.
(d) Executive acknowledges that as the Company's Senior Vice
President, Human Resources, it is essential for the Company's
protection that Executive be restrained following the termination of
Executive's employment with the Company from soliciting or inducing any
of the Company's officers and management employees to leave the
Company's employ, hiring or attempting to hire any of the Company's
officers or management employees, soliciting the Company's customers
and suppliers for a competitive purpose, and competing against the
Company for a reasonable period of time.
(e) Executive represents and warrants that Executive is not bound
by any other agreement, written or oral, which would preclude Executive
from fulfilling all the obligations, duties and covenants in this
Agreement. Executive also represents and warrants that Executive will
not use, in connection with his employment under this Agreement, any
materials which may be construed to be confidential to a prior employer
or other persons or entities. In the event of a breach of this Section
8 which results in damage to the Company, Executive will indemnify and
hold the Company harmless with respect to such damage.
<PAGE>
26
References in this Section 8 to the Company shall include the Company,
its subsidiaries, divisions and affiliates.
SECTION 9. Executive's Covenants and Agreements.
------------------------------------
(a) Executive agrees to maintain full and complete records of all
transactions and of all services performed by Executive on behalf of
the Company and to submit this information to the Company in the manner
and at the times that the Company may, from time to time, direct.
(b) Executive agrees to devote Executive's entire productive
time, ability and attention to the Company's business during the term
of this Agreement. Executive further agrees not to, directly or
indirectly, render any services of a business, commercial or
professional nature to any other person or organization, whether for
compensation or otherwise, without the Company's prior written consent.
(c) Executive agrees to abide by and comply with all personnel
and company practices and policies applicable to Executive.
(d) Executive shall promptly and completely disclose to the
Company and the Company or its customers will own all rights, title and
interest to any Inventions made, recorded, written, first reduced to
practice, discovered, developed, conceived, authored or obtained
by Executive, alone or jointly with others, during the term of
Executive's employment with the Company (whether or not such Inventions
are made, recorded, written, first reduced to practice, discovered,
developed, conceived, authored or obtained during working hours) and
for one year after termination of Executive's employment with the
Company. Executive agrees to take all such action during the term of
Executive's employment with the Company or at any time thereafter as
may be necessary, desirable or convenient to assist the Company or its
customers in securing patents, copyright registrations, or other
proprietary rights in such Inventions and in defending and enforcing
the Company's or such customer's rights to such Inventions, including
without limitation the execution and delivery of any instruments of
assignments or transfer, affidavits, and other documents, as the
Company or its customers may request from time to time to confirm the
Company's or its customers' ownership of the Inventions. Executive
represents and warrants that as of the date hereof there are no works,
software, inventions, discoveries or improvements (other than those
included in a copyright or patent of application therefor) which were
recorded, written, conceived, invented, made or discovered by Executive
before entering into this Agreement and which Executive desires to be
removed from the provisions of this Agreement.
(e) For purposes of this Agreement, "Inventions" means concepts,
developments, innovations, inventions, information, techniques, ideas,
discoveries, designs, processes, procedures, improvements,
enhancements, modifications (whether or not patentable), including, but
not limited to, those relating to hardware, software, languages,
<PAGE>
27
models, algorithms and other computer system components, and writings,
manuals, diagrams, drawings, data, computer programs, compilations
and pictorial representations and other works (whether or not
copyrightable). Inventions does not include those which are made,
developed, conceived, authored or obtained by Executive without the use
of the Company's resources and which do not relate to any of the
Company's past, present or prospective activities.
(f) During and after the term of Executive's employment with the
Company, Executive will hold all of the Confidential Information in the
strictest confidence and will not use any Confidential Information for
any purpose and will not publish, disseminate, disclose or otherwise
make any Confidential Information available to any third party, except
as may be required in connection with the performance of Executive's
duties hereunder.
(g) For purposes of this Agreement, "Confidential Information"
means all information, data, know-how, systems and procedures of a
technical, sensitive or confidential nature in any form relating to the
Company or its customers, including without limitation about
Inventions, all business and marketing plans, marketing and financial
information, pricing, profit margin, cost and sales information,
operations information, forms, contracts, bids, agreements, legal
matters, unpublished written materials, names and addresses of
customers and prospective customers, systems for recruitment,
contractual arrangements, market research data, information about
employees, suppliers and other companies with which the Company has a
commercial relationship, plans, methods, concepts, computer programs or
software in various stages of development, passwords, source code
listings and object code.
(h) All files, records, reports, programs, manuals, notes,
sketches, drawings, diagrams, prototypes, memoranda, tapes, discs, and
other documentation, records and materials in any form that in any way
incorporate, embody or reflect any Confidential Information or
Inventions will belong exclusively to the Company and its customers and
Executive will not remove from the Company's or its customers' premises
any such items under any circumstances without the prior written
consent of the party owning such item. Executive will deliver to the
Company all copies of such materials in Executive's control upon the
Company's request or upon termination of Executive's employment with
the Company and, if requested by the Company, will state in writing
that all such materials were returned.
(i) If Executive's employment is terminated for any reason,
including resignation by Executive or termination by the Company, with
or without Cause, then for a period which extends to the later of two
years immediately following Executive's termination or the date of
which the Employment Period was scheduled to expire, Executive agrees
not to:
(i) own, manage, operate, finance, join, control, or
participate in the ownership, management, operation, financing or
control of, or be connected, directly or indirectly, as proprietor,
<PAGE>
28
partner, shareholder, director, officer, executive, employee, agent,
creditor, consultant, independent contractor, joint venturer, investor,
representative, trustee or in any other capacity or manner whatsoever
with, any entity that engages or intends to engage in any Competing
Business anywhere in the world. "Competing Business" means any
business or other enterprise which engages in the staffing business;
and
(ii) directly or indirectly, solicit, interfere with or
attempt to entice away from the Company, any officer or management
employees of the Company or anyone who was one of the Company's
officers or management employees within 12 months prior to such
contact, solicitation, interference or enticement; and
(iii) contact, solicit, interfere with or attempt to entice
away from the Company, any customer on behalf of a Competing Business.
References in this Section 9 to the Company shall include the Company,
its subsidiaries, divisions and affiliates.
SECTION 10. Remedies.
--------
Executive acknowledges that his promised services hereunder are of
a special, unique, unusual, extraordinary and intellectual character,
which give them peculiar value the loss of which cannot be reasonably
or adequately compensated in an action of law, and that,
in the event there is a breach hereof by Executive, the Company will
suffer irreparable harm, the amount of which will be impossible to
ascertain. Accordingly, the Company shall be entitled, if it so
elects, to institute and prosecute proceedings in any court of
competent jurisdiction, either at law or in equity, to obtain damages
for any breach or to enforce specific performance of the provisions or
to enjoin Executive from committing any act in breach of this
Agreement. The remedies granted to the Company in this Agreement are
cumulative and are in addition to remedies otherwise available to the
Company at law or in equity. If the Company is obliged to resort to
the courts for the enforcement of any of the covenants of Executive
contained in Section 9 hereof, each such covenant shall be extended for
a period of time equal to the period of such breach, if any, which
extension shall commence on the later of (i) the date on which the
original (unextended) term of such covenant is scheduled to terminate
or (ii) the date of the final court order (without further right of
appeal) enforcing such covenant.
SECTION 11. Waiver of Breach.
----------------
The waiver by the Company of a breach of any provision of this
Agreement by Executive shall not operate or be construed as a waiver of
any other or subsequent breach by Executive of such or any other
provision. No delay or omission by the Company or Executive in
exercising any right, remedy or power hereunder or existing at law or
in equity shall be construed as a waiver thereof, and any such right,
remedy or power may be exercised by the Company or Executive from time
to time and as often as may be deemed expedient or necessary by the
Company or Executive in its or his sole discretion.
<PAGE>
29
SECTION 12. Notices.
-------
All notices required or permitted hereunder shall be made in
writing by hand-delivery, certified or registered first-class mail, or
air courier guaranteeing overnight delivery to the other party at the
following addresses:
To the Company:
CDI Corp.
3500 Bell Atlantic Tower
1717 Arch Street
Philadelphia, PA 19103
Attention: President/CEO
with a required copy to:
CDI Corp.
3500 Bell Atlantic Tower
1717 Arch Street
Philadelphia, PA 19103
Attention: General Counsel
To Executive:
Brian J. Bohling
708 Kimberly Drive
Moorestown, New Jersey 08057
or to such other address as either of such parties may designate in a
written notice served upon the other party in the manner provided
herein. All notices required or permitted hereunder shall be deemed
duly given and received when delivered by hand, if personally
delivered; on the third day next succeeding the date of mailing if sent
by certified or registered first-class mail; and on the next business
day, if timely delivered to an air courier guaranteeing overnight
delivery.
SECTION 13. Severability.
------------
If any term or provision of this Agreement or the application
thereof to any person or circumstance shall, to any extent, be held
invalid or unenforceable by a court of competent jurisdiction, the
remainder of this Agreement or the application of any such term or
provision to persons or circumstances other than those as to which it
is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law. If any of the
provisions contained in this Agreement shall for any reason be held to
be excessively broad as to duration, scope, activity or subject, it
shall be construed by limiting and reducing it, so as to be valid and
enforceable to the extent compatible with the applicable law or the
determination by a court of competent jurisdiction.
<PAGE>
30
SECTION 14. Governing Law; Exclusive Choice of Forum.
----------------------------------------
The implementation and interpretation of this Agreement shall be
governed by and enforced in accordance with the laws of the
Commonwealth of Pennsylvania without giving effect to the conflicts of
law provisions thereof. The parties hereby submit to the exclusive
jurisdiction of, and waive any venue objections against, the United
States District Court for the Eastern District of Pennsylvania and the
state and local courts of the Commonwealth of Pennsylvania,
Philadelphia County, for any litigation arising out of this Agreement.
SECTION 15. Binding Effect and Assignability.
--------------------------------
The rights and obligations of both parties under this Agreement
shall inure to the benefit of and shall be binding upon their heirs,
successors and assigns. Executive's rights under this Agreement shall
not, in any voluntary or involuntary manner, be assignable and may not
be pledged or hypothecated without the prior written consent of the
Company.
SECTION 16. Counterparts; Section Headings.
------------------------------
This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument. The section headings of
this Agreement are for convenience of reference only.
SECTION 17. Survival.
--------
Notwithstanding the termination of this Agreement or Executive's
employment hereunder for any reason, Sections 8, 9, 10, 13, 14 and 17
hereof shall survive any such termination.
SECTION 18. Entire Agreement.
----------------
This instrument constitutes the entire agreement with respect to
the subject matter hereof between the parties hereto and replaces and
supersedes as of the date hereof any and all prior oral or written
agreements and understandings between the parties hereto. This
Agreement may only be modified by an agreement in writing executed by
both Executive and the Company.
