HOSPITAL STAFFING SERVICES INC, 10-K/A, 1996-03-29

HOSPITAL STAFFING SERVICES INC
10-K/A, 1996-03-29
HELP SUPPLY SERVICES

Previous: NATIONAL HOUSING PARTNERSHIP REALTY FUND I, 10-K, 1996-03-29

Next: SPIRE CORP, 10KSB40, 1996-03-29

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K/A
AMENDMENT NO. 1

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

For the Fiscal Year Ended NOVEMBER 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

For the transition period from _______ to _________
Commission File Number 0-11781

HOSPITAL STAFFING SERVICES, INC.
(Exact name of registrant as specified in its charter)

FLORIDA 59-2150637
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)

6245 NORTH FEDERAL HIGHWAY, SUITE 400
FORT LAUDERDALE, FLORIDA 33308-1900
(Address of principal executive offices)
(954) 771-0500
Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class Name of each exchange on which registered
Common Stock $.001 par value New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None
(Title of Class)

Indicate by check mark 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 ___

Indicate by check mark if disclosure of delinquent filers pursuant to Rule 405
of Regulation S-K (ss. 229.405 of this Chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K/A or any amendment to this Form 10-K/A. [ ]

The aggregate market value of the voting stock held by non-affiliates
of the Registrant at February 29, 1996 was $12,249,028.

As of February 29, 1996, 6,349,770 shares of common stock, par value
$.001 per share, were outstanding.

<PAGE>

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

THE FOLLOWING TABLE SETS FORTH CERTAIN INFORMATION CONCERNING DIRECTORS AND
EXECUTIVE OFFICERS OF THE COMPANY:

<TABLE>
<CAPTION>
Name Age Position with Company
- ---- --- ---------------------
<S> <C> <C>
Ronald A. Cass(3) 50 Chairman of the Board of Directors, Chief
Executive Officer, President and Treasurer

Ronald G. Huneycutt 52 Vice President of Finance and Chief Financial
Officer

Jeffrey A. Barnhill 39 Senior Vice President of Health Services and
Director of Medicare Reimbursement

Jay Gershberg 57 Senior Vice President of Ancillary Services
and President of The Travel Nurse Group

Robert B. Fields(1,2,3) 58 Director

William F. McConnell(1) 55 Director

Hector L. Ziperovich, M.D.(2) 41 Director

</TABLE>

- --------

(1) Member of the Audit Committee
(2) Member of the Compensation and Stock Option Committee
(3) Member of the Nominating Committee

<PAGE>

Directors are elected for a term that expires at the next annual
meeting of the Company's shareholders. Officers are elected by and serve at the
pleasure of the Board of Directors, subject to the terms of employment
contracts, if any, between the Company and any such officer. There are no family
relationships between any director or executive officers of the Company.

Officers and Directors

Ronald A. Cass founded the Company in 1981 and has been Chairman of the
Board since March 1982, Chief Executive Officer from April 1989 to the present,
President from March 1982 to April 1989 and December 1992 to the present,
Secretary from December 1992 to May 1993, Chief Financial Officer from April
1986 to April 1989, Treasurer from November 1995 to the present and Acting Chief
Financial Officer from May 1995 through January 1996.

Ronald G. Huneycutt is a Certified Public Accountant and joined the
Company as Vice President of Finance and Chief Financial Officer in February
1996. Mr. Huneycutt served as Vice President of Finance and Development for
Neonatology Certified, Inc., Plantation, Florida, since November 1993.
Neonatology Certified provides physician and neonatal nurse staffing for
hospitals. From December 1991 through April 1993, Mr. Huneycutt held the
position of Vice President of Finance for SurgiCare America, Inc. which owned
and managed outpatient surgery centers. Mr. Huneycutt joined the auditing and
consulting firm of Coopers & Lybrand, LLP in 1974 and was admitted to the
partnership in 1982. He served as the partner-in-charge of health care services
for South Florida until his departure in 1991. Mr. Huneycutt earned a B.S. in
Commerce from the University of Virginia in 1974.

Jeffrey A. Barnhill has served as Senior Vice President of Health
Services since September 1995. Mr. Barnhill joined the Company in October 1994
as Director of Reimbursement and was appointed Vice President, Operations in
February 1995. Mr. Barnhill has over fifteen (15) years experience in financial
and operations management in the health care field. From October 1992 until his
employment by the Company, Mr. Barnhill was a principal of O. P. Medical
Consultants, Inc., a health care financial and operations consulting firm. From
July 1990 to September 1992 Mr. Barnhill was Chief Financial Officer and Chief
Operating Officer for Omni Medical Management, Inc., which managed a 35 member
physician multi-specialty group, a home care company, a DME company and a
staffing company. From August 1989 to June 1990 Mr. Barnhill was the Director of
Reimbursement with Florida Medical Center, a 400 plus bed acute care and
rehabilitation facility. He was also the controller for Florida Medical Center's
affiliate companies. Mr. Barnhill earned his M.B.A. (Health Care Management)
from Nova University and his B.A.B.A. (Accounting) from Rollins College.

Jay Gershberg has served as Senior Vice President of Ancillary Services
and President of Travel Nurse Operations, Inc. since September 1995. Mr.
Gershberg joined the Company in November 1984 as President of HSS Associates,
Inc., the Company's then executive search division. In his over eleven (11)
years of service to the Company Mr. Gershberg has served in several other key
executive positions. From December 1980 until his employment with the Company,
Mr. Gershberg was Executive Vice President and a minority-interest owner of
Medical Recruiters of America, Inc. Prior thereto, Mr. Gershberg was employed
approximately fifteen (15) years in various sales and management positions with
CIBA Geigy Pharmaceuticals,

<PAGE>

Inc. Mr. Gershberg received his B.S. degree from Long Island University.

Robert B. Fields was elected to the Company's Board of Directors
effective July 1995. He is President of Tradestar Ltd., a New York City based
financial and management consulting firm. Since November 1992 Mr. Fields has
been Chairman and Chief Executive Officer of Associates for Managed Care, Inc.,
a provider of cost containment and preventative social intervention services to
the managed care industry. From August 1991 through September 1992 Mr. Fields
served as a director on the Board of Flight International Group, Inc. of Newport
News, Virginia, an aviation services company performing military training
services using specially modified aircraft. From September 1991 to November
1991, Mr. Fields was President, Chief Executive Officer and a Director of
L'Express, Inc., an interstate regional airline based in New Orleans. From
January 1987 through June 1988, Mr. Fields was Executive Vice President of
American Finance Group, Inc., an equipment leasing and asset management company
headquartered in Boston. Mr. Fields is on the Board of Directors of Printron,
Inc., Albuquerque, NM, and an advisory director of Quadra Interactive, Inc. of
Carlsbad, CA.

William F. McConnell was elected to the Company's Board of Directors in
1986. Since 1994 Mr. McConnell has served as a Managing Partner of Emerald
Capital Services, Inc., a consulting firm offering management and financial
services to small public companies. From 1991 through 1993, Mr. McConnell was
Chairman of the Board, Chief Operating Officer and Vice President of Dollar Time
Group, Inc., a publicly-held national discount retail chain. On July 24, 1995
Dollar Time Group, Inc. filed for bankruptcy protection under Chapter 11 of the
Federal Bankruptcy laws. From 1987 through 1992, Mr. McConnell was the
President of Travel Data & Marketing, Inc., an international travel research
firm with offices in Rome, Paris, London and Zurich.

Hector Luis Ziperovich, M.D. was elected to the Company's Board of
Directors in February 1992. Since January 1993, Dr. Ziperovich has been the
Company's National Medical Director. From November 1990 to January 1992, Dr.
Ziperovich was Medical Director of Mediflex Acute Staffing Services, a home
health agency, the assets of which were acquired by the Company in January 1992.
Since 1987, Dr. Ziperovich has served as Medical Director of HLZ Acute Dialysis
Service and Clinica Medica del Pueblo (Multi-Specialty Clinic), both of which
are located in Montebello, California. Dr. Ziperovich is a licensed and
practicing physician in the State of California.

No director, officer, affiliate, beneficial owner of more than 5% of
the Company's common stock or associate of any of the foregoing is a party
adverse or has a material interest adverse to the Company or its subsidiaries.

Committees of the Board of Directors;
Board and Committee Meetings

As permitted by the By-Laws of the Company, the Company has several
standing committees, including an Audit Committee, a Compensation and Stock
Option Committee and a Nominating Committee.

<PAGE>

The Audit Committee consists of Robert B. Fields and William F.
McConnell. The Audit Committee's responsibilities are to (i) recommend and
appoint the Company's independent auditors; (ii) review the audit report and
management letter; (iii) consult with the Company's auditors regarding the
adequacy of internal controls; and (iv) review such other matters and member
committees as deemed appropriate.

