SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934 for the
quarterly period ended:
March 31, 1999
or
[ ] Transition Report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934 for the
transition period from: ______to______
Commission file number: 1-10686
MANPOWER INC.
(Exact name of registrant as specified in its charter)
Wisconsin 39-1672779
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
5301 N. Ironwood Road
Milwaukee, Wisconsin 53217
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
Including area code: (414) 961-1000
Indicate by check mark whether the Registrant (1)
has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for
such shorter period that the Registrant was
required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each
of the issuer's classes of common stock, as of the
latest practicable date.
Shares Outstanding
Class at March 31, 1999
Common Stock, 79,145,307
$.01 par value
<PAGE>
MANPOWER INC. AND SUBSIDIARIES
INDEX
Page
Number
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements (unaudited)
- Consolidated Balance Sheets 3 - 4
- Consolidated Statements of Operations 5
- Consolidated Statements of Cash Flows 6
- Notes to Consolidated Financial Statements 7 - 9
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 10 - 13
Item 3 - Quantitative and Qualitative Disclosures
About Market Risk 13
PART II - OTHER INFORMATION AND SIGNATURES
Item 5 - Other Information 14
Item 6 - Exhibits and Reports on Form 8-K 14
Signatures 15
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
MANPOWER INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands)
ASSETS
March 31, December 31,
1999 1998
(unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 173,560 $ 180,456
Accounts receivable, less allowance for
doubtful accounts of $39,264 and
$39,504, respectively 1,504,488 1,674,729
Prepaid expenses and other assets 56,678 53,565
Future income tax benefits 50,852 52,812
Total current assets 1,785,578 1,961,562
OTHER ASSETS:
Investments in licensees 34,285 33,055
Other assets 198,766 195,223
Total other assets 233,051 228,278
PROPERTY AND EQUIPMENT:
Land, buildings, leasehold improvements
and equipment 408,790 411,391
Less: accumulated depreciation and
amortization 219,707 220,131
Net property and equipment 189,083 191,260
Total assets $2,207,712 $2,381,100
The accompanying notes to consolidated financial statements
are an integral part of these balance sheets.
<PAGE>
MANPOWER INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, except share data)
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, December 31,
1999 1998
(unaudited)
CURRENT LIABILITIES:
Payable to banks $ 25,324 $ 99,268
Accounts payable 393,578 347,864
Employee compensation payable 73,203 77,084
Accrued liabilities 151,734 154,428
Accrued payroll taxes and insurance 234,936 319,053
Value added taxes payable 258,168 291,720
Income taxes payable 18,862 17,563
Current maturities of long-term debt 3,574 4,076
Total current liabilities 1,159,379 1,311,056
OTHER LIABILITIES:
Long-term debt 150,127 154,594
Other long-term liabilities 245,765 246,512
Total other liabilities 395,892 401,106
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value, authorized
25,000,000 shares, none issued -- --
Common stock, $.01 par value, authorized
125,000,000 shares, issued 83,494,707
and 83,279,149 shares, respectively 835 833
Capital in excess of par value 1,606,946 1,602,721
Accumulated deficit (767,091) (787,699)
Accumulated other comprehensive loss (59,227) (17,895)
Treasury stock at cost, 4,349,400 shares (129,022) (129,022)
Total stockholders' equity 652,441 668,938
Total liabilities and stockholders'
equity $ 2,207,712 $ 2,381,100
The accompanying notes to consolidated financial statements
are an integral part of these balance sheets.
<PAGE>
MANPOWER INC. AND SUBSIDIARIES
Consolidated Statements of Operations (Unaudited)
(in thousands, except per share data)
3 Months Ended March 31,
1999 1998
Revenues from services $ 2,175,236 $ 1,872,866
Cost of services 1,795,002 1,545,508
Gross profit 380,234 327,358
Selling and administrative expenses 343,442 290,595
Operating profit 36,792 36,763
Interest and other income (expense) (4,840) (3,144)
Earnings before income taxes 31,952 33,619
Provision for income taxes 11,344 11,929
Net earnings $ 20,608 21,690
Net earnings per share $ .26 $ .27
Net earnings per share - diluted $ .26 $ .26
Weighted average common shares 79,044 80,557
Weighted average common shares-diluted 79,844 81,921
The accompanying notes to consolidated financial statements
are an integral part of these statements.
MANPOWER INC. AND SUBSIDIARIES
Supplemental Systemwide Information (Unaudited)
(in thousands)
3 Months Ended March 31,
1999 1998
Systemwide Sales $ 2,562,470 $2,276,913
Systemwide information represents the total of Company-owned branches
and franchises.
<PAGE>
MANPOWER INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
3 Months Ended March 31,
1999 1998
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 20,608 $ 21,690
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation and amortization 17,673 12,549
Deferred income taxes 530 (1,701)
Provision for doubtful accounts 3,035 3,014
Changes in operating assets
and liabilities:
Accounts receivable 65,538 (2,920)
Other assets (8,406) 2,573
Other liabilities (12,873) (8,694)
Cash provided by
operating activities 86,105 26,511
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (21,331) (28,188)
Proceeds from the sale of property and
equipment 682 609
Acquisitions of businesses, net of
cash acquired (2,227) (1,803)
Cash used by investing activities (22,876) (29,382)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in payable to banks (63,969) (19,940)
Proceeds from long-term debt 132 16,917
Repayment of long-term debt (5,105) (349)
Proceeds from stock option and
purchase plans 4,228 7,232
Cash (used) provided by financing
activities (64,714) 3,860
Effect of exchange rate changes on cash (5,411) 1,016
Net change in cash and cash equivalents (6,896) 2,005
Cash and cash equivalents, beginning
of period 180,456 142,246
Cash and cash equivalents, end of period $173,560 $144,251
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ 3,897 $ 3,074
Income taxes paid $ 14,220 $ 14,458
The accompanying notes to consolidated financial statements
are an integral part of these statements.
<PAGE>
MANPOWER INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
For the Three Months Ended March 31, 1999 and 1998
(in thousands, except per share data)
(1) Basis of Presentation
Certain information and footnote disclosures normally
included in financial statements prepared in accordance
with generally accepted accounting principles have been
condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission,
although the Company believes that the disclosures are
adequate to make the information presented not
misleading. These consolidated financial statements
should be read in conjunction with the consolidated
financial statements included in the Company's 1998
Annual Report to Shareholders.
The information furnished reflects all adjustments
that, in the opinion of management, are necessary for a
fair statement of the results of operations for the
periods presented. Such adjustments are of a normal
recurring nature.
(2) Accounting Policies
During the first quarter of 1999, the Company adopted
the American Institute of Certified Public Accountants
(`AICPA') Statement of Position (`SOP') 98-1,
"Accounting for the Costs of Computer Software
Developed or Obtained for Internal Use" and the AICPA
SOP 98-5, "Reporting on the costs of Start-up
Activities." These statements did not have a material
impact on the Company's Consolidated Financial
Statements.
In June of 1998, the Financial Accounting Standards
Board issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This statement
establishes accounting and reporting standards
requiring that every derivative instrument be recorded
on the balance sheet as either an asset or liability
measured at its fair value. The statement requires
that changes in the derivative's fair value be
recognized currently in earnings unless specific hedge
accounting criteria are met, in which case, the gains
or losses would offset the related results of the
hedged item. This statement is effective for the
Company beginning in 2000, but may be adopted earlier.
The Company has not yet determined the timing or method
of adoption or quantified the impact of adopting this
statement. While the statement could increase
volatility in earnings and other comprehensive income,
it is not expected to have a material impact on the
Consolidated Financial Statements due to the Company's
limited use of derivative instruments.
<PAGE>
(3) Earnings Per Share
The calculations of net earnings per share and net
earnings per share - diluted for the three months ended
March 31 are as follows:
1999 1998
Net earnings per share:
Net earnings available to $ 20,608 $ 21,690
common shareholders
Weighted average common shares
outstanding 79,044 80,557
$ .26 $ .27
Net earnings per share - diluted:
Net earnings available to $ 20,608 $ 21,690
common shareholders
Weighted average common shares 79,044 80,557
outstanding
Effect of dilutive stock options 800 1,364
79,844 81,921
$ .26 $ .26
(4) Income Taxes
The Company has provided income taxes for the three
month period ended March 31, 1999 at a rate of 35.5%,
which is equal to the estimated annual effective tax
rate based on the currently available information.
This rate is higher than the U.S. Federal statutory
rate due to foreign tax rate differences and U.S. state
income taxes.
(5) Stockholders' Equity
Total comprehensive income consists of net earnings and
foreign currency translation adjustments and is as
follows for the three months ended March 31:
1999 1998
Net earnings $ 20,608 $ 21,690
Foreign currency (41,332) (10,560)
translation adjustments
Total comprehensive income $(20,724) $ 11,130
(6) Interest Rate Swap
The Company has an interest rate swap agreement,
expiring in 2001, to fix the interest rate at 6.0% on
$50,000 of the Company's borrowings under the revolving
credit agreement. This swap agreement had an immaterial
impact on the recorded interest expense during the
first quarter of 1999. As of March 31, 1999, the
variable interest rate under the revolving credit
agreement was 5.2%.
