JAMES L. PATEREK JOHN FANNING
CHAIRMAN CHAIRMAN
COMFORCE CORPORATION UNIFORCE SERVICES, INC.
2001 MARCUS AVENUE 415 CROSSWAYS PARK DRIVE
LAKE SUCCESS, NY 11092 P.O. BOX 9006
WOODBURY, NY 11797
October 27, 1997
Dear Uniforce Services, Inc. Shareholder:
On August 13, 1997 Uniforce Services, Inc. ("Uniforce") and COMFORCE
Corporation ("COMFORCE") signed an Agreement and Plan of Merger (the "Merger
Agreement") pursuant to which COMFORCE, through its indirectly wholly-owned
subsidiary, COMFORCE Columbus, Inc. ("Subsidiary"), agreed to make an offer (the
"Offer") to purchase all of the issued and outstanding shares of Uniforce Common
Stock ("Shares") and to merge Uniforce with and into Subsidiary (the "Merger").
COMFORCE, through its Subsidiary, is offering to purchase all of the
Shares of Uniforce Common Stock at $28.00 per Share, net to the seller in cash,
without interest thereon, plus 0.5217 shares of COMFORCE Common Stock per Share
(collectively the "Per Share Amount") upon the terms and subject to conditions
set forth in the enclosed Prospectus/Proxy Statement and in the related letter
of transmittal (which, as amended from time to time, together constitute the
"Offer"). The purpose of the Offer is to acquire Uniforce. Upon consummation of
the Offer, COMFORCE will seek to obtain representation, at least commensurate
with its equity interest, on the Board of Directors of Uniforce. COMFORCE also
intends to consummate the Merger between Uniforce and its Subsidiary immediately
following the consummation of the Offer pursuant to which Uniforce will become a
wholly-owned subsidiary of COMFORCE.
Upon the terms and subject to the conditions of the Offer (including,
if the Offer is extended or amended, the terms and conditions of any such
extension or amendment), COMFORCE will accept for payment and pay for any and
all Shares which are validly tendered on or prior to the Expiration Date 12:00
Midnight, New York City time on November 24, 1997 unless and until COMFORCE
shall have extended the period of time for which the Offer is open, in which
event the term "Expiration Date" shall mean the latest date on which the Offer,
as so extended by COMFORCE, shall expire. Consummation of the Offer is
conditioned upon, among other things, the satisfaction or waiver by COMFORCE of
certain conditions including the Minimum Condition (as defined in the
Prospectus/Proxy Statement) and including the receipt by COMFORCE of financing
necessary to pay the aggregate cash portion of the Per Share Amount. A blue
Letter of Transmittal which you can use to tender your Uniforce Common Stock is
enclosed for your convenience.
The Board of Directors of Uniforce has determined that each of the
Offer and the Merger, upon the terms and conditions set forth in the Merger
Agreement, is fair to, and in the best interests of the shareholders of
Uniforce. Accordingly, the Board has unanimously adopted the Merger Agreement
and unanimously recommends that the shareholders accept the Offer and vote in
favor of approval of the Merger Agreement. In arriving at its recommendation,
the board of directors of Uniforce gave careful consideration to the factors
described in the enclosed Prospectus/Proxy Statement and Schedule 14D-9.
<PAGE>
You are cordially invited to attend a Special Meeting of Shareholders
of Uniforce which is scheduled to be held on December 2, 1997 at 10:00 AM at the
Garden City Hotel, 45 Seventh Street, Garden City, NY 11530 (the "Special
Meeting") at which you will be asked to approve the Merger Agreement and the
Merger. As described in the Prospectus/Proxy Statement, however, if COMFORCE
receives at least 90% of the Shares in the Offer, it may determine to proceed
with the Merger without the need for the Special Meeting. Upon the consummation
of the Merger, all of the Shares which have not been tendered to COMFORCE in
connection with the Offer will be converted into the right to receive the Per
Share Amount.
In view of the importance of the Offer and Merger, we urge you to
review carefully the accompanying Notice of Special Meeting of Shareholders and
the Prospectus/Proxy Statement, which contains information about Uniforce and
COMFORCE and describes in detail the Offer and Merger and certain related
matters, including the procedures and deadline for submitting a properly
completed Letter of Transmittal.
YOUR VOTE AND TENDER ARE IMPORTANT. WHETHER OR NOT YOU INTEND TO ATTEND
THE SPECIAL MEETING, PLEASE COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED WHITE
PROXY CARD AS SOON AS POSSIBLE. A WHITE POSTAGE-PAID ENVELOPE IS ENCLOSED FOR
YOUR CONVENIENCE TO RETURN THE PROXY CARD. IF YOU ATTEND THE SPECIAL MEETING,
YOU MAY REVOKE YOUR PROXY AND, IF YOU WISH, VOTE YOUR SHARES IN PERSON.
ADDITIONALLY, YOU ARE URGED TO TENDER YOUR SHARES PURSUANT TO THE OFFER
BY COMPLETING THE BLUE LETTER OF TRANSMITTAL AND FOLLOWING THE DIRECTIONS
INCLUDED WITH IT. A BROWN RETURN ENVELOPE IS ENCLOSED FOR YOU CONVENIENCE TO
RETURN THE LETTER OF TRANSMITTAL.
Sincerely yours,
JAMES L. PATEREK JOHN FANNING
<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
------------------------------------
SCHEDULE 14D-9
Solicitation/Recommendation Statement
Pursuant to Section 14(d)(4) of the
Securities Exchange Act of 1934
------------------------------------
UNIFORCE SERVICES, INC.
(Name of Subject Company)
UNIFORCE SERVICES, INC.
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
------------------------------------
904724101
(CUSIP Number of Class of Securities)
------------------------------------
John Fanning
Chairman of the Board,
President and Chief Executive Officer
Uniforce Services, Inc.
415 Crossways Park Drive
Woodbury, New York 11797
(Name, address and telephone number of person
authorized to receive notice and communications on
behalf of the person(s) filing statement)
------------------------------------
With a copy to:
David J. Adler, Esq.
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022-1170
(212) 753-7200
================================================================================
<PAGE>
ITEM 1. SECURITY AND SUBJECT COMPANY.
The name of the subject company is Uniforce Services, Inc., a New York
corporation (the "Company"), and the address of the principal executive offices
of the Company is 415 Crossways Park Drive, New York, New York 11797. The title
of the class of equity securities to which this statement relates is the common
stock, par value $.01 per share, of the Company (the "Common Stock").
ITEM 2. TENDER OFFER OF THE BIDDER.
This statement relates to a tender offer by COMFORCE Columbus, Inc., a
New York corporation (the "Purchaser"), an indirect wholly-owned subsidiary of
COMFORCE Corporation, a Delaware corporation ("Parent"), disclosed in a Tender
Offer Statement on Schedule 14D-1 (the "Schedule 14D-1"), dated October 27,
1997, to purchase all the outstanding shares of Common Stock of the Company (the
"Shares") at a price of $28, net to the seller in cash, plus .5217 shares of the
common stock of Parent, upon the terms and subject to the conditions set forth
in the Prospectus/Proxy Statement dated October 27, 1997 (the "Prospectus/Proxy
Statement") and the related Letter of Transmittal (which together constitute the
"Offer"). Parent and the Purchaser are sometimes referred to herein,
collectively, as "COMFORCE".
The Offer is being made pursuant to an Agreement and Plan of Merger,
dated August 13, 1997 (the "Merger Agreement"), by and among Parent, Purchaser
and the Company. The Merger Agreement provides that following satisfaction or
waiver of all conditions to the Merger, Purchaser will be merged with and into
the Company (the "Merger") and the Company will continue as the surviving
corporation (the "Surviving Corporation") and an indirect wholly-owned
subsidiary of Parent.
Parent has advised that the principal executive offices of Parent and
Purchaser are located at 2001 Marcus Avenue, Lake Success, New York 11042.
ITEM 3. IDENTITY AND BACKGROUND.
(a) The name and address of the Company, which is the person filing
this statement, are set forth in Item 1 above.
(b) Certain contracts, agreements, arrangements or understandings
between the Company and certain of its directors and executive officers are
described in the Company's Information Statement pursuant to Section 14(f) of
the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 14f-1
thereunder, which is annexed hereto as Annex A and incorporated herein by
reference, in the section entitled "Executive Compensation." In addition,
certain contracts, agreements, arrangements or understandings relating to the
Company and/or the Company's directors, executive officers or affiliates are
contained in the Merger Agreement and related agreements, and are described
below under "Merger Agreement," "Stockholders Agreement" and "Registration
Rights Agreement."
THE MERGER AGREEMENT
The following summary of the Merger Agreement does not purport to be
complete and is qualified in its entirety by reference to the Merger Agreement,
a copy of which is filed as Exhibit 99.1 to this Schedule 14D-9 and is
incorporated by reference herein. The Merger Agreement should be read in its
entirety for a more complete description of the matters summarized below.
<PAGE>
THE OFFER
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The Merger Agreement provides that Parent, through the Purchaser, will
offer to purchase all the issued and outstanding shares (the "Shares") of the
Company Common Stock, at a per share price of $28.00, net to the seller in cash,
without interest thereon, plus 0.5217 shares of the Common Stock of Parent
(collectively, the "Per Share Amount"), upon the terms and subject to the
conditions of the Offer. Pursuant to the Merger Agreement, COMFORCE's obligation
to accept for payment and pay for Shares pursuant to the Offer is subject to (i)
the condition (the "Minimum Condition") that at least that number of Shares
that, when combined with the Shares already owned by it, constitutes at least
66.66% of the outstanding Shares, shall have been validly tendered and not
withdrawn prior to the expiration date of the Offer (the "Expiration Date"), and
(ii) certain other conditions including the receipt by COMFORCE of financing in
an amount sufficient to pay the aggregate Per Share Amount.
Under the Merger Agreement, the Purchaser reserves the right to waive
any or all unsatisfied conditions and otherwise amend the Offer, except that the
Merger Agreement provides that COMFORCE may not make any change to the Offer
which (i) decreases the Per Share Amount, (ii) reduces the maximum number of
Shares to be purchased, (iii) imposes additional conditions to the Offer; (iv)
amends or changes the terms and conditions of the Offer in any manner materially
adverse to the holders of Shares, or (v) changes or waives the Minimum
Condition.
In addition, COMFORCE is not required to accept for payment or, subject
to any applicable rules and regulations of the Securities and Exchange
Commission (the "Commission"), including Rule 14e-l(c) under the Exchange Act
(relating to COMFORCE's obligation to pay for or return tendered Shares promptly
after termination or withdrawal of the Offer), pay for, any tendered Shares, and
may terminate the Offer, if (i) the Minimum Condition shall not have been
satisfied, (ii) at or prior to the Expiration Date, any applicable waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act") shall not have expired or been terminated, (iii)
COMFORCE shall not have received the financing necessary to pay the aggregate
Per Share Amount for all outstanding Shares, or (iv) at any time before the time
of payment for any such Shares (whether or not any Shares have theretofore been
accepted for payment pursuant to the Offer), any of the following events or
conditions exist or shall occur and remain in effect:
(a) there shall have been instituted or be pending any action
or proceeding brought by any governmental, administrative or regulatory
authority or agency, domestic or foreign, before any court or governmental,
administrative or regulatory authority or agency, domestic or foreign, (i)
challenging or seeking to make illegal, materially delay or otherwise directly
or indirectly restrain or prohibit or make materially more costly the making of
the Offer, the acceptance for payment of, or payment for, any Shares by Parent,
Purchaser, or any other affiliate of Parent pursuant to the Offer or seeking to
obtain material damages in connection with the Offer or the Merger; (ii) seeking
to prohibit or limit materially the ownership or operation by the Company,
COMFORCE or any of their subsidiaries of all or any material portion of the
business or assets of the Company, COMFORCE or any of their subsidiaries, or to
compel the Company, COMFORCE or any of their subsidiaries to dispose of or hold
separate all or any material portion of the business or assets of the Company,
COMFORCE or any of their subsidiaries, as a result of the Offer or the Merger;
(iii) seeking to impose or confirm limitations on the ability of COMFORCE,
Parent, Purchaser, or any other affiliate of Parent to exercise effectively full
rights of ownership of any Shares, including, without limitation, the right to
vote any Shares acquired by COMFORCE pursuant to the Offer, or otherwise on all
matters properly presented to the Company's shareholders; or (iv) seeking to
require divestiture by COMFORCE, or any affiliate of COMFORCE, of any Shares;
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<PAGE>
(b) there shall have been issued any injunction, order or
decree by any court or governmental, administrative or regulatory authority or
agency, domestic or foreign, resulting from any action or proceeding brought by
any person other than any governmental, administrative or regulatory authority
or agency, domestic or foreign, which (i) restrains or prohibits the making of
the Offer or the consummation of the Offer or the Merger; (ii) prohibits or
limits ownership or operation by the Company, Parent or Purchaser of all or any
material portion of the business or assets of the Company, COMFORCE or any of
their subsidiaries, in each case as a result of the Offer and the Merger; (iii)
imposes limitations on the ability of Parent or Purchaser to exercise
effectively full rights of ownership of any Shares, including, without
limitation, the right to vote any Shares acquired by COMFORCE pursuant to the
Offer, or otherwise, on all matters properly presented to the Company's
shareholders; or (iv) requires divestiture by Parent or Purchaser of any Shares;
(c) there shall have been any action taken, or any statute,
rule, regulation, order or injunction enacted, entered, enforced, promulgated,
amended, issued or deemed applicable to (i) COMFORCE, the Company or any
subsidiary or affiliate of COMFORCE or the Company or (ii) the Offer or the
Merger, by any legislative body, court, government or governmental,
administrative or regulatory authority or agency, domestic or foreign, which
results in any of the consequences referred to in clauses (i) through (iv) of
paragraph (b) above;
(d) there shall have occurred (i) any general suspension of,
or limitation on prices for, trading in securities of the Company on the
American Stock Exchange, (ii) any decline, measured from the date of the Merger
Agreement, in the Standard & Poor's 500 Index or FTSE 100 Index by an amount in
excess of 20%, (iii) a currency moratorium on the exchange markets in New York
City, (iv) a declaration of a banking moratorium or any suspension of payments
in respect of banks in the United States, (v) any limitation (whether or not
mandatory) by any government or governmental, administrative or regulatory
authority or agency, domestic or foreign, on the extension of credit by banks or
other lending institutions which is likely to have a material adverse effect
upon any financing arranged by COMFORCE in respect of the Offer, (vi) a
commencement of a war or armed hostilities or other national or international
calamity directly or indirectly involving the United States or (vii) in the case
of any of the foregoing existing on the date hereof, a material acceleration or
worsening thereof;
(e) (i) it shall have been publicly disclosed or Purchaser
shall have otherwise learned that beneficial ownership of 20% or more of the
then outstanding Shares has been acquired by any other person other than
COMFORCE or its affiliates or (ii) the Board of Directors of the Company shall
have withdrawn or modified in a manner adverse to COMFORCE the recommendation of
the Offer or approves or recommends any takeover proposal or any other
acquisition of Shares other than the Offer;
(f) the Company shall have failed to perform in any material
respect any material obligation or to comply in any material respect with any
material agreement or covenant of the Company to be performed or complied with
by it under the Merger Agreement;
(g) the Merger Agreement shall have been terminated in
accordance with its terms; or
(h) COMFORCE and the Company shall have agreed that COMFORCE
shall terminate the Offer or postpone the acceptance for payment of or payment
for Shares thereunder.
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<PAGE>
Directors
- ---------
The Merger Agreement provides that, after purchase by Parent or any of
its subsidiaries pursuant to the Offer of such number of shares of Common Stock
that represent at least 51% of the outstanding shares of Common Stock, and from
time to time thereafter, Parent shall be entitled to designate such number of
directors, rounded up to the next whole number (but not more than one less than
the total number of Directors on the Board), as will give Parent representation
on the Board proportionate to the number of shares of the Common Stock owned by
Parent or any of its subsidiaries. The Merger Agreement requires that the
Company shall, upon request by Parent, either increase the size of the Board or
secure the resignation of directors to enable Parent's designees to be elected
to the Board and shall take, at the Company's expense, all lawful action
necessary to effect any such election, including without limitation, mailing to
its stockholders the information required by Section 14(f) of the Exchange Act
and Rule 14f-1 promulgated thereunder. Such information is included in the
Information Statement annexed to this Schedule 14D-9 as Annex A.
The Merger Agreement also provides that following the election or
appointment of Parent's designees pursuant to the Merger Agreement, and prior to
the Effective Time (as defined below), any amendment or termination of the
Merger Agreement, extension for the performance or waiver of the obligations or
other acts of Parent or Purchaser or waiver of the Company's rights thereunder
shall require the concurrence of a majority of directors of the Company then in
office who are "Continuing Directors". The Term "Continuing Director" means (i)
each member of the Board on the date of the Merger Agreement who voted to
approve the Merger Agreement and (ii) any successor to any Continuing Director
that was recommended to succeed such Continuing Director by a majority of the
Continuing Directors then on the Board.
The Merger
- ----------
The Merger Agreement provides that, upon the filing of the certificate
of merger in the form attached to the Merger Agreement with the Secretary of
State of New York (the "Effective Time"), Purchaser will merge with and into the
Company, whereupon the Company will become an indirect wholly-owned subsidiary
of Parent and each outstanding Share (other than treasury shares, Shares held by
COMFORCE and Shares held by Shareholders who have perfected appraisal rights
under New York law) will be converted into the right to acquire an amount per
Share equal to the Per Share Amount (the "Merger Consideration"). The Effective
Time is expected to occur as soon as practicable after the Expiration Date of
the Offer.
THE SURVIVING CORPORATION
Pursuant to the Merger Agreement, the Certificate of Incorporation and
By-laws of the Surviving Corporation shall be amended to be identical to the
Certificate of Incorporation and By-laws, respectively, of Purchaser except the
name of the surviving corporation shall remain "Uniforce Services, Inc." The
directors and officers of Purchaser immediately prior to the Effective Time
shall be the directors and officers, respectively, of the Surviving Corporation.
MERGER CONSIDERATION AND THE CONVERSION OF SHARES
At the Effective Time each holder of an outstanding certificate that
immediately prior to the Effective Time represented Shares shall be entitled to
receive in exchange therefor, upon surrender to the Depositary, the applicable
Merger Consideration, which is identical to the Per Share Amount (including, if
the Per Share Amount payable in the Offer is increased, any such increase in the
Per Share Amount).