<PAGE>
31
IN WITNESS WHEREOF, the undersigned have executed this Agreement
the date and year first written above.
COMPANY:
-------
CDI CORP.
By:
-------------------------------------
Mitchell Wienick
President and Chief Executive Officer
EXECUTIVE:
-------------------------------------
Brian J. Bohling
<PAGE>
32
EXHIBIT A
---------
CDI CORP.
RESTRICTED STOCK AGREEMENT
--------------------------
SECTION 1. Grant of Restricted Stock.
-------------------------
CDI Corp. (the "Company") hereby grants to Brian J. Bohling (the
"Executive") 3,500 shares of the Company's common stock par value
$.10 per share in two groups ("Group A" for 1,500 shares and "Group B"
for 2,000 shares), subject to the restrictions set forth herein. The
Company, immediately following the execution of this Agreement, will
issue or transfer 3,500 shares of the Company's common stock ("Stock")
to Executive. The Stock shall consist of 4 certificates for the Group
A shares consisting of 375 shares each and 4 certificates for the Group
B shares consisting of 500 shares each, all registered in Executive's
name (the "Certificates"), subject to the restrictions set forth
herein.
SECTION 2. Custody of Stock.
----------------
The Company will deliver the Certificates to the Secretary of the
Company ("Secretary"), to be held in escrow in accordance with the
terms of this Agreement. Simultaneously with the delivery of the
Certificates, Executive will sign and deliver to the Secretary an
undated stock power with respect to each of the Certificates,
authorizing the Secretary to transfer title to each Certificate to the
Company, in the event that Executive forfeits all or a portion of the
Stock in accordance with the terms of this Agreement.
SECTION 3. Rights to Vote Stock.
--------------------
Executive will be considered a shareholder with respect to the
escrowed Stock and will have all corresponding rights, including the
right to vote the Stock and to receive all dividends and other
distributions with respect to the Stock, except that Executive will
have no right to sell, exchange, transfer, pledge, hypothecate or
otherwise dispose of any escrowed Stock, and Executive's rights in the
escrowed Stock will be subject to forfeiture as provided in Section 5
of this Agreement.
SECTION 4. Vesting of Restricted Stock.
---------------------------
Executive will vest, if at all, in half of the shares in each
Group pursuant to the terms of Section 5(d) of the Employment Agreement
between Executive and the Company, dated ______, 1997 (the "Employment
Agreement"). Executive will vest in the other half of the shares in
each Group according to the following schedule:
<PAGE>
33
Date of Vesting "Group A" Shares "Group B" Shares
- --------------- ---------------- ----------------
12/31/97 - -
12/31/98 375 -
12/31/99 375 500
12/31/00 - 500
If Executive is terminated by the Company other than for Cause or as a
result of Executive s death or Disability, or if Executive terminates
for Good Reason, as such terms are defined in the Employment Agreement,
Executive shall immediately vest in all unvested restricted shares in
the above schedule and in any restricted shares subject to vesting
under Section 5(d) of the Employment Agreement which, as of the date of
such termination, have not been forfeited. If Executive s employment
with the Company terminates for any reason other than the reasons
specified in the immediately preceding sentence, none of the unvested
shares shall ever vest and such shares shall be forfeited to the
Company as of the date that Executive s employment with the Company
terminates. For all shares of Stock in which Executive becomes vested,
the escrow will terminate and the Secretary will deliver the stock
certificates to Executive as soon as practicable after such shares
vest.
SECTION 5. Forfeiture of Stock.
-------------------
In addition to the reasons for forfeiture of restricted shares
described above, Executive shall also forfeit all remaining escrowed
Stock upon any attempt by Executive to sell, exchange, transfer,
pledge, hypothecate or otherwise dispose or encumber any of the
escrowed Stock. Title to all forfeited shares of Stock shall be
transferred back to the Company as soon as reasonably practicable after
they are forfeited.
SECTION 6. Restriction on Transfer Rights of Shares.
----------------------------------------
Whenever shares of Stock vest under this Agreement or the
Employment Agreement, one-half of those shares of Stock may not be sold
or transferred until the second anniversary of their respective vesting
date, and the other half may be sold or transferred at any time on or
after their respective vesting date. With respect to any shares of
Stock the sale or transfer of which is restricted under this Section 6,
Executive may not engage in any transaction designed to provide him
with substantially the same economic benefit of a sale of any shares of
Stock so restricted, such as a short sale or a sale of
a put option. Certificates representing any shares of Stock so
restricted will be inscribed with an appropriate legend prohibiting
such transfer.
SECTION 7. Compliance with Laws.
--------------------
All shares of Stock issued to Executive or his personal
representative shall be transferred in accordance with all applicable
laws, regulations or listing requirements of any national securities
exchange, and the Company may take all actions necessary or
<PAGE>
34
appropriate to comply with such requirements including, without
limitation, withholding federal income and other taxes with respect to
such Stock; restricting (by legend or otherwise) such Stock as shall be
necessary or appropriate, in the opinion of counsel for the Company, to
comply with applicable federal and state securities laws, including
Rule 16b-3 (or any similar rule) of the Securities and Exchange
Commission, which restrictions shall continue to apply after the
delivery of certificates for the Stock to Executive or his personal
representative; and postponing the issuance or delivery of any Stock.
Notwithstanding any provision in this Agreement to the contrary, the
Company shall not be obligated to issue or deliver any Stock if such
action violates any provision of any law or regulation of any
governmental authority or any national securities exchange.
SECTION 8. Agreement Not to Affect Relationship with Company.
-------------------------------------------------
This Agreement shall not confer upon Executive any right to
continue in the employ or service of the Company.
SECTION 9. Adjustment for Capital Changes.
------------------------------
The number of shares of Stock subject to this Agreement shall be
appropriately adjusted in the event of a stock split, stock dividend,
recapitalization, or other capital change of the Company.
SECTION 10. Interpretation.
--------------
The Company shall have the sole power to interpret this Agreement
and to resolve any disputes arising hereunder.
IN WITNESS WHEREOF, the undersigned have executed this Agreement
the date and year first written above.
Company:
-------
CDI CORP.
By:
-------------------------------------
Mitchell Wienick,
President and Chief Executive Officer
EXECUTIVE:
---------
-------------------------------------
Brian J. Bohling
<PAGE>
35
EXHIBIT B
---------
CDI CORP.
--------
NON-QUALIFIED STOCK OPTION AGREEMENT
------------------------------------
SECTION 1. Grant of Option.
---------------
The CDI Corp. Board of Directors' Stock Option Committee, pursuant
to the authority granted to it under the CDI Corp. Non-Qualified Stock
Option and Stock Appreciation Rights Plan, as amended (the "Plan")
hereby grants to Brian J. Bohling (the "Optionee") an option (the
"Option" when reference is made to the right to purchase all of the
Shares) to purchase up to 11,700 shares of CDI Corp. common stock (the
"Shares" when reference is made to all or a portion of the shares
subject to the Option), according to the terms and conditions set forth
herein and in the Plan.
SECTION 2. Other Definitions.
-----------------
(a) "Board" means the board of directors of the Company.
(b) "Cause" means termination of Optionee's employment with the
Company resulting from any one or more of the following events:
(i) Optionee's conviction or commission of (but only if
Executive admits to committing or if a reasonable person would
conclude, based upon all available evidence, that Executive committed)
a felony or other crime involving moral turpitude;
(ii) Optionee's refusal to perform such services as may be
reasonably delegated or assigned to Optionee, consistent with his
position, by the President; provided, however, that a termination under
this Section 2(b)(ii) shall not be for Cause unless the Company
provides written notice to Optionee of its intention to terminate
Optionee for Cause under this Section 2(b)(ii), and Optionee fails, to
the reasonable satisfaction of the Company, to cure the defects stated
in such written notice within ten days after the notice was given to
Optionee;
(iii) Optionee's willful misconduct or gross negligence in
connection with the performance of his duties under his Employment
Agreement with the Company dated ______, 1997 (the "Employment
Agreement") that materially adversely affects Optionee's ability to
perform his duties for the Company or materially adversely affects the
Company;
(iv) Optionee's material breach of any of the terms or
conditions of the Employment Agreement; provided, however, that a
termination under this Section 2(b)(iv) shall not be for Cause unless
the Company provides written notice to Executive of its intention to
<PAGE>
36
terminate Executive for Cause under this Section 2(b)(iv), and
Executive fails, to the reasonable satisfaction of the Company, to cure
the defects stated in such written notice within ten days after the
notice was given to Executive.
(v) receipt of notice from Optionee of Optionee's
intention to terminate his employment with the Company; or
(vi) receipt of reliable information from another source of
Optionee's intention to terminate his employment with the Company
unless Optionee delivers a written statement to Company providing that
he does not intend to terminate his employment with the Company as long
as such statement is delivered to the Company no later than 48 hours
after the Company has asked Optionee whether its information regarding
his intended termination is accurate.
(c) "Change in Control "shall mean a change in control of a
nature that would be required to be reported in response to Item 1 of
Form 8-K promulgated under the Securities Exchange Act of 1934, as
amended (the "Act"), provided, that, without limitation, such a change
in control shall be deemed to have occurred if (A) any "person" (as
such term is used in Sections 13(d) and 14(d) of the Act), other than
the Company or any "person" who on the date hereof is a director or
officer of the Company, is or becomes the "beneficial owner," (as
defined in Rule 13d-3 under the Act), directly or indirectly, of
securities of the Company representing more than 50% of the combined
voting power of the Company's then outstanding securities; or (B)
during any period of two consecutive years during the term of this
Agreement, individuals who at the beginning of such period constitute
the Board (the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board, unless the election of each director who
was not a director at the beginning of such period has been approved in
advance by directors representing at least a majority of the directors
then in office who were members of the Incumbent Board or whose
election was approved by the Incumbent Board.
(d) "Committee" means the Stock Option Committee of the Board.
(e) "Company" means CDI Corp.
(f) "Date of Exercise" means the date on which the written notice
required by Section 8 below is received by the Treasurer of the
Company.
(g) "Date of Grant" means _____________, 1997, the date on which
the Option is awarded pursuant to the Plan and this Agreement.
(h) "Disability" shall have the same meaning as "Total
Disability" under the CDI Corporation Long Term Disability Benefits
Program, or such other comparable program as may then be in effect that
provides long term disability coverage to the Company's management
employees.
<PAGE>
37
(i) "Fair Market Value" of a share of Stock means the closing
price of actual sales of shares on the New York Stock Exchange on a
given date or, if there are no such sales on such date, the closing
price of the shares of Stock on such exchange on the last date on which
there was a sale.