<PAGE>
(7) Business Segment Data by Geographical Area
Geographical segment information is as follows for the
three months ended March 31:
1999 1998
Revenues from services:
United States (a) $ 515,827 $ 499,073
France 828,023 721,389
United Kingdom 272,803 248,234
Other Europe 326,923 230,838
Other Countries 231,660 173,332
$ 2,175,236 $ 1,872,866
Operating unit profit:
United States $ 13,318 $ 15,261
France 13,364 12,067
United Kingdom 6,870 7,393
Other Europe 9,359 6,118
Other Countries 3,392 7,156
Corporate Expenses (7,930) (9,997)
Amortization of Intangible Assets (1,581) (1,235)
Operating Profit 36,792 36,763
Interest & Other Income (Expense) (4,840) (3,144)
Earnings before Income Taxes 31,952 33,619
(a) Total systemwide sales in the United States,
which includes sales of Company-owned branches and
franchises, was $850,391 and $831,250 for the three
months ended March 31, 1999 and 1998, respectively.
(8) Subsequent Events
On April 26, 1999, the Company's Board of Directors
declared a cash dividend of $.10 per share which is
payable on June 14, 1999 to shareholders of record on
June 2, 1999.
Subsequent to March 31, 1999, the Company repurchased 406,800 shares of
common stock at a cost of $9.5 million.
<PAGE>
Item 2 - Management's Discussion and Analysis of Financial Condition
and Results of Operations
Operating Results - Three Months Ended March 31, 1999 and 1998
Revenues increased 16.1% to $2,175.2 million for the
first quarter of 1999. Revenues were favorably
impacted by changes in currency exchange rates during
the first quarter of 1999 due to the weakening
of the U.S. Dollar, as compared to the first quarter
of 1998, relative to the currencies in most
of the company's non-U.S. markets. At constant
exchange rates, the increase in revenues would have
been 13.1%. Volume, as measured by billable hours of
branch operations, increased 16.9% in the quarter. All
of the Company's major markets experienced revenue
increases, as measured in their local currencies,
including the United States (3.4%), France (10.2%) and
the United Kingdom (10.8%). The Company's Other Europe and Other
Countries segements reported revenue increases, as
measured in their local currencies, of 38% and 23%, respectively.
Cost of services, which consists of payroll and related
expenses of temporary workers, was 82.5% of revenues in the
first quarter of 1999 and 1998. Gross margins in France
increased during the first quarter, while gross margins
in certain other foreign markets have decreased due to
pricing pressures and a change in business mix.
Selling and administrative expenses increased to 18.2% to
$343.4 million in the quarter. This amount represents a
decrease from the fourth quarter 1998 level and was
achieved despite the Company's continued investments
in new or expanding markets.
Interest and other expense was $4.8 million in the first
quarter of 1999 compared to $3.1 million in the first
quarter of 1998. Net interest expense, plus the cost of
the U.S. accounts receivable securitization program in 1999,
was $4.0 million and $.9 million in the first quarter of 1999
and 1998, respectively. This higher 1999 expense was partially
offset by lower translation losses and a lower level of other
expenses compared to 1998.
The Company provided income taxes at a rate of 35.5%
during the first quarter of 1999, equal to the
estimated annual effective tax rate for 1999. This
rate is higher than the U.S. Federal statutory rate
due to foreign tax rate differences and U.S. state
income taxes.
On a diluted basis, net earnings per share was $.26 in
the first quarter of 1999 and 1998. The diluted weighted
average shares decreased by 2.5% for the quarter due to
the Company's treasury stock purchases and a smaller
effect of dilutive stock options (see Note 3 to the
Consolidated Financial Statements) because of the lower
average share price during the quarter.
Liquidity and Capital Resources
Cash provided by operating activities was $86.1 million in
the first quater of 1999 compared to $26.5 million in the
first quarter of 1998. This increase in cash provided
reflects the change in working capital requirements
between periods, due to the lower revenue growth rates
in many of the Company's major markets. Cash provided by
changes in working capital was $44.3 million in the first
quarter of 1999 compared to cash used by changes in working
capital of $9.0 million in the first quarter of 1998. Cash
provided by operating activities before the changes in
working capital requirements was $41.8 million in the
first quarter of 1999 compared to $35.5 million
in the first quarter of 1998.
Capital expenditures were $21.3 million in the first
quarter of 1999 compared to $28.2 million during
the first quarter of 1998. The 1998 expenditures
include capitalized software of $7.4 million. The balance
is comprised of purchases of computer equipment,
office furniture and other costs related to office
openings and refurbishments.
<PAGE>
Net cash used to repay borrowings was $68.9 million and $3.4 million in
the first quarter of 1999 and 1998, respectively.
Accounts receivable decreased to $1,504.5 million at
March 31, 1999 from $1,674.7 million at December 31,
1998. Of this decrease, $99.7 million is due to the
change in exchange rates during the first quarter.
The remaining decrease is primarily due to seasonality, as
sales levels in the first quarter are typically lower than the
fourth quarter.
As of March 31, 1999, the Company had borrowings of
$73.8 million and letters of credit of $49.5 million
outstanding under its $415 million U.S. revolving
credit facility, and borrowings of $72.1 million
outstanding under its U.S. commercial paper program.
The commercial paper borrowings have been classified as
long-term debt due to the availability to refinance
them on a long-term basis under the revolving credit
facility.
The Company and some of its foreign subsidiaries
maintain separate lines of credit with foreign
financial institutions to meet short-term working
capital needs. As of March 31, 1999, such lines
totaled $161.4 million, of which $136.1 million was unused.
In April, the Company's Board of Directors also
declared a cash dividend of $.10 per share which is
payable on June 14, 1999 to shareholders of record on
June 2, 1999.
Year 2000
State of Readiness - In order to address Year 2000 compliance, the Company
has initiated a comprehensive project designed to eliminate or minimize
any business disruption associated with its information technology ("IT")
and non-IT systems. In connection with this project, all significant
Company subsidiaries have done systems assessments to determine what
modifications will be required and detailed plans and timetables have been
developed to complete and test the necessary remediation.
Primarily due to changing customer requirements, the Company is in the process
of converting and upgrading many of its IT systems, and these new IT systems
are Year 2000 compliant. For those IT systems not otherwise being converted
or upgraded, remediation efforts have been planned. In the U.S., initial
remediation efforts are completed, and testing of this remediation is
substantially complete. Any further remdiation needed as a result of the
testing, and additional testing of the system interfaces, will continue
through July of 1999. For all other significant subsidiaries, initial
remediation is scheduled to be completed by June of 1999 and testing of the
remediation is scheduled to be completed during the second and third
quarters of 1999. The remediation or replacement of all critical non-IT
systems is scheduled to be completed during the second and third quarters
of 1999. The Company presently believes that with these conversions,
upgrades and remediation efforts, all significiant Year 2000 Issues related
to the Company's systems will be addressed.
In addition, the Company is contacting significant vendors and customers
to determine the extent to which the Company is vulnerable to those third
parties' potential failure to remediate their own systems to address
Year 2000 Issues. Despite the Company's diligence, there can be no
guarantee that companies that the Company relies upon to conduct its
day-to-day business will be compliant.
Cost - To date, the Company has used both external and internal resources
for the assessment, remediation and testing of its systems. As of
March 31, 1999, approximately $6.5 million has been expensed for external
resources. The total expense for external resources is currently estimated
to be $10 million to $12 million. Hardware purchases directly related to
the project, which are expensed as incurred, have been minimal as of
March 31, 1999, and the Company does not expect any remaining hardware
purchases to be significant. The cost of internal resources is aggregated
with the Company's information technology cost centers. The total cost of
the project is not expected to have a material impact on the Company's
financial position, results of operations or cash flows.
Risks - With respect to the risks associated with its systems, the Company
believes that the most reasonably likely worst case scenario is that the
Company will experience a number of minor system malfunctions and errors
in the early days and weeks of the Year 2000. The Company does not expect
these problems to have a material impact on the Company's ability to place
and pay workers or invoice customers.
With respect to the risks associated with third parties, the Company believes
that the most reasonably likely worst case scenario is that some of the
Company's vendors and customers will not be compliant. The Company believes
that the number of such third parties will have been minimized by the
Company's program of contacting significant vendors and larger customers.
However, failure by these companies, or any governmental entities, to
remediate their systems on a timely basis could have a material adverse
effect on the Company.
Contingency Plans - The Company is currently preparing to handle the most
reasonably likely worst case scenarios described above. The Company is
evaluating and developing contingency plans for these risks and is
scheduled to have them completed by October of 1999.