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<PAGE>
EMPLOYEE STOCK OPTIONS
Under the Merger Agreement, the Company is to take such action, if any,
as may be necessary to cause, effective at or prior to the Effective Time, each
then outstanding option to purchase Shares theretofore granted under any stock
option plan or agreement in effect with respect to the Company's Common Stock
which has not been exercised and remains outstanding at the time (whether or not
such option is vested or immediately exercisable) to be extinguished and
converted to the right to receive a cash payment from the Company in an amount
equal to the product of (i) the difference between the cash value of the Merger
Consideration ($32.00 per Share) and the per Share exercise price of such option
and (ii) the total number of Shares which the holder of such option is entitled
to purchase under such option, subject to any required withholding taxes,
whereupon such options to purchase Shares shall be canceled. It is anticipated
that the Company will obtain written agreements from each holder of an
outstanding option to effect the foregoing arrangements effective on the day
immediately prior to consummation of the Offer, with the payment to each option
holder being made at or immediately after the consummation of the Offer.
CONDITIONS TO THE MERGER
Pursuant to the Merger Agreement, the Merger is conditioned upon, among
other things, (i) the approval, by the requisite vote, of the shareholders of
the Company; (ii) the receipt by COMFORCE of financing in an amount sufficient
to pay the aggregate Merger Consideration payable in the Merger for all shares
of the Company Common Stock outstanding; (iii) the receipt of necessary
governmental waivers, consents, orders and approvals; and (iv) the failure to
exist of any preliminary or permanent injunction or other order or decree or
other governmental action which prevents the consummation of the Merger.
REPRESENTATIONS AND WARRANTIES
The Merger Agreement contains various representations and warranties of
Parent and Purchaser relating to, among other things, the following matters
(subject, in certain cases, to specified exceptions): (i) due organization,
existence and good standing of such parties; (ii) the capitalization of such
parties; (iii) the corporate power and authority of such parties to enter into
the Merger Agreement and consummate the transactions contemplated thereby and
the absence of any conflicts with such parties' charter or by-laws or with
applicable law or with certain material contracts and the absence of
governmental or regulatory approvals required to consummate the Merger; (iv) the
filing of all required filings by COMFORCE with the Commission and the failure
of such filings to contain materially untrue statements or omissions as well as
the fair presentation of certain financial statements included in such filings;
(v) the absence of material adverse changes to each such party since the date of
the most recent filing with the Commission; (vi) the absence of pending or
threatened material litigation affecting COMFORCE or its subsidiaries; (vii) the
absence of undisclosed liabilities affecting COMFORCE or its subsidiaries; and
(viii) the absence of material violations of law by COMFORCE or its
subsidiaries.
The Merger Agreement contains various representations and warranties of
the Company relating to, among other things, the following matters (subject, in
certain cases, to specified exceptions): (i) similar representations to those
set forth with respect to Parent and Purchaser, but applicable to the Company;
(ii) compliance by the Company and its subsidiaries with the terms of their
respective charters and by-laws and with certain material agreements; (iii)
certain tax matters; (iv) certain employee benefit plan matters; (v) certain
labor matters; (vi) certain environmental matters; (vii) certain intellectual
property matters; (viii) certain matters regarding the title to assets and their
relationship to the business of the Company; and (ix) certain agreements between
the Company and its Licensees.
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<PAGE>
TERMINATION OF THE MERGER AGREEMENT
Pursuant to its terms, the Merger Agreement may be terminated by the
Company if (i) the Company's Board of Directors reasonably determines that the
representations and warranties of COMFORCE contained in the Merger Agreement are
not true and correct in any material respect or that all necessary governmental
and other third party consents cannot be obtained; (ii) the Merger is not
completed by December 31, 1997 otherwise than on account of delay or default on
the part of the Company; (iii) the Merger is enjoined by a final, unappealable
court order not entered at the request of the Company; (iv) the Company or its
shareholders receive an offer from a third party with respect to a merger, sale
of substantial assets, tender offer or other business combination and the
Company's Board of Directors determines in good faith and after consultation
with an independent financial advisor, that such offer would yield a higher
value to the Company or its shareholders than the Merger and COMFORCE fails,
within five (5) business days of being notified of such determination and the
terms and conditions of such offer, to make an offer which is substantially
equivalent to, or more favorable than, such offer; or (v) COMFORCE fails to
perform in any material respect any of its material covenants contained in the
Merger Agreement and does not cure such default in all material respects within
thirty (30) days after notice of the default is given to COMFORCE by the
Company.
Pursuant to its terms, the Merger Agreement may be terminated by Parent
if (i) Parent's Board of Directors reasonably determines that the
representations and warranties of the Company contained in the Merger Agreement
are not true and correct in any material respect or that all necessary
governmental and other third party consents cannot be obtained; (ii) the Merger
is not completed by December 31, 1997 otherwise than on account of delay or
default on the part of COMFORCE; (iii) the Merger is enjoined by a final,
unappealable court order not entered at the request of COMFORCE; or (iv) the
Company fails to perform in any material respects any of its material covenants
contained in the Merger Agreement and does not cure such default in all material
respects within thirty (30) days after notice is given to the Company by
COMFORCE.
CONDUCT OF THE COMPANY PENDING THE MERGER
The Company has agreed until the Effective Time, except as otherwise
contemplated by the Merger Agreement or as otherwise agreed to in writing by
COMFORCE: (a) to conduct its business in the ordinary and usual course of
business consistent with past practice; (b) not to (i) amend its charter or
bylaws; (ii) split or reclassify its stock; (iii) declare or pay any dividend or
distribution except payment of quarterly cash dividends in accordance with past
practices in an amount not in excess of $0.03 per share; (iv) issue, sell or
pledge any additional shares of, or options, warrants or rights to acquire, any
capital stock or other securities convertible or exchangeable for such capital
stock; (c) to use all reasonable efforts to preserve intact its business
organizations and goodwill and keep available the services of its officers and
key employees and preserve the goodwill and business relationships with
customers and not engage in any action with the intent to adversely impact the
transactions contemplated by the Merger Agreement; (d) to confer on a regular
and frequent basis with COMFORCE on operational matters; and (e) except as
specifically noted, not to enter into or amend any employment or related
agreements or bonus, profit sharing, compensation, stock option, retirement or
other similar agreements, trusts, funds or arrangements with or for the benefit
of any directors, employees or others, except in the ordinary course of business
and consistent with past practice.
EXPENSES
Except as described in the following two sentences, pursuant to the
Merger Agreement all costs and expenses incurred in connection with the Merger
Agreement and the transactions contemplated thereby
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<PAGE>
will be paid by the party incurring such expenses. Notwithstanding the
foregoing, the Company has agreed to pay COMFORCE $6,600,000 if: (i) the Company
terminates the Merger Agreement because it or its shareholders receives a
merger, asset sale, tender offer or other business combination offer from a
third party which will result in a higher value to the Company or its
shareholders than the Merger and COMFORCE does not choose to match or exceed
such offer within a specified period of time; or (ii) COMFORCE terminates the
Merger Agreement because of a default by the Company and the Company enters into
any of certain specified business combination transactions within nine months of
such termination. Additionally, COMFORCE has agreed to reimburse the Company for
reasonable out-of-pocket expenses incurred by the Company in connection with the
Merger Agreement if COMFORCE terminates the Offer because it did not receive the
financing so long as the Company has not materially breached the Merger
Agreement.
APPRAISAL RIGHTS
No appraisal rights are available to holders of Shares in connection
with the Offer. However, Pursuant to Section 910 of the New York Business
Corporation Law (the "NYBCL"), a shareholder of the Company whose Shares have
not been tendered into the Offer and accepted by COMFORCE and who has not voted
in favor of the Merger may demand payment of the "fair value" of such holder's
Shares in lieu of accepting the payment to be made pursuant to the Merger. Any
holder of Shares wishing to exercise such appraisal rights must fully comply
with Section 623 of the NYBCL. A holder may not exercise appraisal rights with
respect to less than all of the Shares owned by such holder. Such rights, if the
statutory procedures are complied with, could lead to a judicial determination
of the fair value required to be paid in cash to such dissenting holders for
their Shares. Any such judicial determination of the fair value of Shares could
be based upon considerations other than or in addition to the Per Share Amount
and the market value of the Shares. The value so determined could be more or
less than the Per Share Amount or the Merger Consideration.
TIMING
The exact timing and details of the Merger will depend upon legal
requirements and a variety of other factors, including the number of Shares
acquired by Purchaser pursuant to the Offer. Although Parent has agreed to cause
the Merger to be consummated on the terms set forth above, there can be no
assurance as to the timing of the Merger.
THE STOCKHOLDERS AGREEMENT
The following is a summary of certain provisions of the Stockholders
Agreement dated August 13, 1997, by and among Parent, Purchaser and John Fanning
and Fanning Asset Partners, L.P., a limited partnership of which Mr. Fanning is
the General Partner (collectively, the "Fanning Shareholders") (the
"Stockholders Agreement"). The summary is qualified in its entirety by reference
to the Stockholders Agreement which is incorporated herein by reference and a
copy of which has been filed with the Commission as Exhibit 99.2 to this
Schedule 14D-9. The Fanning Shareholders collectively hold in excess of 59% of
the voting Shares outstanding. Pursuant to the Stockholders Agreement, among
other things, the Fanning Shareholders agreed to tender (and not withdraw) their
Shares into the Offer and vote their Shares in favor of the Merger and against
any other business combination or fundamental change transaction or any other
action which could reasonably be expected to impede, interfere with, delay,
postpone, or materially adversely affect the Offer or the Merger. The Fanning
Shareholders also granted COMFORCE a proxy to vote their Shares as outlined
above. The obligations of the Fanning Shareholders pursuant to the Stockholders
Agreement will terminate if the Merger Agreement is terminated in accordance
with its terms. John Fanning has advised that he will contribute 53,125 shares
of the
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<PAGE>
Company's Common Stock to the capital of the Company which will issue a like
number of shares to certain employees of the Company, subject to consummation of
the Offer and to such employees agreeing to be bound by the terms of the
Stockholders Agreement. Such contribution and issuance will take place
immediately prior to consummation of the Merger.
REGISTRATION RIGHTS AGREEMENT
The following is a summary of certain provisions of the Registration
Rights Agreement dated August 13, 1997 by and among Parent and the Fanning
Shareholders (the "Registration Agreement"). The summary is qualified in its
entirety by reference to the Registration Rights Agreement which is incorporated
herein by reference and a copy of which has been filed with the Commission as
Exhibit 99.3 to this Schedule 14D-9. Under the Registration Rights Agreement, at
any time after the Effective Time, the Fanning Shareholders have the right to
include all shares of Parent's Common Stock issued to them in the Offer and the
Merger (the "Registrable Securities") in any registration of equity securities
of Parent relating to an offering other than an underwritten offering or an
offering relating solely to an acquisition of any entity or business or to
equity securities issuable in connection with a stock option or other employee
benefit plan. This right may be waived by the Fanning Shareholders holding a
majority in interest of the Registrable Securities and terminates when Parent
has afforded the Fanning Shareholders the right to exercise the above described
registration rights on two occasions or when all of the Registrable Securities
then held by any Fanning Shareholders may be sold under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act") within any three-month
period. If Parent has not afforded the Fanning Shareholders the right to
register the Registrable Securities on at least one occasion within one year
after the Effective Time, any Fanning Shareholder holding a majority of the
Registrable Securities has the right to require Parent to register the
Registrable Securities under the Securities Act on one occasion.
Parent is required to pay all expenses (other than underwriting
discounts and commissions and other fees and expenses of investment bankers and
other than brokerage commissions) of any such registrations, including fees and
expenses not exceeding $10,000 of one counsel for the holders of the Registrable
Securities. Parent will also indemnify the Fanning Shareholders against certain
liabilities under the federal securities laws in connection with any such
registration.
John Fanning has advised that he will contribute 53,125 of the
Registrable Securities to the capital of the Company which will issue a like
number of shares to certain employees of the Company, subject to such employees
agreeing to be bound by the terms of the Stockholders Agreement. Such
contribution and issuance will take place immediately prior to consummation of
the Merger. COMFORCE has agreed to afford such employee assignees the benefits
of the Registration Rights Agreement on the same basis as if they were Fanning
Shareholders.
ITEM 4. THE SOLICITATION OR RECOMMENDATION.
(a) RECOMMENDATION OF THE BOARD OF DIRECTORS.
The Board has unanimously approved the Merger Agreement and the
transactions contemplated thereby and determined that each of the Offer and the
Merger is fair to, and in the best interests of, the shareholders of the
Company. The Board recommends that all holders of Shares accept the Offer and
tender their Shares pursuant to the Offer.
-8-
<PAGE>
(b) BACKGROUND; REASONS FOR THE RECOMMENDATION; OPINION OF
FINANCIAL ADVISOR.
BACKGROUND OF THE TRANSACTIONS. The initial meeting between management of Parent
and the management of the Company occurred in mid-April 1997, when each attended
a staffing industry conference in Washington, D.C. At that initial meeting the
parties exchanged introductions and inquired as to each other's general
business. Shortly thereafter, senior management of Parent met over lunch with
senior management of the Company. At that lunch, additional facts about each
company were exchanged, but no particular transaction was discussed or proposed.
The discussion instead focused on the potential strategic fit between the two
parties, particularly noting the fact that each company's headquarters were
located very close to one another, the fact that the Company had a particularly
attractive and efficient back office which could be used by Parent, the fact
that the two companies had a complementary Information Technology business and
the fact that there appeared to be a minimum overlap of customers shared by the
parties.
In early May, senior management of Parent and the Company again met
over lunch. At this meeting, for the first time, a proposed transaction was
discussed. Senior management for the Company informed Parent that a transaction
would have to be structured as an all, or substantially all, cash transaction.
At that time, senior management of the Company informed Parent that John
Fanning, the Chairman and Chief Executive Officer of the Company, wished to
purchase the ProUnlimited business line from the Company. Although pricing was
not discussed, the Company's management told Parent of the existence of a
transaction that could have been consummated for $26.00 in cash, which the
Company's management chose not to pursue and implied that any offer by COMFORCE
would have to exceed $26.00 in cash.
On March 27, 1996, Uniforce had engaged a financial advisor to assist
in locating a party with which it might enter into a transaction for the
transfer of the control or assets of Uniforce. From that date until December 31,
1996, the financial advisor and executives of Uniforce diligently sought a
company with which such a transaction could be consummated. The financial
advisor made an extensive number of contacts with potential domestic and foreign
strategic and financial buyers without eliciting an indication of interest other
than the potential transaction at $26 a share referred to above.
Uniforce management determined that an all or substantially all cash
transaction would be in the best interests of the Uniforce shareholders because
it would limit any uncertainty involving the value of the consideration to be
received by the shareholders and protect against market declines, provide cash
for the payment of income taxes that would be imposed in the transaction, and
provide the shareholders with as much liquidity and freedom of choice as to
their future investment decisions as possible in connection with the
transaction.
The Company has been informed by Parent that in May, June and July,
Parent's management had several discussions with investment banking firms about
the feasibility of financing a primarily cash transaction of the approximate
size of the Offer and Merger and that, during those discussions, NatWest Capital
Markets Limited ("NatWest") expressed its high level of confidence in its
ability to sell or place high yield securities in an aggregate principal amount
sufficient to fund the proposed transaction in conjunction with the refinancing
of Parent's credit facility.
In mid-July, senior management of Parent again contacted senior
management of the Company to explore the terms of a transaction. Several
meetings occurred in mid to late July in which the general terms of the
transaction were discussed. The parties discussed the terms of the proposed
transaction pursuant to which Parent would acquire the Company without the
ProUnlimited business.
On July 28, 1997, senior management of the Company and Parent, as well
as their advisors, met to attempt to negotiate the terms of the transaction. At
the end of such meetings, the terms had not yet
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been concluded, as the details of the proposed ProUnlimited transaction had not
been discussed. Throughout that week, management of both companies had further
discussions and on August 4, the parties met again to discuss further the
proposed transaction. That meeting ended without an agreement on the terms of
the transaction with particular disagreement on the terms of the ProUnlimited
transaction. During the next week, members of management of both companies met
and exchanged detailed information about ProUnlimited, and, on August 8, senior
management of both companies met again and discussed the terms of the
transaction without the sale of the ProUnlimited business to Mr. Fanning.
The board of directors of the Company met on August 1 and discussed the
terms of the proposed transactions and authorized management to continue
discussions. On August 13, the Company board acted to approve the Agreement and
Plan of Merger. The Company has been advised that on July 30 and August 11, the
board of directors of Parent met and approved the Agreement and Plan of Merger.
The Merger Agreement was executed on August 13, 1997. Also on August 13, the
Fanning Shareholders, who held greater than 59% of the outstanding voting Shares
of the Company Common Stock, executed the Stockholders Agreement, pursuant to
which they agreed to vote in favor of the Merger and the Merger Agreement and to
tender their shares into the Offer.
REASONS FOR THE RECOMMENDATION. The following are the material factors
considered by the Board of Directors of the Company in reaching its conclusion
described above: (i) the financial condition, earnings, business, operations,
assets, management and prospects of the Company; (ii) the recent market prices
of the Company's Common Stock and the Parent's Common Stock; (iii) the
consideration to be paid under the Merger Agreement as compared to consideration
paid in other business combinations; (iv) prior expressions of interest by third
parties in effecting a business combination with the Company; (v) the general
interest in the investment community in temporary staffing companies; and (vi)
the opinion of Chartered Capital Advisers, Inc., which opinion was rendered
after approval of the Merger Agreement but prior to the date of this Schedule
14D-9, that the consideration to be received by the Shareholders of the Company
pursuant to the Merger Agreement is fair from a financial point of view to the
Shareholders of the Company. The Board did not attach any particular weight to
any one factor. The Board did not consider requiring the separate approval of
any subset of the shareholders or other special procedural devices in connection
with the Merger because the Board of Directors did not believe they were
warranted by the facts or circumstances or required by applicable law. In
considering the recommendation of the Board, Shareholders should be aware that
certain members of the Board and executive officers of the Company have
interests in the transaction which may present them with conflicts of interest.
See the description of certain Employment Agreements under the heading
"Executive Compensation" in Annex A hereto and the descriptions of The
Stockholders Agreement and the Registration Rights Agreement in Item 3 hereof.
The members of the Board were aware of these potential conflicts and considered
them in making their recommendation and approving the Merger Agreement.
OPINION OF FINANCIAL ADVISOR. Chartered Capital Advisers, Inc. (the "Financial
Advisor") was retained by the Company on behalf of the Board of Directors to
render its opinion to the Board as to the fairness to the Shareholders of the
Company from a financial point of view of the consideration to be received by
the Shareholders of the Company pursuant to the Merger Agreement. No limitations
were imposed by the Company with respect to the opinion to be rendered by the
Financial Advisor.