The Compensation and Stock Option Committee consists of Robert B.
Fields and Hector L. Ziperovich, M.D. The Committee's responsibilities are to
(i) approve compensation philosophy and guidelines for directors and executive
officers and (ii) recommend to the full Board of Directors compensation for the
directors and executive officers, including determining bonus compensation,
awarding option grants and determining other benefits.

The Nominating Committee consists of Ronald A. Cass and Robert B.
Fields. The Nominating Committee has the power and authority to select a slate
of candidates for directorships with the Company.

Compliance with Section 16 (a) of the Securities Exchange Act of 1934, As
Amended

Section 16 (a) of the Securities Exchange Act of 1934, as amended,
requires the Company's directors and executive officers, and persons who own
more than 10% of a registered class of the Company's equity securities
(collectively "insiders"), to file with the Securities and Exchange Commission
and the New York Stock Exchange initial reports of ownership and reports of
changes in ownership of common stock and other equity securities of the Company.
These insiders are required by Securities and Exchange Commission regulations
to furnish the Company with copies of all Section 16 (a) forms they file,
including Forms 3, 4 and 5.

Based solely on a review of copies of such reports furnished to the
Company or written representations that no such reports were required and on
other information that has come to the Company's attention, the Company believes
that, during fiscal year 1995, all filing requirements under Section 16(a) of
the Securities and Exchange Act of 1934 applicable to its officers, directors
and greater than 10% beneficial owners were complied with except as follows: Mr.
McConnell and Dr. Ziperovich each received a stock option grant in 1992 and 1995
and did not timely report these two grants on a Form 4 or Form 5; Mr. Fields
received two stock option grants in 1995 and did not timely report these grants
on a Form 4 or Form 5 and effected one open market purchase in 1995 and did not
timely report that purchase on a Form 4; Mr. Cass received two option grants,
one each in 1992 and 1993 (and an existing option expired unexercised) and did
not timely report these grants and expiration on Form 4 or Form 5 and effected
one open market purchase in November 1995 and did not timely report that
purchase on a Form 4; Mr. Gershberg received two stock option grants, one in
1993 and one in 1995 (and an existing option was terminated unexercised) and did
not timely report these grants and termination on Form 4 or Form 5; Mr. Barnhill
became an officer of the Company in February 1995 and did not timely report this
event on Form 3, received a stock option grant in 1995 and did not timely report
this grant on a Form 4 or Form 5 and purchased shares in the open market in
November 1995 and did not timely report this purchase on a Form 4; and Peter S.
Busicchia became chief accounting officer in May 1995 and did not timely report
this event on Form 3 and received a stock option grant in 1995 (and an existing
option was terminated unexercised) and did not timely report this grant and
termination on Form 4 or Form 5. The officers and directors identified by the
Company in this paragraph as having delinquent filings under Section 16(a) have
each filed a late Form 5 to report any transaction for which he had a delinquent
filing.

<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

The following tables summarize all compensation accrued by the Company
for the fiscal years ended November 30, 1993, 1994 and 1995 for (i) the
Company's Chief Executive Officer; (ii) each other executive officer serving as
such at November 30, 1995 whose compensation during fiscal 1995 exceeded
$100,000; and (iii) each executive officer not serving as such at November 30,
1995 whose compensation during fiscal 1995 exceeded $100,000 (collectively, the
"named executive officers").

<PAGE>

SUMMARY COMPENSATION

<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
------------------- ------------
Options
Name and Other Annual (Number All Other
Principal Position Year Salary Bonus Compensation of Shares) Compensation
- ------------------ ---- ------ ----- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Ronald A. Cass 1995 $206,447 $30,000 $48,705(1) - $479,725(2)
Chief Executive Officer, 1994 $357,483 - $58,979(1) - -
President and Treasurer 1993 $356,787 - $60,659(1) 30,000 -

Warren A. Marmorstein 1995 $94,270 - $9,143(3) - $183,750(4)
1994 $200,858 $40,000 $96,656(3) - -
1993 $191,478 - $31,343(3) 50,000 -

Jeffrey A. Barnhill 1995 $107,468 $25,000 $15,054(5) 7,000 -
Senior Vice President of 1994 - - - - -
Health Services and 1993 - - - - -
Director of Medicare
Reimbursement

Jay Gershberg 1995 $146,881 $19,517(6) $16,639(7) 2,500 -
Senior Vice President of 1994 $133,086 $7,500 $20,664(7) - -
Ancillary Services and 1993 $126,033 $16,000 $26,751(7) 10,000 -
President of Travel Nurse
Group

</TABLE>

(1) Includes payment in lieu of vacation taken (1995 - $16,919; 1994 -
$29,531 and 1993 - $25, 774); automobile allowance and related
insurance (1995 - $18,000; 1994 - $18,000 and 1993 - $20,813); health
club benefits in 1995, 1994 and 1993; and various other types of
insurance payments; health, disability and life.

(2) Includes principal and interest paid to Mr. Cass during fiscal 1995 on
a note issued to Mr. Cass in settlement of certain severance
obligations plus offsets against the note due him for the purchase of
the Company's Broward County HomeCare Operations and the liquidation of
his employee loans (see "Employment and Other Agreements").

(3) Includes payment in lieu of vacation taken (1995 - $4,792 and 1994 -
$73,790); automobile benefits (1995 - $3,082; 1994 - $15,636 and 1993 -
$23,516); health club benefits in 1995, 1994 and 1993; and various
types of insurance payments; health and disability.

(4) Represents payments to Mr. Marmorstein during fiscal 1995 on a note
issued to Mr. Marmorstein in settlement of certain severance
obligations due him by the Company (see "Employment and Other
Agreements").

(5) Includes payment in lieu of vacation taken (1995 - $3,097); automobile
benefits (1995 - $5,558); health club benefits and various other types
of insurance payments; health, disability and life.

(6) Represents deferred bonuses from prior years.

(7) Includes payment in lieu of vacation taken (1995 - $2,769 and 1994 -
$7,730); difference between fair market value and purchase price of
Company automobile (1993 - $11,900); automobile benefits (1995 -
$9,000; 1994 - $9,000 and 1993 - $8,112); health club benefits in 1995,
1994 and 1993; and various other types of insurance payments; health
and disability.

<PAGE>

Stock Option/Grants

The following table sets forth certain information concerning grants of
stock options for each named executive officer in fiscal 1995:

<TABLE>
<CAPTION>
OPTION GRANTS IN FISCAL 1995

Potential Realizable
Number % of Total Value at
of Shares Options Exercise Assumed Annual Rate
Underlying Granted to or Base of Stock Price
Options Employees in Price Per Expiration Appreciation for
Granted Fiscal Year Share Date Option Term
------- ----------- ----- ---- -----------
Name 5% 10%
- ---- -- ---
<S> <C> <C> <C> <C> <C> <C>
Ronald A. Cass - - - - - -
Warren A. Marmorstein - - - - - -
Jay Gershberg 2,500(1) 6.25% $3.00 08-07-01 $7,538 $9,965
Jeffrey A. Barnhill 7,000(2) 17.50% $2.50 11-30-00 $20,101 $25,366

</TABLE>

(1) Fully vesting at August 7, 1996.
(2) Fully vested at November 30, 1995.

Option Exercises and Holdings

The following table sets forth information with respect to the named
executive officers, concerning the exercise of options during the 1995 fiscal
year and unexercised options held as of the end of the fiscal year:

AGGREGATED OPTION EXERCISES IN FISCAL 1995
AND 1995 FISCAL YEAR-END OPTION VALUES

NUMBER OF SECURITIES VALUE OF UNEXERCISED
VALUE REALIZED UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES (MARKET PRICE AT OPTIONS AT FY END AT FISCAL YEAR END(1)
ACQUIRED EXERCISE LESS ---------------------------- ----------------------------
NAME ON EXERCISE EXERCISE PRICE) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
RONALD A. CASS - - 230,000 - - -
WARREN A. MARMORSTEIN - - 100,000 - - -
JAY GERSHBERG - - 10,000 2,500 - -
JEFFREY BARNHILL - - 7,000 - - -
</TABLE>

(1) Value is calculated by subtracting the exercise price per share from
the closing price per share on the New York Stock Exchange on November
30, 1995 and multiplying by the number of shares subject to the option.

8
<PAGE>

Employment and Other Agreements

The Company has agreements with its named executive officers and others
which provide for severance and other benefits in the case of termination of
employment under various circumstances. The agreements in place with the
Company's named executive officers and others are as follows:

Ronald A. Cass entered into a Termination and Benefits Agreement (the
"1991 Agreement") with the Company in 1991 which was modified by the terms of a
Settlement Agreement between the Company and Mr. Cass dated December 30, 1994
(the "Modification Agreement"). The 1991 Agreement entitled Mr. Cass to
severance benefits ranging from two to five years and to the acceleration of
vesting of options in the event of his termination or a change in control of the
Company. The actual severance period varied depending on whether the termination
was voluntary or involuntary, whether it was for cause or without cause and
whether it was in connection with a change of control.