The Euro
On January 1, 1999, eleven of the fifteen member
countries of the European Union (the "participating
countries") established fixed conversion
rates between their existing sovereign currencies (the
"legacy currencies") and the Euro and have agreed to
adopt the Euro as their common legal currency. The legacy
currencies will remain legal tender in the participating
countries as denominations of the Euro between January 1, 1999
and January 1, 2002 (the "transition period"). During the
transition period, public and private parties may pay
for goods and services using either the Euro or the
participating country's legacy currency.
The Company is currently assessing the impact of the Euro in its
business operations in all participating countries.
In some countries, the Company has made system modifications to
generate dual currency invoices, allowing customers to pay in either
the legacy currency or in Euro. To date, the Company has not had
significant customer requests for specific invoicing or reporting formats
that are not handled by the current systems. However, modificatins will
be necessary to convert database information to report information in
either Euro or in both currencies. Such modifications will occur throughout
the transition period and will be coordinated with other system-related
upgrades and enhancements. The Company expenses all such system modification
costs as incurred. To date, all modification costs have been minimal, and
the Company currently does not expect significant costs related to
future modifications.
Forward-Looking Statements
Certain information included or incorporated by
reference in this filing and identified by use of the
words `expects,' `believes,' `plans' or the like
constitutes forward-looking statements, as such term is
defined in Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934.
In addition, any information included or incorporated
by reference in future filings by the Company with the
Securities and Exchange Commission, as well as
information contained in written material, releases and
oral statements issued by or on behalf of the Company
may include forward-looking statements. All statements
which address operating performance, events or
developments that the Company expects or anticipates
will occur or future financial performance are forward-
looking statements.
<PAGE>
These forward-looking statements speak only as of the
date on which they are made. They rely on a number of
assumptions concerning future events and are subject to
a number of risks and uncertainties, many of which are
outside of the Company's control, that could cause
actual results to differ materially from such
statements. These risks and uncertainties include, but
are not limited to:
* material changes in the demand from larger
customers, including customers with which the Company
has national or global arrangements
* availability of temporary workers or increases in
the wages paid to these workers
* competitive market pressures, including pricing pressures
* ability to successfully invest in and implement information systems
* unanticipated technological changes, including
obsolescence or impairment of information systems
* changes in customer attitudes toward the use of staffing services
* government or regulatory policies adverse to the employment services
industry
* general economic conditions in international markets
* interest rate and exchange rate fluctuations
The Company disclaims any obligation to update publicly
or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Item 3 - Quantitative and Qualitative Disclosures About Market Risk
The Company's annual report on Form 10-K contains
certain disclosures about market risks affecting the
Company. There have been no material changes to the
information provided which would require additional
disclosures as of the date of this filing.
<PAGE>
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Employment Agreement between Jeffrey A. Joerres and Manpower
Inc. dated as of February 22, 1999
10.2 Severance Agreement between Jeffrey A. Joerres and Manpower
Inc. dated as of February 22, 1999.
10.3 Employment Agreement between Michael J. Van Handel and
Manpower Inc. dated as of February 22, 1999.
10.4 Severance Agreement between Michael J. Van Handel and
Manpower Inc. dated as of February 22, 1999
27 Financial Data Schedule
(b) Reports on Form 8-K - None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report
to be signed on its behalf by the undersigned thereunto
duly authorized.
MANPOWER INC.
- -------------
(Registrant)
Date: May 14, 1999 /s/Michael J. Van Handel
------------------------
Michael J. Van Handel
Senior Vice President
Chief Financial Officer,
Treasurer and Secretary
(Signing on behalf of the Registrant
and as the Principal Financial Officer
and Principal Accounting Officer)
Manpower Inc.
5301 North Ironwood Road
Milwaukee, Wisconsin 53217
February 22, 1999
Mr. Jeffrey Joerres:
We have agreed as follows with respect to the compensation
to be paid and the other benefits to be provided to you in
connection with your continuing employment by Manpower Inc. (the
"Corporation"):
1. Term. The term of this agreement (the "Term") will
begin on the date of this letter indicated above and end on the
first to occur of the following: (a) the date two years after
the occurrence of a Change of Control, as defined in the letter
to you of even date regarding other rights and obligations on
termination of your employment; (b) January 31, 2002, if no
Change of Control occurs between the date of this letter
indicated above and January 31, 2002; or (c) the Date of
Termination, as defined in the letter from the Corporation to
you of even date regarding other rights and obligations on
termination of your employment.
2. Base Compensation. You will be paid a base salary for
your services during the Term equal to Three Hundred Thousand
Dollars ($300,000) per year, as may be increased from time to
time by the Corporation. Your base compensation will be paid in
accordance with the Corporation's regular payroll practices with
respect to such compensation as in effect from time to time.
3. Incentive Bonus. You also will be entitled to receive
an incentive bonus for each full or partial fiscal year of the
Corporation included within the Term. It is intended that the
amount of this incentive bonus will be determined annually based
upon objective criteria established at the beginning of each
fiscal year, but until such criteria are established the amount
will be determined by the Executive Compensation Committee of the
Corporation, subject to ratification by the Board of Directors,
in its sole discretion. This incentive bonus will be paid within
45 days after the close of each such fiscal year.
4. Benefits. During the entire Term, the Corporation will
provide you with, and you will be eligible for, all benefits of
employment generally made available to the senior executives of
the Corporation from time to time (collectively, the "Benefits
Plans"), subject to and on a basis
<PAGE>
consistent with the terms, conditions and overall administration
of such Benefit Plans. You will be considered for participation
in Benefit Plans which by the terms thereof are discretionary
in nature (such as stock option plans) on the same basis as
other executive personnel of the Corporation of similar rank.
You also will be entitled to vacations and perquisites in accordance
with the Corporation's policies as in effect from time to time for
senior executives of the Corporation.
5. Expenses. The Corporation will reimburse to you on a
monthly basis for all traveling, hotel, entertainment and other
expenses reasonably incurred by you in the proper performance of
your duties during the Term, subject to your compliance with the
guidelines and regulations concerning expense reimbursement
issued by the Corporation.
6. Nondisclosure and Nonsolicitation.
(a) Nondisclosure.
(i) You will not, directly or indirectly, at any
time during the term of your employment with the
Corporation or any of its direct or indirect
subsidiaries (collectively, the "Manpower Group") or
during the two-year period following your termination
of employment with the Manpower Group, use for yourself
or others, or disclose to others, any Confidential
Information (as defined below), whether or not
conceived, developed, or perfected by you and no matter
how it became known to you, unless (a) you first secure
written consent of the Corporation to such disclosure
or use, (b) the same shall have lawfully become a
matter of public knowledge other than by your act or
omission, or (c) you are ordered to disclose the same
by a court of competent jurisdiction or are otherwise
required to disclose the same by law, and you promptly
notify the Corporation of such disclosure.
"Confidential Information" shall mean all business
information (whether or not in written form) which
relates to any company in the Manpower Group and which
is not known to the public generally (absent your
disclosure), including but not limited to confidential
knowledge, operating instructions, training materials
and systems, customer lists, sales records and
documents, marketing and sales strategies and plans,
market surveys, cost and profitability analyses,
pricing information, competitive strategies, personnel-
related information, and supplier lists. This
obligation will survive the termination of your
employment for a period of two years and will not be
construed to in any way limit the Corporation's rights
to protect confidential information which constitute
trade secrets under applicable trade secrets law even
after such two-year period.
(ii) Upon your termination of employment with the
Manpower Group, or at any other time upon request of
the Corporation, you will promptly surrender to the
Corporation, or destroy and certify such destruction to
the Corporation, any documents, materials, or computer
or electronic records containing any Confidential
Information which are in your possession or under your control.
<PAGE>
(b) Nonsolicitation of Employees. You agree that you
will not, at any time during the term of your employment
with the Manpower Group or during the one-year period
following your termination of employment with the Manpower
Group, either on your own account or in conjunction with or
on behalf of any other person, company, business entity, or
other organization whatsoever, directly or indirectly
induce, solicit, entice or procure any person who is an
employee of any company in the Manpower Group, or has been
such an employee within the three months preceding such
action, to terminate his or her employment with the Manpower
Group so as to accept employment elsewhere.
(c) Injunction. You recognize that irreparable and
incalculable injury will result to the Manpower Group and
its businesses and properties in the event of your breach of
any of the restrictions imposed by Sections 6(a) - (b),
above. You therefore agree that, in the event of any such
actual, impending or threatened breach, the Corporation will
be entitled, in addition to any other remedies and damages
available to it, to temporary and permanent injunctive
relief (without the necessity of posting a bond or other
security) restraining the violation, or further violation,
of such restrictions by you and by any other person or
entity from whom you may be acting or who is acting for you
or in concert with you.
7. Successors; Binding Agreement. This letter agreement
will be binding on the Corporation and its successors and will
inure to the benefit of and be enforceable by your personal or
legal representatives, heirs and successors.