The Financial Advisor was not involved in determining the terms of the Merger
Agreement. The Financial Advisor was selected by the Board of Directors, after
consideration of other investment bankers, based upon favorable past experience
with the Financial Advisor and its familiarity with the Company and upon the
Company Board's view of the Financial Advisor's qualifications, expertise and
reputation. The Board of Directors considered and obtained proposals from three
investment bankers, each of which had considerable experience in rendering
fairness opinions and providing financial advisory services. An
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independent committee of the Board, consisting of Joseph A. Driscoll, John H.
Brinkerhoff and Gordon Robinett, discussed the experience and qualifications of
the three firms and, in the case of Chartered Capital Advisers, Inc., its prior
engagements with the Company. The committee recommended and the Board selected
Chartered Capital Advisers, Inc. because it had previously provided services
that were rendered in a timely and satisfactory manner and because of its
familiarity with the operations, financial condition and prospects of the
Company.
The Financial Advisor is regularly engaged in the valuation of
businesses and securities in connection with mergers and acquisitions, private
placements, shareholder transactions, estate and gift taxes, litigation, and for
other purposes.
At a meeting of the Company's Board of Directors held on August 13,
1997, the Board determined that the Merger Agreement and the transactions
contemplated thereby are fair to and in the best interests of the Shareholders
of the Company, subject to receipt of a written opinion from an investment
banking firm as to the fairness from a financial point of view of the
consideration to be received by the Company Shareholders pursuant to the Merger
Agreement. At a meeting of the Company Board held on September 3, 1997, the
proposed written opinion of the Financial Advisor was considered and discussed
by the Board, and accepted as fulfilling the foregoing condition. Thereafter,
the Financial Advisor issued its opinion dated September 3, 1997. The opinion
states that the consideration to be received by the Shareholders of the Company
pursuant to the Merger Agreement (the "Consideration") is fair from a financial
point of view to the Shareholders of the Company.
Reference is made to the full text of the opinion of the Financial
Advisor, which is set forth as Annex B to this Schedule 14D-9 and is hereby
incorporated herein by reference. Shareholders of the Company are urged to read
the opinion carefully in its entirety. As described in its opinion, the
Financial Advisor, among other things, (i) reviewed the Merger Agreement, the
Stockholders Agreement, and the Registration Rights Agreement, Noncompetition
Agreement and Employment Agreements signed by the Company, Parent and/or certain
executives of the Company as of August 13, 1997; (ii) reviewed the Parent
Disclosure Schedule provided by Parent pursuant to the Merger Agreement; (iii)
reviewed a draft of the Registration Statement of which the Prospectus/Proxy
Statement forms a part; (iv) analyzed financial information with respect to the
Company, including but not limited to unaudited financial statements for the six
months ended June 30, 1997, audited financial statements for the five years
ended December 31, 1996 and various internal management information reports; (v)
analyzed financial information with respect to Parent, including but not limited
to unaudited financial statements for the six months ended June 30, 1997, and
audited financial statements as of and for the two years ended December 31,
1996; (vi) reviewed various documents filed by the Company with the Securities
and Exchange Commission, including the Form 8-K filed on August 19, 1997, the
Forms 10-Q for the quarters ended March 31, 1997 and June 30, 1997, the Forms
10-K for the five years ended December 31, 1996 and the Definitive Proxy filed
on April 29, 1997; (vii) reviewed various documents filed by Parent with the
Securities and Exchange Commission, including the Form 8-K filed on August 20,
1997, the Forms 10-Q for the quarters ended March 31, 1997 and June 30, 1997,
the Forms 10-K for the two years ended December 31, 1996, the Form S-3 filed on
July 11, 1997 and the Definitive Proxy filed on June 30, 1997; (viii) visited
the facilities of the Company and held discussions with certain members of its
management and advisors concerning the past, current, and planned operations,
financial condition, and business of the Company; (ix) analyzed historical stock
prices of the Company and Parent; (x) discussed with the legal advisors of the
Company the results of their due diligence; (xi) considered financial data for
publicly held companies with similar investment characteristics to the Company;
(xii) considered financial data of the Company, and compared that data with
similar data for certain business combinations and other transactions that have
recently been effectuated; (xiii) considered the cash flow and net asset value
of the Company; (xiv) considered the projected financial performance of the
Company; (xv) considered the
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<PAGE>
acquisition premium reflected in the consideration to be received by the
Company's Shareholders as a result of the Offer and the Merger, and compared
that premium to other relevant transactions; and (xvi) considered such other
information, financial studies and analyses as the Financial Advisor deemed
relevant, and performed such analyses, studies and investigations as it deemed
appropriate.
The Financial Advisor utilized several analyses in rendering its
fairness opinion. They are briefly described below.
Capitalization multiples were developed for 52 publicly traded staffing
companies - substantially all of the publicly traded companies in the industry.
The capitalization multiples developed reflected the price per share on August
27, 1997 of each of these companies divided by their historical earnings,
projected 1997 earnings, projected 1998 earnings, revenues, and book value. The
capitalization multiples developed from these companies were applied to the
historical earnings, projected 1997 earnings, projected 1998 revenues, and book
value of the Company to develop a range of value. The range of value resulting
from the application of this methodology was between $86,000,000 and
$105,000,000, or $28.44 to $34.73 per share. The Consideration is at the high
end of the indicated range. Accordingly, this methodology supports the Financial
Advisor's opinion that the Consideration is fair, from a financial point of
view, to the shareholders of the Company.
Capitalization multiples developed from 24 staffing companies that were
acquired between 1994 and 1997 were applied to the revenues, earnings, cash
flow, book value and net tangible assets of the Company. The range of value
resulting from the application of this methodology was between $60,000,000 and
$75,000,000, or $19.84 to $24.81 per share. The Consideration is above the high
end of the indicated range. Accordingly, this methodology supports the Financial
Advisor's opinion that the Consideration is fair, from a financial point of
view, to the shareholders of the Company.
The historical cash flows of the Company were capitalized, using two
alternative capital structures for purposes of developing a cash flow
capitalization multiple. One capital structure was based on the indebtedness of
the Company at June 30, 1997; the alternative analysis assumed a 3:1 debt/equity
ratio. The alternative capital structures resulted in two different ranges of
value. The range of value based on the capital structure of the Company at June
30, 1997 was between $45,000,000 and $55,000,000, or $14.88 to $18.19 per share.
The range of value based on a 3:1 debt/equity ratio was between $74,000,000 and
$90,000,000 or $24.47 to $29.77 per share. The Consideration is above the high
end of the indicated ranges. Accordingly, these methodologies support the
Financial Advisor's opinion that the Consideration is fair, from a financial
point of view, to the shareholders of the Company.
An estimate of value was developed, based on a pro forma capital
structure supportable by the assets and cash flow of the Company under a
leveraged buyout. The range of value resulting from the application of this
methodology was between $36,000,000 and $44,000,000, or $11.91 to $14.55 per
share. The Consideration is above the high end of the indicated range.
Accordingly, this methodology supports the Financial Advisor's opinion that the
Consideration is fair, from a financial point of view, to the shareholders of
the Company.
Discounted cash flow analysis was used to estimate value based on the
projected cash flows of the Company. The analysis is based on the projections
set forth under the caption "Projected Financial Information of Uniforce"
contained in the Prospectus/Proxy Statement. These projections, covering 1997
and 1998, were extrapolated through the year 2002, and adjusted to take into
consideration the capital requirements of the Company. The cash flows were
discounted to a present value, based on an estimate of a pro forma weighted
average cost of capital. At the end of the period projected, a terminal value
was estimated, by capitalizing the projected operating income in 2002 at the
weighted average cost of capital.
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The Consideration exceeds the range of value developed under discounted cash
flow analysis. The range of value resulting from the application of this
methodology was between $78,000,000 and $96,000,000, or $25.80 to $31.75 per
share. The Consideration is above the high end of the indicated range.
Accordingly, this methodology supports the Financial Advisor's opinion that the
Consideration is fair, from a financial point of view, to the shareholders of
the Company.
The net tangible asset value of the Company was estimated as of June
30, 1997. Adjustments were made to eliminate goodwill, deferred costs, and other
intangible assets. The range of value resulting from the application of this
methodology was between $8,800,000 and $10,700,000, or $2.91 to $3.54 per share.
The Consideration is above the high end of the indicated range. Although this
methodology supports the Financial Advisor's opinion that the Consideration is
fair, from a financial point of view, to the shareholders of the Company, the
Financial Advisor attributed no weight to this methodology, since it is not an
appropriate basis for valuing a company such as the Company. However, for
purposes of performing a comprehensive valuation analysis, the Financial Advisor
performed an analysis of net tangible asset value.
The Financial Advisor considered the premium reflected in the
Consideration in relation to the price of the Company's common stock the day
prior to the announcement of the Merger (a 39.1% premium), as well as the
premium based on a comparison of the Consideration to the closing price of the
Company's common stock 30 days earlier (a 58.0% premium), 60 days earlier (an
85.5% premium), and the average 1997 stock price prior to August 13, 1997 (an
82.1% premium). The acquisition premium is high in relationship to the premium
of 43.09% (based on a 30 day average of the closing price) reflected in other
acquisitions of publicly held companies where transaction sizes were equal to or
greater than $20 million and were announced during the first seven months of
1997. The Consideration reflects a substantial premium over the price of the
Company's common stock over the past five years, and is in excess of the highest
price that the Company's common stock has traded during that period.
In rendering its opinion, the Financial Advisor relied on the accuracy
and completeness of the financial and other information furnished to it, as well
as upon publicly available information, and did not independently verify such
information. The opinion is based upon economic, market, and other conditions as
of the date that it was rendered. It is limited to the fairness from a financial
point of view of the Consideration. It is not an opinion of the value of the
Company or Parent, nor does it constitute a representation regarding the
business decision to enter into the Merger Agreement, or any other terms of the
Merger Agreement.
The Company will pay the Financial Advisor a fee of $50,000 for
rendering its opinion. In addition, the Company agreed to reimburse the
Financial Advisor for reasonable out-of-pocket expenses and to indemnify the
Financial Advisor and its directors, officers and employees against any loss or
claims arising out of its engagement by the Company, subject to certain
exceptions.
From 1994 through 1997, the Financial Advisor provided certain
valuation and financial advisory services to the Company and its outside
directors. The fees received by the Financial Advisor for these services have
approximated $35,000.
ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
Neither the Company nor any person acting on its behalf, has retained
any persons to make solicitations or recommendations to security holders in
connection with this transaction. However, the Company retained Chartered
Capital Advisers, Inc. on behalf of the Board to render its opinion to the
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Board as to the fairness to the Company's shareholders from a financial point of
view of the consideration to be received by the Company's shareholders pursuant
to the Merger Agreement. See Item 4 hereof.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.
(a) No transactions in the Shares have been effected during the past 60
days by the Company or, to the best of the Company's knowledge, by any executive
officer, director, affiliate or subsidiary of the Company.
(b) To the best of the Company's knowledge, to the extent permitted by
applicable securities laws, rules or regulations, all of the Company's executive
officers, directors and affiliates who own Shares presently intend to tender
such Shares to Purchaser pursuant to the Offer.
ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY SUBJECT COMPANY.
(a) Except as set forth herein, the Company is not engaged in any
negotiation in response to the Offer which relates to or would result in (i) an
extraordinary transaction such as a merger or reorganization, involving the
Company or any subsidiary of the Company; (ii) a purchase, sale or transfer of a
material amount of assets by the Company or any subsidiary of the Company; (iii)
a tender offer for or other acquisition of securities by or of the Company; or
(iv) any material change in the present capitalization or dividend policy of the
Company.
(b) Except as set forth herein, there are no transactions, Board
resolutions, agreements in principle or signed contracts in response to the
Offer that relate to or would result in one or more of the events referred to in
Item 7(a) above.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.
None
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 99.1 Agreement and Plan of Merger, dated as of August 13,
1997, by and among Parent, Purchaser and the Company
(incorporated herein by reference to Annex A to Proxy
Statement/Prospectus filed by the Company with the
Commission on September 11, 1997 and included as a
part of Registration Statement on Form S-4 filed by
COMFORCE Corporation on September 11, 1997 under file
no. 33-35451).
Exhibit 99.2 Stockholders Agreement, dated as of August 13, 1997,
among Parent, Purchaser, John Fanning and Fanning
Asset Partners, L.P. (incorporated herein by
reference to exhibit filed with Proxy
Statement/Prospectus filed by the Company with the
Commission on September 11, 1997 and included as a
part of Registration Statement on Form S-4 filed by
COMFORCE Corporation on September 11, 1997 under file
no. 33-35451).
Exhibit 99.3 Registration Rights Agreement dated as of August 13,
1997 among Parent, Purchaser, John Fanning and
Fanning Asset Partners, L.P. (incorporated by
reference to exhibit filed with Proxy
Statement/Prospectus filed by the Company with the
Commission on October 24, 1997 and included as a part
of Amendment
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No. 2 to Registration Statement on Form S-4 filed by
COMFORCE Corporation on October 24, 1997 under file
no. 33-35451).
Exhibit 99.4 Employment Agreement dated August 13, 1997 between
the Company and John Fanning.
Exhibit 99.5 Employment Agreement dated August 13, 1997 between
the Company and Rosemary Maniscalco.
Exhibit 99.6 Employment Agreement dated August 13, 1997 between
the Company and Harry V. Maccarrone.
Exhibit 99.7 Letter dated September 3, 1997 from Chartered Capital
Advisers, Inc. to the Board of Directors of the
Company (Annex B hereto).*
Exhibit 99.8 The Company's Information Statement pursuant to
Section 14(f) of the Securities Exchange Act of 1934
and Rule 14f-1 thereunder(Annex A hereto).*
Exhibit 99.9 Copy of Letter to Stockholders, dated October 27,
1997.*
- --------
* Included in materials being distributed to shareholders of the Company
with this Schedule 14D-9.
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<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
UNIFORCE SERVICES, INC.
By: /S/ Harry V. Maccarrone
-----------------------------
Harry V. Maccarrone,
Vice President - Finance
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ANNEX A
UNIFORCE SERVICES, INC.
415 CROSSWAYS PARK DRIVE
WOODBURY, NEW YORK 11797
---------------------------
INFORMATION STATEMENT PURSUANT TO
SECTION 14(F) OF THE SECURITIES
EXCHANGE ACT OF 1934 AND RULE 14F-1 THEREUNDER
This Information Statement is being mailed on or about October 27,
1997, as part of Uniforce Services, Inc.'s (the "Company")
Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9")
to the holders of record at the close of business on October 27, 1997 of the
Shares. Capitalized terms used and not otherwise defined herein shall have the
meaning ascribed to them in the Schedule 14D-9. You are receiving this
Information Statement in connection with the possible election of persons
designated by the Parent to a majority of the seats on the Board of Directors of
the Company (the "Board"). This Information Statement is required by Section
14(f) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 14f-1
thereunder. You are urged to read this Information Statement carefully. However,
you are not required to take any action in connection with this Information
Statement.
Pursuant to the Merger Agreement, on October 27, 1997 Purchaser
commenced the Offer. The Offer is scheduled to expire at 12:00 Midnight on
November 24, 1997, unless extended.
The information contained in this Information Statement (including
information listed in Schedule I attached hereto and information incorporated by
reference) concerning Parent, Purchaser and Designees (as defined herein) has
been furnished to the Company by Parent and Purchaser, and the Company assumes
no responsibility for the accuracy or completeness of such information.
The common stock of the Company, $.01 par value per share ("Common
Stock"), is the only class of voting securities of the Company outstanding. Each
share of Common Stock has one vote. As of October 27, 1997, there were 3,038,543
shares of Common Stock outstanding.
BOARD OF DIRECTORS
GENERAL
The Board currently consists of six (6) members. Members of the Board
are elected to serve one-year terms and each director holds office until his
successor is elected and qualified or until his earlier death, resignation or
removal.
<PAGE>
BUYER DESIGNEES
The Merger Agreement provides that, after purchase by Parent or any of
its subsidiaries pursuant to the Offer of such number of shares of Common Stock
that represent at least 51% of the outstanding shares of Common Stock, and from
time to time thereafter, Parent shall be entitled to designate such number of
directors, rounded up to the next whole number (but not more than one less than
the total number of Directors on the Board), as will give Parent representation
on the Board proportionate to the number of shares of the Common Stock owned by
Parent or any of its subsidiaries. The Merger Agreement requires that the
Company shall, upon request by Parent, either increase the size of the Board or
secure the resignation of directors to enable Parent's designees (the
"Designees") to be elected to the Board.
Parent has informed the Company that it will choose the Designees from
the directors and executive officers listed in Schedule I attached hereto.
Parent has informed the Company that each of the directors and executive
officers listed in Schedule I has consented to act as a director, if so
designated. The Company is informed that the business address of Parent and
Purchaser is 2001 Marcus Avenue, Lake Success, New York 11042.
A-2
<PAGE>
DIRECTORS OF THE COMPANY
The names of the current directors, their ages as of October 27, 1997,
and certain other information about them are set forth below. As indicated
above, some of the current directors may resign effective immediately following
the purchase of Shares by Purchaser pursuant to the Offer.
<TABLE>
<CAPTION>
Name and Age Principal Occupation(1) Director Sine(2)
- ------------------------------------- ------------------------------------------------ ---------------------
<S> <C> <C>
John Fanning (66).................... Chairman of the Board, President and Chief 1961
Executive Officer of the Company
Rosemary Maniscalco (56)............. Executive Vice President and Chief 1983
Operating Officer of the Company(3)
Harry V. Maccarrone (50)............. Vice President Finance, Chief Financial 1989
Officer and Treasurer of the Company
John H. Brinckerhoff III (68)........ Stockbroker, Brokers Transaction Services, 1983
Inc.(4)
Gordon Robinett (62)................. Vice Chairman and a Director of Command 1981
Security Corporation, security
consultants(5)
Joseph A. Driscoll (57).............. Financial Consultant/Certified Public 1992
Accountant(6)
</TABLE>
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(1) Except as stated below, the nominees' principal occupations have been
their respective principal occupations for at least five years.
(2) Directors' tenure includes their period of service as directors of the
Company's predecessor.
(3) Ms. Maniscalco became Chief Operating Officer of the Company in June
1992.
(4) Mr. Brinckerhoff was a Vice President of Peter Rogen International,
corporate consultants, from before 1992 until November 1994.
(5) Mr. Robinett retired as Vice President - Finance and Treasurer of the
Company effective May 1, 1989.
(6) Mr. Driscoll has been self-employed in such capacities since July 1991.
From 1988 until his retirement from such firm, he was a partner of KPMG
Peat Marwick LLP, certified public accountants, and also served as a
director thereof from 1987 to 1990. Prior to 1987, Mr. Driscoll was the
managing partner of the New York office of KMG Main Hurdman, a
predecessor of KPMG Peat Marwick LLP.