To eliminate the severance obligations of the Company in the 1991
Agreement, the Company and Mr. Cass entered into the Modification Agreement that
provided for the payment to Mr. Cass of $1.0 million and a reduction in Mr.
Cass' annual base salary from $330,000 per year to $175,000 per year. The $1.0
million payment was made by issuing Mr. Cass a note, payable in 55 monthly
installments of $13,000 plus interest at a rate equal to prime rate. The
remaining balance of $285,000 was satisfied by (i) setting off $100,000 owed to
the Company by Mr. Cass for advances made in prior years and (ii) setting off
the purchase price of $185,000 owed by Mr. Cass to the Company for the purchase
by Mr. Cass of the Company's Broward County private duty home health agency in
January 1995. (See "Certain Relationships and Related Transactions"). The
promissory note provides for acceleration of the balance due to be immediately
payable to the Chief Executive Officer upon the Company's default of a scheduled
monthly payment or upon a change in control of the Company, as defined.

The Modification Agreement provides that Mr. Cass shall continue as an
at-will employee and be entitled 90 days' notice of termination or, to the
extent such notice is not given, payment of his base salary for up to 90 days.
In addition, upon termination of Mr. Cass' employment for any reason he shall be
entitled to receive all earned but unused vacation and, for one year, all
health, disability and life insurance benefits that he was receiving at the time
of termination. The Modification Agreement also provides that in the event of
Mr. Cass' death or disability, Mr. Cass' spouse and/or dependents are entitled
to receive health benefits for up to one year following such death or disability
and in the event of termination as a result of Mr. Cass' death, his estate shall
receive Mr. Cass' base salary for a 90 day period. Mr. Cass also agreed to
remain bound by the non-compete and confidentially provisions of the 1991
Agreement.

Effective December 1, 1995 the Board of Directors agreed to increase
Mr. Cass' annual base salary to $250,000.

Pursuant to an agreement between the Company and its former Chief
Financial and Administrative Officer, Warren A. Marmorstein, dated as of March
31, 1995, Mr. Marmorstein agreed to resign as an officer and employee of the
Company effective May 1, 1995 and agreed to a severance payment of $630,000
payable in 24 monthly installments through April 30, 1997 (the "1995
Agreement"). The 1995 Agreement was a modification to a Termination and Benefit
Agreement between Mr. Marmorstein and the Company dated November 1, 1993 (the
"1993 Agreement") pursuant to which Mr. Marmorstein was entitled to two year
severance payments (including bonuses) if he was terminated without cause and
one year severance payments (including bonuses) if he was terminated for cause
or he resigned voluntarily. As a result of the 1995 Agreement, Mr. Marmorstein's
unvested options relating to 16,667 shares of common stock became fully vested.
As a result, Mr. Marmorstein had fully vested options to purchase 100,000 shares
of common stock

<PAGE>

at the time of his resignation. The 1995 Agreement provided that the period of
time for exercising such options be extended in accordance with the following
schedule:

50,000 options expire on November 28, 1997
16,667 options expire on October 6, 1998
16,667 options expire on October 6, 1999
16,667 options expire on October 6, 2000

The 1995 Agreement required Mr. Marmorstein to agree to a one-year
non-competition provision and to maintain the confidentiality of trade secrets
of the Company.

Messrs. Jay L. Gershberg, Jeffrey A. Barnhill and Ronald G. Huneycutt
(collectively, the "Employees") each have entered into Employment Agreements
with the Company providing for a twelve month term, and automatically renewable
annually unless the Employee's employment is terminated as provided in the
Employment Agreements. Each of the Employment Agreements for Messrs. Gershberg
and Barnhill provide that, subject to the Employee complying with certain
non-competition provisions, in the event the Employee is terminated "without
cause" (as defined) he shall be entitled to one full year's base salary plus all
earned, but unused, vacation or if the Employee voluntarily terminates
employment within one year following a "change-in-control" (as defined) he shall
be entitled to (i) one full year's base salary plus all earned, but unused,
vacation, (ii) a pro rata share of a performance bonus for that year and (iii)
an auto allowance and all benefits existing at the date of termination for one
year. The Employment Agreement for Mr. Gershberg also provides for a death
benefit equal to 90 days of the Employee's base salary at the time of death and
for short term disability payments to the Employee equal to 180 days of base
salary. Mr. Huneycutt's Employment Agreement provides for three months severance
under the same terms and conditions stated above and provides additionally for
the grant of options to acquire 10,000 shares of the company's common stock at
$3.00 Per share, which was higher than the fair market value of a share of
common stock at the date of this Agreement.

Mr. Gershberg's and Mr. Barnhill's Employment Agreements were effective
as of September 1, 1995 and Mr. Huneycutt's was effective as of February 1,
1996. The annual base salary provided for in each of the Employment Agreements
during the first twelve month term is $141,750, $130,000 and $117,500 for
Messrs. Gershberg, Barnhill and Huneycutt, respectively, plus an annual cash
payment for retirement benefits equal to 8% of their respective base salaries
and other benefits, including an automobile allowance and $100,000 of life
insurance.

Director Compensation

During fiscal 1995, each of the Company's non-employee directors
received compensation of $750 per Board and Committee Meeting. In addition, in
lieu of an annual retainer amount of $2,500, each such director elected to
receive an option to acquire 10,000 shares of common stock of the Company with
an exercise price of $2.375 per share. Directors are also reimbursed for their
travel expenses in connection with such meetings. The total cash compensation
paid to directors for meetings in 1995 was approximately $17,376.

1983 Stock Option Plan

The Company's 1983 Incentive Stock Option Plan, as amended (the "1983
Plan"), provided for the grant of options to purchase up to 300,000 shares of
Common Stock at an exercise price of not less than 100% of

<PAGE>

the fair market value of the Company's Common Stock on the date of grant (110%
of fair market value in the case of an optionee who is the owner of greater than
10% of the outstanding shares).

During the fiscal year ended November 30, 1995 no options were granted
or exercised under the 1983 Plan and none expired. At November 30, 1995, options
to purchase 17,250 shares were outstanding at an exercise price of $5.875 Per
share. These options are exercisable for up to ten years from the date of grant.
No options will be granted under the 1983 Plan in the future.

1990 Stock Option Plan

In 1989, the Company adopted the 1990 Stock Option Plan (the "1990
Plan") which provides that options may be granted to purchase up to 770,000
shares of Common Stock. Options granted under the 1990 Plan are in the form of
either an incentive stock option ("ISO") qualified under Section 422 of the
Internal Revenue Code, a non-qualified stock option ("NSO") or a reload option
(a newly issued option to purchase shares of Common Stock equal in number to the
shares of Common Stock which may be tendered, in lieu of cash, to pay for the
exercise of options previously granted). The Company's Compensation and Stock
Option Committee determines which employees are awarded options under the 1990
Plan and the terms and vesting provisions of such options.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth Common Stock ownership information,
based on 6,349,770 shares of common stock outstanding as of February 29, 1996
with respect to (i) each person known to the Company to be the beneficial owner
of more than 5% of the Company's Common Stock, (ii) each director and named
executive officer of the Company and (iii) all directors and named executive
officers of the Company as a group. This information as to beneficial ownership
was furnished to the Company by or on behalf of the persons named. Unless
otherwise indicated, the business address of each person listed is 6245 North
Federal Highway, Suite 400, Fort Lauderdale, Florida 33308.

Shares Percent
Beneficially of
Owned(1) Class(2)

Ronald A. Cass 608,788(3) 9.6%
Chairman of the Board,
Chief Executive Officer,
President and Treasurer

Jeffrey A. Barnhill 17,200(4) * (5)
Senior Vice President, Health Services

Jay L. Gershberg 10,000(6) * (5)
Senior Vice President, Ancillary Services
President, Travel Nurse Group

Warren Marmorstein(7) 100,000(8) 1.6%

Robert B. Fields 10,740(9) * (5)
Director

<PAGE>

William F. McConnell 5,000(10) * (5)
Director

Hector Luis Ziperovich, M.D. 15,000(11) * (5)
Director

All officers and directors 781,728(12) 12.3%
as a group (8 individuals)

The Taneja Group(13) 356,800(14) 5.6%
NuMed Home Health Care, Inc.
6505 Rockside Road, Suite 400
Independence, OH 44131-2342

Heartland Advisors, Inc. 860,400(15) 13.6%
790 Milwaukee Street
Milwaukee, WI 53202

Continental Stock Transfer 700,000(16) 11.0%
& Trust Company, Trustee
2 Broadway, New York, NY 10014

(1) Beneficial ownership has been determined in accordance with Rule 13d-3
under the Securities Exchange Act of 1934, as amended ("Rule 13d-3")
and unless otherwise indicated, represents shares for which the
beneficial owner has sole voting and investment power, as of the date
hereof. Stock options included are exercisable on February 29, 1996, or
will be exercisable by April 30, 1996.