8. Notice. Notices and all other communications provided
for in this letter will be in writing and will be deemed to have
been duly given when delivered in person, sent by telecopy, or
mailed by United States registered or certified mail, return
receipt requested, postage prepaid, and properly addressed to the
other party.
9. No Right to Remain Employed. Nothing contained in this
letter will be construed as conferring upon you any right to
remain employed by the Corporation or any member of the Manpower
Group or affect the right of the Corporation or any member of the
Manpower Group to terminate your employment at any time for any
reason or no reason, subject to the obligations of the
Corporation and the Manpower Group as set forth herein.
10. Modification. No provision of this letter may be
modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing by you and the Corporation.
11. Withholding. The Corporation shall be entitled to
withhold from amounts to be paid to you hereunder any federal,
state, or local withholding or other taxes or charges which it
is, from time to time, required to withhold under applicable law.
12. Previous Agreement. This letter and the letter of even
date from the Corporation to you, regarding other rights and
obligations on termination of your employment, upon acceptance
<PAGE>
by you, expressly supersede any and all previous agreements or
understandings relating to your employment by the Corporation or
the Manpower Group or the termination of such employment, and any
such agreement or agreements shall, as of the date of your
acceptance, have no further force or effect.
If you are in agreement with the foregoing, please sign and
return one copy of this letter which will constitute our
agreement with respect to the subject matter of this letter.
Sincerely,
MANPOWER INC.
By: /s/Mitchell S. Fromstein
------------------------
Agreed as of the 22nd day of February, 1999.
/s/Jeffrey Jorres
- -----------------
Jeffrey Joerres
Manpower Inc.
5301 North Ironwood Road
Milwaukee, Wisconsin 53217
February 22, 1999
Mr. Jeffrey Joerres:
Manpower Inc. (the "Corporation") desires to
retain experienced, well-qualified executives, like
you, to assure the continued growth and success of the
Corporation and its direct and indirect subsidiaries
(collectively, the "Manpower Group"). Accordingly, as
an inducement for you to continue your employment in
order to assure the continued availability of your
services to the Manpower Group, we have agreed as follows:
1. Definitions. For purposes of this letter:
(a) Cause. Termination by the Corporation of your
employment with the Corporation for "Cause" will mean
termination upon (i) your willful and continued failure
to substantially perform your duties with the Manpower
Group after a written demand for substantial
performance is delivered to you that specifically
identifies the manner in which the Corporation believes
that you have not substantially performed your duties,
and you have failed to resume substantial performance
of your duties on a continuous basis within ten days
after receiving such demand, (ii) your commission of
any material act of dishonesty or disloyalty involving
the Manpower Group, (iii) your chronic absence from
work other than by reason of a serious health
condition, (iv) your commission of a crime which
substantially relates to the circumstances of your
position with the Manpower Group or which has material
adverse effect on the business of the Manpower Group,
or (v) the willful engaging by you in conduct which is
demonstrably and materially injurious to the Manpower
Group. For purposes of this Subsection 1(a), no act,
or failure to act, on your part will be deemed
"willful" unless done, or omitted to be done, by you
not in good faith.
(b) Change of Control. A "Change of Control" will
mean the first to occur of the following:
(i) the acquisition (other than from the Corporation),
by any person, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities
<PAGE>
Exchange Act of 1934 (the "Exchange Act")), directly or
indirectly, of beneficial ownership (within the meaning
of Exchange Act Rule 13d-3) of more than 50% of the
then outstanding shares of common stock of the
Corporation or voting securities representing more than
50% of the combined voting power of the Corporation's
then outstanding voting securities entitled to vote
generally in the election of directors; provided,
however, no Change of Control shall be deemed to have
occurred as a result of an acquisition of shares of
common stock or voting securities of the Corporation
(A) by the Corporation, any of its subsidiaries, or any
employee benefit plan (or related trust) sponsored or
maintained by the Corporation or any of its
subsidiaries or (B) by any other corporation or other
entity with respect to which, following such
acquisition, more than 60% of the outstanding shares of
the common stock, and voting securities representing
more than 60% of the combined voting power of the
then outstanding voting securities entitled to vote
generally in the election of directors, of such other
corporation or entity are then beneficially owned,
directly or indirectly, by the persons who were the
Corporation's shareholders immediately prior to such
acquisition in substantially the same proportions as
their ownership, immediately prior to such acquisition,
of the Corporation's then outstanding common stock or
then outstanding voting securities, as the case may be; or
(ii) any merger or consolidation of the Corporation
with any other corporation, other than a merger or
consolidation which results in more than 60% of the
outstanding shares of the common stock, and voting
securities representing more than 60% of the combined
voting power of the then outstanding voting securities
entitled to vote generally in the election of
directors, of the surviving or consolidated corporation
being then beneficially owned, directly or indirectly,
by the persons who were the Corporation's shareholders
immediately prior to such acquisition in substantially
the same proportions as their ownership, immediately
prior to such acquisition, of the Corporation's then
outstanding common stock or then outstanding voting
securities, as the case may be; or
(iii) any liquidation or dissolution of the Corporation
or the sale or other disposition of all or
substantially all of the assets of the Corporation; or
(iv) individuals who, as of the date of this letter,
constitute the Board of Directors of the Corporation
(as of such date, the "Incumbent Board") cease for any
reason to constitute at least a majority of such Board;
provided, however, that any person becoming a director
subsequent to the date of this letter whose election,
or nomination for election by the shareholders of the
Corporation, was approved by at least a majority of the
directors then comprising the Incumbent Board shall be,
for purposes of this letter, considered as though such
person were a member of the
<PAGE>
Incumbent Board but excluding, for this purpose, any
such individual whose initial assumption of office
occurs as a result of an actual or threatened election
contest which was (or, if threatened, would have been)
subject to Exchange Act Rule 14a-11; or
(v) the Corporation shall enter into any agreement
(whether or not conditioned on shareholder approval)
providing for or contemplating, or the Board of
Directors of the Corporation shall approve and
recommend that the shareholders of the Corporation
accept, or approve or adopt, or the shareholders of the
Corporation shall approve, any acquisition that would
be a Change of Control under clause (i), above, or a
merger or consolidation that would be a Change of
Control under clause (ii), above, or a liquidation or
dissolution of the Corporation or the sale or other
disposition of all or substantially all of the assets
of the Corporation; or
(vi) whether or not conditioned on shareholder
approval, the issuance by the Corporation of common
stock of the Corporation representing a majority of the
outstanding common stock, or voting securities
representing a majority of the combined voting power
of the outstanding voting securities of the Corporation
entitled to vote generally in the election of
directors, after giving effect to such transaction.
Following the occurrence of an event which is not a
Change of Control whereby there is a successor holding
company to the Corporation, or, if there is no such
successor, whereby the Corporation is not the surviving
corporation in a merger or consolidation, the surviving
corporation or successor holding company (as the case
may be), for purposes of this definition, shall
thereafter be referred to as the Corporation.
(c) Good Reason. "Good Reason" will mean, without
your consent, the occurrence of any one or more of the
following during the Term:
(i) the assignment to you of a position which
represents a material reduction from your current
position of Senior Vice President - Marketing and Major
Account Development and Senior Vice President -
European Operations, or the assignment to you of
duties, other than incidental duties, inconsistent with
your current position or such other position, provided
you object to such assignment by written notice to the
Corporation within twenty (20) business days after it
is made and the Corporation fails to cure, if
necessary, within ten (10) business days after such
notice is given;
(ii) any material violation of this agreement or of
Sections 2 through 5 of the Compensation Agreement by
the Corporation which remains uncured ten (10) business
days after you give written notice to the Corporation
which specifies the violation;
<PAGE>
(iii) being required by the Corporation to change
the location of your principal office to one in excess
of seventy-five (75) miles from the Corporation's home
office in Glendale, Wisconsin, provided your employment
with the Manpower Group is terminated within ninety
(90) days after any such change of location; or
(iv) any reduction in the amount of incentive bonus
received by you for a given fiscal year during the Term
within two years after the occurrence of a Change of
Control, as compared to the amount of the incentive
bonus received by you for the fiscal year immediately
preceding the fiscal year in which a Change of Control
occurred, unless the incentive bonus for such given
fiscal year is based on the same objective criteria as
applied in the prior fiscal year or other objective
criteria to which you have agreed.
Your continued employment or failure to give
Notice of Termination will not constitute
consent to, or a waiver of rights with
respect to, any circumstance constituting
Good Reason hereunder except as otherwise provided.
(d) Notice of Termination. Any termination of your
employment by the Corporation, or termination by you
for Good Reason during the Term will be communicated by
Notice of Termination to the other party hereto. A
"Notice of Termination" will mean a written notice
which specifies a Date of Termination (which date shall
be on or after the date of the Notice of Termination)
and, if applicable, indicates the provision in this
letter applying to the termination and sets forth in
reasonable detail the facts and circumstances claimed
to provide a basis for termination of your employment
under the provision so indicated.