A-3
<PAGE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS
During the Company's past fiscal year, the Board of Directors held six
meetings. Each director attended every meeting. Each director received a fee of
$1,000 for each meeting attended in person. In addition, pursuant to the
Directors Stock Option Plan, each director who is not an employee of the Company
was granted an option to purchase 1,000 shares of Common Stock on January 1,
1996 and will be granted an option to purchase an additional 1,000 shares of
Common Stock on each January 1 so long as he remains a director. In addition, on
March 14, 1997, each director received an option to purchase 1,000 shares of
common stock at an exercise price of $16 per share, exercisable 6 months from
the date of grant.
The Audit Committee of the Board of Directors is charged with reviewing
the Company's consolidated financial statements and accounting policies,
resolving potential conflicts of interest, receiving and reviewing the
recommendations of the Company's independent auditors, and conferring with the
Company's independent auditors with respect to the training and supervision of
internal accounting personnel and the adequacy of internal accounting controls.
Messrs. Brinckerhoff, Driscoll and Fanning are the members of the Audit
Committee. During 1996, the Audit Committee held one meeting. All members of the
Audit Committee attended such meeting.
The Compensation Committee of the Board of Directors consists of
Messrs. Fanning, Brinckerhoff and Robinett. The Compensation Committee
recommends to the Board of Directors the compensation for the Company's
executive officers and other key employees. The Compensation Committee did not
meet during 1996, although the members thereof conferred informally from time to
time during the year.
The Company does not presently have a nominating committee, the
customary functions of such committee being performed by the entire Board of
Directors.
A-4
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth, for the fiscal years indicated, all
compensation awarded to, earned by or paid to the chief executive officer (the
"CEO") of the Company (Mr. John Fanning, Chairman of the Board and President of
the Company) and the other most highly compensated executive officers of the
Company other than the CEO whose salary and bonus exceeded $100,000 (three
individuals, the "named executive officers") for one or more of the fiscal years
presented.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
----------------------- ---------------------------
Securities All Other All Other
Underlying Compensation Compensation
Name and Principal Position Year Salary Bonus Options(#) (1) (2)
- ------------------------------ ------ -------- ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
John Fanning........................ 1996 $225,000 $223,905(3) -- $8,603 $4,000
Chairman of the Board, President 1995 225,000 153,834(4) -- 4,499 4,000
and Chief Executive Officer 1994 191,668 119,630(5) -- 2,875 2,000
Rosemary Maniscalco................. 1996 $178,366 $141,604(6) 69,401 $11,025 $4,000
Executive Vice President and Chief 1995 175,000 169,236(7) -- 4,365 4,000
Operating Officer 1994 177,019 194,353(8) -- 2,655 2,000
Harry V. Maccarrone................. 1996 $152,615 $25,000(9) 23,134 $3,695 $4,000
Vice President Finance, Treasurer 1995 138,837 25,000(9) -- 2,951 4,000
and Chief Financial Officer 1994 133,752 25,000(9) -- 2,006 2,000
Diane J. Geller..................... 1996 $132,282 $15,000(9) -- $2,976 $4,000
Secretary 1995 118,651 15,000(9) -- 2,524 4,000
1994 114,303 15,000(9) -- 1,715 2,000
</TABLE>
- ----------------
(1) Such amount represents payments (including interest thereon)
contributed by the Company under a Deferred Compensation Plan.
(2) Such compensation represents directors fees. Perquisites and other
personal benefits, securities or property received by each executive
officer did not exceed the lesser of $50,000 or 10% of such executive
officer's annual salary and bonus.
(3) Such amount represents incentive compensation of $198,905 and a
discretionary bonus of $25,000.
(4) Such amount represents incentive compensation of $128,834 and a
discretionary bonus of $25,000.
(5) Such amount represents incentive compensation of $94,630 and a
discretionary bonus of $25,000.
(6) Such amount represents additional compensation of $25,000 based upon
the terms of her employment agreement, incentive compensation of
$49,687, a discretionary bonus of $25,000 and sales compensation of
$41,917. See "--Employment Agreements."
A-5
<PAGE>
(7) Such amount represents additional compensation of $25,000 based upon
the terms of her employment agreement, incentive compensation of
$32,613, a discretionary bonus of $25,000 and sales compensation of
$86,623. See "-- Employment Agreements."
(8) Such amount represents additional compensation of $25,000 based upon
the terms of her employment agreement, incentive compensation of
$19,894, a discretionary bonus of $25,000 and sales compensation of
$124,459. See "-- Employment Agreements."
(9) Such amount represents a discretionary bonus.
OPTION GRANTS DURING 1996 FISCAL YEAR
The following table provides information related to options to purchase
Common Stock granted to the named executive officers during 1996. The Company
currently does not have any plans providing for the grant of stock appreciation
rights.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
- -------------------------------------------------------------------------------- VALUE AT ASSUMED RATES
OF STOCK PRICE
% OF TOTAL APPRECIATION FOR OPTION
NUMBER OF OPTIONS EXERCISE TERM(2)
SECURITIES GRANTED TO OR BASE -------------------------
UNDERLYING EMPLOYEES IN PRICE
NAME OPTION(#)(1) FISCAL YEAR ($/SH)(2) EXPIRATION DATE 5% 10%
- ------------------- -------------- ------------- ---------- ----------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Rosemary Maniscalco 69,401 57.3% $11.25 February 19, 2006 $491,017 $1,244,332
Harry V. Maccarrone 23,134 19.1% $11.25 February 19, 2006 $163,675 $414,783
</TABLE>
- -----------
(1) The option exercise price may be paid in shares of Common Stock owned
by the executive, in cash, or a combination of any of the foregoing, as
determined by the Stock Option Committee administering the Company's
stock option plans. The exercise price is equal to the fair market
value of the Common Stock on the date of grant.
(2) The potential realizable value portion of the foregoing table
illustrates values that might be realized upon exercise of the options
immediately prior to the expiration of their term, assuming the
specified compounded rates of appreciation on the Company's Common
Stock over the term of the options. These numbers do not take into
account provisions of certain options providing for termination of the
option following termination of employment, non-transferability or
differences in vesting periods. Regardless of the theoretical value of
an option, its ultimate value will depend upon the market value of the
Common Stock at a future date, and that value will depend on a variety
of factors, including the overall condition of the stock market and the
Company's results of operations and financial condition. There can be
no assurance that the values reflected in this table will be achieved.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
The following table provides information related to options exercised
by the named executive officers during 1996 and the number and value of options
held by the named executive officers at fiscal year end.
A-6
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF SECURITIES UNDERLYING
COMMON UNEXERCISED OPTIONS AT FY-END VALUE OF UNEXERCISED IN-THE-
STOCK VALUE (#) MONEY OPTIONS AT FY-END($)(1)
ACQUIRED ON REALIZED ------------------------------- ------------------------------
NAME EXERCISE(#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------- ------------- --------- -------------- --------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
John Fanning............ -- -- 45,250 29,750 927,625 609,875
Rosemary Maniscalco..... 8,330 170,765 55,101 81,800 1,129,571 1,676,900
Harry V. Maccarrone..... 1,059 21,710 35,909 19,900 736,135 407,950
Diane J. Geller......... -- -- 0 2,550 0 52,275
</TABLE>
- -------------------
(1) Based on the closing price of a share of Common Stock on December 31,
1996 of $20.50, as reported on the National Association of Securities
Dealers, Inc. Automated Quotation System ("Nasdaq") National Market.
EMPLOYMENT AGREEMENTS
EXISTING AGREEMENTS
Under an employment agreement dated as of January 26, 1984, as amended
through January 1, 1997, between the Company and John Fanning, Mr. Fanning is
employed as Chief Executive Officer and President for a term that will expire on
December 31, 1997. Mr. Fanning receives a base salary of $250,000, increased
from $225,000 effective January 1, 1997. Such agreement also provides for
incentive compensation equal to 5% of the Company's "pre-tax operating income"
(as defined therein) in excess of $2,500,000 but not in excess of $3,000,000,
plus 3.5% of such income in excess of $3,000,000.
Under an employment agreement dated as of May 1, 1993, as amended
through January 1, 1997, between the Company and Rosemary Maniscalco, Ms.
Maniscalco is employed as Executive Vice President and Chief Operating Officer
for a term that will expire on December 31, 1997 and thereafter shall be
extended for successive one-year periods unless either party notifies the other
party at least 90 days prior to December 31, 1997, or the expiration of any such
subsequent one-year term. Ms. Maniscalco receives a base salary of $225,000 per
annum (increased from $175,000, effective January 1, 1997) and (i) incentive
compensation equal to 5% of the Company's "pretax operating income" (as defined
in such agreement) in excess of $2,500,000 but not in excess of $3,000,000, plus
1% of such income in excess of $3,000,000; and (ii) sales compensation based
upon (A) the sales of, and/or licensing fees actually paid by, licensed offices
of the Company acquired by it or converted to the Company system as a direct
result of Ms. Maniscalco's sales efforts and (B) the gross profit of offices
located within the United States that are acquired by the Company with respect
to sales of such offices derived from sales of the Company's PrO Unlimited
product line. In all events, the aggregate of base salary, incentive
compensation and sales compensation in respect of any full fiscal year may not
be less than $250,000.
In addition, the Company has entered into arrangements with Ms.
Maniscalco and Mr. Maccarrone under which Ms. Maniscalco is entitled to receive
a cash bonus of $780,761 (subject to reduction in certain circumstances) and Mr.
Maccarrone is entitled to receive a cash bonus of $260,257, each payable to the
extent of 10% thereof on January 11, 1999, to the extent of 30% thereof on
January 11, 2000 and as to the balance thereof on January 11, 2001, provided
that the recipient is then employed by the Company. The cash bonus installments
are subject to acceleration in the event of the recipient's death, the merger of
the Company, the sale of all or substantially all of the Company's assets or a
change of control of the Company.
A-7
<PAGE>
NEW AGREEMENTS
In connection with the Merger Agreement, the Company has entered into
Employment Agreements dated as of August 13, 1997 with John Fanning, Rosemary
Maniscalco and Harry V. Maccarrone (collectively, the "New Agreements") each of
which becomes effective on the date (the "Employment Date") that COMFORCE has
acquired at least 51% of the issued and outstanding Common Stock of the Company.
Until the Employment Date the existing employment agreements and incentive
arrangements described above with each such person remain in effect. The
following is a summary of certain provisions of the Employment Agreements, which
is qualified in its entirety by reference to the Employment Agreements which are
incorporated herein by reference and copies of which have been filed with the
Commission as Exhibits 99.4, 99.5 and 99.6 to the Schedule 14D-9 to which this
Information Statement is annexed.
Under Mr. Fanning's Employment Agreement, Mr. Fanning will be employed
as President of the Financial Services Division of the Company or in such other
executive capacity as is from time to time designated by the Board of Directors
of the Company for an initial term of one year from the Employment Date and on a
year-to-year basis thereafter until such Employment Agreement is terminated. Mr.
Fanning is to be paid a base salary of $150,000 per year plus supplemental pay
of $134,500 per year, as well as incentive compensation payable with respect to
the period prior to the Employment Date and a $25,000, previously earned, bonus
to the extent that such amounts have not been paid prior to the Employment Date.
The Employment Agreement may be terminated if Mr. Fanning dies, is permanently
disabled and for certain events constituting "cause". In addition, the
Employment Agreement may be terminated by the Company by written notice at any
time (subject to the obligation to make severance payments if termination occurs
during the initial term equal to the amount of base salary and supplemental pay
which would be due to Mr. Fanning until the end of the initial term). Under a
separate Noncompetition Agreement dated as of August 13, 1997 among Mr. Fanning,
the Company, Parent and Purchaser, effective on the Employment Date, Mr. Fanning
has agreed not to compete with the Company for a period commencing on the
Effective Date and terminating on the later of four years after the Employment
Date or two years after termination of Mr. Fanning's employment with the Company
for any reason.
Under Ms. Maniscalco's Employment Agreement, Ms. Maniscalco will be
employed as President of the Company or in such other executive capacity as is
from time to time designated by the Board of Directors of the Company for an
initial term of two years from the Employment Date and on a year-to-year basis
thereafter until such Employment Agreement is terminated. Ms. Maniscalco is to
be paid a base salary of $150,000 per year, supplemental pay of $90,000 per year
and a one-time bonus of $10,000 if she continues to be employed by and work
full-time for the Company for six months after the Employment Date, as well as
incentive compensation payable with respect to the period prior to the
Employment Date and a $25,000, previously earned, bonus to the extent that such
amounts have not been paid prior to the Employment Date. The Employment
Agreement also provides that Parent will grant to Ms. Maniscalco an incentive
stock option to purchase 50,000 shares of Parent's Common Stock at a price equal
to the closing price of the Parent's Common Stock on the American Stock Exchange
on the Employment Date. Such option becomes exercisable by Ms. Maniscalco if she
remains employed with the Company over a two year period. Ms. Maniscalco is also
entitled to receive incentive compensation for each fiscal year during the term
of her employment in an amount equal to 5% of the Managed Pre-Tax Operating
Income (which generally relates to operating income of subsidiaries and business
units of the Company for which Ms. Maniscalco has management responsibilities
and is more fully defined in her Employment Agreement) in excess of $2,500,000
but not in excess of $3,000,000, and 1% of such income in excess of $3,000,000.
Such targets may be changed as appropriate in the event that Ms. Maniscalco has
management responsibilities for additional or for fewer business units or
subsidiaries. Ms. Maniscalco is also entitled to receive 1% of the sales of
offices of businesses acquired by the Company or any of its subsidiaries after
the Employment Date if such acquisition opportunity was brought to the attention
of the
A-8
<PAGE>
Company or Parent solely through the efforts of Ms. Maniscalco and she used her
best efforts to assist in such acquisition. The Employment Agreement may be
terminated if Ms. Maniscalco dies, is permanently disabled and for certain
events constituting "Cause". In addition, the Employment Agreement may be
terminated by the Company by written notice at any time (subject to the
obligation to make severance payments if termination occurs during the initial
term equal to the amount of base salary and supplemental pay which would be due
to Ms. Maniscalco for the lesser of one year or the period until the end of the
initial term). Ms. Maniscalco has also agreed not to compete with the Company
for a period of two years after termination of her employment with the Company
for any reason.
Under Mr. Maccarrone's Employment Agreement, Mr. Maccarrone will be
employed as Vice President - Finance of the Company or in such other executive
capacity as is from time to time designated by the Board of Directors of the
Company. Mr. Maccarrone's Employment Agreement has no specified term. Mr.
Maccarrone is to be paid a base salary of $150,000 per year, plus supplemental
pay of $16,500 per year, as well as a $25,000, previously earned, bonus to the
extent that such amount has not been paid prior to the Employment Date. The
Employment Agreement also provides that Parent will grant to Mr. Maccarrone an
incentive stock option to purchase 30,000 shares of Parent's Common Stock at a
price equal to the closing price of the Parent's Common Stock on the American
Stock Exchange on the Employment Date. Such option becomes exercisable by Mr.
Maccarrone, if he remains employed with the Company, over a two year period. Mr.
Maccarrone has also agreed not to compete with the Company, in certain
circumstances, for a period of one year after termination of his employment with
the Company for any reason.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
GENERAL
The Compensation Committee determines the cash and other incentive
compensation, if any, excluding stock options, to be paid to the Company's
executive officers and key employees. The Compensation Committee currently
consists of Messrs. Fanning, Robinett and Brinckerhoff. In addition, each of the
stock option plans is administered by a committee (the "Stock Option Committee")
appointed by the Board of Directors. The Stock Option Committee currently
consists of Messrs. Robinett, Brinckerhoff and Driscoll, each of whom is a
Non-Employee Director, within the meaning of Rule 16b-3 under the Securities
Exchange Act of 1934, as amended ("Rule 16b-3"), and an Outside Director, within
the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended
(the "Code"), of the Company.
The provisions of the New Agreements were determined by negotiations
between COMFORCE and the executives parties thereto. The Compensation Committee
was not consulted with respect to such negotiations or the New Agreements, nor
was its approval of the New Agreements sought.
COMPENSATION PHILOSOPHY
The Compensation Committee's executive compensation philosophy is to
base management's pay, in part, on the achievement of the Company's annual and
long-term performance goals, to provide competitive levels of compensation, to
recognize individual initiative, achievement and length of service to the
Company, and to assist the Company in attracting and retaining qualified
management. The Compensation Committee and the Stock Option Committee also
believe that the potential for equity ownership by management is beneficial in
aligning management's and shareholders' interests in the enhancement of
shareholder value. Section 162(m) of the Code generally prohibits a publicly
held corporation, such as the Company, from claiming a deduction on its federal
income tax return for compensation in excess of $1 million paid for a given
fiscal year to the chief executive officer (or person acting in that capacity)
at the close of the corporation's fiscal year and the four most highly
compensated
A-9
<PAGE>
officers of the corporation other than the chief executive officer, at the end
of the corporation's fiscal year. However, the $1 million compensation deduction
limitation does not apply to "performance-based compensation." The Company is
seeking shareholder approval with regard to amendments to its 1991 Stock Option
Plan to enable compensation received by executive officers in connection with
the exercise of options granted under such plan to qualify as "performance-based
compensation." No amendments are required for the Company's other stock option
plans.
SALARIES
Base salaries for the Company's executive officers are determined
initially by evaluating the responsibilities of the position held and the
experience of the individual, and by reference to the competitive marketplace
for management talent, including a comparison of base salaries for comparable
positions at comparable companies within the Company's industry. Several of such
companies are in the Company's Peer Group as described under "Common Stock
Performance." The Company believes that its salaries are comparable to those of
its competitors. Annual salary adjustments are determined by evaluating the
competitive marketplace, the performance of the Company, the performance of the
executive particularly with respect to the ability to manage growth of the
Company, the length of the executive's service to the Company and any increased
responsibilities assumed by the executive. The Company has employment agreements
with each of Mr. Fanning and Ms. Maniscalco, which set the base salary for such
individuals.
ANNUAL BONUSES AND INCENTIVE COMPENSATION
The Company from time to time considers the payment of bonuses and
incentive compensation to its executive officers, although with the exception of
Ms. Maniscalco and Mr. Fanning, no bonus or incentive compensation is currently
provided pursuant to a formal plan or employment agreement. Most of Ms.
Maniscalco's incentive compensation and bonus is determined in accordance with
the terms of her employment agreement. See "-- Employment Agreements."
With respect to the Company's executive officers and upper-middle
managers, bonuses are determined annually by the Compensation Committee and are
generally based, first, upon the level of achievement by the Company of its
strategic and operating goals and, second, upon the level of personal
achievement by participants. The achievement of goals by the Company includes,
among other things, the performance of the Company as measured by return on
assets. The achievement of personal goals includes the actual performance of the
Company for which the executive officer or manager has responsibility as
compared to the planned performance thereof, the level of cost savings achieved
by such executive officer or manager, other individual contributions, the
ability to manage and motivate reporting employees and the achievement of
assigned projects. During 1996 the Company awarded bonuses to Ms. Maniscalco,
Mr. Maccarrone and Ms. Geller of $25,000, $25,000 and $15,000, respectively. As
indicated under "-- Stock Option Plans" below, certain of the named executive
officers were awarded stock options in 1996.