(2) The percentage of class is calculated in accordance with Rule 13d-3 and
assumes that the beneficial owner has exercised any options or other
rights to subscribe which are currently exercisable within sixty (60)
days and that no other options or rights to subscribe have been
exercised by anyone else.

(3) The total amount includes 359,288 shares of Common Stock held jointly
by Mr. Cass and his wife, 7,000 shares held solely by Mr. Cass and
options to purchase 242,500 shares of Common Stock held solely by Mr.
Cass.

(4) Includes options to purchase 17,000 shares of Common Stock.

(5) Represents less than 1%.

(6) Represents options to purchase 10,000 shares of Common Stock.

(7) On May 1, 1995, Mr. Marmorstein resigned as the Company's Chief
Financial and Administrative Officer, Senior Vice President, Treasurer
and Secretary.

(8) Represents options to purchase 100,000 shares of Common Stock.

(9) Includes options to purchase 10,000 shares of Common Stock.

<PAGE>

(10) Represents options to purchase 5,000 shares of Common Stock.

(11) Includes options to purchase 5,000 shares of Common Stock and warrants
to purchase 10,000 shares of Common Stock.

(12) Includes options to acquire 15,000 shares of Common Stock.

(13) The Taneja Group is a group of related shareholders who have joined
together as a voting group.

(14) As per Amended Schedule 13D filed with the Securities Exchange
Commission by the Taneja Group on March 27, 1995.

(15) As per Schedule 13G filed with the Securities Exchange Commission by
Heartland Advisors, Inc. on February 9, 1996.

(16) In July 1995, 700,000 shares of Company Common Stock were placed in
escrow with Continental Stock Transfer & Trust Company, as Escrow
Agent, pending the final approval of the Stipulation and Settlement
Agreement (the "Stipulation") in connection with the settlement of a
class action suit filed in the United States District Court for the
Northern District of California styled Roe et al. v. Hospital Staffing
Services, Inc. The Court has approved the Stipulation, and the shares
will be distributed to the authorized claimants in accordance with the
Stipulation. Undistributed shares will be voted by the Escrow Agent
in the same percentage as the holders of the remaining outstanding
Company shares are voted.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

At the beginning of fiscal 1995, the Company had outstanding loans to
Ronald A. Cass, Chairman and Chief Executive Officer of the Company, of
approximately $100,000 which accrued interest at rates ranging from 6.5% to 8.0%
per annum. All funds advanced were for personal, non-business related purposes.
On January, 13, 1995, all loans were repaid to the Company via an offset to the
$1.0 million promissory note given him by the Company. (See Page 8).

On January 13, 1995 certain fixed and intangible assets of the
Company's Broward County, Florida private duty home health agency were sold to
the Company's Chairman and Chief Executive Officer at their fair market value of
approximately $185,000. Payment of this amount to the Company was via an offset
to the $1.0 million promissory note given him by the Company. (See Page 8).

The Company has outstanding loans to Warren Marmorstein, the Company's
former Chief Financial Officer, of approximately $53,000, which accrue interest
at rates ranging from 6.5% to 8.0% per annum. All funds advanced were for
personal non-business related purposes. Mr. Marmorstein is repaying his
obligation via a non-interest bearing promissory note to the Company in
installments of approximately $4,500 monthly. At November 30, 1995, the unpaid
balance due the Company was approximately $17,800.

In 1992 the Company made a loan to William F. McConnell, an outside
director of the Company, of approximately $72,200, which accrues interest at the
rate of 8.0% per annum. All funds advanced were for personal non-business
related purposes. Mr. McConnell is repaying his obligation to the Company in
installments of approximately $4,900 monthly. At February 29, 1996, the unpaid
balance due the Company was $33,642.

<PAGE>

In 1994, the Company began utilizing the services of Mr. McConnell as a
consultant. Such services included shareholder relations, evaluation of
strategic alternatives for the Company and other duties as assigned by the Chief
Executive Officer. The fees for such services were approximately $32,000 in
fiscal 1995.

During 1995, the Company utilized the services of Dr. Hector L.
Ziperovich an outside director of the Company as its National Medical Director
and in July 1995 entered into a written contractual arrangement whereby the
Director would continue as the Company's Medical Director for an indeterminate
time or until the contract is terminated by either party. Such services include
utilization review, quality assurance, medical guidance, and compliance with all
clinically relevant Federal and State regulations. For the Fiscal Year 1995, the
fees for such services were approximately $42,000.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS

As referenced above, during 1995, Dr. Hector L. Ziperovich served as
National Medical Director for the Company.

<PAGE>

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Hospital Staffing Services, Inc. has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

HOSPITAL STAFFING SERVICES, INC.

By: Ronald A. Cass Ronald A. Cass, Chairman of the Board, Chief
Executive Officer, President and Treasurer
Date: March 29, 1996

<PAGE>

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

EXHIBIT NO.

10.11 Employment Agreement with Jay Gershberg dated September 1, 1995
(Corrected)

10.12 Employment Agreement with Jeffrey A. Barnhill dated September 1, 1995
(Corrected)

10.13 Employment Agreement with Ronald Huneycutt dated February 1, 1996
(Corrected)

10.19 Termination and Benefits Agreement with Ronald A. Cass dated June 1,
1991 (Incorporated by reference to Exhibit 10.15 to Registrant's
Registration Statement on From S-1 (No. 33-42640)).

10.20 Termination and Benefits Agreement with Warren Marmorstein dated
November 1, 1993. (Incorporated by reference to Exhibit 10.25 filed
with the Registrant's Annual Report on Form 10-K for the fiscal year
ended November 30, 1993).

EXHIBIT 10.11

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of the 1st day of September , 1995 (the "Effective Date"), between Hospital
Staffing Services, Inc., a Florida corporation, whose address is 6245 N. Federal
Highway, Suite 400, Fort Lauderdale, FL 33308 (the "Company"), and Jay
Gershberg, whose address is 3260 N. W. 112 Avenue, Coral Springs, Florida 33065
(the "Employee").

RECITALS

A. The Company is principally engaged in the business, inter alia, of
(1) providing home health care; (2) acting as a professional recruiter of
registered nurses and other professional medical personnel for provision to
hospitals on an interim staffing basis (the "Business").

B. The Company has established a valuable reputation and goodwill in
its Business, with expertise in all aspects of the Business.

C. The Company presently employs the Employee and desires to continue
to employ the Employee and the Employee desires to continue in the employ of the
Company.

D. In consideration for the Employee's continued employment with the
Company, and for an increase in the Employee's base salary, the Company wishes
to provide certain benefits to the Employee upon certain events of termination
of the Employee's employment with the Company, as described more fully in this
Agreement.

E. The Employee, by virtue of the Employee's employment by the Company,
shall become familiar with and possessed with the manner, methods, trade secrets
and other confidential information pertaining to the Company's Business,
including the Company's client base.

NOW THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Employee do hereby agree as follows:

1. Recitals. The above recitals are true, correct, and are herein
incorporated by reference.

2. Employment. The Company hereby employs the Employee in the capacity
as the Company's Vice President of Ancillary Services/President Travel Nurse
Operations, and the Employee hereby accepts such employment, upon the terms and
conditions hereinafter set forth.

3. Authority and Power During Employment Period. The duties of the
Employee shall be subject to the direction of the Company and the Employee shall
perform all duties as shall be directed by the Company. The Employee shall
devote full attention and render exclusive, full time services to the Company
and shall be employed solely by the Company according to the

<PAGE>

terms of this Agreement. Employee's job title is subject to change by the Board
of Directors.

4. Compensation and Benefits.

a. Base Salary. For all services rendered by the Employee pursuant to
the terms of this Agreement and in consideration of the execution of this
Agreement by the Employee, the Company shall pay the Employee a base salary as
is set forth on Exhibit A of this Agreement.

b. Additional Compensation. The Employee shall be entitled to receive
such additional compensation as set forth on Exhibit B of this Agreement.

c. Employee Benefits. The Employee shall be entitled to participate in
all benefit programs of the Company currently existing or hereafter made
available to senior executives and/or other salaried employees.

d. Automobile Allowance. The Employee shall be entitled to receive an
automobile allowance as set forth on Exhibit C of this Agreement.

e. Business Expense Reimbursement. During the Employee's employment,
the Employee shall be entitled to receive proper reimbursement for all
reasonable, out-of-pocket expenses incurred by the Employee (in accordance with
the policies and procedures established by the Company for its executives) in
performing services hereunder, provided the Employee properly accounts therefor.

5. Term. The Term of employment hereunder will commence on the
Effective Date as set forth above and continue for a period of twelve (12)
months from the Effective Date. The Term shall be automatically renewed for
successive twelve (12) month periods unless otherwise terminated pursuant to
Section 6 hereof.

6. Termination.

a. Termination by the Company for Cause.

(1) Nothing herein shall prevent the Company from terminating Employee
for "Cause," as hereinafter defined.