(j) "Good Reason" exists if the Optionee voluntarily terminates
employment with the Company at any time after (i) the Optionee is
assigned duties that are demeaning or otherwise materially inconsistent
with the duties currently performed by the Optionee, or (ii) the
Optionee's place of employment with the Company is moved outside the
Philadelphia metropolitan area, or a request is made to Optionee to
make such a move, and Optionee is unwilling to make such
a move, or (C) Mitch Wienick involuntarily ceases to be President and
Chief Executive Officer of the Company, or (D) there is a Change in
Control, as defined above. Before the Optionee terminates for Good
Reason, he must notify the Company in writing of his intention to
terminate and the Company shall have 15 days after receiving such
written notice to remedy the situation, if possible.
(k) "Group A" shares means 5,200 shares of the 11,700 shares
subject to this Option.
(l) "Group B" shares means the remaining 6,500 shares of the
11,700 shares subject to this Option.
(m) "Option Price" means $______, representing the Fair Market
Value of a share of Stock on the last trading date immediately
preceding the Date of Grant.
(n) "President" means the President and Chief Executive Officer
of the Company.
(o) "Stock" means the Company's common stock, par value $.10 per
share.
(p) "Termination Date" means the earliest of:
(i) the date on which Optionee's employment with the
Company terminates if such termination is by the Company for Cause or
by Optionee without Good Reason;
(ii) in the event of termination of Optionee's employment
by the Company without Cause or by Optionee for Good Reason, the date
two weeks after the date of such termination;
(iii) in the event of the death or Disability of the
Optionee, the date six months after the date of the Optionee's death or
Disability; or
(iv) 12:00 a.m. __________, 2002.
<PAGE>
38
SECTION 3. Time of Exercise.
----------------
No Option shall be exercisable with respect to any Shares unless
the Option has vested with respect to such Shares in accordance with
Section 4 hereof. If vested, the Option may be exercised in whole or
in part as to the vested portion at any time after vesting until the
Termination Date.
SECTION 4. Option Vesting.
--------------
Subject to the accelerated vesting provisions of Section 4(b), the
Option will vest as follows:
(a) Date of Vesting "Group A" Shares "Group B" Shares
--------------- ---------------- ----------------
12/31/97 1,560 -
12/31/98 1,560 1,950
12/31/99 2,080 1,950
12/31/00 - 2,600
(b) Accelerated Vesting. In addition to the vesting provisions
above, the Option shall vest and be immediately exercisable upon the
termination of the Optionee's employment with the Company by the
Optionee for Good Reason, or following a Change in Control of the
Company if such termination is by the Company without Cause or as a
result of Optionee s death or Disability.
SECTION 5. Payment for Shares by the Optionee.
----------------------------------
Full payment for Shares purchased upon the exercise of the Option
shall be made by check or bank draft.
SECTION 6. Nontransferability of Option.
----------------------------
The Option may not be transferred, in whole or in part, except by
will or the applicable laws of descent and distribution. The Option
may not be exercised by any person other than the Optionee or, in the
case of the Optionee's death, by the person to whom the Optionee's
rights have passed by will or by the applicable laws of descent and
distribution.
SECTION 7. Restriction on Transfer Rights of Shares.
----------------------------------------
Whenever Shares are purchased through the exercise of all or a
portion of the Option, one-half of the purchased Shares may not be sold
or transferred until the second anniversary of their respective Dates
of Exercise, and the other half may be sold or transferred at any time
on or after their respective Dates of Exercise.
With respect to any Shares the sale or transfer of which is
restricted under this Section 7, Optionee may not engage in any
transaction designed to provide him with substantially the same
economic benefit of a sale of any Shares so restricted, such as a
<PAGE>
39
short sale or a sale of a put option. Certificates representing any
Shares so restricted will be inscribed with an appropriate legend
prohibiting such transfer.
SECTION 8. Manner of Exercise.
------------------
The Option shall be exercised by giving written notice of exercise
to the Company's Treasurer, at 1717 Arch St., 35th Floor, Philadelphia,
Pennsylvania 19103-2768. Such notice must state the
number of Shares and the Group as to which the Option is exercised.
Each such notice shall be irrevocable once given. Notice of exercise
must be accompanied by full payment.
SECTION 9. Securities Laws.
---------------
The Committee may from time to time impose any conditions on the
exercise of the Option as it deems necessary or advisable to ensure
that all options granted under the Plan, and the exercise thereof,
satisfy Rule 16b-3 (or any similar rule) of the Securities and Exchange
Commission. Such conditions may include, without limitation, the
partial or complete suspension of the right to exercise the Option.
SECTION 10. Issuance of Certificates; Payment of Taxes.
------------------------------------------
(a) The Option can only be exercised as to whole shares of Stock.
Upon exercise of the Option and payment of the Option Price,
a certificate for the number of shares of Stock purchased through the
exercise will be issued and delivered by the Company to the Optionee,
provided that the Optionee has remitted to the Company an amount,
determined by the Company, sufficient to satisfy the applicable
requirements to withhold federal, state, and local taxes, or made other
arrangements with the Company for the satisfaction of such withholding
requirements.
(b) Subject to the provisions of Section 9 above, the Company may
also condition delivery of certificates for shares of Stock upon the
prior receipt from the Optionee of any undertakings that it determines
are required to ensure that the certificates are being issued in
compliance with federal and state securities laws.
SECTION 11. Rights Prior to Issuance of Certificates.
----------------------------------------
Neither the Optionee nor the person to whom the Optionee's rights
shall have passed by will or by the laws of descent and distribution
shall have any of the rights of a shareholder with respect to any
shares of Stock issuable upon exercise of the Option until the date of
issuance to the Optionee of a certificate for such shares as provided
in Section 10 above.
SECTION 12. Option Not to Affect Relationship with Company.
----------------------------------------------
The Option shall not confer upon the Optionee any right to
continue in the employ or service of the Company.
<PAGE>
40
SECTION 13. Adjustment for Capital Changes.
------------------------------
In case the number of outstanding shares of the Company's capital
stock is changed as a result of a stock dividend, stock split,
recapitalization, combination, subdivision, issuance of rights or other
similar corporate change, the Board shall make an appropriate
adjustment in the aggregate number of Shares subject to, and the Option
Price of, any then outstanding Option.
SECTION 14. Interpretation.
--------------
The Committee shall have the sole power to interpret this
Agreement and to resolve any disputes arising hereunder.
Intending to be legally bound, the parties have executed this
Agreement as of the Date of Grant.
For the Stock Option Committee OPTIONEE
of the Board of Directors of
CDI Corp.
By:
----------------------------- -----------------------------
Brian J. Bohling
<PAGE>
41
EMPLOYMENT AGREEMENT
--------------------
CDI CORP. AND BRIAN J. BOHLING
------------------------------
EXHIBIT C
---------
1997 QUALITATIVE GOALS
----------------------
o Support development and implementation with Price Waterhouse of
new executive compensation plan.
o Develop strategy, organization, and staffing plan for CDI Human
Resource function and capabilities.
o Support and participate with Bain and Co. in development of CDI
corporate strategy.
o Develop preliminary new product development plan working with
business unit Presidents.
o Develop preliminary recommendation on new corporate benefit
plans including medical and life insurance, relocation policy
and 401(k) plans.
o Assist CEO in identifying, recruiting and hiring senior level
CDI executives.
o Assist CEO in developing senior level executive evaluation
process and tools.
o Assist CEO and other senior executives in defining and shaping
corporate culture leading to status as world class supplier of
staffing services.
o Assist CEO in developing 1998 operating planning process,
timetable and deliverables.
o Assume responsibility for CDI corporate communications function
including the hiring of a new corporate communications manager
and assessing value of existing corporate communications tools
and channels.
o Working with law department and outside resources, develop in-
depth understanding of rules, laws, regulations and court
rulings in the areas of co-employment, workman's compensation,
disability, benefits and liability.
<PAGE>
42
SUPPLEMENTAL RETIREMENT AGREEMENT
This SUPPLEMENTAL RETIREMENT AGREEMENT (the "Agreement") is
entered into as of this ____ day of November, 1997 between CDI Corp., a
Pennsylvania corporation (the "Company"), and Brian J. Bohling
("Bohling").
Background
The Company and Bohling have entered into an Employment Agreement
dated July 8, 1997 (the "Employment Agreement"), pursuant to which
Bohling will assume the position, and duties, of Senior Vice President
of Human Resources of the Company. Under Section 5(e) of the
Employment Agreement, Bohling is entitled to participate in the
employee benefit programs made available by the Company to its senior
executive officers from time to time.
One of those programs, the CDI Corporation Retirement Plan (the
"Retirement Plan"), requires, among other things, one year of service
as a precondition of eligibility to participate. Under the terms of
this Plan, Bohling will be eligible to participate on January 1, 1999.
Through this Agreement, the Company intends to provide Bohling
with a supplemental retirement benefit substantially similar to the
benefit Bohling would have received with respect to 1997 and 1998
services if he had been immediately eligible to participate in the
Retirement Plan upon assuming his duties under the Employment
Agreement. For the years 1999 and following, the one year of service
rule will have no adverse effect on Bohling's benefits under either
Plan.
Therefore, intending to be legally bound, the Company and Bohling
agree as follows:
Agreement
1. Establishment of Account. The Company will establish a
bookkeeping account (the "Account") that will be used to calculate the
supplemental retirement benefit due to Bohling under the terms of this
Agreement. The Account will be used solely as a device to measure and
determine the amount of the supplemental retirement benefits to be paid
to Bohling as specified herein. The Account shall not constitute or be
treated as a trust fund of any kind. The Company shall be under no
obligation to segregate any of its assets for purposes of the Account.
Any amounts at any time credited to the Account shall be and remain the
sole property of the Company. Bohling will not have by virtue of the
Account any ownership interest or rights of any nature with respect to
specific assets of the Company. Bohling's rights shall be limited to
those of a recipient of an unfunded, unsecured promise to pay amounts
in the future and his position with respect to the amounts credited to
his Account shall be that of a general unsecured creditor of the
Company.
<PAGE>
43
2. Credits to the Account. The amount to be credited to the
Account will be the total of the Contribution Credits and the Earnings
Credits, determined as follows:
(a) Contribution Credits: The Company will credit to the
Retirement Account the amount that would have been contributed on
Bohling's behalf under the Retirement Plan for the years 1997 and 1998
if Bohling had been eligible to participate in that Plan upon assuming
his duties under the Employment Agreement. That credit will be made at
the time the Company otherwise makes its 1997 contribution to the
Retirement Plan.
(b) Earnings Credits: Earnings (or losses) shall be credited
to the Retirement Account annually, or at such other more frequent
intervals as the Company may determine, at the same rate as is
generated by the Retirement Plan's investments of amounts actually
contributed thereto, beginning with the date upon which the Company's
1997 contribution is paid to the Retirement Plan.
3. Excess Benefit Plan Participation. In addition to the
supplemental retirement benefits to be provided through the Account,
Bohling will also be eligible to participate in the Company's Excess
Benefit Plan for 1997.