(e) Date of Termination. "Date of Termination" will
mean the date specified in the Notice of Termination
where required (which date shall be on or after the
date of the Notice of Termination) or in any other case
upon your ceasing to perform services for the Manpower
Group.
(f) Term. The "Term" will be a period beginning on
the date of this letter indicated above and ending on
the first to occur of the following: (a) the date two
years after the occurrence of a Change of Control; (b)
January 31, 2002, if no Change of Control occurs
between the date of this letter indicated above and
January 31, 2002; and (c) the Date of Termination.
(g) Benefit Plans. "Benefit Plans" means all benefits
of employment generally made available to the senior
executives of the Corporation from time to time.
(h) Compensation Agreement. The "Compensation
Agreement" means the letter of even date from the
Corporation to you, as accepted by you, regarding your
compensation and benefits.
<PAGE>
2. Compensation and Benefits on Termination.
(a) Termination by the Corporation for Cause or by You
Other Than for Good Reason. If your employment with
the Manpower Group is terminated by the Corporation for
Cause or by you other than for Good Reason, the
Corporation will pay you or provide you with (a) your
full base salary as then in effect through the Date of
Termination, (b) your unpaid incentive bonus, if any,
attributable to any complete fiscal year of the
Corporation ended before the Date of Termination (but
no incentive bonus will be payable for the fiscal year
in which termination occurs, notwithstanding the terms
of the Compensation Agreement), and (c) all benefits to
which you are entitled under any Benefit Plans in
accordance with the terms of such plans. The Manpower
Group will have no further obligations to you.
(b) Termination of Reason of Disability or Death. If
your employment with the Manpower Group terminates
during the Term by reason of your disability or death,
the Corporation will pay you or provide you with (a)
your full base salary as then in effect through the
Date of Termination, (b) all benefits to which you are
entitled under any Benefit Plans in accordance with the
terms of such plans, (c) your unpaid incentive bonus,
if any, attributable to any complete fiscal year of the
Corporation ended before the Date of Termination, and
(d) as the incentive bonus for the year in which
termination occurs to be paid pursuant to the
Compensation Agreement, an amount equal to the amount
determined based on the applicable objective criteria
for the full year in which the Date of Termination
occurs (or alternatively your annual incentive bonus
for the fiscal year of the Corporation immediately
preceding the Date of Termination if the incentive
bonus for the year in which the Date of Termination
occurs would have been determined on a discretionary
basis), prorated for the actual number of days you were
employed by the Manpower Group during the fiscal year
in which the Date of Termination occurs, payable within
45 days after the close of such fiscal year. The
Corporation shall be entitled to terminate your
employment by reason of your disability if you become
disabled and entitled to benefits under the terms of
the long-term disability plan of the Corporation. The
Manpower Group will have no further obligations to you.
(c) Termination for Any Other Reason.
(i) If, during the Term and within two years after the
occurrence of a Change of Control, your employment with
the Manpower Group is terminated for any reason not
specified in Subsection 2(a) or (b), above, you will be
entitled to the following:
(A) the Corporation will pay you your full base salary
through the Date of Termination at the rate in effect
at the time Notice of Termination is given;
<PAGE>
(B) the Corporation will pay you your unpaid incentive
bonus, if any, attributable to any complete fiscal year
of the Corporation ended before the Date of
Termination;
(C) as the incentive bonus for the year in which
termination occurs to be paid under the Compensation
Agreement, the Corporation will pay you an amount equal
to the amount which would have been payable to you had
your employment not terminated (which shall be
determined based on the objective criteria for the full
fiscal year in which the Date of Termination occurs, if
applicable, but which shall not be less than the
largest annual incentive bonus awarded to you for the
three fiscal years of the Corporation immediately
preceding the Date of Termination unless such incentive
bonus for the year during which the Date of Termination
occurs is determined on the basis of objective criteria
which also applied in the prior fiscal year or to which
you have agreed), prorated for the actual number of
days you were employed by the Manpower Group during the
year in which the termination occurs, payable within 45
days after the close of such fiscal year unless
objective criteria for such bonus will not be relevant;
(D) the Corporation will pay as a severance benefit to
you a lump-sum payment equal to two and a half times
the sum of (i) your annual base salary in effect at the
time Notice of Termination is given and (ii) the amount
of your largest incentive bonus for the three fiscal
years of the Corporation immediately preceding the Date
of Termination or, if greater, the incentive bonus for
the fiscal year during which the Date of Termination
occurs (determined as provided in Subsection
2(c)(i)(C), above); and
(E) for an eighteen-month period after the Date of
Termination, the Corporation will arrange to provide
you and your eligible dependents, at the Corporation's
expense, with benefits under the medical, dental, life,
and disability plans of the Manpower Group, or benefits
substantially similar to the benefits you were
receiving during the 90-day period immediately prior to
the time Notice of Termination is given under the named
plans; provided, however, that benefits otherwise
receivable by you pursuant to this Subsection
2(c)(i)(E) will be reduced to the extent other
comparable benefits are actually received by you during
the eighteen-month period following your termination,
and any such benefits actually received by you will be
reported to the Corporation; provided, further that any
insurance continuation coverage that you may be
entitled to receive under the Consolidated
<PAGE>
Omnibus Budget Reconciliation Act of 1986 ("COBRA")
will commence on the Date of Termination.
(ii) If your employment with the Manpower Group is
terminated during the Term for any reason not specified
in Subsection 2(a) or (b), above, and Subsection
2(c)(i) does not apply to the termination, you will be
entitled to the following:
(A) the Corporation will pay you your full base salary
through the Date of Termination at the rate then in
effect;
(B) the Corporation will pay you your unpaid incentive
bonus, if any, attributable to any complete fiscal year
of the Corporation ended before the Date of Termination;
(C) as the incentive bonus for the year in which
termination occurs to be paid pursuant to the
Compensation Agreement, the Corporation will pay you an
amount equal to the amount which would have been
payable to you had your employment not terminated
(which shall be determined based on the objective
criteria for the full fiscal year in which the Date of
Termination occurs, if applicable, but which shall not
be less than the largest annual incentive bonus awarded
to you for the three fiscal years of the Corporation
immediately preceding the Date of Termination unless
such incentive bonus for the year during which the Date
of Termination occurs is determined on the basis of
objective criteria which also applied in the prior
fiscal year or to which you have agreed), prorated for
the actual number of days you were employed by the
Manpower Group during the fiscal year in which the Date
of Termination occurs, payable within 45 days after the
close of such fiscal year unless objective criteria for
such bonus will not be relevant;
(D) the Corporation will pay as a severance benefit to
you a lump-sum payment equal to the amount of your
annual base salary as then in effect plus an amount
equal to your largest annual incentive bonus for the
three fiscal years of the Corporation immediately
preceding the Date of Termination or, if greater, the
incentive bonus for the fiscal year during which the
Date of Termination occurs (determined as provided in
Subsection 2(c)(ii)(C), above); and
(E) for the twelve-month period after the Date of
Termination, you and your eligible dependents will
continue to receive benefits under the medical and
dental plans of the Corporation as if your employment
by the Corporation did not terminate; provided, that
the payments
<PAGE>
or benefits otherwise receivable by you
pursuant to this Subsection 2(c)(ii)(E) will be reduced
to the extent other comparable payments or benefits are
actually received by you during the twelve-month period
following your termination, and any such payments or
benefits actually received by you will be reported to
the Corporation; and provided, further that any
insurance continuation coverage that you may be
entitled to receive under the Consolidated Omnibus
Budget Reconciliation Act of 1986 or similar state laws
will commence on the Date of Termination;
The amounts paid to you pursuant to Subsection 2(c)(i)(D) or
2(C)(ii)(D) will not be included as compensation for purposes of
any qualified or nonqualified pension or welfare benefit plan of
the Manpower Group.
(d) Golden Parachute Tax.
(i) Notwithstanding anything contained in this letter
to the contrary, in the event that any payment or
distribution to or for your benefit pursuant to the
terms of this letter (a "Payment" or "Payments") would
be subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the
"Code"), or any interest or penalties are incurred by
you with respect to such excise tax (such excise tax,
together with any interest and penalties, are
collectively referred to as the "Excise Tax"), then you
shall be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after
payment by you of all taxes (including any interest or
penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up
Payment, you retain an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments.