A-10
<PAGE>
COMPENSATION OF CHIEF EXECUTIVE OFFICER
Mr. Fanning's base salary of $225,000 in 1996 was based upon the terms
of his employment agreement and the factors described in the "Salaries"
paragraph above. The Company believes Mr. Fanning's salary is comparable to the
salaries of chief executive officers of companies reviewed by the Company. In
addition, Mr. Fanning can receive incentive compensation in accordance with the
terms of his employment agreement. See "-- Employment Agreements." Mr. Fanning
also received a discretionary bonus of $25,000 for 1996. Discretionary bonuses
to Mr. Fanning are based upon the factors described in "Annual Bonuses and
Incentive Compensation."
STOCK OPTION PLANS
In 1996, the Stock Option Committee awarded stock options to purchase
an aggregate of 69,401 shares and 23,134 shares to Ms. Maniscalco and Mr.
Maccarrone, respectively. It is the philosophy of the Stock Option Committee
that stock options should be awarded only to key employees of the Company to
promote long-term interests between such employees and the Company's
shareholders and to assist in the retention of such employees.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
John Fanning, the Company's Chairman of the Board, President and Chief
Executive Officer, and Gordon Robinett, the former Vice President - Finance and
Treasurer of the Company until 1989, participated in deliberations of the
Company's Compensation Committee concerning executive officer compensation.
Compensation Committee: John Fanning
Gordon Robinett
John H. Brinckerhoff III
COMMON STOCK PERFORMANCE
The following graph compares the total cumulative return (assuming
dividends are reinvested) on the Company's Common Stock during the five fiscal
years ended December 31, 1996 with the cumulative return on the Nasdaq Market
Index and a Peer Group Index. The Peer Group selected by the Company consists of
Olsten Corp., Joule Inc., Butler International Inc., Kelly Services, Inc., Staff
Builders Inc. and the Company.
COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN
AMONG UNIFORCE SERVICES, INC.,
NASDAQ MARKET INDEX AND PEER GROUP INDEX
<TABLE>
<CAPTION>
Fiscal Year Ending
- ------------------------------ ------------------------------------------------------------------------------------------
1991 1992 1993 1994 1995 1996
------ ------ ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C>
Uniforce Services, Inc. 100 92.88 100.16 150.35 167.52 314.62
Peer Group 100 146.48 134.16 141.31 159.21 133.91
Nasdaq Market 100 100.98 121.13 127.17 164.96 204.98
</TABLE>
ASSUMES $100 INVESTED ON JAN. 1, 1992
ASSUMES DIVIDEND REINVESTED
FISCAL YEAR ENDED DEC. 31, 1996
A-11
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information at September 3, 1997
as to the Common Stock beneficially owned by directors, certain executive
officers and all directors and certain executive officers of the Company as a
group and by certain principal shareholders. Unless otherwise indicated, the
address of each person listed below is 415 Crossways Park Drive, Woodbury, New
York 11797.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF BENEFICIAL OWNER Number of Shares and Percent of
Nature of Beneficial CLASS (2)
OWNERSHIP (1) ----------
--------------------
<S> <C> <C>
John Fanning (3).............................. 1,860,530 (4) 60.2%
Fanning Asset Partners, L.P................... 361,513 11.9%
Northern Trust Plaza, Suite 4160
Boca Raton, FL 33431
Dimensional Fund Advisors Inc. (5)............ 221,400 (5) 7.3%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
Rosemary Maniscalco........................... 78,701 (6) 2.5%
Harry V. Maccarrone........................... 44,202 (7) 1.4%
Gordon Robinett............................... 10,000 (8) (9)
John H. Brinckerhoff.......................... 8,108 (8) (9)
Joseph A. Driscoll............................ 9,000 (8) (9)
1,450 (10) (9)
Diane J. Geller...............................
Directors and executive officers.............. 2,011,991 (11) 62.1%
as a group (8 persons)
</TABLE>
- -------------------------
(1) Each beneficial owner named below exercises sole voting and dispositive
power with respect to the shares beneficially owned.
(2) Includes the shares of the Company Common Stock subject to options
(exercisable within 60 days after September 3, 1997) held by each of
the named individuals or the directors and executive officers as a
group for purposes of calculating the respective percentages of the
Company Common Stock owned by such individuals or by the directors and
executive officers as a group.
(3) Includes 361,513 shares owned by Fanning Asset Partners, L.P., a
Georgia limited partnership of which Mr. Fanning is the general
partner. Mr. Fanning disclaims beneficial ownership of the shares owned
by said partnership in excess of his proportional interest in the
partnership. Under the rules and regulations of the Securities and
Exchange Commission, Mr. Fanning may be deemed a "control person" of
the Company.
A-12
<PAGE>
(4) Includes 51,500 shares of the Company Common Stock subject to options.
(5) Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment
advisor, is deemed to have beneficial ownership of 221,400 shares of
the Company Common Stock as of December 31, 1996, all of which shares
are held in portfolios of DFA Investment Dimensions Group Inc., a
registered open-end investment company, or in series of the DFA
Investment Trust Company, a Delaware business trust, or the DFA Group
Trust and DFA Participation Group Trust, investment vehicles for
qualified employee benefit plans, all of which Dimensional serves as
investment manager. Dimensional disclaims beneficial ownership of all
such shares.
(6) Represents 78,701 shares of the Company Common Stock subject to
options.
(7) Includes 43,143 shares of the Company Common Stock subject to options.
(8) Includes 8,000 shares of the Company Common Stock subject to options.
(9) Includes 8,000 shares of the Company Common Stock subject to options.
(10) Represents 1,450 shares of the Company Common Stock subject to options.
(11) Includes an aggregate of 198,794 shares of the Company Common Stock
subject to options.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
See the sections entitled "Stockholders Agreement" and "Registration
Rights Agreement" in Item 3 of the Company's Schedule 14D-9 accompanying this
Information Statement for a description of certain agreements concerning the
Common Stock of the Company held, and the Common Stock of COMFORCE Corporation
to be held after consummation of the Offer and Merger, by Mr. Fanning and an
entity controlled by him.
A-13
<PAGE>
SCHEDULE I
DIRECTOR DESIGNEES
<TABLE>
<CAPTION>
Present Occupation or
Employment and Five
NAME AND BUSINESS ADDRESS AGE Year Employment History
- ------------------------- --- -----------------------
<S> <C>
James L. Paterek 35 Mr. Paterek has served as Chairman of the
c/o COMFORCE Corporation Board of Parent since February 1997, having
2001 Marcus Avenue previously served as consultant to Parent since
Lake Success, New York 11042 December 1995. Mr. Paterek was a founder
of Spectrum Global Services, Inc. (following
its acquisition by Parent, renamed
COMFORCE Telecom Inc. ("COMFORCE
Telecom")) and he served as COMFORCE
Telecom's President from 1987 to 1995.
Christopher P. Franco 38 Mr. Franco has served as the Chief Executive
c/o COMFORCE Corporation Officer and a Director of Parent since
2001 Marcus Avenue February 1997, having previously served as
Lake Success, New York 11042 Executive Vice President of Parent since
December 1995. In addition, Mr. Franco has
served as Secretary of Parent since December
1995. From 1993 to 1995, Mr. Franco served as
Vice President and General Counsel of Spectrum
Information Technologies, Inc. (wireless
transmissions, telecommunications and
franchiser of computer stores). From 1985 to
1993, Mr. Franco practiced law, principally in
the field of corporate securities, with the law
firms of Fullbright & Jaworski (Houston),
Cummings & Lockwood (Hartford) and Kelley Drye
& Warren (New York).
Michael Ferrentino 34 Mr. Ferrentino has served as the President and
c/o COMFORCE Corporation a Director of Parent since December 1995.
2001 Marcus Avenue Mr. Ferrentino was a founder of COMFORCE
Lake Success, New York 11042 Telecom, and he served as COMFORCE
Telecom's Executive Vice President from 1987 to
1995. From 1984 through 1987, he was employed
by Dun & Bradstreet.
</TABLE>
A-14
<PAGE>
<TABLE>
<CAPTION>
Present Occupation or
Employment and Five
NAME AND BUSINESS ADDRESS AGE Year Employment History
- ------------------------- --- -----------------------
<S> <C> <C>
Richard Barber 38 Mr. Barber has served as a Director of Parent
c/o COMFORCE Corporation since December 1995 and is a member of the
2001 Marcus Avenue Audit Committee of the Board. He is a partner
Lake Success, New York 11042 at L.H. Frishkoff & Company, a certified
public accounting firm. Mr. Barber is a
member of the American Institute of Certified
Public Accountants and the New York State
Society of Certified Public Accountants and
has served as a committee member of the New
York State Real Estate Accounting
Committee.
Keith Goldberg 34 Mr. Goldberg has served as a Director of
c/o COMFORCE Corporation Parent since December 1995 and is a member
2001 Marcus Avenue of the Compensation and Stock Option
Lake Success, New York 11042 Committees of the Board. He is a partner at J.
Walter Thompson Advertising. Previously,
he worked for BBDO Advertising as an Associate
Creative Director from 1994 to 1995. From 1989
through 1994, he served as a Vice President at
Young & Rubicam (advertising). Dr. Glen Miller
61 Dr. Miller has served as a Director of
Parent c/o COMFORCE Corporation since December
1995 and is a member of the 2001 Marcus Avenue
Audit, Compensation and Stock Option Lake
Success, New York 11042 Committees of the
Board. He is a Vice President of Pacer
International, a telecommunications
construction company. From September 1996 to
April 1997, he was a Vice President of Cybertel
Network Systems, a telecommunications service
company. From 1990 to 1994, Dr. Miller was
responsible for strategic planning for the
Harris Corporation (electronics and
communications). From 1984 to 1990, he was
responsible for the direction and arrangement
of business activities in various markets
nationwide for GTE Telecom, a
telecommunications company. Dr. Miller is a
retired Colonel, U.S. Air Force.
</TABLE>
A-15
<PAGE>
APPENDIX B
CHARTERED CAPITAL ADVISERS, INC.
145 FOURTH AVENUE
NEW YORK, NEW YORK 10003
(212) 505-9743 o (212) 533-9680 FAX
September 3, 1997
Board of Directors
Uniforce Services, Inc.
415 Crossways Park Drive
Woodbury, NY 11797
Dear Members of the Board of Directors:
We understand that Uniforce Services, Inc. ("Uniforce" or the
"Company") has signed an Agreement and Plan of Merger (the "Merger Agreement")
under which a wholly owned subsidiary of COMFORCE Corporation ("COMFORCE")
proposes to make a, tender offer (the "Offer") to acquire all the issued and
outstanding common stock of Uniforce. Under the terms of the Merger Agreement,
Uniforce will merge with a wholly owned subsidiary of COMFORCE, and will thereby
become a wholly owned subsidiary of COMFORCE. The per-share consideration (the
"Consideration") to be paid by COMFORCE under the Offer and subsequent merger
will consist of: (1) $28.00 in cash; plus (2) COMFORCE common stock equivalent
in value to $4.00, calculated based on the average closing price of COMFORCE
common stock during the three days preceding and following the announcement of
the Offer.
You have requested our opinion as to the fairness of the Consideration,
from a financial point of view, to the shareholders of Uniforce. Chartered
Capital Advisers, Inc. is customarily engaged in the valuation of businesses and
their securities in connection with mergers & acquisitions, private placements,
shareholder transactions, estate and gift taxes, litigation, and for other
purposes.
In connection with rendering our opinion we have, among other things:
(1) Reviewed the Agreement and Plan of Merger, Stockholders
Agreement, Registration Rights Agreement, Noncompetition
Agreement, and Employment Agreements signed by and among
Uniforce, COMFORCE, and/or certain of the key executives of
Uniforce as of August 13, 1997;
(2) Reviewed the Parent Disclosure Schedule Provided by COMFORCE
Pursuant to the Terms of the Agreement and Plan of Merger
Dated as of August 13, 1997;
(3) Reviewed a draft of the proposed Registration Statement,
Prospectus, and Proxy Statement to be filed in connection with
the Merger Agreement;
(4) Analyzed financial information with respect to Uniforce,
including but not limited to unaudited financial statements
for the six months ended June 30, 1997, audited financial
statements for the five years ended December 31, 1996, and
various internal management information reports;
(5) Analyzed financial information with respect to COMFORCE,
including but not limited to unaudited financial statements
for the six months ended June 30, 1997, and audited financial
statements as of and for the two years ended December 31,
1996;
<PAGE>
(6) Reviewed various documents filed by Uniforce with the
Securities and Exchange Commission, including the Form 8-K
filed on August 19, 1997, the Forms 10-Q for the quarters
ended March 31, 1997 and June 30, 1997, the Forms 10-K for the
five years ended December 31, 1996, and the Definitive Proxy
filed on April 29, 1997;
(7) Reviewed various documents filed by COMFORCE with the
Securities and Exchange Commission, including the Form 8-K
filed on August 20, 1997, the Forms 10-Q for the quarters
ended March 31, 1997 and June 30, 1997, the Forms 10-K for the
two years ended December 31, 1996, the Form S-3 filed on July
11, 1997, and the Definitive Proxy filed on June 30, 1997;
(8) Visited the facilities of Uniforce and held discussions with
certain members of its management and advisers concerning the
past, current, and planned operations, financial condition,
and business prospects of Uniforce;
(9) Analyzed historical stock prices of Uniforce;
(10) Discussed with the legal advisors of Uniforce the results of
their due diligence;
(11) Considered financial data of Uniforce, and have compared that
data with similar data for publicly held companies with
similar investment characteristics to Uniforce;
(12) Considered financial data of Uniforce, and have compared that
data with similar data for certain business combinations and
other transactions that have recently been effectuated;
(13) Considered the cash flow and net asset value of Uniforce;
(14) Considered the projected financial performance of Uniforce;
(15) Considered the acquisition premium reflected in the
Consideration, and compared that premium to other relevant
transactions; and
(16) Considered such other information, financial studies, and
analyses as we deemed relevant, and performed such analyses,
studies, and investigations as we deemed appropriate.
Chartered Capital Advisers, Inc. has assumed and relied upon, without
independent verification, the accuracy and completeness of the information
reviewed by us. We have assumed that the representations of management have been
made in good faith, and that they reflect the best currently available
management judgments as to the matters covered. Our opinion is necessarily based
upon economic, market, and other conditions as in effect on, and the information
made available to us as of, the date of this letter. Our opinion is limited to
the fairness of the Consideration as of the date hereof, from a financial point
of view. We make no representations with respect to the business decision to
enter into the Merger Agreement, or any other terms of the Merger Agreement.
This opinion does not represent our opinion as to the value of Uniforce or
COMFORCE as of the date of this letter.
We understand that in considering the Merger Agreement, the Board of
Directors of Uniforce may have considered a wide range of financial and
nonfinancial factors, many of which may be beyond the scope of this letter. This
letter is not intended to substitute for the Board's exercise of its own
business judgment in reviewing the Merger Agreement.
Based upon and subject to the foregoing considerations, it is our
opinion as financial advisors that the Consideration is fair, from a financial
point of view, to the shareholders of Uniforce.
B-2
<PAGE>
The foregoing opinion is to be used solely for the information and
assistance of Uniforce Accordingly, it is understood and agreed that no person
other than Uniforce and its officers, directors and shareholders shall be
allowed to use or rely upon this opinion.
We hereby consent to the use of this opinion in the Prospectus/Proxy
Statement and Schedule 14D-9 to be filed with the Securities and Exchange
Commission and to the use of our name in the Prospectus and Schedule 14D-9 in
connection with the matters referred to under the caption "Opinion of Financial
Advisor."
Very truly yours,
CHARTERED CAPITAL ADVISERS, INC.
/s/ Ronald G. Quintero
Ronald G. Quintero, CPA, CFA
Managing Director
B-3
<PAGE>
EXHIBIT INDEX
Exhibit 99.1 Agreement and Plan of Merger, dated as of August 13,
1997, by and among Parent, Purchaser and the Company
(incorporated herein by reference to Annex A to Proxy
Statement/Prospectus filed by the Company with the
Commission on September 11, 1997 and included as a
part of Registration Statement on Form S-4 filed by
COMFORCE Corporation on September 11, 1997 under file
no. 33-35451).
Exhibit 99.2 Stockholders Agreement, dated as of August 13, 1997,
among Parent, Purchaser, John Fanning and Fanning
Asset Partners, L.P. (incorporated herein by
reference to exhibit filed with Proxy
Statement/Prospectus filed by the Company with the
Commission on September 11, 1997 and included as a
part of Registration Statement on Form S-4 filed by
COMFORCE Corporation on September 11, 1997 under file
no. 33-35451).
Exhibit 99.3 Registration Rights Agreement dated as of August 13,
1997 among Parent, Purchaser, John Fanning and
Fanning Asset Partners, L.P. (incorporated by
reference to exhibit filed with Proxy
Statement/Prospectus filed by the Company with the
Commission on October 24, 1997 and included as a part
of Amendment No. 2 to Registration Statement on Form
S-4 filed by COMFORCE Corporation on October 24, 1997
under file no. 33-35451).
Exhibit 99.4 Employment Agreement dated August 13, 1997 between
the Company and John Fanning.
Exhibit 99.5 Employment Agreement dated August 13, 1997 between
the Company and Rosemary Maniscalco.
Exhibit 99.6 Employment Agreement dated August 13, 1997 between
the Company and Harry V. Maccarrone.
Exhibit 99.7 Letter dated September 3, 1997 from Chartered Capital
Advisers, Inc. to the Board of Directors of the
Company (Annex B hereto).*
Exhibit 99.8 The Company's Information Statement pursuant to
Section 14(f) of the Securities and Exchange Act of
1934 and Rule 14f-1 thereunder(Annex A hereto).*
Exhibit 99.9 Copy of Letter to Stockholders, dated October 27,
1997.*
EXHIBIT 4
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") made as of the 13th day of
August, 1997 between UNIFORCE SERVICES, INC., a New York corporation hereinafter
called the "Employer," and John Fanning, hereinafter called the "Employee", who
resides at the address set forth under his signature hereto.