(2) "Cause" shall mean (i) committing or participating in an injurious
act of fraud, gross neglect, misrepresentation, embezzlement or dishonesty
against the Company; (ii) committing or participating in any other injurious act
or omission wantonly, willfully, recklessly or in a manner which was grossly
negligent against the Company, monetarily or otherwise; (iii) engaging in a
criminal enterprise involving moral turpitude; (iv) conviction of a felony under
the laws of the United States or any state thereof; (v) if applicable, loss of
any state or federal license required for the Employee to perform the Employee's
material duties or

<PAGE>

responsibilities for the Company; provided, however, that this Subsection
6(a)(2) shall not be applicable if such loss of license shall be a result of any
actions or inactions outside the Employees control; (vi) failure or refusal of
Employee to perform the lawful orders or instructions of his superiors; or (vii)
any assignment of this Agreement in violation of Section 16 of this Agreement.

(3) Notwithstanding anything else contained in this Agreement, this
Agreement will not be deemed to have been terminated for Cause unless and until
there shall have been delivered to the Employee a notice of termination stating
that the Employee committed one of the types of conduct set forth in Section
6(a) of this Agreement and specifying the particulars thereof and the Employee
shall be given a thirty (30) day period to cure such conduct set forth in
Section 6(a)(2); provided that the conduct set forth in clause (vi) is subject
to only one thirty (30) notice and cure period.

b. Constructive Termination of Employment. A termination by the Company
Without Cause under Section 7 shall be deemed to have occurred upon the
occurrence of one or more of the following events without the express written
consent of the Employee:

(1) a significant change in the nature or scope of the authorities,
powers, functions, duties or responsibilities attached to the Employee's
position as described in Section 2; or

(2) a five percent (5%) reduction in the Employee's salary below the
salary in effect immediately prior to such reduction; or

(3) a material breach of this Agreement by the Company;

(4) failure by a successor company to assume the obligations under the
Agreement; or

(5) change in the Employee's principal office to a location outside the
Dade-Broward-Palm Beach County, Florida area.

Anything herein to the contrary notwithstanding, the Employee shall give written
notice to the Board of Directors of the Company that the Employee believes an
event has occurred which would result in a Constructive Termination of the
Employee's employment under this Section 6(b), which written notice shall
specify the particular act or acts, on the basis of which the Employee intends
to so terminate the Employee's employment, and the Company shall then be given
the opportunity, within fifteen (15) days of its receipt of such notice to cure
said event.

c. Termination Following a Change of Control.

(1) In the event that a "Change in Control," as hereinafter defined, of
the Company shall occur at any time during the Term or any renewal thereof, the
Employee shall

<PAGE>

have the right to terminate his employment under this Agreement upon thirty (30)
days written notice given at any time within one (1) year after the occurrence
of such event, and such termination of the Employee's employment with the
Company pursuant to this Section 6(c)(1), then, in any such event, such
termination shall be deemed to be a termination by the Company Without Cause.

(2) For purposes of this Agreement, a "Change in Control" of the
Company shall mean a change in control (i) as set forth in Section 280G of the
Internal Revenue Code or (ii) of a nature that would be required to be reported
in response to Item 1 of the current report on Form 8K, as in effect on the date
hereof, pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act"); provided that, without limitation, such a change in
control shall be deemed to have occurred at such time as:

(a) any "person," other than the Employee (as such term is used in
Section 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or
more of the combined voting power of the Company's outstanding securities then
having the right to vote at elections of directors; or,

(b) the individuals who, at the commencement date of the Agreement
constitute the Board of Directors, cease for any reason to constitute a majority
thereof unless the election, or nomination for election, of each new director
was approved by a vote of at least two thirds of the directors then in office
who were directors at the commencement of the Agreement; or

(c) there is a failure to elect a number of directors as would
constitute a majority of the Board of Directors' candidates nominated by
management of the Company to the Board of Directors; or

(d) the business of the Company for which the Employee's services are
principally performed is disposed of by the Company pursuant to a partial or
complete liquidation of the Company, a sale of assets (including stock of a
subsidiary of the Company) or otherwise.

Anything herein to the contrary notwithstanding, this Section 6(c)(2) will not
apply where the Employee gives the Employee's explicit written waiver stating
that for the purposes of this Section 6(c)(2), a Change in Control shall not be
deemed to have occurred. The Employee's participation in any negotiations or
other matters in relation to a Change in Control shall in no way constitute such
a waiver which can only be given by an express written waiver as provided in the
preceding sentence.

(3) Anything in this Section 6(c) to the contrary notwithstanding, in
no event will any action or non-action by the Employee at any time prior to the
first anniversary date

<PAGE>

of the applicable Change in Control be deemed consent to any of the events
described in this Section 6(c).

7. Termination Without Cause; Termination as a Result of Change of
Control and Severance Benefits.

a. If the Employee is terminated Without Cause, and subject to
Employee's compliance with the provisions of Sections 8 and 9 hereof or as
otherwise provided in this Agreement, following the effective date of the
Employee's effective date of termination of his employment, the Employee shall
continue to receive (1) the base salary which existed at the time of the
Employee's termination as set forth on Exhibit "A" of this Agreement (the
"Severance Compensation") for a period of twelve (12) months thereafter; and (2)
all accrued but unused vacation through the date of termination.

b. If the Employee is terminated as a result of a Change of Control as
defined herein and subject to Employee's compliance with the provisions of
Sections 8 and 9 hereof or as otherwise provided in this Agreement, following
the effective date of the Employee's effective date of termination of his
employment, the Employee shall continue to receive, for a period of twelve (12)
months following the effective date of termination, (1) the base salary which
existed at the time of the Employee's termination as set forth on Exhibit A (the
"Severance Compensation"); (2) all accrued but unused vacation; (3) the
Employee's pro-rata share of Additional Compensation for the year, as described
in Section 4(b) and on Exhibit B and (payable through month-end of the last full
month prior to the date of termination); (4) a Car Allowance in the amount set
forth on Exhibit C; and (5) each and every one of the benefits of any employee
of the Company which existed at the time of the Employee's termination
(collectively the "Severance Compensation and Benefits").

c. All Severance Compensation shall be payable to the Employee weekly;
provided that in the event the Employee is entitled to receive the Severance
Compensation and Benefits as a result of a Change of Control, at the Employee's
option, the Employee may receive either (i) a lump sum equal to the Compensation
and Benefits due to the Employee pursuant to Section 7(a) reduced to present
value, as set forth in Section 280G of the Internal Revenue Code or (ii) weekly.

d. Death. In the event of the death of the Employee during the term of
his employment, base salary shall be paid to the Employee's designated
beneficiary, or, in the absence of such designation, to the estate or other
legal representative of the Employee for a period of ninety (90) days from and
after the date of death. Other death benefits will be determined in accordance
with the terms of the Company's benefit programs and plans.

e. Disability.

(1) In the event of the Employee's "disability," as hereinafter
defined, during the term of his employment, the Employee shall be entitled to
compensation in accordance

<PAGE>

with the Company's disability compensation practice for senior executives,
including any separate arrangement or policy covering the Employee, but in all
events the Employee shall continue to receive the Employee's salary for a
period, at the annual rate in effect immediately prior to the commencement of
disability, of not less than one hundred eighty (180) days from the date on
which the disability has been deemed to occur as hereinafter provided below. Any
amounts provided for in this Section 7(e) shall be offset by other long-term
disability benefits provided to the Employee by the Company.

(2) "Disability," for the purposes of this Agreement, shall be deemed
to have occurred in the event (A) the Employee is unable, by reason of sickness
or accident, to perform the Employee's duties under this Agreement for an
aggregate of ninety (90) days in any twelve (12) month period or forty-five (45)
consecutive days, or (B) the Employee has a guardian of the person or estate
appointed by a court of competent jurisdiction.

(3) Anything herein to the contrary notwithstanding, if, following a
termination of employment hereunder due to disability as provided in the
preceding paragraph, the Employee becomes re-employed, whether as an Employee or
a Consultant, any salary, annual incentive payments or other benefits earned by
the Employee from such employment shall offset any salary continuation due to
the Employee hereunder commencing with the date of reemployment.