(ii) A determination shall be made as to whether and
when a Gross-Up Payment is required pursuant to this
Subsection 2(d) and the amount of such Gross-Up
Payment, such determination to be made within fifteen
business days of the Date of Termination, or such other
time as requested by the Corporation or by you
(provided you reasonably believe that any of the
Payments may be subject to the Excise Tax). Such
determination shall be made by a national independent
accounting firm selected by you (the "Accounting
Firm"). All fees, costs and expenses (including, but
not limited to, the cost of retaining experts) of the
Accounting Firm shall be borne by the Corporation and
the Corporation shall pay such fees, costs and expenses
as they become due. The Accounting Firm shall provide
detailed supporting calculations, acceptable to you,
both to the Corporation and you. The Gross-Up Payment,
if any, as determined pursuant to this Subsection
<PAGE>
2(d)(ii) shall be paid by the Corporation to you within
five business days of the receipt of the Accounting
Firm's determination. Any such initial determination
by the Accounting Firm of whether or when a Gross-Up
Payment is required and, if such a payment is required,
the amount thereof shall be binding upon the
Corporation and you subject to the application of
Subsection 2(d)(iii).
(iii) As a result of the uncertainty in the
application of Sections 4999 and 280G of the Code, it
is possible that a Gross-Up Payment (or a portion
thereof) will be paid which should not have been paid
(an "Overpayment") or a Gross-Up Payment (or a portion
thereof) which should have been paid will not have been
paid (an "Underpayment"). An Underpayment shall be
deemed to have occurred upon notice (formal or
informal) to you from any governmental taxing authority
that your tax liability (whether in respect of your
then current taxable year or in respect of any prior
taxable year) may be increased by reason of the
imposition of the Excise Tax on a Payment or Payments
with respect to which the Corporation has failed to
make a sufficient Gross-Up Payment. An Overpayment
shall be deemed to have occurred upon a "Final
Determination" (as hereinafter defined) that the Excise
Tax shall not be imposed upon a Payment or Payments
with respect to which you had previously received a
Gross-Up Payment. A Final Determination shall be
deemed to have occurred when you have received from the
applicable governmental taxing authority a refund of
taxes or other reduction in your tax liability by
reason of the Overpayment and upon either (A) the date
a determination is made by, or an agreement is entered
into with, the applicable governmental taxing authority
which finally and conclusively binds you and such
taxing authority, or in the event that a claim is
brought before a court of competent jurisdiction, the
date upon which a final determination has been made by
such court and either all appeals have been taken and
finally resolved or the time for all appeals has
expired or (B) the expiration of the statute of
limitations with your applicable tax return. If an
Underpayment occurs, you shall promptly notify the
Corporation and the Corporation shall pay to you at
least five business days prior to the date on which the
applicable governmental taxing authority has requested
payment, an additional Gross-Up Payment equal to the
amount of the Underpayment plus any interest and
penalties imposed on the Underpayment. If an
Overpayment occurs, the amount of the Overpayment shall
be treated as a loan by the Corporation to you and you
shall, within ten business days of the occurrence of
such Overpayment, pay to the Corporation the amount of
the Overpayment plus interest at an annual rate equal
to the rate provided for in Section 1274(b)(2)(B) of
the Code from the date the Gross-Up Payment (to which
the Overpayment relates) was paid to you.
<PAGE>
(iv) Notwithstanding anything contained in this letter
to the contrary, in the event it is determined that an
Excise Tax will be imposed on any Payment or Payments,
the Corporation shall pay to the applicable
governmental taxing authorities as Excise Tax
withholding, the amount of the Excise Tax that the
Corporation has actually withheld from the Payment or
Payments.
(e) Payment. The payments provided for in Subsections
2(c)(i)(A) through (D) or 2(c)(ii)(A) through (D),
above, will be made not later than the fifteenth
business day following the Date of Termination, except
as otherwise provided. If any of such payments is not
made when due (hereinafter a "Delinquent Payment"), in
addition to such principal sum, the Corporation will
pay you interest on any and all such Delinquent
Payments from the date due computed at the prime rate
as announced from time to time by Firstar Bank of
Milwaukee, compounded monthly.
(f) No Mitigation. You will not be required to
mitigate the amount of any payment or benefit provided
for in this Section 2 by seeking other employment or
otherwise, nor will the amount of any payment provided
for in this Section 2, unless otherwise provided
herein, be reduced by any compensation earned by you as
the result of employment by another employer after the
Date of Termination, or otherwise.
(g) Release of Claims. Notwithstanding the foregoing,
the Corporation will not pay you, and you have no right
to receive, any benefit described in Section 2, above,
unless and until you execute, and there shall be
effective following any statutory period for
revocation, a release, in a form reasonably acceptable
to the Corporation, that irrevocably and
unconditionally releases, waives, and fully and forever
discharges the Manpower Group and its past and current
directors, officers, employees, and agents from and
against any and all claims, liabilities, obligations,
covenants, rights, demands and damages of any nature
whatsoever, whether known or unknown, anticipated or
unanticipated, relating to or arising out of your
employment with the Manpower Group, including without
limitation claims arising under the Age Discrimination
in Employment Act of 1967, as amended, Title VII of the
Civil Rights Act of 1964, as amended, the Civil Rights
Act of 1991, the Equal Pay Act, as amended, and any
other federal, state, or local law or regulation.
(h) Forfeiture. Notwithstanding the foregoing, your
right to receive the payments and benefits to be
provided to you under this Section 2 beyond those
described in Subsection 2(a), above, is conditioned
upon your performance of the obligations stated in
Section 3, below, and in Section 6 of the Compensation
Agreement, and upon your breach of any such
obligations, you will immediately return to the
Corporation the amount of such payments and benefits
and you will no longer have any right to receive any
such payments or benefits.
<PAGE>
3. Noncompetition Agreement.
(a) Noncompetition. During the term of your
employment with the Manpower Group, you will not assist
any competitor of any company in the Manpower Group in
any capacity. During the one-year period which
immediately follows the termination of your employment
with the Manpower Group:
(i) You will not, directly or indirectly, contact any
customer or prospective customer of the Corporation
with whom you have had contact on behalf of the
Corporation during the two-year period preceding the
date of such termination or any customer or prospective
customer about whom you obtained confidential
information in connection with your employment by the
Corporation during such two-year period so as to cause
or attempt to cause such customer or prospective
customer of the Corporation not to do business or to
reduce such customer's business with the Corporation or
divert any business from the Corporation.
(ii) You will not, directly or indirectly, provide
services or assistance of a nature similar to the
services provided to the Manpower Group during the term
of your employment with the Manpower Group, to any
entity engaged in the business of providing temporary
staffing services anywhere in the United States or any
other country in which the Manpower Group conducts
business as of the Date of Termination which has,
together with its affiliated entities, annual revenues
from such business in excess of $500,000,000. You
acknowledge that the scope of this limitation is
reasonable in that, among other things, providing any
such services or assistance during such one-year period
would permit you to use unfairly your close
identification with the Manpower Group and the customer
contacts you developed while employed by the Manpower
Group and would involve the use and disclosure of
confidential information pertaining to the Manpower
Group.
(b) Injunction. You recognize that irreparable and
incalculable injury will result to the Manpower Group
and its businesses and properties in the event of your
breach of any of the restrictions imposed by Subsection
3(a), above. You therefore agree that, in the event of
any such actual, impending or threatened breach, the
Corporation will be entitled, in addition to the
remedies set forth in Subsection 2(h), above, and any
other remedies and damages, to temporary and permanent
injunctive relief (without the necessity of posting a
bond or other security) restraining the violation, or
further violation, of such restrictions by you and by
any other person or entity from whom you may be acting
or who is acting for you or in concert with you.
<PAGE>
(c) Nonapplication. Notwithstanding the above, this
Section 3 will not apply if your employment with the
Corporation is terminated by you for Good Reason or by
the Corporation without Cause within two years after
the occurrence of a Change of Control.
4. Nondisparagement. Upon your termination of
employment with the Manpower Group for any reason, the
Manpower Group agrees to maintain a positive and
constructive attitude and demeanor toward you, and
agrees to refrain from making any derogatory comments
or statements of a negative nature about you. Upon
your termination of employment with the Manpower Group
for any reason, you agree to maintain a positive and
constructive attitude and demeanor toward the Manpower
Group, and agree to refrain from making derogatory
comments or statements of a negative nature about the
Manpower Group, its officers, directors, shareholders,
agents, partners, representatives and employees, to
anyone.
5. Successors; Binding Agreement. This letter
agreement will be binding on the Corporation and its
successors and will inure to the benefit of and be
enforceable by your personal or legal representatives,
heirs and successors.
6. Notice. Notices and all other communications
provided for in this letter will be in writing and will
be deemed to have been duly given when delivered in
person, sent by telecopy, or mailed by United States
registered or certified mail, return receipt requested,
postage prepaid, and properly addressed to the other party.
7. No Right to Remain Employed. Nothing contained in
this letter will be construed as conferring upon you
any right to remain employed by the Corporation or any
member of the Manpower Group or affect the right of the
Corporation or any member of the Manpower Group to
terminate your employment at any time for any reason or
no reason, subject to the obligations of the
Corporation and the Manpower Group as set forth herein.
8. Modification. No provision of this letter may be
modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing by
you and the Corporation.