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Employer has entered into an Agreement and Plan of Merger (the
"Merger Agreement") with COMFORCE CORPORATION, a Delaware corporation
("Parent"), and COMFORCE COLUMBUS, INC., a New York corporation ("Subsidiary"),
wherein Subsidiary is to acquire the Employer; and
WHEREAS, Employer has employed Employee as its Chairman and President
under the terms of an Amended and Restated Employment Agreement dated as of
January 26, 1984 (the "Existing Agreement"), as amended by letter agreements
dated May 10, 1984, January 5, 1989, January 10, 1992, March 15, 1994, April 26,
1994, November 26, 1996 and January 1, 1997; and
WHEREAS, among other things, Parent and Subsidiary have conditioned
their execution and delivery of the Merger Agreement upon the execution and
delivery of this Agreement;
WHEREAS, Employer and Employee wish to enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained, and it is hereby agreed as follows:
1. The Employee is hereby engaged to work as President of the
[Columbus] Financial Services Division of Employer or in such other executive
capacity as is from time to time designated by the Board of Directors of
Employer from time to time. In connection with the Employee's employment by the
Employer, the Employee shall be based at the offices of the Employer located in
or about Boca Raton, Florida, it being understood that Employee shall travel to
and spend time at other offices of Employer as reasonably required by Employer.
2. The effective date of this Agreement (the "Effective Date")
shall be the date on which Parent, directly or indirectly, has acquired at least
51% of the issued and outstanding stock of Employer, and Employee's employment
hereunder shall continue for a period of one (1) year thereafter unless and
until terminated as hereinafter provided (the "Initial Term"). After the Initial
Term, Employee's employment hereunder shall continue on a year-to-year basis
unless and until terminated as hereinafter provided. This Agreement shall be
null and void and of no further force or effect in the event the Merger
Agreement is terminated in accordance with its terms unless prior to such
termination Subsidiary or another subsidiary of Parent has acquired at least 51%
of the issued and outstanding stock of Employee.
3. The Employer agrees as follows:
<PAGE>
(a) To employ Employee as described in Section 1 hereof.
(b) To pay the Employee a base salary (the "Base Salary") at
the rate of One Hundred Fifty Thousand Dollars ($150,000.00) per year payable in
accordance with the Employer's pay schedule practices generally in effect for
its executive employees.
(c) To pay the Employee supplemental pay (the "Supplemental
Pay") at the rate of One Hundred Thirty-Four Thousand Five Hundred Dollars
($134,500.00) per year payable in accordance with the Employer's pay schedule
practices generally in effect for its executive employees.
(d) That the Employee shall receive such other incidental
benefits of employment, such as insurance, pension plan participation, and
vacation, as are provided generally to the Employer's other executive officers
and will be eligible in the sole discretion of the Employer's Board for
discretionary bonuses.
(e) To reimburse the Employee for business expenses incurred
in connection with conducting and promoting the business and affairs of the
Employer, subject to reasonable limitations and restrictions set by the Employer
from time to time. Submission of business expenses for reimbursement must
conform to the Internal Revenue Code.
(f) To pay to Employee incentive compensation payable with
respect to the period through the Effective Date under the Existing Agreement,
as amended, and the $25,000 bonus described in Section 6.13 of the Disclosure
Schedule (as defined in the Merger Agreement) to the extent such compensation
and bonus have not been previously paid.
4. The Employee agrees as follows:
(a) To devote Employee's full business time and entire
business skill, labor and attention to said employment, that Employee will not
engage in any other business during working hours without the prior written
consent of Employer and that Employee will promptly and faithfully do and
perform all services pertaining to said position that are or may hereafter be
reasonably required of Employee by the Employer consistent with Employee's
officership and with the provisions hereof during the term hereof.
(b) That any inventions, discoveries, improvements, or works
which are conceived, first reduced to practice, made, developed, suggested by,
or created in anticipation of, in the course of or as a result of work done by
Employee under this agreement or during his prior employment with Employer shall
become the absolute property of the Employer, and the Employee further agrees
that all such inventions, discoveries, improvements, creations, or works, and
all letters patent or copyrights that may be obtained therefor, shall be the
property of the Employer, and the Employee agrees that he will promptly execute
any and all applications, assignments or other instruments which the Employer
shall deem necessary or useful to vest said patents or copyrights in the
Employer without any other or additional consideration to the Employee than
herein expressed, other than reimbursement of out-of-pocket expenses incurred in
connection therewith.
2
<PAGE>
(c) To the extent permitted by applicable law, Employer may
set-off against any wages or other compensation due the Employee, any amounts
owed by the Employee to the Employer including, but not limited to, money due to
the Employer because of salary or bonus advances, excess payments, or damage to
or loss of the Employer's physical or intellectual property due to Employee's
violation of the terms hereof.
5. (a) Employer and Employee shall have the right to terminate
the employment of Employee as set forth in this paragraph 5.
(b) If Employee becomes disabled during the Initial Term
because of sickness, physical or mental disability, or any other reason so that
Employee is unable to perform Employee's duties hereunder, Employer agrees to
continue Employee's salary during such disability for a period of up to ninety
(90) continuous days. These benefits may be provided in whole or in part by a
policy of disability insurance. Immediately following such period, if Employee
continues to be unable to perform Employee's duties hereunder, Employee's
employment shall be terminated and Employee shall thereafter receive only such
amounts as are earned (including, without limitation, any accrued and earned or
otherwise due but unpaid bonus or incentive compensation) or otherwise due to
him under this Agreement to the date of such termination, and no further
consideration or compensation shall be owed by Employer to Employee hereunder.
(c) The employment of Employee shall automatically terminate
upon the death of the Employee. Upon such termination, Employee's estate shall
receive only such amounts as are earned (including, without limitation, any
accrued and earned or otherwise due but unpaid bonus or incentive compensation)
or otherwise due to Employee under this Agreement to the date of Employee's
death, and thereafter no further consideration or compensation shall be owed by
Employer to Employee or to Employee's estate.
(d) The Employer may immediately terminate Employee's
employment under this Agreement during the Initial Term by giving Employee
written notice of such termination upon the occurrence of any of the following
events (termination for any such reason being referred to herein as termination
for "Cause"): (i) repeated failure or refusal of Employee to implement or follow
the reasonable written policies or written directions of the Employer provided
that Employer shall have notified Employee in writing a reasonable period of
time prior to the termination of such willful failure or refusal and further
provided that Employee's failure or refusal is not based upon Employee's belief,
in good faith, as expressed to Employer in writing, that the implementation
thereof would be unlawful; (ii) intentional wrongful conduct by Employee which
results or which the Board of Directors of Employer reasonably concludes could
reasonably be expected to result in a material adverse effect (financial or
otherwise) to the business of Employer including without limitation any matters
described in clause (iii) below, whether or not a conviction is obtained
therefor; (iii) conviction of the Employee of a crime involving disloyalty,
dishonesty, embezzlement, fraud or the like; (iv) misappropriation of the
Employer's funds or misuse of the Employer's assets by the Employee; or (v)
material breach of this Employment Agreement by Employee. Upon termination
3
<PAGE>
for Cause as defined in this paragraph 5 or as a result of Employee's
resignation for any reason whatsoever, Employee shall receive only such amounts
as have been earned by or are otherwise due to him under this Agreement to the
date of such termination, and thereafter no further consideration shall be owed
by Employer to Employee.
(e) The Employer may terminate Employee's employment under
this Agreement without Cause by giving Employee written notice of termination.
In such case, Employer's sole obligation to Employee shall be to pay Employee
any amounts earned or otherwise due (including, without limitation, any earned
but unpaid bonuses or incentive compensation) to Employee under this Agreement
to the date of such termination plus, if and only if the termination occurs
during the Initial Term, a severance payment in an amount equal to the Base
Salary and Supplemental Pay payable to Employee hereunder for the period of time
from the date of termination until the end of the Initial Term, which amount
shall be payable in equal installments over such period of time in accordance
with the Employer's regular payroll practices for salaried executive employees.
Employee shall not be entitled to any such severance payment in the event
Employee's employment has terminated without Cause at any time after the end of
the Initial Term.
6. Employee confirms in their entirety the covenants and
agreements of Employee set forth in the Noncompetition Agreement (the
"Noncompetition Agreement") of even date herewith by and between Employer,
Employee and Parent.
7. The Employee recognizes and agrees that from time to time
certain confidential information will be made available to the Employee by the
Employer or by the Employer's clients or customer to assist the Employee in
Employee's job and that Employee possesses such information by virtue of
Employee's conduct and participation in the business of Employer prior to the
date hereof. Employee recognizes and agrees that such confidential information
possessed by Employee or which has been or will be compiled, created, and
maintained by special effort and expense of the Employer or by the Employer's
clients or customers and which is not generally available to the trade or the
public at large is a trade secret of Employer and agrees that such information
disclosed or known to the Employee remains at all times the property of the
Employer and/or the Employer's Clients and further, the Employee agrees that
such information shall not (except as required by law or court order) be
divulged by the Employee either during Employee's employment or after
termination for any reason whatsoever. The Employee shall upon such termination
promptly upon request deliver to the Employer's designated representative all
such confidential or proprietary information in his possession and any abstracts
therefrom or information developed on the basis thereof. The foregoing shall not
apply to any confidential information which has become available to the general
public other than as a result of disclosure by Employee in violation of this
Agreement.
8. Employee further agrees not to utilize or make available any
confidential knowledge or confidential information of Employer either directly
or indirectly in connection with the establishment of an enterprise similar to
that of the Employer or that will compete with Employer, or in connection with
the solicitation, acceptance, or conduct of employment with any other person or
entity.
4
<PAGE>
9. (a) Those paragraphs which by their nature are intended to
survive termination of this Agreement, including without limitation paragraphs
4(b), 7 and 8, shall survive termination of this Agreement. In addition, all
obligations of the Employer to make payments hereunder shall survive any
termination of this Agreement on the terms set forth herein.
(b) It is understood and agreed by and between the parties
hereto that the rights and privileges granted to Employer by Employee under
paragraphs 4(b), 7 and 8 are of a special, unique and extraordinary character,
which gives them a peculiar value, the loss of which cannot be reasonably or
adequately compensated in damages in any action at law, and that a breach by
Employee of any of the provisions contained in this Agreement will cause
Employer great and irreparable injury and damage. Employee hereby expressly
agrees that Employer shall be entitled to the remedies of injunction, specific
performance and other equitable relief to prevent a breach of this Agreement by
Employee. This provision shall not, however, be construed as a waiver of any of
the rights which Employer may have for damages or otherwise.
10. (a) This Agreement supersedes all prior agreements between the
parties regarding the subject matter hereof (other than the obligation to pay
incentive compensation payable with respect to the period through the Effective
Date under the Existing Agreement, as amended) , and this Agreement constitutes
and express the entire agreement of the parties hereto in reference to the
employment of the Employee by the Employer and in reference to any of the
matters or things herein provided for or hereinbefore discussed or mentioned in
reference to such employment, all promises, representations, and understandings
relative thereto being herein merged. It is a condition precedent to the
obligations of the parties hereto that the Effective Date shall have occurred.
(b) No oral arrangements have been made between the parties
hereto. This agreement may be amended only by a writing signed by both parties.
11. The Employee represents and warrants that at the time of the
signing of this agreement, Employee knows of no written or oral contract to
which he is a party which would inhibit or prohibit the employment herein
provided for and that the Employee will not knowingly utilize any trade secret,
company confidential information, or other intellectual property right of
another party in the performance of the Employee's duties hereunder.
12. The rights and obligations of the Employee and the Employer
under this agreement shall inure to the benefit of and shall be binding upon
their successors and assigns. The Employee may not assign Employee's obligations
under this agreement.
13. This Agreement shall be construed in accordance with the laws
of the State of New York.
5
<PAGE>
14. In construing this Agreement, feminine pronouns shall be
substituted for those masculine in form and vice versa, and plural terms shall
be substituted for singular and vice versa in any place the context so requires.
15. All notices shall be deemed to have been given or served only
if in writing, and shall be personally delivered (and shall be deemed given when
delivered if personally delivered) or sent by U.S. certified mail, postage
pre-paid, return receipt requested (and shall be deemed given five (5) days
after mailing if sent by certified mail), or by Federal Express or other private
express delivery or courier service (and shall be deemed given on the scheduled
delivery date if sent by courier), if to Employer at 2001 Marcus Avenue, Lake
Success, New York 11042, Attn: Chief Executive Officer, or at such other address
as Employer may direct, and if to Employee, at the address set forth under
Employee's signature or at such other address as Employee may direct.
16. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to be one and the same instrument
17. Any dispute, controversy or claim arising out of or relating
to this Agreement or to any breach or alleged breach hereof shall, upon the
request of the Employer or the Employee, unless and to the extent an injunction
or other equitable relief is requested, be submitted to and settled by
arbitration in the City of New York, New York pursuant to the rules then in
effect of the American Arbitration Association (or at any other place or under
any other form of arbitration mutually acceptable to the Employer and the
Employee). Disputes shall be arbitrated in accordance with the American
Arbitration Association's rules. Any award rendered shall be final and
conclusive upon the parties, and a judgment may be entered in the highest court,
state or federal, having jurisdiction. The expenses of arbitration shall be paid
as directed by the arbitrator.
18. Employee hereby agrees to hold confidential and not disclose
to any person the terms of this Agreement (other than the terms of paragraphs 7
and 8, terms disclosed publicly other than by Employee or as required by law)
without the express written consent of the Employer. Employee acknowledges that
Employer does not intend to permit any such disclosure except to the extent the
same may be necessary to comply with any reporting obligations imposed by
governmental authority, generally accepted accounting procedures or otherwise by
law.
6
<PAGE>
IN WITNESS WHEREOF, the parties have signed this Agreement on
the date first above written.
UNIFORCE SERVICES, INC.
By: /s/ Rosemary Maniscalco
------------------------
Title: Executive Vice President
------------------------
/s/ John Fanning
------------------------------------
John Fanning
Address:
3505 S. Ocean Blvd.
Highland Beach, FL 33437
EXHIBIT 5
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") made as of the 13th day of
August, 1997 UNIFORCE SERVICES, INC., a New York corporation hereinafter called
the "Employer," and Rosemary Maniscalco, hereinafter called the "Employee", who
resides at the address set forth under her signature hereto.
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Employer has entered into an Agreement and Plan of Merger (the
"Merger Agreement") with COMFORCE CORPORATION, a Delaware corporation
("Parent"), and COMFORCE COLUMBUS, INC., a New York corporation ("Subsidiary"),
wherein Subsidiary is to acquire the Employer; and
WHEREAS, Employer has employed Employee as its Chief Operating Officer
under the terms of an Amended and Restated Employment Agreement dated as of May
1, 1993 (the "Existing Agreement"), as amended by letter agreements dated
September 30, 1993, December 8, 1995 and January 1, 1997 and as supplemented by
a letter agreement dated January 11, 1996, as amended by letter agreement dated
August 13, 1997, and by a letter agreement dated February 21, 1996
(collectively, the "1996 Letter Agreement"); and
WHEREAS, among other things, Parent and Subsidiary have conditioned
their execution and delivery of the Merger Agreement upon the execution and
delivery of this Agreement;
WHEREAS, Employer and Employee wish to enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained, and it is hereby agreed as follows:
1. The Employee is hereby engaged to work as President of
Employer or in such other executive capacity as is from time to time designated
by the Board of Directors of Employer from time to time. In connection with the
Employee's employment by the Employer, the Employee shall be based at the
offices of the Employer located in or about Boca Raton, Florida, it being
understood that Employee shall travel to and spend time at other offices of
Employer as reasonably required by Employer.
2. The effective date of this Agreement (the "Effective Date")
shall be the date on which Parent, directly or indirectly, has acquired at least
51% of the issued and outstanding stock of Employer, and Employee's employment
hereunder shall continue for a period of two (2) years thereafter unless and
until terminated as hereinafter provided (the "Initial Term"). After the Initial
Term, Employee's employment hereunder shall continue on a year-to-year basis
unless and until terminated as hereinafter provided. This Agreement shall be
null and void and of no further force or effect in the event the Merger
Agreement is terminated in accordance with its terms unless prior to such
termination Subsidiary or another subsidiary of Parent has acquired at least 51%
of the issued and outstanding stock of Employee. Until the Effective Date, the
Existing Agreement, as amended, and the 1996 Letter Agreement shall continue to
be in full force and effect.
3. The Employer agrees as follows:
<PAGE>
(a) To employ Employee as described in Section 1 hereof.
(b) To pay the Employee a base salary (the "Base Salary") at
the rate of One Hundred Fifty Thousand Dollars ($150,000.00) per year payable in
accordance with the Employer's pay schedule practices generally in effect for
its executive employees.
(c) To pay the Employee supplemental pay ("Supplemental Pay")
at the rate of Ninety Thousand Dollars ($90,000.00) per year payable in
accordance with the Employer's pay schedule practices generally in effect for
its executive employees.
(d) To pay Employee a one-time bonus in the amount of Ten
Thousand Dollars ($10,000.00) if Employee continues to be employed by and work
full-time for Employer six (6) months after the Effective Date.
(e) To pay Employee the $25,000 bonus described in Section
6.13 of the Disclosure Schedule (as defined in the Merger Agreement) to the
extent such bonus has not been previously paid.
(f) That the Employee shall receive such other incidental
benefits of employment, such as insurance, pension plan participation, and
vacation, as are provided generally to the Employer's other executive officers
and will be eligible in the sole discretion of the Employer's Board for
discretionary bonuses.
(g) To reimburse the Employee for business expenses incurred
in connection with conducting and promoting the business and affairs of the
Employer, subject to reasonable limitations and restrictions set by the Employer
from time to time. Submission of business expenses for reimbursement must
conform to the Internal Revenue Code.
(h) To cause Parent to grant the Employee as of the Effective
Date an incentive stock option to purchase fifty thousand (50,000) shares of
common stock of Parent. The purchase price or "strike price" per share shall be
equal to the closing price of a share of such stock on the American Stock
Exchange on the Effective Date and the option shall not be exercisable at the
time of grant and shall vest and become exercisable for one-quarter of the
initial number of shares subject to the option if the Employee is employed by
the Employer six months after the Effective Date, for one-quarter of the initial
number of shares subject to the option if the Employee is employed by the
Employer on the first anniversary of the Effective Date and for the remaining
shares subject to the option if the Employee is employed by the Employer on the
second anniversary of the Effective Date.
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(i) To pay the Employee incentive compensation and sales
compensation as set forth in paragraphs 6 and 7.
4. The Employee agrees as follows:
(a) To devote Employee's full business time and entire
business skill, labor and attention to said employment, that Employee will not
engage in any other business during working hours without the prior written
consent of Employer (it being understood that Employee may without the prior
written consent of the Employer, on Employee's own time when she is not required
to provide services to Employer, finish and promote the book referred to in
subparagraph (b) of this paragraph) and that Employee will promptly and
faithfully do and perform all services pertaining to said position that are or
may hereafter be reasonably required of Employee by the Employer consistent with
Employee's officership and the provisions hereof during the term hereof.