4. Vesting: Bohling shall have no vested interest in the right
to receive amounts credited to the Retirement Account until he has been
credited with five years of vesting service under the terms of the
Retirement Plan. At that point, he will have a 100% vested interest in
right to receive the amounts credited to the Retirement Sub-Account in
accordance with the terms of this Agreement. Bohling's (or his
beneficiary's) right to receive those amounts shall also become 100%
vested upon Bohling's Disability as defined in the Retirement Plan, or
his death.
5. Payment of Account.
(a) Vested Rights. As soon as practicable following
Bohling's termination of employment for any reason, the amounts
credited to the Account that Bohling (or in the case of death his
beneficiary) has a vested right to receive will be paid to Bohling in a
single sum payment. Bohling's beneficiary with respect to his vested
right to receive amounts from the Retirement Account will be his
beneficiary designated under the terms of the Retirement Plan.
(b) Unvested Rights. If, at the time of Bohling's
termination of employment there are amounts in the Retirement Account
that neither Bohling nor his beneficiary has a right to receive, those
amounts will be forfeited and the Company shall have no further
obligation with respect to those amounts.
6. Effect on Employment Agreement. This Agreement is not
intended to, in any way, modify or amend the Employment Agreement.
Neither the provisions of this Agreement nor the crediting or payment
of any benefit hereunder shall be construed to in any way alter the
terms of the Employment Agreement.
<PAGE>
44
7. Governing Law. This Agreement is being entered into in, and
shall be construed in accordance with the laws of, the Commonwealth of
Pennsylvania, without giving effect to the conflicts of laws provisions
thereof. The parties hereby submit to the exclusive jurisdiction of,
and waive any venue objections against, the United States District
Court for the Eastern District of Pennsylvania and the state and local
courts of the Commonwealth of Pennsylvania, Philadelphia County, for
any litigation arising out of this Agreement.
8. Binding Effect. This Agreement shall be binding upon, and
shall inure to the benefit of, Bohling and the Company, and the
respective successors of each. Bohling's rights under this Agreement
shall not, in any voluntary or involuntary manner, be assignable and
may not be pledged or hypothecated.
9. Entire Agreement. This instrument constitutes the entire
agreement with respect to the subject matter hereof between the parties
hereto and replaces and supersedes as of the date hereof any and all
prior oral or written agreements and understandings between the parties
hereto. This Agreement may only be modified by an agreement in writing
executed by both Bohling and the Company.
IN WITNESS WHEREOF, the undersigned have executed this Agreement
the date and year first written above.
COMPANY: EXECUTIVE:
- ------- ---------
CDI CORP.
By:
---------------------------- ----------------------------
Mitch Wienick, President Brian J. Bohling
and Chief Executive Officer
<PAGE>
45
EMPLOYMENT AGREEMENT
--------------------
This is an amendment and restatement of the employment agreement
between CDI Corporation, (the "Company"), and Joseph R. Seiders,
("Employee"). The parties desire to amend and restate the terms of
their employment relationship pursuant to the terms and subject to the
conditions set forth in this amended and restated employment agreement
("Agreement"), which replaces and supersedes all prior employment
agreements between the parties and which is entered into as of Insert
Date of Agreement.
Accordingly, in consideration of the mutual promises and
undertakings set forth herein, with each party acknowledging that its
promises and undertakings are adequately supported by the consideration
received from the other party, and intending to be legally bound
hereby, the parties agree as follows:
TERMS
-----
Section 1. Employment.
----------
The Company hereby employs Employee as Senior Vice President and
General Counsel, and Employee hereby accepts such employment and agrees
to serve in such capacity and to render services to the Company during
the Employment Period defined in Section 3, below, subject to the terms
and conditions hereinafter set forth.
Section 2. Duties.
------
Employee shall carry out such duties as are customarily associated
with the position described in Section 1, above. Employee agrees to
perform such duties in compliance with all policies and directives
established by the Company.
Section 3. Term.
----
The term of Employee's employment under this Agreement (the
"Employment Period") shall commence as of the date set forth above and
shall continue until terminated as provided in this Agreement.
Section 4. Compensation and Benefits.
-------------------------
(a) Compensation. During the Employment Period, Employee shall
be eligible to receive the cash compensation set forth on Schedule A
hereto.
(b) Employee Benefits. During the Employment Period, Employee
shall be entitled to participate in all employee benefit plans and
programs that the Company provides generally to other employees of the
Company in positions similar to Employee's. The Company reserves the
right to amend or terminate such plans in accordance with the terms of
those plans.
<PAGE>
46
Section 5. Expense Reimbursements.
----------------------
During the Employment Period, the Company shall reimburse Employee
for all reasonable, necessary and itemized out-of-pocket expenses
incurred by Employee in the ordinary course of the Company's business,
provided such expenses are properly reported to the Company in
accordance with its accounting procedures.
Section 6. Termination.
-----------
The Employment Period may be terminated as follows:
(a) "For Cause". The Company will have the right at any time to
terminate the Employment Period for Cause. "For Cause" includes the
following:
(1) a material breach by Employee of any provision of this
Agreement;
(2) Employee's rendering services while under the influence
of alcohol or illegal drugs;
(3) Employee's performing any act of dishonesty in
rendering services hereunder, including falsification
of records, expense accounts or other reports;
(4) Employee's conviction, whether by judgment or plea, of
any crime which constitutes a felony or which
constitutes a misdemeanor involving violence, fraud,
embezzlement, theft or business activities;
(5) Employee's violation of any law or agreement which
results in the entry of a judgment or order enjoining
or preventing Employee from such activities as are
essential for Employee to perform services under this
Agreement;
(6) Employee's violation of any of the Company's policies
which provide for termination of employment as a
possible consequence of such violation;
(7) conduct engaged in by Employee which is injurious
(other than to an immaterial extent) to the Company;
(8) the Company's receipt of reliable information from any
source of Employee's entering into or intending to
enter into competition with the Company; or
(9) insubordination by Employee toward Employee's superior.
In the event the Employment Period is terminated for Cause, Employee
will be paid Base Salary through the date of termination of the
Employment Period.
<PAGE>
47
(b) Other Than "For Cause". Employee and the Company agree that
Employee's employment hereunder is on an at-will basis. Accordingly,
in addition to the Company's right, described above, to terminate the
Employment Period "for Cause", Employee or the Company may terminate
the Employment Period at any time for any reason whatsoever, and
without being required to specify a reason for the termination to the
other. For such terminations, both Employee and the Company do agree,
however, to give the other thirty (30) calendar days' advance notice of
such termination. If such notice is given by either party to the
other, the Company will have the option of terminating Employee's
services at any time prior to the date of termination of the Employment
Period set forth in such 30 day notice. In the event the Employment
Period is terminated pursuant to this Section 6(b), Employee will be
paid Base Salary through the date of termination of the Employment
Period.
(c) Death or Disability. The Employment Period will
automatically terminate upon Employee's death and may be terminated by
the Company if it is determined that Employee is unable to perform the
services specified under this Agreement due to a Disability (i.e.,
employee's suffering from an injury, illness or impairment such that
Employee is unable to perform the essential functions of Employee's job
after reasonable accommodation for a period in excess of that
permissible under applicable state or federal law). In the event of
Employee's death or disability, the Company will pay Employee Base
Salary through the date of termination of the Employment Period.
Section 7. Representations, Warranties and Acknowledgments of
Employee.
--------------------------------------------------
(a) Employee represents and warrants that Employee's experience
and capabilities are such that the provisions of Section 8, below, will
not prevent Employee from earning a livelihood, and acknowledges that
it would cause the Company serious and irreparable injury and cost if
Employee were to use Employee s ability and knowledge in competition
with the Company or to otherwise breach the obligations contained in
Section 8.
(b) Employee acknowledges that (1) during the Employment Period,
Employee will have access to Confidential Information (defined below);
(2) such Confidential Information is proprietary, material and
important to the Company and it being maintained as confidential is
essential to the effective and successful conduct of the Company's
business; (3) the Company's business, its customers' business and the
businesses of other companies with which the Company may have
commercial relationships could be damaged by the unauthorized use or
disclosure of this Confidential Information; and (4) it is essential to
the protection of the Company's goodwill and to the maintenance of the
Company's competitive position that the Confidential Information be
kept secret, and that Employee not disclose the Confidential
Information to others or use the Confidential Information to Employee's
advantage or the advantage of others.
<PAGE>
48
(c) Employee acknowledges that Employee will be put in a position
of trust and confidence and have access to Confidential Information,
will be supervising operations and employees of the Company, will be in
contact with customers and prospective customers and will participate
in the preparation and submission of bids and proposals to customers
and prospective customers.
(d) Employee acknowledges that it is essential for the Company's
protection that Employee be restrained following the termination of
Employee's employment with the Company from soliciting or inducing any
of the Company's employees to leave the Company's employ, hiring or
attempting to hire any of the Company's employees, soliciting the
Company's customers and suppliers for a competitive purpose, and
competing against the Company for a reasonable period of time.
(e) Employee represents and warrants that Employee is not bound
by any other agreement, written or oral, which would preclude Employee
from fulfilling all the obligations, duties and covenants in this
Agreement. Employee also represents and warrants that Employee will
not use, in connection with the employment under this Agreement, any
materials which may be construed to be confidential to a prior employer
or other persons or entities. In the event of a breach of this Section
7, which results in damage to the Company, Employee will indemnify and
hold the Company harmless with respect to such damage.
References in this Section 7 to the Company shall include the Company,
its parent, subsidiaries, divisions and affiliates.
Section 8. Employee's Covenants and Agreements.
-----------------------------------
(a) Employee agrees to maintain full and complete records of all
transactions and of all services performed by Employee on behalf of the
Company and to submit this information to the Company in the manner and
at the times that the Company may, from time to time, direct.
(b) Employee agrees to devote Employee's entire productive
business time, ability and attention to the Company's business during
the term of this Agreement. Employee further agrees not to, directly
or indirectly, render any services of a business, commercial or
professional nature to any other person or organization, whether for
compensation or otherwise, without the Company's prior written consent.
(c) Employee agrees to abide by and comply with all personnel and
Company practices and policies applicable to Employee.
(d) Employee shall promptly and completely disclose to the
Company and the Company or its customers will own all rights, title and
interest to any Inventions (defined below) made, recorded, written,
first reduced to practice, discovered, developed, conceived, authored
or obtained by Employee, alone or jointly with others, during the term
of Employee's employment with the Company (whether or not
<PAGE>
49
such Inventions are made, recorded, written, first reduced to practice,
discovered, developed, conceived, authored or obtained during working
hours) and for one year after termination of Employee's employment with
the Company. Employee agrees to take all such action during the term
of Employee's employment with the Company or at any time thereafter as
may be necessary, desirable or convenient to assist the Company or its
customers in securing patents, copyright registrations, or other
proprietary rights in such Inventions and in defending and enforcing
the Company's or such customer's rights to such Inventions, including
without limitation the execution and delivery of any instruments of
assignment or transfer, affidavits, and other documents, as the Company
or its customers may request from time to time to confirm the Company's
or its customers' ownership of the Inventions. Employee represents and
warrants that as of the date hereof there are no works, software,
inventions, discoveries or improvements (other than those included in a
copyright or patent or application therefor) which were recorded,
written, conceived, invented, made or discovered by Employee before
entering into this Agreement and which Employee desires to be removed
from the provisions of this Agreement.