9. Withholding. The Corporation shall be entitled to
withhold from amounts to be paid to you hereunder any
federal, state, or local withholding or other taxes or
charges which it is, from time to time, required to
withhold under applicable law.
10. Previous Agreement. This letter, upon acceptance
by you, and the Compensation Agreement expressly
supersede any and all previous agreements or
understandings relating to your employment by the
Corporation or the Manpower Group or the termination of
such employment, and any such agreement or agreements
shall, as of the date of your acceptance, have no
further force or effect.
<PAGE>
If you are in agreement with the foregoing, please
sign and return one copy of this letter which will constitute
our agreement with respect to the subject matter of this letter.
Sincerely,
MANPOWER INC.
By: /s/Mitchell S. Fromstein
------------------------
Agreed as of the 22nd day of February, 1999.
/s/Jeffrey Jorres
- -----------------
Jeffrey Joerres
Manpower Inc.
5301 North Ironwood Road
Milwaukee, Wisconsin 53217
February 22, 1999
Mr. Michael J. Van Handel:
We have agreed as follows with respect to the compensation
to be paid and the other benefits to be provided to you in
connection with your continuing employment by Manpower Inc. (the
"Corporation"):
1. Term. The term of this agreement (the "Term") will
begin on the date of this letter indicated above and end on the
first to occur of the following: (a) the date two years after
the occurrence of a Change of Control, as defined in the letter
to you of even date regarding other rights and obligations on
termination of your employment; (b) January 31, 2002, if no
Change of Control occurs between the date of this letter
indicated above and January 31, 2002; or (c) the Date of
Termination, as defined in the letter from the Corporation to you
of even date regarding other rights and obligations on
termination of your employment.
2. Base Compensation. You will be paid a base salary for
your services during the Term equal to Two Hundred Twenty-Five
Thousand Dollars ($225,000) per year, as may be increased from
time to time by the Corporation. Your base compensation will be
paid in accordance with the Corporation's regular payroll
practices with respect to such compensation as in effect from time to time.
3. Incentive Bonus. You also will be entitled to receive
an incentive bonus for each full or partial fiscal year of the
Corporation included within the Term. The amount of this
incentive bonus will be the amount approved by the Executive
Compensation Committee, in its sole discretion, based upon
recommendation of the Chief Executive Officer of the Corporation.
This incentive bonus will be paid within 45 days after the close
of each such fiscal year.
4. Benefits. During the entire Term, the Corporation will
provide you with, and you will be eligible for, all benefits of
employment generally made available to the executives of
the Corporation from time to time (collectively, the "Benefits
Plans"), subject to and on a basis consistent with the terms,
conditions and overall administration of such Benefit Plans. You
will be considered for participation in Benefit Plans which by
the terms thereof are discretionary in
<PAGE>
nature (such as stock option plans) on the same basis as other executive
personnel of the Corporation of similar rank. You also will be entitled to
vacations and perquisites in accordance with the Corporation's
policies as in effect from time to time for executives of the Corporation.
5. Expenses. The Corporation will reimburse to you on a
monthly basis for all traveling, hotel, entertainment and other
expenses reasonably incurred by you in the proper performance
of your duties during the Term, subject to your compliance with
the guidelines and regulations concerning expense reimbursement
issued by the Corporation.
6. Nondisclosure and Nonsolicitation.
(a) Nondisclosure.
(i) You will not, directly or indirectly, at any
time during the term of your employment with the
Corporation or any of its direct or indirect
subsidiaries (collectively, the "Manpower Group") or
during the two-year period following your termination
of employment with the Manpower Group, use for yourself
or others, or disclose to others, any Confidential
Information (as defined below), whether or not
conceived, developed, or perfected by you and no matter
how it became known to you, unless (a) you first secure
written consent of the Corporation to such disclosure
or use, (b) the same shall have lawfully become a
matter of public knowledge other than by your act or
omission, or (c) you are ordered to disclose the same
by a court of competent jurisdiction or are otherwise
required to disclose the same by law, and you promptly
notify the Corporation of such disclosure.
"Confidential Information" shall mean all business
information (whether or not in written form) which
relates to any company in the Manpower Group and which
is not known to the public generally (absent your
disclosure), including but not limited to confidential
knowledge, operating instructions, training materials
and systems, customer lists, sales records and
documents, marketing and sales strategies and plans,
market surveys, cost and profitability analyses,
pricing information, competitive strategies, personnel-
related information, and supplier lists. This
obligation will survive the termination of your
employment for a period of two years and will not be
construed to in any way limit the Corporation's rights
to protect confidential information which constitute
trade secrets under applicable trade secrets law even
after such two-year period.
(ii) Upon your termination of employment with the
Manpower Group, or at any other time upon request of
the Corporation, you will promptly surrender to the
Corporation, or destroy and certify such destruction to
the Corporation, any documents, materials, or computer
or electronic records containing any Confidential
Information which are in your possession or under your control.
<PAGE>
(b) Nonsolicitation of Employees. You agree that you
will not, at any time during the term of your employment
with the Manpower Group or during the one-year period
following your termination of employment with the Manpower
Group, either on your own account or in conjunction with or
on behalf of any other person, company, business entity, or
other organization whatsoever, directly or indirectly
induce, solicit, entice or procure any person who is an
employee of any company in the Manpower Group, or has been
such an employee within the three months preceding such
action, to terminate his or her employment with the Manpower
Group so as to accept employment elsewhere.
(c) Injunction. You recognize that irreparable and
incalculable injury will result to the Manpower Group and
its businesses and properties in the event of your breach of
any of the restrictions imposed by Sections 6(a) - (b),
above. You therefore agree that, in the event of any such
actual, impending or threatened breach, the Corporation will
be entitled, in addition to any other remedies and damages
available to it, to temporary and permanent injunctive
relief (without the necessity of posting a bond or other
security) restraining the violation, or further violation,
of such restrictions by you and by any other person or
entity from whom you may be acting or who is acting for you
or in concert with you.
7. Successors; Binding Agreement. This letter agreement
will be binding on the Corporation and its successors and will
inure to the benefit of and be enforceable by your personal or
legal representatives, heirs and successors.
8. Notice. Notices and all other communications provided
for in this letter will be in writing and will be deemed to have
been duly given when delivered in person, sent by telecopy, or
mailed by United States registered or certified mail, return
receipt requested, postage prepaid, and properly addressed to the
other party.
9. No Right to Remain Employed. Nothing contained in this
letter will be construed as conferring upon you any right to
remain employed by the Corporation or any member of the Manpower
Group or affect the right of the Corporation or any member of the
Manpower Group to terminate your employment at any time for any
reason or no reason, subject to the obligations of the
Corporation and the Manpower Group as set forth herein.
10. Modification. No provision of this letter may be
modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing by you and the Corporation.
11. Withholding. The Corporation shall be entitled to
withhold from amounts to be paid to you hereunder any federal,
state, or local withholding or other taxes or charges which it
is, from time to time, required to withhold under applicable law.
<PAGE>
12. Previous Agreement. This letter and the letter of even
date from the Corporation to you, regarding other rights and
obligations on termination of your employment, upon acceptance by
you, expressly supersede any and all previous agreements or
understandings relating to your employment by the Corporation or
the Manpower Group or the termination of such employment, and any
such agreement or agreements shall, as of the date of your
acceptance, have no further force or effect.
If you are in agreement with the foregoing, please sign and
return one copy of this letter which will constitute our
agreement with respect to the subject matter of this letter.
Sincerely,
MANPOWER INC.
By: /s/Mitchell S. Fromstein
------------------------
Agreed as of the 22nd day of February, 1999.
/s/Michael J. Van Handel
- ------------------------
Michael J. Van Handel
Manpower Inc.
5301 North Ironwood Road
Milwaukee, Wisconsin 53217
February 22, 1999
Mr. Michael J. Van Handel:
Manpower Inc. (the "Corporation") desires to
retain experienced, well-qualified executives, like
you, to assure the continued growth and success of the
Corporation and its direct and indirect subsidiaries
(collectively, the "Manpower Group"). Accordingly, as
an inducement for you to continue your employment in
order to assure the continued availability of your
services to the Manpower Group, we have agreed as
follows:
1. Definitions. For purposes of this letter:
(a) Cause. Termination by the Corporation of your
employment with the Corporation for "Cause" will mean
termination upon (i) your willful and continued failure
to substantially perform your duties with the Manpower
Group after a written demand for substantial
performance is delivered to you that specifically
identifies the manner in which the Corporation believes
that you have not substantially performed your duties,
and you have failed to resume substantial performance
of your duties on a continuous basis within ten days
after receiving such demand, (ii) your commission of
any material act of dishonesty or disloyalty involving
the Manpower Group, (iii) your chronic absence from
work other than by reason of a serious health
condition, (iv) your commission of a crime which
substantially relates to the circumstances of your
position with the Manpower Group or which has material
adverse effect on the business of the Manpower Group,
or (v) the willful engaging by you in conduct which is
demonstrably and materially injurious to the Manpower
Group. For purposes of this Subsection 1(a), no act,
or failure to act, on your part will be deemed
"willful" unless done, or omitted to be done, by you
not in good faith.