(b) That any inventions, discoveries, improvements, or works
which are conceived, first reduced to practice, made, developed, suggested by,
or created in anticipation of, in the course of or as a result of work done by
Employee under this Agreement or during her prior employment with Employer shall
become the absolute property of the Employer, and the Employee further agrees
that all such inventions, discoveries, improvements, creations, or works, and
all letters patent or copyrights that may be obtained therefor, shall be the
property of the Employer, and the Employee agrees that she will promptly execute
any and all applications, assignments or other instruments which the Employer
shall deem necessary or useful to vest said patents or copyrights in the
Employer without any other or additional consideration to the Employee than
herein expressed, other than reimbursement of out-of-pocket expenses incurred in
connection therewith. Notwithstanding the foregoing, it is understood and agreed
that Employee is in the process of writing a book giving advice to job seekers
that is to be submitted to a book agent. That book shall not be subject to this
paragraph.
(c) To the extent permitted by applicable law, Employer may
set-off against any wages or other compensation due the Employee, any amounts
owed by the Employee to the Employer including, but not limited to, money due to
the Employer because of salary or bonus advances, excess payments, or damage to
or loss of the Employer's physical or intellectual property due to Employee's
violation of the terms hereof.
5. (a) Employer and Employee shall have the right to terminate
the employment of Employee as set forth in this Section 5.
(b) If Employee becomes disabled during the Initial Term
because of sickness, physical or mental disability, or any other reason so that
Employee is unable to perform Employee's duties hereunder, Employer agrees to
continue Employee's salary during such disability for a period of up to ninety
(90) continuous days. These benefits may be provided in whole or in part by a
policy of disability insurance. Immediately following such period, if Employee
continues to be unable to perform Employee's duties hereunder, Employee's
employment shall be terminated and Employee
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shall thereafter receive only (i) such amounts as are earned (including, without
limitation, any accrued and earned or otherwise due but unpaid bonus, incentive
compensation or additional sales compensation) or otherwise due to Employee
under this Agreement prior to the date of such termination, (ii) incentive
compensation payable to Employee for any portion of a fiscal year occurring
prior to the termination as provided in paragraph 6 and (iii) any additional
sales compensation payable pursuant to paragraph 7 hereof as a result of
Employee's actions prior to termination, and no further consideration or
compensation shall be owed by Employer to Employee hereunder.
(c) The employment of Employee shall automatically terminate
upon the death of the Employee. Upon such termination, Employee's estate shall
receive only such amounts as are earned (including, without limitation, any
accrued and earned or otherwise due but unpaid bonus, incentive compensation or
additional sales compensation) or otherwise due to Employee under this Agreement
prior to the date of Employee's death, and thereafter no further consideration
or compensation shall be owed by Employer to Employee or to Employee's estate.
(d) The Employer may immediately terminate Employee's
employment under this Agreement during the Initial Term by giving Employee
written notice of such termination upon the occurrence of any of the following
events (termination for any such reason being referred to herein as termination
for "Cause"): (i) repeated failure or refusal of Employee to implement or follow
the reasonable written policies or written directions of the Employer provided
that Employer shall have notified Employee in writing a reasonable period of
time prior to the termination of such willful failure or refusal and further
provided that Employee's failure or refusal is not based upon Employee's belief,
in good faith, as expressed to Employer in writing, that the implementation
thereof would be unlawful; (ii) intentional wrongful conduct by Employee which
results or which the Board of Directors of Employer reasonably concludes could
reasonably be expected to result in a material adverse effect (financial or
otherwise) to the business of Employer including without limitation any matters
described in clause (iii) below, whether or not a conviction is obtained
therefor; (iii) conviction of the Employee of a crime involving disloyalty,
dishonesty, embezzlement, fraud or the like; (iv) misappropriation of the
Employer's funds or misuse of the Employer's assets by the Employee; or (v)
material breach of this Employment Agreement by Employee. Upon termination for
Cause as defined in this paragraph 5 or as a result of Employee's resignation
for any reason whatsoever, Employee shall receive only such amounts as are
earned or otherwise due to her under this Agreement to the date of such
termination, and thereafter no further consideration shall be owed by Employer
to Employee.
(e) The Employer may terminate Employee's employment under
this Agreement without Cause by giving Employee written notice of termination.
In such case, Employer's sole obligation to Employee shall be to pay Employee
any amounts earned or otherwise due (including, without limitation, any accrued
and earned or otherwise due but unpaid bonuses, incentive compensation or
additional sales compensation) to Employee under this Agreement prior to the
date of such termination plus, if and only if the termination occurs during the
Initial Term, a severance payment in an amount equal to the Base Salary and
Supplemental Pay payable to Employee hereunder
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for the lesser of (i) one (1) year or (ii) the period of time from the date of
termination until the end of the Initial Term, which amount shall be payable in
equal installments over such period of time in accordance with the Employer's
regular payroll practices for salaried employees. Employee shall not be entitled
to any such severance payment in the event Employee's employment has terminated
without Cause at any time after the end of the Initial Term.
6. (a) Employer agrees to pay the Employee incentive compensation
as set forth in this Section for each fiscal year during the term of Employee's
employment hereunder. In the event of any termination of Employee's employment
hereunder that is not the result of embezzlement or other similar criminal
conduct by Employee or of an event of Cause that was intended to or did
materially overstate the results of operation of any of Employer's businesses
(including without limitation, in the event of termination as a result of death
or disability), Employee shall be entitled to receive incentive compensation
otherwise payable hereunder with respect to the fiscal year of the termination
multiplied by a fraction, the numerator of which is the number of days of the
fiscal year occurring prior to the termination and the denominator of which is
365.
(b) The incentive compensation payable under this Section 6
shall be in an amount equal to 5% of the Managed Pre-Tax Operating Income (as
defined herein) in excess of $2,500,000 (the "First Target"), but not in excess
of $3,000,000 (the "Second Target"), plus 1% of such income in excess of the
Second Target. Notwithstanding the foregoing, to the extent the results of any
subsidiaries or business units of Employer that were accounted for in
determining Managed Pre-Tax Operating Income are no longer accounted for in such
determination, the First Target and Second Target (collectively, the "Targets")
shall be reduced on a pro rata basis based on the proportion of Employer's total
pre-tax operating income for its immediately preceding fiscal year represented
by the results of such subsidiaries and business units. In addition, if Employee
and Employer mutually agree that Employee shall be responsible for the
management of any business units or operations that are added to Employer's
business after the Effective Date, the Targets (as well as the maximum amount of
interest expense permitted to be accounted for in calculating Managed Pre-Tax
Operating Income pursuant to clause (i)(E) of subparagraph (c) of this
paragraph) shall be adjusted as agreed upon by the parties. Employee shall be
entitled to receive incentive compensation for the Employer's 1997 fiscal year
based on entire year results even though this Agreement was not in effect during
the entire fiscal year, reduced by the amount of any and all incentive
compensation paid to Employee with respect to the 1997 fiscal year under the
Existing Agreement, as amended, with respect to the portion of the fiscal year
occurring prior to the Effective Date.
(c) For purposes of this paragraph 6, "Managed Pre-Tax
Operating Income" shall mean the consolidated earnings of the Employer and its
direct and indirect subsidiaries existing on the date hereof and such other
subsidiaries as are from time to time added by mutual agreement of the parties
to the business units and operations with respect to which Employee has
management responsibilities, (i) before (A) deduction of, or allowance or
provision for, taxes based on income, (B) deduction of, or allowance or
provision for, the incentive compensation and sales compensation payable
pursuant to Section 6 or Section 7 of this Agreement, incentive compensation
payable to John Fanning based upon income or profits of Employer and payments
made to Employee under the
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1996 Letter Agreement or to Harry Maccarrone under substantially similar
agreements with Employer, (C) amortization of good will arising from and
charges, costs and expenses relating to the transactions contemplated by the
Merger Agreement, (D) any extraordinary gain or loss and (E) deduction of or
provision for interest expense in excess of $600,000 for such fiscal year and
(ii) excluding the results of subsidiaries or business units managed not managed
by Employee, it being understood that after the Effective Date, subject to the
power of the Board of Employer to restructure in the Board's discretion
Employer's operations, Employee will manage all of the business units and
subsidiaries of Employer in existence on the date of this Agreement. It is
understood that (i) in calculating Managed Pre-Tax Operating Income, interest
expense as used in Clause (E) above shall include only interest expense that
relates directly to subsidiaries and business units, the results of which are
the basis for calculating Managed Pre-Tax Operating Income, and (ii) the term
extraordinary gain or loss shall include any damages, settlements or awards
attributable to lawsuits to which the Employer or any of its subsidiaries is a
party. To the extent the Board of Employer exercises its power to restructure
Employer's operations and, as a result thereof, Employee ceases to manage a
business unit or operation in the middle of a fiscal year, Managed Pre-Tax
Operating Income shall be calculated so it includes a pro rata portion of the
results of the business unit or operation, pro rated based on the portion of the
fiscal year during which it was managed by Employee (and any adjustment to the
Target contemplated by subparagraph (b) of this paragraph shall be subject to a
similar proration for that fiscal year).
(d) The amount of any incentive compensation to which Employee
becomes entitled pursuant to this Agreement shall be payable as follows: within
forty-five (45) days after the end of the each of the first three (3) fiscal
quarters of each full fiscal year of the Employer, the Employer shall make an
estimated payment of incentive compensation to Employee on the basis of the
Employer's unaudited pre-tax operating income in respect of the period from the
beginning of the fiscal year to the close of such quarter. Estimated payments
shall be made in amounts such that at the end of each of the first three (3)
fiscal quarters of the Employer's fiscal year, Employee shall have received an
amount equal to 50% of the incentive compensation to which she would be entitled
based upon the Employer's pre-tax operating income in respect of the period then
ended, after consideration of all prior estimated payments made in respect of
such fiscal year. Within one hundred twenty (120) days after the end of each
fiscal year, the actual amount of incentive compensation, if any, to which
Employee is entitled pursuant hereto for such fiscal year shall be computed and
the amount by which such incentive compensation exceeds the aggregate estimated
payments made for such fiscal year shall be paid to Employee. In the event,
however, that such aggregate estimated payments exceed the incentive
compensation to which Employee is entitled, upon notification from the Employer,
Employee shall forthwith repay the Employer the amount of such excess.
(e) Except as otherwise expressly provided by this Agreement,
the determination of pre-tax operating income shall be made in accordance with
generally accepted accounting principles applied on a consistent basis.
7. Employee shall also be entitled to receive, as additional
sales compensation, one percent (1%) of the sales of offices of businesses
acquired after the Effective Date by the Employer
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or any subsidiary thereof (the "Acquired Offices") located within the United
States of America and its territories during the one-year period following the
acquisition of the acquired business (regardless of whether Employee's
employment hereunder shall terminate for any reason during any such one-year
period other than as the result of embezzlement or other similar criminal
conduct by Employee or of an event of Cause that was intended to or did
materially overstate the results of operation of any of Employer's businesses,
in which case no further sales compensation shall be payable); provided,
however, that (i) additional sales compensation shall be payable with respect to
an Acquired Office only if (A) the opportunity to purchase the Acquired Office
was brought to the attention of Employer or Parent solely by Employee without
the assistance of any broker, finder or other employee of Employer or Parent or
other subsidiaries of Parent and was not previously brought to the attention of
Employer or Parent by any other party and (B) Employee has used her reasonable
best efforts to assist Employer in connection with the acquisition of the
Acquired Office; (ii) the term "Acquired Office" shall include offices of an
acquired business added to its operations in the ordinary course of its business
during the one-year period following the acquisition of such business; and (iii)
additional sales compensation in respect of Acquired Offices shall only be
payable with respect to sales of Acquired Offices derived from sales of product
lines offered by the Acquired Offices at the date of the acquisition of the
acquired business.
8. The Employee recognizes that the methods employed in the
Employer's business are such as have and will place the Employee in close
business and personal relationship with the Employer's clients and customers. It
is therefore agreed that in the event of a termination of this Agreement for any
reason whatsoever, the Employee will not for a period of two (2) years from the
date of termination of this Agreement, either directly or indirectly on
Employee's own account or as agent, stockholder, owner, employer, employee, or
otherwise, solicit any business from the then Clients of the Employer or from
potential Clients of the Employer that Employee may have contacted or been
assigned to at any time during Employee's period of employment. For purposes of
this paragraph and paragraphs 9 and 10, the term "Employer" shall mean any
corporation or other business entity directly or indirectly controlled by
Parent, for which Employee is requested to perform services.
9. The Employee further agrees that the Employee will not for a
period of two (2) years from the date of termination of employment for any
reason engage, either directly or indirectly on Employee's own account or as
agent, stockholder, owner, employer, employee, or otherwise, in a business which
is the same as or substantially similar to the Business (as defined herein) (i)
within the United States or (ii) within any other country in which Employer
conducts any portion of the Business during the term of Employee's employment
under this Employment Agreement, if Employee manages the conduct of the portion
of the Business in the other country for Employer or, in connection with
Employee's performance of its duties for Employer, has meaningful involvement in
the operation of the portion of the Business in the other country. For purposes
of this Agreement, the term "Business" shall mean (i) technical or non-technical
staffing, consulting and outsourcing services, vendor-on-premises services,
staffing needs analysis, "telecommuting" staffing services, and payrolling, and
related financial support and billing and accounting, services, and (ii) any
other business that Employer operates which Employee manages for Employer or in
which Employee has
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meaningful involvement in performing Employee's duties under this Agreement.
Notwithstanding the foregoing, this paragraph shall not be deemed to prevent
Employee's ownership of not more than 5% of a publicly traded entity.
10. (a) Employee agrees that Employee shall not for a period of
two (2) years after termination of employment for any reason, contact or
approach either directly or indirectly for Employee's own individual purposes or
those of another, any employee of Employer, without regard to his/her location,
for the purpose of attempting to or actually soliciting or hiring that employee
on Employee's own account or on the account of another.
(b) The Employee further agrees that the covenants contained
in paragraphs 8, 9 and 10 are reasonable as to geographic space, time and scope,
protect the legitimate interests of the Employer and present no undue hardship
to the Employee. Employee hereby waives any defenses which contest the
reasonableness of the covenants contained in paragraphs 8, 9 and 10. If
nonetheless a court of competent jurisdiction believes under the circumstances
that the covenants are too broad, or unreasonable or unenforceable, in whole or
in part, said court may modify the covenants so that same are enforceable to the
maximum extent permissible by law.
(c) It is the intent of the parties that each of paragraphs 8,
9 and 10 be a separate and distinct promise and that unenforceability of any one
paragraph shall have no effect on the enforceability of another.
11. Employee agrees that should either party seek to enforce or
determine its rights through legal or judicial proceedings because of any act of
the Employee which the Employer believes to be in contravention of paragraph 8,
9 or 10 (collectively, the "Covenant"), the Covenant period shall be extended
for a time period equal to the period necessary to obtain judicial enforcement
of the Employer's rights hereunder. The Covenant period shall commence upon the
date of termination of employment as contained in a notice of termination or
resignation.
12. The Employee recognizes and agrees that from time to time
certain confidential information will be made available to the Employee by the
Employer or by the Employer's clients or customer to assist the Employee in
Employee's job and that Employee possesses such information by virtue of
Employee's conduct and participation in the business of Employer prior to the
date hereof. Employee recognizes and agrees that such confidential information
possessed by Employee or which has been or will be compiled, created, and
maintained by special effort and expense of the Employer or by the Employer's
clients or customers and which is not generally available to the trade or the
public at large is a trade secret of Employer and agrees that such information
disclosed or known to the Employee remains at all times the property of the
Employer and/or the Employer's Clients and further, the Employee agrees that
such information shall not (except as required by law or court order) be
divulged by the Employee either during Employee's employment or after
termination for any reason whatsoever. The Employee shall upon such termination
promptly upon request deliver to the Employer's designated representative all
such confidential or proprietary information in her possession and any abstracts
therefrom or information developed on the basis
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thereof. The foregoing shall not apply to any confidential information which has
become available to the general public other than as a result of disclosure by
Employee in violation of this Agreement.
13. Employee further agrees not to utilize or make available any
such knowledge or confidential information either directly or indirectly in
connection with the establishment of an enterprise similar to that of the
Employer or that will compete with Employer, or in connection with the
solicitation, acceptance, or conduct of employment with any other person or
entity.
14. (a) Those paragraphs which by their nature are intended to
survive termination of this Agreement, including without limitation paragraph
4(b), 4(c), 8, 9, 10, 11, 12 and 13 shall survive termination of this Agreement.
In addition, all obligations of the Employer to make payments hereunder shall
survive any termination of this Agreement on the terms set forth herein.
(b) It is understood and agreed by and between the parties
hereto that the rights and privileges granted to Employer by Employee under
paragraphs 8, 9, 10, 11, 12 and 13, are of a special, unique and extraordinary
character, which gives them a peculiar value, the loss of which cannot be
reasonably or adequately compensated in damages in any action at law, and that a
breach by Employee of any of the provisions contained in this Agreement will
cause Employer great and irreparable injury and damage. Employee hereby
expressly agrees that Employer shall be entitled to the remedies of injunction,
specific performance and other equitable relief to prevent a breach of this
Agreement by Employee. This provision shall not, however, be construed as a
waiver of any of the rights which Employer may have for damages or otherwise.
15. (a) This Agreement supersedes all prior agreements between the
parties other than the 1996 Letter Agreement, which continues to be in full
force and effect, and this Agreement and the 1996 Letter Agreement constitute
and express the entire agreement of the parties hereto in reference to the
employment of the Employee by the Employer and in reference to any of the
matters or things herein provided for or hereinbefore discussed or mentioned in
reference to such employment, all promises, representations, and understandings
relative thereto being herein merged. Nothing herein shall be deemed to
terminate any right Employee has under the Existing Agreement, as amended, to
receive compensation for periods occurring prior to the Effective Date. It is a
condition precedent to the obligations of the parties hereto that the Effective
Date shall have occurred.
(b) No oral arrangements have been made between the parties
hereto. This Agreement may be amended only by a writing signed by both parties.
16. The Employee represents and warrants that the Existing
Agreement, as amended by the amendments described in the recitals hereto, the
1996 Letter Agreement, and any stock option grants made to Employee, are the
sole agreements in effect relating to the employment of Employee and
compensation therefor and that, at the time of the signing of this Agreement,
Employee knows of no written or oral contract to which he is a party or of any
other impediment which would inhibit or prohibit the employment herein provided
for and that the Employee will not knowingly utilize any
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trade secret, company confidential information, or other intellectual property
right of another party in the performance of the Employee's duties hereunder.
17. The rights and obligations of the Employee and the Employer
under this Agreement shall inure to the benefit of and shall be binding upon
their successors and assigns. The Employee may not assign Employee's obligations
under this Agreement.