(e) For purposes of this Agreement, "Inventions" means concepts,
developments, innovations, inventions, information, techniques, ideas,
discoveries, designs, processes, procedures, improvements,
enhancements, modifications (whether or not patentable), including, but
not limited to, those relating to hardware, software, languages,
models, algorithms and other computer system components, and writings,
manuals, diagrams, drawings, data, computer programs, compilations and
pictorial representations and other works (whether or not
copyrightable). Inventions does not include any of the foregoing which
are made, developed, conceived, authored or obtained by Employee
without the use of the Company's resources and which do not relate to
any of the Company's past, present or prospective activities.
(f) During and after the term of Employee's employment with the
Company, Employee will hold all Confidential Information in the
strictest confidence and will not use any Confidential Information for
any purpose and will not publish, disseminate, disclose or otherwise
make any Confidential Information available to any third party, except
as may be required in connection with the performance of Employee's
duties hereunder.
(g) For purposes of this Agreement, "Confidential Information"
means all information, data, know-how, systems and procedures of a
technical, sensitive or confidential nature in any form relating to the
Company or its customers, including without limitation, all business
and marketing plans, marketing and financial information, pricing,
profit margin, cost and sales information, operations information,
forms, contracts, bids, agreements, legal matters, unpublished written
materials, names and addresses of customers and prospective customers,
systems for recruitment, contractual arrangements, market research
data, information about employees, suppliers and other companies with
which the Company has a commercial
50
relationship, plans, methods, concepts, computer programs or software
in various stages of development, passwords, source code listings and
object code.
(h) All files, records, reports, programs, manuals, notes,
sketches, drawings, diagrams, prototypes, memoranda, tapes, discs, and
other documentation, records and materials in any form that in any way
incorporate, embody or reflect any Confidential Information or
Inventions will belong exclusively to the Company and its customers and
Employee will not remove from the Company's or its customers' premises
any such items under any circumstances without the prior written
consent of the party owning such item. Employee will deliver to the
Company all copies of such materials in Employee's control upon the
Company's request or upon termination of Employee's employment with the
Company and, if requested by the Company, will state in writing that
all such materials were returned.
(i) If Employee's employment is terminated for any reason,
including resignation by Employee or termination by the Company, with
or without Cause, then, for the time periods described below, Employee
agrees not to:
(1) own, manage, operate, finance, join, control, or
participate in the ownership, management, operation,
financing or control of, or be connected, directly or
indirectly, as proprietor, partner, shareholder,
director, officer, employee, agent, creditor,
consultant, independent contractor, joint venturer,
investor, representative, trustee or in any other
capacity or manner whatsoever with any entity that
engages or intends to engage in any Competing Business
in the geographic area where Employee had managerial
responsibility for the Company's business under this
Agreement. "Competing Business" means any business or
other enterprise which provides personnel to customers
on a contract or temporary basis; provides engineering,
design, drafting, data processing, software develop-
ment, light industrial, or related services to
customers; provides "vendor on premises" services such
as providing personnel and administrative supervision
of such personnel for customers in their facility; or
which provides any other services then provided by the
Company; and
(2) directly or indirectly, solicit, interfere with or
attempt to entice away from the Company, any employee
of the Company; and
(3) contact, solicit, interfere with or attempt to entice
away from the Company any customer on behalf of a
Competing Business.
Employee agrees to be bound by Sections 8(i)(2) and 8(i)(3), above, for
a period of two years following the termination of the Employment
<PAGE>
51
Period. In addition, Employee agrees to be bound by Section 8(i)(1),
above, for so long following the termination of the Employment Period
as the Company pays Employee the additional consideration of one-half
of Employee's Base Salary (at the rate of salary being paid Employee at
the time of termination of the Employment Period) up to a maximum of
two years.
References in this Section 8 to the Company shall include the Company,
its subsidiaries, divisions and affiliates.
Section 9. Remedies
--------
Employee acknowledges that Employee's promised services hereunder
are of a special, unique, unusual, extraordinary and intellectual
character, which give them peculiar value the loss of which cannot be
reasonably or adequately compensated in an action of law, and that, in
the event there is a breach hereof by Employee, the Company will suffer
irreparable harm, the amount of which will be impossible to ascertain.
Accordingly, the Company shall be entitled, if it so elects, to
institute and prosecute proceedings in any court of competent
jurisdiction, either at law or in equity, to obtain damages for any
breach or to enforce specific performance of the provisions or to
enjoin Employee from committing any act in breach of this Agreement.
The remedies granted to the Company in this Agreement are cumulative
and are in addition to remedies otherwise available to the Company at
law or in equity. If the Company is obliged to resort to the courts
for the enforcement of any of the covenants of Employee contained in
Section 8 hereof, each such covenant shall be extended for a period of
time equal to the period of such breach, if any, which extension shall
commence on the later of (a) the date on which the original
(unextended) term of such covenant is scheduled to terminate or (b) the
date of the final court order (without further right of appeal)
enforcing such covenant.
Section 10. Waiver of Breach.
----------------
The waiver by the Company of a breach of any provision of this
Agreement by Employee shall not operate or be construed as a waiver of
any other or subsequent breach by Employee of such or any other
provision. No delay or omission by the Company or Employee in
exercising any right, remedy or power hereunder or existing at law or
in equity shall be construed as a waiver thereof, and any such right,
remedy or power may be exercised by the Company or Employee from time
to time and as often as may be deemed expedient or necessary by the
Company or Employee.
Section 11. Notices.
-------
All notices required or permitted hereunder shall be made in
writing by hand-delivery, certified or registered first-class mail, or
air courier guaranteeing overnight delivery to the other party at the
address which the party giving the notice reasonably believes to be the
then current address of the other party. All notices required or
permitted hereunder shall be deemed duly given and received when
<PAGE>
52
delivered by hand, if personally delivered; on the third day next
succeeding the date of mailing if sent by certified or registered
first-class mail; and on the next business day, if timely delivered to
an air courier guaranteeing overnight delivery.
Section 12. Severability.
------------
If any term or provision of this Agreement or the application thereof
to any person or circumstance shall, to any extent, be held invalid or
unenforceable by a court of competent jurisdiction, the remainder of
this Agreement or the application of any such term or provision to
persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each term
and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law. If any of the provisions contained in
this Agreement shall for any reason be held to be excessively broad as
to duration, scope, activity or subject, it shall be construed by
limiting and reducing it, so as to be valid and enforceable to the
extent compatible with the applicable law or the determination by a
court of competent jurisdiction.
Section 13. Binding Effect and Assignability.
--------------------------------
The rights and obligations of both parties under this Agreement
shall inure to the benefit of and shall be binding upon their heirs,
successors and assigns. Employee's rights under this Agreement shall
not, in any voluntary or involuntary manner, be assignable and may not
be pledged or hypothecated without the prior written consent of the
Company.
Section 14. Counterparts: Section Headings.
------------------------------
This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original, but all of which together
shall constitute one and the same instrument. The section headings of
this Agreement are for convenience of reference only.
Section 15. Survival.
--------
Notwithstanding the termination of this Agreement or the
Employment Period for any reason, Sections 7, 8, 9, 12 and 15 hereof
shall survive any such termination.
Section 16. Entire Agreement.
----------------
This instrument constitutes the entire agreement with respect to
the subject matter hereof between the parties hereto and replaces and
supersedes as of the date hereof any and all prior oral or written
agreements and understandings between the parties hereto. This
Agreement may only be modified by an agreement in writing executed by
both Employee and the Company.
<PAGE>
53
IN WITNESS WHEREOF, the undersigned have executed this Agreement
as of the date and year first written above.
COMPANY:
-------
By:
-------------------------------------
Title: President and Chief Executive Officer
EMPLOYEE:
--------
--------------------------------------------
Joseph R. Seiders
<PAGE>
54
Schedule A
----------
Compensation
------------
This Schedule A sets forth the compensation for Joseph R. Seiders
(Employee) under this Employment Agreement. If at any time during the
Employment Period the Company and Employee agree that compensation
different from the compensation set forth in this Schedule A should be
paid to Employee, and the Company pays Employee and Employee accepts
such different compensation from the Company, then the terms of this
Schedule A will be deemed to have been amended to reflect the different
compensation.
1. Base Salary. During the Employment Period, Employee shall be paid
a salary at the rate of $248,000 per year ("Base Salary").
2. Bonus Awards. Employee will be eligible to receive an Annual Bonus
during the Employment Period pursuant to the terms of the Annual Bonus
Program, attached as Exhibit 1. Employee s Target Bonus for the first
Bonus Year under this Agreement is $62,000. The following are the
Performance Goals for the first Bonus Year under this Agreement:
a) Operating Plan Goals Bonus Opportunity
-------------------- -----------------
CDI Revenue 20%
CDI Operating Profit Margin 20%
CDI Return on Total Capital 20%
b) Qualitative Goals 40%
-----------------
As agreed upon between Employee and the President/CEO of the
Company.
c) EPS Threshold. Bonus will only be paid for a Bonus Year if CDI
Corp.'s Earnings Per Share ("EPS") for that year equals or exceeds the
threshold percentage of Target EPS established by CDI Corp.'s Board of
Directors.
<PAGE>
55
EXHIBIT I
Annual Bonus Program
--------------------
This exhibit describes the terms and workings of the Company s
Annual Bonus Program.
A. Summary.
-------
Employee will be eligible to receive an Annual Bonus for each
calendar year during the Employment Period. Annual Bonus is payable in
recognition of Employee's performance over the course of a calendar
year (called a Bonus Year in this Annual Bonus Program) and is
calculated based upon the achievement of Performance Goals for the
Bonus Year. There are two types of Performance Goals: Operating Plan
Goals and Qualitative Goals. Operating Plan Goals are based on
selected elements of the Operating Plan for the Bonus Year.
Qualitative Goals are based on discretionary criteria chosen by
Employee's superior and Employee. When a Bonus Year has been
completed, an evaluation will be done to compare the Bonus Year's
actual performance with the Bonus Year's Performance Goals to determine
how much, if any, of the year's Target Bonus will be paid to Employee.
The Target Bonus will be paid for Target Performance, a portion of the
Target Bonus will be paid for Threshold Performance and additional
bonus will be paid for Superior Performance.
B. Procedure.
---------
1. Prior to or at the beginning of each Bonus Year the following
steps will be taken:
o Employee's supervisor, with input from Employee, will set
the goals that Employee will be expected to achieve for that Bonus
Year;
o A Target Bonus amount will be set for Employee for that
year;
o A Bonus Opportunity will be set for each Performance Goal.