8. Covenant Not to Compete. The Employee acknowledges and recognizes
the highly competitive nature of the Company's business and the goodwill,
continued patronage, and specifically the names and addresses of the Company's
Clients (as hereinafter defined) constitute a substantial asset of the Company
having been acquired through considerable time, money and effort. Accordingly,
in consideration of continued employment and compensation by the Company, the
Employee agrees to the following:

a. That during the Restricted Period (as defined herein) and within the
Restricted Area (as defined herein), the Employee will not, individually or in
conjunction with others, directly or indirectly, engage in any Business
Activities (as hereinafter defined) other than on behalf of the Company and as
agreed by the Company and the Employee, whether as an officer, director,
proprietor, employer, partner, independent contractor, investor, stockholder
(other than as a holder of less than one percent (1%) of the outstanding capital
stock of a publicly traded corporation), consultant, advisor, agent or
otherwise. Except that during the term of Employee's employment with the
Company, the foregoing limitations as to Restricted Area shall not be
applicable.

b. That during the Restricted Period and within the Restricted Area (as
defined herein), the Employee will not, indirectly or directly, compete with the
Company by soliciting, inducing or influencing any of the Company's Clients
which have a business relationship with the Company at any time during the
Restricted Period to discontinue or reduce the extent of such relationship with
the Company. Except that during the term of the Employee's employment with

<PAGE>

the Company, the foregoing limitations as to Restricted Area shall not be
applicable.

c. At no time during the Employee's employment with the Company and for
any time thereafter, the Employee will not (i) directly or indirectly recruit,
solicit or otherwise influence any employee or agent of the Company to
discontinue such employment or agency relationship with the Company, or (ii)
employ or seek to employ, or cause or permit any business which competes
directly or indirectly with the Business Activities of Company (the "Competitive
Business") to employ or seek to employ for any Competitive Business any person
who is then (or was at any time within six (6) months prior to the date the
Employee or the Competitive Business employs or seeks to employ such person)
employed by the Company.

d. That during the Restricted Period, the Employee will not interfere
with, disrupt or attempt to disrupt any past, present or prospective
relationship, contractual or otherwise, between the Company and any Company's
client, employee, agent, vendor, supplier or customer.

9. Non-Disclosure of Confidential Information.

a. The Employee acknowledges that the Company's trade secrets, private
or secret processes, methods and ideas, as they exist from time to time,
customer lists and information concerning the Company's products, services,
business records and plans, inventions, product design information, price
structure, discounts, costs, computer programs and listings, source code and/or
subject code, copyright, trademark, proprietary information, formulae,
protocols, forms, procedures, training methods, development, technical
information, marketing activities and procedures, method for operating the
Company's Business, credit and financial data concerning the Company and the
Company's Clients and Client Lists, which Client Lists shall not only mean one
or more of the names and addresses of the Clients of the Company but it shall
also encompass any and all information whatsoever regarding them, including
their needs, and marketing and advertising practices and plans and information
which is embodied in written or otherwise recorded form, but it shall also
include information which is mental, not physical (collectively, the
"Confidential Information") as valuable, special and unique assets of the
Company, access to and knowledge of which are essential to the performance of
the Employee hereunder. In light of the highly competitive nature of the
industry in which the Company's business is conducted, the Employee agrees that
all Confidential Information, heretofore or in the future obtained by the
Employee as a result of the Employee's association with the Company, shall be
considered confidential.

b. Excluded from the Confidential Information, and therefore not
subject to the provisions of this Agreement, shall be any information which:

(1) At the time of disclosure, is in the public domain as evidenced by
printed publications;

<PAGE>

(2) After the disclosure, enters the public domain by way of printed
publication through no fault of the Employee or those in privity with it;

(3) Employee can show by written documentation was in its possession at
the time of disclosure and which was not acquired directly or indirectly from
the Company; or

(4) Employee can show by written documentation was acquired, after
disclosure, from a third party who did not receive it from the Company, and who
had the right to disclose the information without any obligation to hold such
information confidential.

c. The Employee acknowledges that, as between the Company and the
Employee, the Confidential Information and any and all rights and privileges
provided under the trademark, copyright, trade secret and other laws of the
United States, the individual states thereof, and jurisdictions foreign thereto,
and the goodwill associated therewith, are and at all times will be the property
of the Company.

d. Employee agrees that it shall:

(1) Hold in confidence and not disclose or make available to any third
party any such Confidential Information unless so authorized in writing by the
Company;

(2) Exercise all reasonable efforts to prevent third parties from
gaining access to the Confidential Information;

(3) Not use, directly or indirectly, the Confidential Information in
any respect of its business, except as necessary to evaluate the information;

(4) Restrict the disclosure or availability of the Confidential
Information to those of Employee's employees who have read and understand this
Agreement and who have a need to know the information in order to achieve the
purposes of this Agreement;

(5) Not copy or modify any Confidential Information without prior
written consent of the Company.

(6) Take such other protective measures as may be reasonably necessary
to preserve the confidentiality of the Confidential Information; and

(7) Relinquish and require all of its employees to relinquish all
rights it and its employees may have in any matter, such as drawings, documents,
models, samples, photographs, patterns, templates, molds, tools or prototypes,
which may contain, embody or make use of the Confidential Information; promptly
deliver to the Company any such matter as the Company may direct at any time;
and not retain any copies or other reproductions thereof.

<PAGE>

e. Employee further agrees:

(1) That it shall promptly disclose in writing to the Company all
ideas, inventions, improvements and discoveries which may be conceived, made or
acquired by Employee or its employees as the direct or indirect result of the
disclosure by the Company of the Confidential Information to Employee;

(2) That all such ideas, inventions, improvements and discoveries
conceived, made or acquired by Employee, alone or with the assistance of others,
relating to the Confidential Information, shall be the property of the Company
and shall be treated as Confidential Information in accordance with the
provisions hereof and that the Employee shall not acquire any intellectual
property rights under this Agreement except the limited right to use set forth
in this Agreement.

(3) That Employee and its employees shall assist in the preparation and
execution of all applications, assignments and other documents which the Company
may deem necessary to obtain patents, copyrights and the like in the United
States and in jurisdictions foreign thereto, and to otherwise protect the
Company.

f. Upon written request of the Company, Employee shall return to the
Company all written materials containing the Confidential Information. Employee
shall also deliver to the Company written statements signed by the Employee
certifying all materials have been returned within five (5) days of receipt of
the request.

10. Company's Clients. The "Company's Clients" shall be deemed to be
any persons, partnerships, corporations, professional associations or other
organizations for whom the Company has performed Business Activities.

11. Restrictive Period. The "Restrictive Period" shall be deemed to be
during the Employee's employment with the Company and for a period of twelve
(12) months following termination of the Employee's employment, regardless of
the reason for termination.

12. Restricted Area. The Restricted Area shall be deemed to mean within
the restricted area and shall be limited to any county in the United States or
in any country throughout the world where Company or any of its subsidiaries are
engaged in the homecare business as may be conducted by Company or any of its
subsidiaries as of the date of this Agreement or during the term of the
Employee's employment with the Company.

13. Business Activities. "Business Activities" shall be deemed to
include any activities which are included in the Company's Business now or
during the effective period of this Agreement.

<PAGE>

14. Covenants as Essential Elements of this Agreement. It is understood
by and between the parties hereto that the foregoing covenants by Employee
contained in Sections 8 or 9 of this Agreement shall be construed to be
agreements independent of any other element of the Employee's employment with
the Company. The existence of any other claim or cause of action, whether
predicated on any other provision in this Agreement, or otherwise, as a result
of the relationship between the parties shall not constitute a defense to the
enforcement of the covenants in the Agreement against the Employee.

15. Remedies.

a. The Employee acknowledges and agrees that the Company's remedy at
law for a breach or threatened breach of any of the provisions of Sections 8 or
9 herein would be inadequate and the breach shall be per se deemed as causing
irreparable harm to the Company. In recognition of this fact, in the event of a
breach by the Employee of any of the provisions of Sections 8 or 9, the Employee
agrees that, in addition to any remedy at law available to the Company,
including, but not limited to monetary damages, the Company, without posting any
bond, shall be entitled to obtain, and the Employee agrees not to oppose the
Company's request for, equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction or any other
equitable remedy which may then be available to the Company.

b. The Employee acknowledges that the granting of a temporary
injunction, temporary restraining order or permanent injunction merely
prohibiting the use of Confidential Information would not be an adequate remedy
upon breach or threatened breach of Sections 8 or 9 and consequently agrees,
upon proof of any such breach, to the granting of injunctive relief prohibiting
any form of competition with the Company. Nothing herein contained shall be
construed as prohibiting the Company from pursuing any other remedies available
to it for such breach or threatened breach.

c. In the event that the Employee shall be in violation of the
aforementioned restrictive covenants, then the time limitation during which
breach or breaches should occur, and in the event the Company should be required
to seek relief from such breach in any court or other tribunal, then the
covenant shall be extended for a period of time equal to the pendency of such
proceedings, including appeal.

16. Binding Effect/Assignment. This Agreement shall be binding upon the
parties hereto, their heirs, legal representatives, successors and assigns. This
Agreement shall not be assignable by the Employee but shall be assignable by the
Company in connection with the sale, transfer or other disposition of its
business or to any of the Company's affiliates controlled by or under common
control with the Company.