18. (a) This Agreement shall be construed in accordance with the
laws of the State of New York.
(b) Any dispute, controversy or claim arising out of or
relating to this Agreement or to any breach or alleged breach hereof shall, upon
the request of the Employer or the Employee, unless and to the extent an
injunction or other equitable relief is requested, be submitted to and settled
by arbitration in the City of New York, New York pursuant to the rules then in
effect of the American Arbitration Association (or at any other place or under
any other form of arbitration mutually acceptable to the Employer and the
Employee). Disputes shall be arbitrated in accordance with the American
Arbitration Association's rules. Any award rendered shall be final and
conclusive upon the parties, and a judgment may be entered in the highest court,
state or federal, having jurisdiction. The expenses of arbitration shall be paid
as directed by the arbitrator.
19. All notices shall be deemed to have been given or served only
if in writing, and shall be personally delivered (and shall be deemed given when
delivered if personally delivered) or sent by U.S. certified mail, postage
pre-paid, return receipt requested (and shall be deemed given five (5) days
after mailing if sent by certified mail), or by Federal Express or other private
express delivery or courier service (and shall be deemed given on the scheduled
delivery date if sent by courier), if to Employer at 2001 Marcus Avenue, Lake
Success, New York 11042, Attn: Chief Executive Officer, or at such other address
as Employer may direct, and if to Employee, at the address set forth under
Employee's signature or at such other address as Employee may direct.
20. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to be one and the same instrument.
21. Employee hereby agrees to hold confidential and not disclose
to any person the terms of this Agreement (other than the terms of paragraphs 8,
9, 10, 11, 12 and 13, terms disclosed publicly by any party other than Employee
or as required by law) without the express written consent of the Employer.
Employee acknowledges that Employer does not intend to permit any such
disclosure except to the extent the same may be necessary to comply with any
reporting obligations imposed by governmental authority, generally accepted
accounting procedures or otherwise by law.
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IN WITNESS WHEREOF, the parties have signed this Agreement on
the date first above written.
UNIFORCE SERVICES, INC.
By: /s/ John Fanning
------------------------
Title: President
------------------------
/s/ Rosemary Maniscalco
------------------------------------
Rosemary Maniscalco
Address:
23359D S.W. 55 Way
Boca Raton, FL 33433
11
EXHIBIT 6
EMPLOYMENT AGREEMENT
This Employment Agreement (this "Agreement") made as of the 13th day of
August, 1997 between UNIFORCE SERVICES, INC., a New York corporation hereinafter
called the "Employer," and Harry Maccarrone hereinafter called the "Employee",
who resides at the address set forth under his signature hereto.
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Employer has entered into an Agreement and Plan of Merger (the
"Merger Agreement") with COMFORCE CORPORATION, a Delaware corporation
("Parent"), and COMFORCE COLUMBUS, INC., a New York corporation ("Subsidiary"),
wherein Subsidiary is to acquire the Employer; and
WHEREAS, Employer has employed Employee as its Vice President -
Finance; and
WHEREAS Employee has certain rights under a letter agreement dated
January 11, 1996, as amended by a letter agreement dated August 13, 1997, and
under a letter agreement dated February 21, 1996 (collectively, the "1996 Letter
Agreement") ; and
WHEREAS, among other things, Parent and Subsidiary have conditioned
their execution and delivery of the Merger Agreement upon the execution and
delivery of this Agreement;
WHEREAS, Employer and Employee wish to enter into this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained, and it is hereby agreed as follows:
1. The Employee is hereby engaged to work as Vice President -
Finance of Employer or in such other executive capacity as is from time to time
designated by Employer from time to time. In connection with the Employee's
employment by the Employer, the Employee shall be based at the offices of the
Employer located in or within twenty-five (25) miles of Woodbury, New York, it
being understood that Employee shall travel to and spend time at other offices
of Employer as reasonably required by Employer.
2. The effective date of this Agreement (the "Effective Date")
and the commencement of work hereunder shall be the date on which Parent,
directly or indirectly, has acquired at least 51% of the issued and outstanding
stock of Employer. The initial term of this Agreement shall be one year, subject
to termination as provided herein, which term shall be automatically renewed at
the end of the initial term or renewal thereof for an additional one year term,
in all cases subject to termination as provided herein, unless this Agreement
has been previously terminated in accordance with its terms. This Agreement may
be terminated by either party at any time during the initial term or thereafter
for any reason whatsoever by giving the other party thirty (30) days' prior
written notice. In the event of termination by either party, salary and other
benefits and rights shall cease as of the termination date. This Agreement shall
be null and void and of no further force or effect in the event the Merger
Agreement is terminated in accordance with its terms unless prior to such
termination
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Subsidiary or another subsidiary of Parent has acquired at least 51% of the
issued and outstanding stock of Employee. Until the Effective Date, the terms
under which Employee is employed on the date hereof shall be in full force and
effect.
3. The Employer agrees as follows:
(a) To employ Employee as described in Section 1 hereof.
(b) To pay the Employee a base salary (the "Base Salary") at
the rate of One Hundred Fifty Thousand Dollars ($150,000.00) per year payable in
accordance with the Employer's pay schedule practices generally in effect for
its executive employees.
(c) To pay the Employee supplemental pay at the rate of
Sixteen Thousand Five Hundred Dollars ($16,500.00) per year payable in
accordance with the Employer's pay schedule practices generally in effect for
its executive employees.
(d) That the Employee shall receive such other incidental
benefits of employment, such as insurance, pension plan participation, and
vacation, as are provided generally to the Employer's other executive officers
and will be eligible in the sole discretion of the Employer's Board for
discretionary bonuses.
(e) To reimburse the Employee for business expenses incurred
in connection with conducting and promoting the business and affairs of the
Employer, subject to reasonable limitations and restrictions set by the Employer
from time to time. Submission of business expenses for reimbursement must
conform to the Internal Revenue Code.
(f) To pay Employee the $25,000 bonus described in Section
6.13 of the Disclosure Schedule (as defined in the Merger Agreement) if such
bonus has not been previously paid.
(g) To cause Parent to grant the Employee as of the Effective
Date a non-qualified option to purchase thirty thousand (30,000) shares of
common stock of Parent. The purchase price or "strike price" per share shall be
the closing price of a share of such stock on the American Stock Exchange on the
Effective Date and the option shall not be exercisable at the time of grant and
shall vest and become exercisable for one-quarter of the initial number of
shares subject to the option if the Employee is employed by the Employer six
months after the Effective Date, for an additional one-quarter of the initial
number of shares subject to the option if the Employee is employed by the
Employer on the first anniversary of the Effective Date, and for the remaining
shares subject to the option if the Employee is employed by the Employer on the
second anniversary of the Effective Date.
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4. The Employee agrees as follows:
(a) To devote Employee's full business time and entire
business skill, labor and attention to said employment, that Employee will not
engage during working hours in any other business without the prior written
consent of Employer and that Employee will promptly and faithfully do and
perform all services pertaining to said position that are or may hereafter be
reasonably required of Employee by the Employer consistent with Employee's
officership and the provisions hereof during the term hereof.
(b) That any inventions, discoveries, improvements, or works
which are conceived, first reduced to practice, made, developed, suggested by,
or created in anticipation of, in the course of or as a result of work done by
Employee under this agreement or during his prior employment with Employer shall
become the absolute property of the Employer, and the Employee further agrees
that all such inventions, discoveries, improvements, creations, or works, and
all letters patent or copyrights that may be obtained therefor, shall be the
property of the Employer, and the Employee agrees that he will promptly execute
any and all applications, assignments or other instruments which the Employer
shall deem necessary or useful to vest said patents or copyrights in the
Employer without any other or additional consideration to the Employee than
herein expressed, other than reimbursement of out-of-pocket expenses incurred in
connection therewith.
(c) To the extent permitted by applicable law, Employer may
set-off against any wages or other compensation due the Employee, any amounts
owed by the Employee to the Employer that are due on demand or in default,
including, but not limited to, money due to the Employer because of salary or
bonus advances, loans that are in default, excess payments, or damage to or loss
of the Employer's physical or intellectual property due to Employee's violation
of the terms hereof.
5. The Employee recognizes that the methods employed in the
Employer's business are such as have placed and would place the Employee in
close business and personal relationship with the Employer's clients and
customers. It is therefore agreed that in the event of a termination of this
Agreement for any reason whatsoever, the Employee will not for a period of one
(1) year from the date of termination of this Agreement, either directly or
indirectly on Employee's own account or as agent, stockholder, owner, employer,
employee, or otherwise, solicit any business from the then Clients of the
Employer or from potential Clients of the Employer that Employee may have
contacted or been assigned to at any time during Employee's period of
employment. Nothing herein shall be deemed to preclude Employee from taking a
position or working in a position in accordance with the last sentence of
Section 6 hereof, as long as he is not directly involved in actions or conduct
prohibited by this Section 5.
6. The Employee further agrees that the Employee will not for a
period of one (1) year from the date of termination of employment for any reason
engage, either directly or indirectly on Employee's own account or as agent,
stockholder, owner, employer, employee, or otherwise, in a business which is the
same as or substantially similar to the Business (as defined herein) (i) within
the United States or (ii) within any other country in which Employer conducts
any portion of the Business during the term of Employee's employment under this
Employment Agreement, if Employee manages
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the conduct of the portion of the Business in the other country for Employer or,
in connection with Employee's performance of its duties for Employer, has
meaningful involvement in the operation of the portion of the Business in the
other country. For purposes of this Agreement, the term "Business" shall mean
(i) technical or non-technical staffing, consulting and outsourcing services,
vendor-on-premises services, staffing needs analysis, "telecommuting" staffing
services, and payrolling, and related financial support and billing and
accounting services, and (ii) any other business that Employer operates which
Employee manages for Employer or in which Employee has meaningful involvement in
performing Employee's duties under this Agreement. Notwithstanding the
foregoing, Employee may during the period in which this paragraph 6 is in effect
own stock or other interests in corporations or other entities that engage in
businesses similar to those engaged in by the Employer provided that Employee
does not, directly or indirectly (including without limitation as the result of
ownership or control of another corporation or other entity), individually or as
a part of a group (as that term is defined in Section 13(d) of the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder) (a) control or have the ability to control the corporation or other
entity, (b) provide to the corporation or entity, whether as an employee,
consultant or otherwise, advice or consultation, (c) provide to the corporation
or entity any information regarding Employer or its business or regarding the
conduct of a business similar to that of the Employer, (d) hold or have the
right to hold a position on the board of directors or other governing body of
the corporation or entity or have the right to elect one or more persons to any
such position, (e) hold a position as an officer of the corporation or entity,
(f) have the purpose to change or influence the control of the corporation or
entity (other than solely by the voting of his shares of ownership interest) or
(g) have a business or other relationship, by contract or otherwise, whether as
a vendor, customer or otherwise, with the corporation or entity other than as a
passive investor in it; provided, however, that Stockholder may vote his shares
or ownership interest in such manner as he chooses provided that such action
does not otherwise violate the prohibitions set forth in this sentence. In
addition, notwithstanding the prior provisions of this paragraph 6, after the
termination of Employee's employment with Employer, Employee may take a position
as an employee with a business that is similar to Employer provided that such
position is a position, such as chief financial officer or controller, that
solely relates to financial and accounting aspects of the business, that such
position does not involve the management, oversight or direction of any
operations other than accounting and financial functions and does not include
involvement in, and Employee is not involved in and does not give any advice or
services with respect, to sales or marketing, other than such advice as is
incidental to providing financial and accounting services.
7. (a) Employee agrees that Employee shall not for a period of
one (1) year after termination of employment for any reason, contact or approach
either directly or indirectly for Employee's own individual purposes or those of
another, any employee of Employer, without regard to his/her location, for the
purpose of attempting to or actually soliciting or hiring that employee on
Employee's own account or on the account of another.
(b) The Employee further agrees that the covenants contained
in paragraphs 5, 6 and 7 are reasonable as to geographic space, time and scope,
protect the legitimate interests of the Employer and present no undue hardship
to the Employee. Employee hereby waives any defenses
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which contest the reasonableness of the covenants contained in paragraphs 5, 6
and 7. If nonetheless a court of competent jurisdiction believes under the
circumstances that the covenants are too broad, or unreasonable or
unenforceable, in whole or in part, said court may modify the covenants so that
same are enforceable to the maximum extent permissible by law.
(c) It is the intent of the parties that each of paragraphs 5,
6 and 7 be a separate and distinct promise and that unenforceability of any one
paragraph shall have no effect on the enforceability of another.
8. Employee agrees that should either party seek to enforce or
determine its rights through legal or judicial proceedings because of any act of
the Employee which the Employer believes to be in contravention of paragraph 5,
6 and 7 (collectively, the "Covenant"), the Covenant period shall be extended
for a time period equal to the period necessary to obtain judicial enforcement
of the Employer's rights hereunder. The Covenant period shall commence upon the
date of termination of employment.
9. The Employee recognizes and agrees that from time to time
certain confidential information will be made available to the Employee by the
Employer or by the Employer's clients or customer to assist the Employee in
Employee's job and that Employee possesses such information by virtue of
Employee's conduct and participation in the business of Employer prior to the
date hereof. Employee recognizes and agrees that such confidential information
possessed by Employee or which has been or will be compiled, created, and
maintained by special effort and expense of the Employer or by the Employer's
clients or customers and which is not generally available to the trade or the
public at large is a trade secret of Employer and agrees that such information
disclosed or known to the Employee remains at all times the property of the
Employer and/or the Employer's Clients and further, the Employee agrees that
such information shall not (except as required by law or court order) be
divulged by the Employee either during Employee's employment or after
termination for any reason whatsoever. The Employee shall upon such termination
promptly upon request deliver to the Employer's designated representative all
such confidential or proprietary information in his possession and any abstracts
therefrom or information developed on the basis thereof. The foregoing shall not
apply to any confidential information which has become available to the general
public other than as a result of disclosure by Employee in violation of this
Agreement.
10. Employee further agrees not to utilize or make available any
such knowledge or information either directly or indirectly in connection with
the establishment of an enterprise similar to that of the Employer or that will
compete with Employer, or in connection with the solicitation, acceptance, or
conduct of employment with any other person or entity.
11. (a) Those paragraphs which by their nature are intended to
survive termination of this Agreement, including without limitation paragraph
4(b), 4(c), 5, 6, 7, 8, 9 and 10 shall survive termination of this Agreement. In
addition, all obligations of the Employer to make payments hereunder shall
survive any termination of this Agreement on the terms set forth herein.
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(b) It is understood and agreed by and between the parties
hereto that the rights and privileges granted to Employer by Employee under
paragraphs 4(b), 5, 6, 7, 8, 9 and 10 are of a special, unique and extraordinary
character, which gives them a peculiar value, the loss of which cannot be
reasonably or adequately compensated in damages in any action at law, and that a
breach by Employee of any of the provisions contained in this Agreement will
cause Employer great and irreparable injury and damage. Employee hereby
expressly agrees that Employer shall be entitled to the remedies of injunction,
specific performance and other equitable relief to prevent a breach of this
Agreement by Employee. This provision shall not, however, be construed as a
waiver of any of the rights which Employer may have for damages or otherwise.
12. (a) This Agreement supersedes all prior agreements between the
parties other than the 1996 Letter Agreement, which continues to be in full
force and effect, and this Agreement and the 1996 Letter Agreement constitute
and express the entire agreement of the parties hereto in reference to the
employment of the Employee by the Employer and in reference to any of the
matters or things herein provided for or hereinbefore discussed or mentioned in
reference to such employment, all promises, representations, and understandings
relative thereto being herein merged. It is a condition precedent to the
obligations of the parties hereto that the Effective Date shall have occurred.
(b) No oral arrangements have been made between the parties
hereto. This agreement may be amended only by a writing signed by both parties.
13. The Employee represents and warrants that the 1996 Letter
Agreement and any stock option grants made to Employee are the sole written
agreements in effect relating to the employment of Employee and compensation
therefor and that, at the time of the signing of this agreement, Employee knows
of no written or oral contract to which he is a party or of any other impediment
which would inhibit or prohibit the employment herein provided for and that the
Employee will not knowingly utilize any trade secret, company confidential
information, or other intellectual property right of another party in the
performance of the Employee's duties hereunder.
14. The rights and obligations of the Employee and the Employer
under this agreement shall inure to the benefit of and shall be binding upon
their successors and assigns. The Employee may not assign Employee's obligations
under this agreement.
15. (a) This agreement shall be construed in accordance with the
laws of the State of New York.
(b) Any dispute, controversy or claim arising out of or
relating to this Agreement or to any breach or alleged breach hereof shall, upon
the request of the Employer or the Employee, unless and to the extent an
injunction or other equitable relief is requested, be submitted to and settled
by arbitration in the City of New York, New York pursuant to the rules then in
effect of the American Arbitration Association (or at any other place or under
any other form of arbitration mutually acceptable to the Employer and the
Employee). Disputes shall be
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arbitrated in accordance with the American Arbitration Association's rules. Any
award rendered shall be final and conclusive upon the parties, and a judgment
may be entered in the highest court, state or federal, having jurisdiction. The
expenses of arbitration shall be paid as directed by the arbitrator.
16. In construing this agreement, feminine pronouns shall be
substituted for those masculine in form and vice versa, and plural terms shall
be substituted for singular and vice versa in any place the context so requires.
17. All notices shall be deemed to have been given or served only
if in writing, and shall be personally delivered (and shall be deemed given when
delivered if personally delivered) or sent by U.S. certified mail, postage
pre-paid, return receipt requested (and shall be deemed given five (5) days
after mailing if sent by certified mail), or by Federal Express or other private
express delivery or courier service (and shall be deemed given on the scheduled
delivery date if sent by courier), if to Employer at 2001 Marcus Avenue, Lake
Success, New York 11042, Attn: Chief Executive Officer, or at such other address
as Employer may direct, and if to Employee, at the address set forth under
Employee's signature or at such other address as Employee may direct.
18. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to be one and the same instrument.
19. Employee hereby agrees to hold confidential and not disclose
to any person the terms of this Agreement without the express written consent of
the Employer (other than the terms of paragraphs 5, 6, 7, 8, 9 and 10, terms
publicly disclosed by any party other than Employee or as required by law).
Employee acknowledges that Employer does not intend to permit any such
disclosure except to the extent the same may be necessary to comply with any
reporting obligations imposed by governmental authority, generally accepted
accounting procedures or otherwise by law.
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IN WITNESS WHEREOF, the parties have signed this Agreement on
the date first above written.
UNIFORCE SERVICES, INC.
By: /s/ John Fanning
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Title: President
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/s/ Harry Maccarone
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Harry Maccarone
Address:
49 Riviera Drive South
Massapequa, NY 11758