Each Bonus Opportunity reflects the percentage of the Target Bonus that
will be paid to Employee for Target Performance of the related
Performance Goal, i.e., for 100% achievement of that Performance Goal.
(For example, if the Performance Goal "Revenue Growth" has a Bonus
Opportunity of 15%, then 15% of the Target Bonus can be earned for
Target Performance, or 100% achievement, of the Revenue Growth
Performance Goal.) The total of all Bonus Opportunities will be 100%.
2. At the end of each Bonus Year, the degree of achievement of
Employee's Performance Goals for that year will be determined. For the
Operating Plan Goals, the degree of achievement will be determined by
comparing actual performance as reflected in the Company's final
<PAGE>
56
financial statements for the Bonus Year with the Performance Goal for
that year. For the Qualitative Goals, the degree of achievement will
be determined in the judgment of Employee's supervisor, with input from
Employee.
If less than 90% of a Performance Goal has been achieved, no
bonus will be paid. If 90% of a Performance Goal has been achieved
(called "Threshold Performance" in this Program), the Bonus Opportunity
for that goal will be reduced by 50%. If 110% or more of a Performance
Goal has been achieved (called "Superior Performance" in this Program),
the Bonus Opportunity for that goal will be increased by 50%. And for
achievement of a Performance Goal which is between 90% and 110%, the
Bonus Opportunity for that goal will be increased on a straight line
basis from 50% to 150% depending on the degree of achievement (i.e., a
5% increase for every 1% increase in achievement).
Examples: Assume a Bonus Opportunity of 15% for the
Performance Goal "Revenue Growth" and a Target Bonus for the year of
$30,000.
(a) If actual Revenue Growth for the Bonus Year is 87%
of the Revenue Growth in the Operating Plan, no
bonus would be payable for this Performance Goal
because less than 90% of the goal had been achieved.
(b) If actual Revenue Growth is 94% of the Operating
Plan, then 70% of the Revenue Growth Bonus
Opportunity would be payable, and bonus for this
Performance Goal would be calculated as follows:
70% x 15% x $30,000 = $3,150
(c) If actual Revenue Growth is 106.4% of Operating
Plan, then 132% of the Bonus Opportunity would be
payable, and bonus for this Performance Goal would
be calculated as follows:
132% x 15% x $30,000 = $5,940
(d) If actual Revenue Growth were 112% of Operating
Plan, then 150% (i.e., the maximum adjustment) of
the Bonus Opportunity would be payable.
The bonus payable for all Performance Goals will be combined to
make up the Annual Bonus for the Bonus Year.
C. Payment of Bonuses.
------------------
Annual Bonuses (or any proportionate amounts of Annual Bonus which
may be payable with respect to Employee's first or last year of
employment) will be paid to Employee within thirty days after the
delivery of audited financial statements to CDI Corporation for the
Bonus Year.
<PAGE>
57
D. First Year of Employment.
------------------------
In the event that Employee s first year of employment is not a
full calendar year, Employee will be paid a proportionate amount of the
Annual Bonus for that year. The proportionate amount will be a
percentage of the Annual Bonus payable for such year which will be
equal to the percentage of the year during which Employee was employed
by the Company.
E. Last Year of Employment.
-----------------------
No Annual Bonus will be paid to Employee for the Bonus Year during
which Employee's employment with the Company terminates if the
termination occurs as a result of (a) Employee's resignation or (b)
termination by the Company for cause. If Employee's employment with
the Company terminates due to Employee's death or disability or due to
termination by the Company other than for cause, then a proportionate
amount of the Annual Bonus for that year will be paid to Employee or,
in the event of Employee's death, to Employee's designated beneficiary
or estate. The proportionate amount will be a percentage of the Annual
Bonus payable for such year which will be equal to the percentage of
the year during which Employee was employed by the Company.
F. Future Years' Performance Goals.
-------------------------------
At the end of each Bonus Year, Employee's superior, with input
from Employee, will establish the Performance Goals for the next Bonus
Year. These goals will be recorded in writing.
G. Definition of Financial Measures.
--------------------------------
All financial measures which are used in setting or calculating
performance goals in connection with this Agreement will have the
meanings ascribed to them in the Company's accounting and financial
reporting systems.
<PAGE>
58
CDI CORP.
PERFORMANCE SHARE PLAN
----------------------
Article 1. General Description
-------------------------------
The CDI Corp. Performance Share Plan (the "Plan") provides
designated management personnel of the Company with the opportunity to
earn shares of CDI Stock, when pre-established performance goals are
met.
Article 2. Purpose and Effective Date
--------------------------------------
2.1 Purpose. The purpose of the Plan is to provide additional
incentives to, and rewards for, sustained performance by selected
management personnel to promote the Company's long term growth and
financial success by (i) attracting and retaining management personnel
of outstanding ability, (ii) strengthening the Company's capability to
develop, maintain and direct a highly-skilled and motivated management
team, (iii) providing an effective means for selected management
personnel to acquire and maintain ownership of CDI Stock, (iv)
motivating selected management personnel to achieve long-range
performance goals and objectives and (v) providing incentive
compensation opportunities competitive with those of other major
corporations.
2.2 Effective Date and Termination of the Plan. The Plan is
effective as of January 1, 1998 and may be terminated at any time by
CDI Corp.'s Board of Directors.
Article 3. Definitions
-----------------------
3.1 "Agreement" means a Performance Unit Award Agreement, which
is a written confirmation furnished to a Participant of an Award under
the Plan.
3.2 "Award" means the grant of Performance Units under an
Agreement.
3.3 "Board" means the Board of Directors of CDI Corp.
3.4 "Cause" shall have the same meaning as is set forth in a
Participant's employment agreement with the Company. If there is no
such agreement, then Cause shall mean:
(i) a Participant's rendering services while under
the influence of alcohol or illegal drugs;
<PAGE>
59
(ii) a Participant's performing any act of dishonesty
in rendering services to the Company, including
falsification of records, expense accounts or
other reports;
(iii) a Participant's conviction, whether by judgment
or plea, of any crime which constitutes a felony
or which constitutes a misdemeanor involving
violence, fraud, embezzlement, theft or business
activities;
(iv) a Participant's violation of any law or agree-
ment which results in the entry of a judgment or
order enjoining or preventing Participant from
such activities as are essential for Participant
to perform services for the Company;
(v) a Participant's violation of any of the
Company s policies which provide for termination
of employment as a possible consequence of such
violation;
(vi) a Participant's engaging in conduct which is
injurious (other than to an immaterial extent)
to the Company;
(vii) the Company's receipt of reliable information
from any source of a Participant's entering into
or intending to enter into competition with the
Company; or
(viii) insubordination by a Participant.
3.5 "CDI Stock" means common stock, par value at $.10 per share,
of CDI Corp.
3.6 "Committee" means the CDI Corp. Compensation and Stock
Option Committee. The members of the Committee shall be "Outside
Directors" as defined or interpreted for purposes of Section 162(m)
of the Code, and "Disinterested Persons," within the meaning of Rule
16b-3 under the Securities Exchange Act of 1934 (the "1934 Act").
3.7 "Company" as the context requires, means CDI Corp., CDI
Corp. and its Subsidiary Companies or the individual Subsidiary Company
which employs or retains a Participant.
3.8 "Date of Grant" means the date on which an Award is granted
under an Agreement.
3.9 "Effective Date" means January 1, 1998.
3.10 "Eligible Consultant" means a consultant who performs
services for the Company and is designated as eligible to participate
in the Plan by the Committee.
<PAGE>
60
3.11 "Eligible Employee" means an employee or a group of
employees identified by job classification of the Company who has been
designated as eligible to participate in the Plan by the Committee.
3.12 "Eligible Director" means any Non-Employee Director except a
director whose compensation for service on the Board is included in the
income of a corporation or partnership of which the director is an
employee or partner.
3.13 "Fair Market Value" means the closing price of actual sales
of CDI Stock on the New York Stock Exchange composite tape on a given
date or, if there are no such sales on such date, the closing price of
CDI Stock on such Exchange on the last date on which there was a sale.
3.14 "Fiscal Year" means the fiscal year of the Company, which
ends each December 31.
3.15 "Non-Employee Director" means any director of CDI Corp. who
is not a full-time employee of the Company.
3.16 "Participant" means (i) an Eligible Employee, (ii) an
Eligible Consultant or (iii) an Eligible Director who is designated by
the Committee to participate in the Plan.
3.17 "Performance Goals" means the goals established by the
Committee pursuant to Section 5.3.
3.18 "Performance Period" means the Fiscal Year(s), or initially
the portion thereof, over which Performance Goals will be measured as
established from time to time by the Committee. The "Initial
Performance Period" begins on the Effective Date.
3.19 "Performance Share" means the CDI Stock delivered to a
Participant upon the Participant's attainment of the Performance Goals
established with respect to the Participant for a particular
Performance Period. The number of Performance Shares received by a
Participant is determined by multiplying the number of Performance
Units awarded to a Participant under an Award by a percentage, to be
determined by the Committee, based on the satisfaction of the
Performance Goals applicable to the Performance Period to which the
Award relates.
3.20 "Performance Unit" means a book entry unit representing the
right to acquire that number of shares of CDI Stock equal to the number
of units recorded in book entry form, provided that the Participant
attains the Performance Goals established by the Committee for the
applicable Performance Period.
3.21 "Personal Representative" means the person or persons who,
upon the death or Total and Permanent Disability of a Participant,
shall have acquired by will or by the laws of descent and distribution
or by other legal proceedings the right to an Award granted to such
Participant.
<PAGE>
61
3.22 "Retirement" means a Participant's leaving the employ of the
Company:
(i) on or after the date that the Participant satisfies
one of the following combinations of age and years of service with the
Company:
o 60 years of age and 20 years of service;
o 62 years of age and 15 years of service; or
o 65 years of age and 5 years of service.
(ii) at such earlier date as may be approved by the
Committee, in its sole discretion.
Article 4. Participation
-------------------------
4.1 Participants. An Eligible Employee, Eligible Consultant or
Eligible Director shall become a Participant in this Plan upon
designation as such by the Committee, in its sole discretion.
4.2 Making Awards. Subject to the limitations imposed by this
Plan, an Award may be made to any Participant selected by the
Committee. In making this selection and in determining the form and
amount of the Award, the Committee may give consideration to the
functions and responsibilities of the respective Participant, his or
her present and potential contributions to the success of the Company,
the value of his or her services to the Company and any other factors
deemed relevant by the Committee
4.3 No Future Entitlement. Designation as a Participant for any
Performance Period shall not imply an entitlement to be so designated
for any subsequent Performance Period.