<PAGE>

17. Miscellaneous Provisions. Any notice required or permitted to be
given under the terms of this Agreement shall be sufficient if in writing and if
sent postage prepaid by registered or certified mail, return receipt requested;
by overnight delivery; by courier; or by confirmed telecopy, in the case of the
Employee to the Employee's last place of business or residence as shown on the
records of the Company, or in the case of the Company to its principal office as
set forth in the introductory paragraph, or such other place as it may
designate. This Agreement sets forth the entire understanding of the parties
relating to the subject matter hereof, and supersedes and cancels any prior
communications, understandings and agreements between the parties. This
Agreement cannot be modified or changed, nor can any of its provisions be
waived, except by written agreement signed by all parties. This Agreement shall
be governed by the laws of the State of Florida. Venue shall be Broward County,
Florida. In the event of any dispute as to the terms of this Employment
Agreement, the prevailing party in any litigation shall be entitled to
reasonable attorneys' fees.

18. Construction. This Agreement shall be construed within the fair
meaning of each of its terms and not against the party drafting the document.

19. Severability. This Agreement shall be deemed severable, and the
invalidity or enforceability of any term or provision hereof shall not affect
the validity or enforceability of this Agreement or of any other term or
provision hereof. Furthermore, in lieu of any such invalid or unenforceable term
or provision, the parties hereto intend that there shall be added as a part of
this Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.

<PAGE>

THE PARTIES TO THIS AGREEMENT HAVE READ THIS AGREEMENT, UNDERSTAND ITS TERMS AND
CONDITIONS, HAVE HAD THE OPPORTUNITY TO CONSULT WITH INDEPENDENT COUNSEL OF
THEIR OWN CHOICE AND AGREE TO BE BOUND BY ITS TERMS AND CONDITIONS.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written in Broward County, Florida.

WITNESS: THE COMPANY
________________________________ HOSPITAL STAFFING SERVICES, INC.
BY: /s/ Ronald A. Cass
NAME: Ronald A. Cass
Its: Chief Executive Officer

THE EMPLOYEE

________________________________ /s/ Jay Gershberg
Jay Gershberg

<PAGE>

EXHIBIT A

BASE SALARY

The base salary is $141,750 per year.

<PAGE>

EXHIBIT B

ADDITIONAL COMPENSATION

The Employee shall be entitled to receive

a. Eight percent (8%) of the Employee's base salary in deferred
compensation, pursuant to the Company's deferred compensation plan.

<PAGE>

EXHIBIT C

AUTOMOBILE ALLOWANCE

The Automobile Allowance is $9,000 per year.

EXHIBIT 10.12

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of the 1st day of September , 1995 (the "Effective Date"), between Hospital
Staffing Services, Inc., a Florida corporation, whose address is 6245 N. Federal
Highway, Suite 400, Fort Lauderdale, FL 33308 (the "Company"), and Jeffrey
Barnhill, whose address is 150 N. W. 112 Lane, Coral Springs, Florida 33071 (the
"Employee").

RECITALS

B. The Company has established a valuable reputation and goodwill in
its Business, with expertise in all aspects of the Business.

C. The Company presently employs the Employee and desires to continue
to employ the Employee and the Employee desires to continue in the employ of the
Company.

D. In consideration for the Employee's continued employment with the
Company, the Company wishes to provide certain benefits to the Employee upon
certain events of termination of the Employee's employment with the Company, as
described more fully in this Agreement.

NOW THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Employee do hereby agree as follows:

1. Recitals. The above recitals are true, correct, and are herein
incorporated by reference.

2. Employment. The Company hereby employs the Employee in the capacity
as the Company's Vice President of Health Services, Operations and
Reimbursement, and the Employee hereby accepts such employment, upon the terms
and conditions hereinafter set forth.

<PAGE>

4. Compensation and Benefits.

b. Additional Compensation. The Employee shall be entitled to receive
such additional compensation as set forth on Exhibit B of this Agreement.

d. Automobile Allowance. The Employee shall be entitled to receive an
automobile allowance as set forth on Exhibit C of this Agreement.

6. Termination.

a. Termination by the Company for Cause.

(1) Nothing herein shall prevent the Company from terminating Employee
for "Cause," as hereinafter defined.

<PAGE>

control; (vi) failure or refusal of Employee to perform the lawful orders or
instructions of his superiors; or (vii) any assignment of this Agreement in
violation of Section 16 of this Agreement.

(1) a significant change in the nature or scope of the authorities,
powers, functions, duties or responsibilities attached to the Employee's
position as described in Section 2; or

(2) a five percent (5%) reduction in the Employee's salary below the
salary in effect immediately prior to such reduction; or

(3) a material breach of this Agreement by the Company;

(4) failure by a successor company to assume the obligations under the
Agreement; or

(5) change in the Employee's principal office to a location outside the
Dade-Broward-Palm Beach County, Florida area.

c. Termination Following a Change of Control.

(1) In the event that a "Change in Control," as hereinafter defined, of
the Company shall occur at any time during the Term or any renewal thereof, the
Employee shall have the right to terminate his employment under this Agreement
upon thirty (30) days written notice given at any time within one (1) year after
the occurrence of such event, and such

<PAGE>

termination of the Employee's employment with the Company pursuant to this
Section 6(c)(1), then, in any such event, such termination shall be deemed to be
a termination by the Company Without Cause.

(c) there is a failure to elect a number of directors as would
constitute a majority of the Board of Directors' candidates nominated by
management of the Company to the Board of Directors; or

(3) Anything in this Section 6(c) to the contrary notwithstanding, in
no event will any action or non-action by the Employee at any time prior to the
first anniversary date of the applicable Change in Control be deemed consent to
any of the events described in this Section 6(c).

<PAGE>

7. Termination Without Cause; Termination as a Result of Change of
Control and Severance Benefits.

<PAGE>

(other than as a holder of less than one percent (1%) of the outstanding capital
stock of a publicly traded corporation), consultant, advisor, agent or
otherwise. Except that during the term of Employee's employment with the
Company, the foregoing limitations as to Restricted Area shall not be
applicable.

9. Non-Disclosure of Confidential Information.

<PAGE>

business is conducted, the Employee agrees that all Confidential Information,
heretofore or in the future obtained by the Employee as a result of the
Employee's association with the Company, shall be considered confidential.

b. Excluded from the Confidential Information, and therefore not
subject to the provisions of this Agreement, shall be any information which:

(1) At the time of disclosure, is in the public domain as evidenced by
printed publications;

(2) After the disclosure, enters the public domain by way of printed
publication through no fault of the Employee or those in privity with it;

(3) Employee can show by written documentation was in its possession at
the time of disclosure and which was not acquired directly or indirectly from
the Company; or

d. Employee agrees that it shall:

(1) Hold in confidence and not disclose or make available to any third
party any such Confidential Information unless so authorized in writing by the
Company;

(2) Exercise all reasonable efforts to prevent third parties from
gaining access to the Confidential Information;

(3) Not use, directly or indirectly, the Confidential Information in
any respect of its business, except as necessary to evaluate the information;

(5) Not copy or modify any Confidential Information without prior
written consent of the Company.

<PAGE>

(6) Take such other protective measures as may be reasonably necessary
to preserve the confidentiality of the Confidential Information; and

e. Employee further agrees:

11. Restrictive Period. The "Restrictive Period" shall be deemed to be
during the Employee's employment with the Company and for a period of one (1)
year following termination of the Employee's employment, regardless of the
reason for termination.

12. Restricted Area. The Restricted Area shall be deemed to mean within
the restricted area and shall be limited to any county in the United States or
in any country throughout the world

<PAGE>

where Company or any of its subsidiaries are engaged in the homecare business as
may be conducted by Company or any of its subsidiaries as of the date of this
Agreement or during the term of the Employee's employment with the Company.

13. Business Activities. "Business Activities" shall be deemed to
include any activities which are included in the Company's Business now or
during the effective period of this Agreement.

15. Remedies.

<PAGE>

18. Construction. This Agreement shall be construed within the fair
meaning of each of its terms and not against the party drafting the document.

<PAGE>

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written in Broward County, Florida.

WITNESS: THE COMPANY
HOSPITAL STAFFING SERVICES, INC.
/s/ Suzette Palmer BY: /s/ Bobby L. Shields
NAME: Bobby L. Shields
Its: Corporate Counsel/Secretary

THE EMPLOYEE
/s/ Dorothy R. Zoghby
/s/ Jeffrey Barnhill
Jeffrey Barnhill

<PAGE>

EXHIBIT A

BASE SALARY

The base salary is $130,000 per year.

<PAGE>

EXHIBIT B

ADDITIONAL COMPENSATION

The Employee shall be entitled to receive

a. Eight percent (8%) of the Employee's base salary in deferred
compensation, pursuant to the Company's deferred compensation plan.

<PAGE>

EXHIBIT C

AUTOMOBILE ALLOWANCE

The Automobile Allowance is $6,000 per year.

EXHIBIT 10.13

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of the 1st day of February , 1996 (the "Effective Date"), between Hospital
Staffing Services, Inc., a Florida corporation, whose address is 6245 N. Federal
Highway, Suite 400, Fort Lauderdale, FL 33308 (the "Company"), and Ronald
Huneycutt, whose address is 7421 S.W. 7th Street, Plantation, Florida 33317 (the
"Employee").