Article 5. Available Shares, Performance Goals
and Limitations on Awards
-----------------------------------------------
5.1 Shares Available Under the Plan. The CDI Stock to be issued
under the Plan upon the attainment of the Performance Goals applicable
to any Performance Period may be (i) authorized but previously unissued
CDI Stock or (ii) CDI Stock previously issued and outstanding and
reacquired by the Company. Subject to adjustment under Section 7.2, no
more than 100,000 shares of CDI Stock shall be issuable pursuant to
Performance Share awards granted under the Plan.
5.2 Performance Goals. Before the beginning of a Performance
Period, or within ninety (90) days following the beginning of the
Initial Performance Period, the Committee will establish written
Performance Goals for the Company and its various operating units and
Subsidiaries. The goals will be comprised of specified annual levels
of one or more performance criteria as the Committee may deem
<PAGE>
62
appropriate. If actual performance during a Performance Period equals
the Performance Goals for that period, then the Performance Shares
applicable to that Performance Period will be delivered to the
Participant. A greater or lesser number of Performance Shares may be
issued to a Participant based on performance which exceeds or falls
short of the Performance Goals if so determined by the Committee and
according to a formula to be established by the Committee and set forth
in a Participant's Agreement. In order to ensure that there is
consistency, over time, in the determination of whether Performance
Goals are being satisfied, the Committee shall disregard or offset the
effect of any extraordinary items, special charges or gains and other
unusual and infrequent gains or losses, determined in accordance with
generally accepted accounting principles consistently applied. The
Committee may also restate the results of any prior period to reflect
an accounting change becoming effective with or within a Performance
Period. Awards may also be payable when Company performance, as
measured by one or more of the above criteria, meets or exceeds an
objective target established by the Committee.
Article 6. Grant of Awards
---------------------------
6.1 Conditions. The Committee may make an Award to any
Participant, subject to this Article 6 and to such other terms and
conditions as the Committee may determine, including the attainment of
Performance Goals in accordance with Section 5.3.
6.2 Book Entries. Each Award will be registered in book entry
form in the name of the Participant.
6.3 Performance Period. At or before granting an Award, the
Committee may establish a Performance Period applicable to such Award.
6.3.1 The Committee may establish different Performance
Periods from time to time and each Award may have a different
Performance Period, at the discretion of the Committee.
6.3.2 Performance Periods, when established for each
Award, shall not be changed except as permitted by Section 7.2.
6.4 Other Terms and Conditions. Performance Shares, when
awarded pursuant to an Award, will be represented by a book entry
notation in the name of the Participant who receives the Award. The
Participant shall not be entitled to receive any dividends that may
be paid during the Performance Period with respect to the CDI Stock
that underlies the Award. In no event will the Participant have the
right to vote CDI Stock represented by a Performance Unit. During
any applicable Performance Period, (i) the Participant will not be
entitled to delivery of a certificate of CDI stock for the Performance
Shares applicable to such Performance Period and (ii) a breach of the
terms and conditions established by the Committee pursuant to the Award
will cause a forfeiture of the Award. The Participant may satisfy any
amounts required to be withheld by the Company under applicable
federal, state and local tax laws in effect from time to
<PAGE>
63
time, by electing to have the Company withhold a portion of the shares
of CDI Stock otherwise deliverable with respect to the Award. The
portion of the Award to be withheld pursuant to the applicable federal,
state and local tax laws shall be determined by using the Fair Market
Value of the CDI Stock as of the date such stock is received pursuant
to the Award; provided, that the Company shall deliver cash equal to
the Fair Market Value of any fractional shares of CDI Stock in lieu of
such fractional shares.
6.5 Award Agreement. Each Award shall be evidenced by an Award
Agreement.
6.6 Termination of Employment. Unless provided otherwise in the
Participant's Agreement, the following provisions shall apply upon the
termination of employment by Participant.
6.6.1 Resignation or Termination. If a Participant resigns
or his or her employment with the Company is terminated for any reason
other than as provided in Sections 6.6.2 through 6.6.4, any Performance
Units awarded for a Performance Period that has not been completed
shall be canceled.
6.6.2 Death or Total and Permanent Disability. If a
Participant dies or becomes Totally and Permanently Disabled while
employed by the Company, any Performance Units held at the time by the
deceased or disabled Participant shall remain outstanding, and any
shares of CDI Stock earned with respect to such Performance Units will
be paid to his or her Personal Representative in the case of death or
to the Participant in the case of disability, promptly following the
close of the relevant Performance Period.
6.6.3 Retirement. If a Participant's employment with the
Company is terminated as a result of the of the Participant's
Retirement, the Participant's Performance Shares shall remain
outstanding, and any shares of CDI Stock earned with respect to such
Performance Units will be paid to the Participant promptly following
the close of the relevant Performance Period.
6.6.4 Cessation of Board Service. If an Eligible Director
ceases to be a member of the Board for any reason, any Performance
Shares held by such Eligible Director shall expire and any rights
thereunder shall terminate immediately.
6.7 Payment for Performance Share Awards. Awards may be made by
the Committee under which the Participant shall not be required to make
any payment for the CDI Stock or, in the alternative, under which the
Participant, as a condition to the Award, shall pay all (or any lesser
amount than all) of the Fair Market Value of the CDI Stock to be
delivered upon satisfaction of the Target Level Goal, determined as of
the date the Award is made. If the latter, such purchase price shall
be paid in cash as provided in the applicable Agreement.
<PAGE>
64
Article 7. General Provisions
------------------------------
7.1 Limits on Transferability. Unless otherwise provided by the
Committee, no Award made under the Plan shall be transferable by the
Participant otherwise than by will or, if the Participant dies
intestate, by the laws of descent and distribution. Any transfer
contrary to this Section 7.1 will nullify the Award.
7.2 Adjustments Upon Changes in Stock. In case of any
reorganization, recapitalization, stock split, stock dividend,
combination of shares, merger, consolidation, rights offering, or any
other changes in the corporate structure or shares of the Company,
appropriate adjustments may be made by the Committee (or if the Company
is not the surviving corporation in any such transaction, the board of
directors of the surviving corporation) in the aggregate number and
kind of shares subject to the Plan, or that may be issued under
outstanding Awards. Appropriate adjustments may also be made
by the Committee in the terms of any Awards under the Plan, to reflect
such changes and to modify any other terms of outstanding Awards on an
equitable basis, including modifications of Performance Goals and
changes in the length of Performance Periods.
7.3 Amendment, Suspension, and Termination of Plan. The Board,
or a designated committee, may suspend or terminate the Plan or any
portion thereof at any time, and may amend the Plan from time to time
in such respects as the Board may deem advisable in order that any
Awards thereunder shall conform to any change in applicable laws or
regulations or in any other respect the Board may deem to be in the
best interests of the Company.
7.4 Nonuniform Determinations. The Committee's determinations
under the Plan, including, without limitation, (i) the determination of
the Participants eligible to receive Awards, (ii) the form, amount, and
timing of such Awards, (iii) the terms and provisions of such Awards
and (iv) the Agreements evidencing the same, need not be uniform and
may be made by it selectively among Participants whether or not such
Participants are similarly situated.
7.5 General Restriction. Each Award under the Plan shall be
subject to the condition that, if at any time the Committee shall
determine that (i) the listing, registration, or qualification of the
shares of CDI Stock subject or related thereto upon any securities
exchange or under any state or federal law, (ii) the consent or
approval of any government or regulatory body or (iii) an agreement by
the Participant with respect thereto, is necessary or desirable, then
such Award shall not become exercisable in whole or in part unless such
listing, registration, qualification, consent, approval, or agreement
shall have been effected or obtained free of any conditions not
acceptable to the Committee.
7.6 No Right To Employment or Continued Service. Neither the
action of the Company in establishing the Plan, nor any action taken by
it or by the Board or the Committee under the Plan, nor any provision
of the Plan or any Agreement, shall be construed as giving to any
person the right to be retained in the employ, performance of services
or membership on the Board of the Company.
<PAGE>
65
CDI CORP.
MANAGEMENT STOCK PURCHASE PLAN
------------------------------
Article 1. General Description
-------------------------------
The CDI Corp. Management Stock Purchase Plan ("the Plan") provides
designated management personnel of the Company with the opportunity to
purchase CDI Stock on a pre-tax basis and, in many cases, to receive an
additional contribution of CDI Stock from the Company. Participants
use a portion of their Annual Bonus Awards to purchase "units", each of
which represents a share of CDI Stock. After a Vesting Period
elapses, a number of shares of CDI Stock equal to the number of "units"
which have vested will be delivered to the Participant.
Article 2. Purpose and Effective Date
--------------------------------------
2.1. Purpose. The purpose of the Plan is to provide financial
incentives for selected management personnel thereby promoting the
Company's long-term growth and financial success by (i) attracting and
retaining management personnel of outstanding ability, (ii)
strengthening the Company's capability to develop, maintain and direct
a highly-skilled and motivated management team, (iii) providing an
effective means for selected management personnel to acquire and
maintain ownership of CDI Stock, (iv) motivating selected management
personnel to achieve long-range performance goals and objectives and
(v) providing incentive compensation opportunities competitive with
those of other major corporations.
2.2. Effective Date and Termination of the Plan. The Plan is
effective as of January 1, 1998 and may be terminated at any time by
CDI Corp.'s Board of Directors.
Article 3. Definitions
-----------------------
The following words and phrases used in the Plan shall have the
following meanings unless a different meaning is plainly required by
the context:
3.1 "Annual Bonus Awards" means an incentive payment made
pursuant to the Annual Bonus Program set forth in an Eligible
Employee's employment agreement with the Company.
3.2 "Cause" shall have the same meaning as is set forth in a
Participant's employment agreement with the Company.
3.3 "CDI Stock" means common stock, par value $.10 per share, of
CDI Corp.
<PAGE>
66
3.4 "Committee" means the CDI Corp. Compensation and Stock
Option Committee. The members of the Committee shall be "Outside
Directors" as defined or interpreted for purposes of Section 162(m)
of the Internal Revenue Code and "Disinterested Persons" within the
meaning of Rule 16b-3 under the Securities Exchange Act of 1934.
3.5 "Company", as the context requires, means CDI Corp., CDI
Corp. and its subsidiaries or the individual subsidiary of CDI Corp.
which employs an Eligible Employee.
3.6 "Eligible Employee" means an employee of the Company who has
been designated by the Committee as being eligible to participate in
the Plan.
3.7 "Fair Market Value" means the closing price of actual sales
of CDI Stock on the New York Stock Exchange composite tape on a given
date or, if there are no such sales on such date, the closing price of
CDI Stock on such Exchange on the last date on which there was a sale.
3.8 "Fiscal Year" means the fiscal year of the Company, which
ends each December 31.
3.9 "MSPP Account" means the account maintained for a
Participant in which is recorded all information related to purchases
of MSPP Units and the issuance of CDI Stock under the Plan.