RECITALS

B. The Company has established a valuable reputation and goodwill in
its Business, with expertise in all aspects of the Business.

C. The Company wishes to employ the Employee and the Employee wishes to
be employed by the Company, pursuant to the terms and conditions set forth in
this Agreement.

D. In consideration for the Employee's employment with the Company, the
Company wishes to provide certain benefits to the Employee upon certain events
of termination of the Employee's employment with the Company, as described more
fully in this Agreement.

NOW THEREFORE, in consideration of the mutual agreements herein made,
the Company and the Employee do hereby agree as follows:

1. Recitals. The above recitals are true, correct, and are herein
incorporated by reference.

2. Employment. The Company hereby employs the Employee in the capacity
as the Company's Vice President of Finance, and the Employee hereby accepts such
employment, upon the terms and conditions hereinafter set forth.

<PAGE>

4. Compensation and Benefits.

b. Additional Compensation. The Employee shall be entitled to receive
such additional compensation as set forth on Exhibit B of this Agreement.

d. Automobile Allowance. The Employee shall be entitled to receive an
automobile allowance as set forth on Exhibit D of this Agreement.

e. Business Expense Reimbursement. During the Employee's employment,
the Employee shall be entitled to receive proper reimbursement for all
reasonable out-of-pocket expenses incurred by the Employee (in accordance with
the policies and procedures established by the Company for its executives) in
performing services hereunder, provided the Employee properly accounts therefor.

6. Termination.

a. Termination by the Company for Cause.

(1) Nothing herein shall prevent the Company from terminating Employee
for "Cause," as hereinafter defined.

<PAGE>

applicable if such loss of license shall be a result of any actions or inactions
outside the Employee's control; (vi) failure or refusal of Employee to perform
the lawful orders or instructions of his superiors; or (vii) any assignment of
this Agreement in violation of Section 16 of this Agreement.

(1) a significant change in the nature or scope of the authorities,
powers, functions, duties or responsibilities attached to the Employee's
position as described in Section 2; or

(2) a five percent (5%) reduction in the Employee's salary below the
salary in effect immediately prior to such reduction; or

(3) a material breach of this Agreement by the Company;

(4) failure by a successor company to assume the obligations under the
Agreement; or

(5) change in the Employee's principal office to a location outside the
Dade-Broward-Palm Beach County, Florida area.

c. Termination Following a Change of Control.

(1) In the event that a "Change in Control," as hereinafter defined, of
the Company shall occur at any time during the Term or any renewal thereof, the
Employee shall

<PAGE>

(c) there is a failure to elect a number of directors as would
constitute a majority of the Board of Directors' candidates nominated by
management of the Company to the Board of Directors; or

<PAGE>

7. Termination Without Cause; Termination as a Result of Change of
Control and Severance Benefits.

a. If the Employee is terminated Without Cause, and subject to
Employee's compliance with the provisions of Sections 8 and 9 hereof or as
otherwise provided in this Agreement, following the effective date of the
Employee's effective date of termination of his employment, the Employee shall
continue to receive (1) the base salary which existed at the time of the
Employee's termination as set forth on Exhibit "A" of this Agreement (the
"Severance Compensation") for a period of three (3) months thereafter; and (2)
all accrued but unused vacation through the date of termination.

b. If the Employee is terminated as a result of a Change of Control as
defined herein and subject to Employee's compliance with the provisions of
Sections 8 and 9 hereof or as otherwise provided in this Agreement, following
the effective date of the Employee's effective date of termination of his
employment, the Employee shall continue to receive, for a period of three (3)
months following the effective date of termination, (1) the base salary which
existed at the time of the Employee's termination as set forth on Exhibit A (the
"Severance Compensation"); (2) all accrued but unused vacation; (3) the
Employee's pro-rata share of Additional Compensation for the year, as described
in Section 4(b) and on Exhibit B and (payable through month-end of the last full
month prior to the date of termination); (4) a Car Allowance in the amount set
forth on Exhibit C; and (5) each and every one of the benefits of any employee
of the Company which existed at the time of the Employee's termination
(collectively the "Severance Compensation and Benefits").

<PAGE>

9. Non-Disclosure of Confidential Information.

<PAGE>

b. Excluded from the Confidential Information, and therefore not
subject to the provisions of this Agreement, shall be any information which:

(1) At the time of disclosure, is in the public domain as evidenced by
printed publications;

(2) After the disclosure, enters the public domain by way of printed
publication through no fault of the Employee or those in privity with it;

(3) Employee can show by written documentation was in its possession at
the time of disclosure and which was not acquired directly or indirectly from
the Company; or

d. Employee agrees that he shall:

(1) Hold in confidence and not disclose or make available to any third
party any such Confidential Information unless so authorized in writing by the
Company;

(2) Exercise all reasonable efforts to prevent third parties from
gaining access to the Confidential Information;

(3) Not use, directly or indirectly, the Confidential Information in
any respect of its business, except as necessary to evaluate the information;

(5) Not copy or modify any Confidential Information without prior
written consent of the Company.

(6) Take such other protective measures as may be reasonably necessary

<PAGE>

to preserve the confidentiality of the Confidential Information; and

(7) Relinquish and require all of his employees, if applicable, to
relinquish all rights he may have in any matter, such as drawings, documents,
models, samples, photographs, patterns, templates, molds, tools or prototypes,
which may contain, embody or make use of the Confidential Information; promptly
deliver to the Company any such matter as the Company may direct at any time;
and not retain any copies or other reproductions thereof.

e. Employee further agrees:

(1) That he shall promptly disclose in writing to the Company all
ideas, inventions, improvements and discoveries which may be conceived, made or
acquired by Employee or its employees as the direct or indirect result of the
disclosure by the Company of the Confidential Information to Employee;

11. Restrictive Period. The "Restrictive Period" shall be deemed to be
during the Employee's employment with the Company and for a period of three (3)
months following termination of the Employee's employment, regardless of the
reason for termination.

<PAGE>

conducted by Company or any of its subsidiaries as of the date of this Agreement
or during the term of the Employee's employment with the Company.

13. Business Activities. "Business Activities" shall be deemed to
include any activities which are included in the Company's Business now or
during the effective period of this Agreement.

14. Covenants as Essential Elements of this Agreement.

a. It is understood by and between the parties hereto that the
foregoing covenants by Employee contained in Sections 8 or 9 of this Agreement
shall be construed to be agreements independent of any other element of the
Employee's employment with the Company. The existence of any other claim or
cause of action, whether predicated on any other provision in this Agreement, or
otherwise, as a result of the relationship between the parties shall not
constitute a defense to the enforcement of the covenants in the Agreement
against the Employee.

b. The covenants by Employee contained in Sections 5 and 6 shall
survive the expiration of this Agreement if the Employee continues to work for
the Company, in any manner, without renewing this Agreement. The Employee
further agrees that the covenants set forth in Sections 8 and 9 of this
Agreement shall continue to be in effect following the expiration or termination
of the Employee's employment with the Company.

15. Remedies.

<PAGE>

18. Construction. This Agreement shall be construed within the fair
meaning of each of its terms and not against the party drafting the document.

<PAGE>

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written in Broward County, Florida.

WITNESS: THE COMPANY
HOSPITAL STAFFING SERVICES, INC.
/s/ Jacqueline Baez BY: /s/ Ronald Cass
NAME: Ronald Cass
Its: Chief Executive Officer

THE EMPLOYEE
/s/ Jacqueline Baez
/s/ Ronald Huneycutt
Ronald Huneycutt

<PAGE>

EXHIBIT A

BASE SALARY

The base salary is $117,500.

<PAGE>

EXHIBIT B

ADDITIONAL COMPENSATION

The Employee shall be entitled to receive

a. Eight percent (8%) of the Employee's base salary in deferred
compensation, pursuant to the Company's deferred compensation plan; and

b. Options to purchase up to 10,000 shares or restricted common stock
of the Company at $3.00 per share, exercisable for a period of five (5) years
from the date of vesting, which options shall vest after one (1) year from the
Effective Date; subject to the Employee being employed with the Company as of
the vesting date, as set forth more fully in a definitive Stock Option Agreement
between the Company and the Employee, the form of which is attached hereto as
Schedule 1.

<PAGE>

EXHIBIT C

EMPLOYEE BENEFITS

The Employee shall be entitled to

a. family health benefits;

b. Employee disability benefits;

c. a $100,000 term life insurance policy (standard premium); and

d. three (3) weeks paid vacation per year, accruing immediately
at the rate of ten (10) hours per month, and available six (6)
months commencing one (1) year after the Effective Date.

<PAGE>

EXHIBIT D

AUTOMOBILE ALLOWANCE

The Automobile Allowance is $6,000 per year.