3.10 "MSPP Unit" means a bookkeeping entry which is entered in
a Participant's MSPP Account which represents a right to one share of
CDI Stock upon the satisfaction of the Vesting Period applicable to
such MSPP Unit and upon the satisfaction of any other conditions which
the Committee may impose.
3.11 "Participant" means an Eligible Employee who has purchased
MSPP Units.
3.12 "Personal Representative" means the person or persons who,
upon the death, disability or incompetency of a Participant, shall have
acquired, by will or by the laws of descent and distribution or by
other legal proceedings, the right to any MSPP Unit or underlying
shares of CDI Stock.
3.13 "Vesting Period" means that period of time which must elapse
following a Participant's purchase of an MSPP Unit, or the Company's
matching contribution of an MSPP Unit, before CDI Stock is issued in
exchange for the MSPP Units.
Article 4. Participation
-------------------------
An eligible employee participates in the Plan by using a portion
of his or her Annual Bonus Award to purchase MSPP Units. Participation
is either mandatory or voluntary.
<PAGE>
67
4.1 Mandatory Participation. Certain senior executives
designated by the Committee are required to participate in the Plan and
will automatically have 25%, or such other percentage as the Committee
may determine, of the pre-tax amount of their Annual Bonus Awards
withheld and used to purchase MSPP Units.
4.2 Voluntary Participation. Any Eligible Employee may
participate on a voluntary basis by electing to have up to 25%, or such
other maximum percentage as the Committee may determine, of the pre-tax
amount of his or her Annual Bonus Award withheld and used to purchase
MSPP Units. For those Participants subject to mandatory participation,
this amount is in addition to the automatic, required withholding
described in 4.1.
4.3 Company Matching Contributions. Unless otherwise determined
by the Committee, the Company will make a matching contribution to a
Participant's MSPP Account of one MSPP Unit for every three MSPP Units
purchased by a Participant through voluntary, but not mandatory,
participation.
4.4 Calculation of MSPP Units and Crediting of MSPP Accounts.
The number of MSPP Units which will be credited to a Participant's MSPP
Account will be calculated by dividing the amount of the Participant's
Annual Bonus which is being used to purchase MSPP Units by the Fair
Market Value of a share of CDI Stock on the date the Participant's MSPP
Account is credited. Participants' MSPP Accounts will be so credited
as promptly as is practicable following the public release of the
Company's audited financial results for the Fiscal Year for which the
applicable Annual Bonus Award is being calculated.
4.5 Participation Elections. On or before June 30th of each
year, or such other date as the Committee may determine, a Participant
must notify the Company of (i) that percentage of the Participant's
Annual Bonus Award, if any, which the Participant will earn for that
year which the Participant elects to use to purchase MSPP Units, and
(ii) the number of years which the Participant elects to have in the
Vesting Period for those MSPP Units. If the Participant fails to make
such an election, the Participant will be deemed to have elected not to
make any voluntary purchases of MSPP Units for that year and to have
elected a three year vesting period for any MSPP Units purchased
through mandatory participation for that year.
Article 5. Vesting
-------------------
5.1 All MSPP Units purchased or contributed to a Participant's
MSPP Account for a particular year will be subject to a Vesting Period
of from three to ten years, as chosen by the Participant. A Vesting
Period chosen for a particular year's MSPP Units will be applicable to
all MSPP Units acquired for that year - whether through mandatory or
voluntary purchase or through matching Company contribution - and will
run from the date the MSPP Units are credited to the Participant's MSPP
Account.
<PAGE>
68
5.2 When a Vesting Period elapses, a certificate for a number of
shares of CDI Stock equal to the number of MSPP Units which were
subject to the elapsed Vesting Period will be delivered to the
Participant, and the MSPP Units will be canceled.
5.3 MSPP Units may not be sold, pledged or transferred during
the Vesting Period.
5.4 If a participant's employment with CDI terminates before the
Vesting Period applicable to any MSPP Units has elapsed, the following
will apply:
(i) if the termination occurs less than three years after
the purchase of the MSPP Units and is by the Company for Cause or as a
result of the Participant's resignation, the Participant will receive,
in cash and not CDI Stock, the lesser of the amount paid for the MSPP
Units or the then current market price of the underlying shares of CDI
Stock. (Participant will forfeit any MSPP Units credited to his or her
account as a result of matching Company contributions); or
(ii) if the termination occurs more than three years after
the purchase of the MSPP Units for any reason whatsoever, or if the
termination occurs at any time after the purchase of the MSPP Units for
reasons other than termination by the Company for Cause or the
Participant's resignation, then the unvested MSPP Units will
immediately vest and a number of shares of CDI Stock equal to the
number of such MSPP Units will be delivered to the Participant or his
or her Personal Representative.
Article 6. CDI Stock Ownership Requirements
--------------------------------------------
All Participants in the MSPP are required to adhere to the CDI
Stock Ownership Requirements, a copy of which will be delivered to each
Participant.
Article 7. Administration
--------------------------
7.1 General. The Plan shall be administered by the Committee.
7.2 Plan Interpretation. The Committee shall have the authority
and responsibility to interpret and construe the Plan and decide all
questions arising thereunder, including, without limitation, questions
of eligibility for participation, eligibility to make purchases or
receive matching contributions, the amount of account balances and the
timing of the exchange of CDI Stock for MSPP Units, and shall have the
authority to deviate from the literal terms of the Plan to the extent
the Committee determines it to be necessary or appropriate to operate
the Plan in compliance with the provisions of applicable law. The
Committee's interpretations of the Plan, and all actions taken and
determinations made by the Committee pursuant to the powers vested in
it hereunder, shall be conclusive and binding on all parties concerned,
including the Company and any employee.
69
7.3 Responsibilities and Reports. The Committee may, pursuant
to a written instruction, delegate specific duties and responsibilities
to other named persons; provided, however, that any such delegation may
not violate or otherwise contravene any requirement of applicable law.
The Committee shall be entitled to rely conclusively upon all tables,
valuations, certificates, opinions and reports that are furnished by
any accountant, controller, counsel, or other person who is employed or
engaged for such purposes.
7.4 Powers of Committee. Subject to the provisions of the Plan,
the Committee shall have all necessary powers to administer and
interpret the Plan including, without limitation:
(i) The authority to adopt such rules, regulations and
instruments for the administration of the Plan and for the conduct of
its business as the Committee deems necessary or advisable;
(ii) The authority to designate which employees of the
Company are Eligible Employees;
(iii) The Committee may correct any defect or supply any
omission or reconcile any inconsistency in the Plan in such manner and
to the extent the Committee shall determine in order to carry out the
purposes of the Plan.
Article 8. General Provisions
------------------------------
8.1 Limits as to Transferability. Unless otherwise provided by
the Committee, MSPP Units are not transferable by the Participant
otherwise than by will or, if the Participant dies intestate, by the
laws of descent and distribution.
8.2 Shares Available Under the Plan. The CDI Stock to be
offered under the Plan will be authorized but unissued CDI Stock or CDI
Stock previously issued and outstanding and reacquired by the Company.
Subject to adjustment under Section 8.3, no more than 250,000 shares of
CDI Stock shall be issuable under the Plan.
8.3 Adjustments Upon changes in Stock. In case of any reorgan-
ization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation, rights offering, or any other changes in
the corporate structure or shares of the Company, appropriate
adjustments may be made by the Committee (or if the Company is not the
surviving corporation in any such transaction, the board of directors
of the surviving corporation) in the aggregate number and kind of
shares subject to the Plan, and the number and kind of shares and the
price per share subject to outstanding MSPP Units.
8.4 Amendment, Suspension, and Termination of Plan. The Board
of Directors of CDI Corp. or a designated committee, may suspend or
terminate the Plan or any portion thereof at any time, and may amend
the Plan from time to time in such respects as the Board may deem
<PAGE>
70
advisable. No such amendment, suspension, or termination shall alter
or impair any outstanding MSPP Units without the consent of the
Participant adversely affected thereby.
8.5 Nonuniform Determinations. The Committee's determinations
under the Plan, including without limitation, the determination of
Eligible Employees, need not be uniform and may be made by it
selectively among Participants whether or not such Participants are
similarly situated.
8.6 No Right to Employment or Continued Service. Neither the
action of the Company in establishing the Plan, nor any action taken by
it or by the Board of Directors or the Committee under the Plan, nor
any provision of the Plan or any Agreement, shall be construed as
giving to any person the right to be retained in the employ of the
Company.
8.7 Funding; Unsecured Status. The Company will not be required
to segregate or hold separately from its general assets any amounts
credited to a Participant's MSPP Account, and shall be under no
obligation whatsoever to fund in advance any amounts under the Plan.
The right of a Participant to receive any amounts or shares of CDI
Stock under the Plan shall be an unsecured claim against the general
assets of the Company.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains financial information extracted from the
consolidated financial statements of CDI Corp. and Subsidiaries and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 7,992
<SECURITIES> 0
<RECEIVABLES> 296,991
<ALLOWANCES> 4,604
<INVENTORY> 0
<CURRENT-ASSETS> 320,454
<PP&E> 82,600
<DEPRECIATION> 54,644
<TOTAL-ASSETS> 388,499
<CURRENT-LIABILITIES> 143,312
<BONDS> 7,456
0
0
<COMMON> 1,995
<OTHER-SE> 224,556
<TOTAL-LIABILITY-AND-EQUITY> 388,499
<SALES> 0
<TOTAL-REVENUES> 378,766
<CGS> 0
<TOTAL-COSTS> 286,757
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6
<INCOME-PRETAX> 17,756
<INCOME-TAX> 6,925
<INCOME-CONTINUING> 10,709
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,709
<EPS-PRIMARY> .54
<EPS-DILUTED> .54
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the
consolidated financial statements of CDI Corp. and Subsidiaries and is
qualified in its entirety by reference to such financial statements.
The schedule is restated to present earnings per share data in
accordance with the provisions of Financial Accounting Standards Board
Statement No. 128, Earnings per Share, which became effective for years
ending after December 15, 1997 and requires restatement of all prior
periods.
</LEGEND>
<RESTATED>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 15,561
<SECURITIES> 0
<RECEIVABLES> 261,707
<ALLOWANCES> 4,439
<INVENTORY> 0
<CURRENT-ASSETS> 322,614
<PP&E> 71,383
<DEPRECIATION> 45,324
<TOTAL-ASSETS> 375,304
<CURRENT-LIABILITIES> 120,492
<BONDS> 59,166
0
0
<COMMON> 1,988
<OTHER-SE> 185,690
<TOTAL-LIABILITY-AND-EQUITY> 375,304
<SALES> 0
<TOTAL-REVENUES> 360,461
<CGS> 0
<TOTAL-COSTS> 278,519
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 704
<INCOME-PRETAX> 18,088
<INCOME-TAX> 7,236
<INCOME-CONTINUING> 10,741
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,741
<EPS-PRIMARY> .54
<EPS-DILUTED> .54
</TABLE>