(b) Change of Control. A "Change of Control" will
mean the first to occur of the following:
<PAGE>
(i) the acquisition (other than from the Corporation),
by any person, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934 (the "Exchange Act")), directly or
indirectly, of beneficial ownership (within the meaning
of Exchange Act Rule 13d-3) of more than 50% of the
then outstanding shares of common stock of the
Corporation or voting securities representing more than
50% of the combined voting power of the Corporation's
then outstanding voting securities entitled to vote
generally in the election of directors; provided,
however, no Change of Control shall be deemed to have
occurred as a result of an acquisition of shares of
common stock or voting securities of the Corporation
(A) by the Corporation, any of its subsidiaries, or any
employee benefit plan (or related trust) sponsored or
maintained by the Corporation or any of its
subsidiaries or (B) by any other corporation or other
entity with respect to which, following such
acquisition, more than 60% of the outstanding shares of
the common stock, and voting securities representing
more than 60% of the combined voting power of the
then outstanding voting securities entitled to vote
generally in the election of directors, of such other
corporation or entity are then beneficially owned,
directly or indirectly, by the persons who were the
Corporation's shareholders immediately prior to such
acquisition in substantially the same proportions as
their ownership, immediately prior to such acquisition,
of the Corporation's then outstanding common stock or
then outstanding voting securities, as the case may be; or
(ii) any merger or consolidation of the Corporation
with any other corporation, other than a merger or
consolidation which results in more than 60% of the
outstanding shares of the common stock, and voting
securities representing more than 60% of the combined
voting power of the then outstanding voting securities
entitled to vote generally in the election of
directors, of the surviving or consolidated corporation
being then beneficially owned, directly or indirectly,
by the persons who were the Corporation's shareholders
immediately prior to such acquisition in substantially
the same proportions as their ownership, immediately
prior to such acquisition, of the Corporation's then
outstanding common stock or then outstanding voting
securities, as the case may be; or
(iii) any liquidation or dissolution of the
Corporation or the sale or other disposition of all or
substantially all of the assets of the Corporation; or
(iv) individuals who, as of the date of this letter,
constitute the Board of Directors of the Corporation
(as of such date, the "Incumbent Board") cease for any
reason to constitute at least a majority of such Board;
provided, however, that any person becoming a director
subsequent to the date of this letter whose election,
or nomination for election by the
<PAGE>
shareholders of the Corporation, was approved by at least
a majority of the directors then comprising the Incumbent
Board shall be, for purposes of this letter, considered as
though such person were a member of the Incumbent Board but
excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an
actual or threatened election contest which was (or, if
threatened, would have been) subject to Exchange Act
Rule 14a-11; or
(v) the Corporation shall enter into any agreement
(whether or not conditioned on shareholder approval)
providing for or contemplating, or the Board of
Directors of the Corporation shall approve and recom
mend that the shareholders of the Corporation accept,
or approve or adopt, or the shareholders of the
Corporation shall approve, any acquisition that would
be a Change of Control under clause (i), above, or a
merger or consolidation that would be a Change of
Control under clause (ii), above, or a liquidation or
dissolution of the Corporation or the sale or other
disposition of all or substantially all of the assets
of the Corporation; or
(vi) whether or not conditioned on shareholder
approval, the issuance by the Corporation of common
stock of the Corporation representing a majority of the
outstanding common stock, or voting securities
representing a majority of the combined voting power
of the outstanding voting securities of the Corporation
entitled to vote generally in the election of
directors, after giving effect to such transaction.
Following the occurrence of an event which is not a
Change of Control whereby there is a successor holding
company to the Corporation, or, if there is no such
successor, whereby the Corporation is not the surviving
corporation in a merger or consolidation, the surviving
corporation or successor holding company (as the case
may be), for purposes of this definition, shall
thereafter be referred to as the Corporation.
(c) Good Reason. "Good Reason" will mean, without
your consent, the occurrence of any one or more of the
following during the Term:
(i) the assignment to you of a position which
represents a material reduction from your current
positions of Senior Vice President, Chief Financial
Officer, Secretary and Treasurer or the assignment to
you of duties, other than incidental duties,
inconsistent with your current positions or such other
positions, provided you object to such assignment by
written notice to the Corporation within twenty (20)
business days after it is made and the Corporation
fails to cure, if necessary, within ten (10) business
days after such notice is given;
<PAGE>
(ii) any material violation of this agreement or of
Sections 2 through 5 of the Compensation Agreement by
the Corporation which remains uncured ten (10) business
days after you give written notice to the Corporation
which specifies the violation;
(iii) any reduction in the amount of incentive
bonus received by you for a given fiscal year during
the Term within two years after the occurrence of a
Change of Control, as compared to the amount of the
incentive bonus received by you for the fiscal year
immediately preceding the fiscal year in which the
Change of Control occurred; or
(iv) being required by the Corporation to change the
location of your principal office to one in excess of
seventy-five (75) miles from the Corporation's home
office in Glendale, Wisconsin, provided your employment
with the Manpower Group is terminated within ninety
(90) days after any such change of location.
Your continued employment or failure to give
Notice of Termination will not constitute
consent to, or a waiver of rights with
respect to, any circumstance constituting
Good Reason hereunder except as otherwise
provided.
(d) Notice of Termination. Any termination of your
employment by the Corporation, or termination by you
for Good Reason during the Term will be communicated by
Notice of Termination to the other party hereto. A
"Notice of Termination" will mean a written notice
which specifies a Date of Termination (which date shall
be on or after the date of the Notice of Termination)
and, if applicable, indicates the provision in this
letter applying to the termination and sets forth in
reasonable detail the facts and circumstances claimed
to provide a basis for termination of your employment
under the provision so indicated.
(e) Date of Termination. "Date of Termination" will
mean the date specified in the Notice of Termination
where required (which date shall be on or after the
date of the Notice of Termination) or in any other case
upon your ceasing to perform services for the Manpower Group.
(f) Term. The "Term" will be a period beginning on
the date of this letter indicated above and ending on
the first to occur of the following: (a) the date two
years after the occurrence of a Change of Control; (b)
January 31, 2002, if no Change of Control occurs
between the date of this letter indicated above and
January 31, 2002; and (c) the Date of Termination.
(g) Benefit Plans. "Benefit Plans" means all benefits
of employment generally made available to the
executives of the Corporation from time to time.
<PAGE>
(h) Compensation Agreement. The "Compensation
Agreement" means the letter of even date from the
Corporation to you, as accepted by you, regarding your
compensation and benefits.
2. Compensation and Benefits on Termination.
(a) Termination by the Corporation for Cause or by You
Other Than for Good Reason. If your employment with
the Manpower Group is terminated by the Corporation for
Cause or by you other than for Good Reason, the
Corporation will pay you or provide you with (i) your
full base salary as then in effect through the Date of
Termination, (ii) your unpaid incentive bonus, if any,
attributable to any complete fiscal year of the
Corporation ended before the Date of Termination (but
no incentive bonus will be payable for the fiscal year
in which termination occurs, notwithstanding the terms
of the Compensation Agreement), and (iii) all benefits
to which you are entitled under any Benefit Plans in
accordance with the terms of such plans. The Manpower
Group will have no further obligations to you.
(b) Termination of Reason of Disability or Death. If
your employment with the Manpower Group terminates
during the Term by reason of your disability or death,
the Corporation will pay you or provide you with (i)
your full base salary as then in effect through the
Date of Termination, (ii) all benefits to which you are
entitled under any Benefit Plans in accordance with the
terms of such plans, (iii) your unpaid incentive bonus,
if any, attributable to any complete fiscal year of the
Corporation ended before the Date of Termination, and
(iv) as the incentive bonus for the year in which
termination occurs to be paid pursuant to the
Compensation Agreement, an amount equal to your annual
incentive bonus for the fiscal year of the Corporation
immediately preceding the Date of Termination, prorated
for the actual number of days you were employed by the
Manpower Group during the fiscal year in which the Date
of Termination occurs, payable within 45 days after the
close of such fiscal year. The Corporation shall be
entitled to terminate your employment by reason of your
disability if you become disabled and entitled to
benefits under the terms of the long-term disability
plan of the Corporation. The Manpower Group will have
no further obligations to you.
(c) Termination for Any Other Reason.
(i) If, during the Term and within two years after the
occurrence of a Change of Control, your employment with
the Manpower Group is terminated for any reason not
specified in Subsection 2(a) or (b), above, you will be
entitled to the following:
(A) the Corporation will pay you your full base salary
through the Date of Termination at the rate in effect
at the time Notice of Termination is given;
<PAGE>
(B) the Corporation will pay you your unpaid incentive
bonus, if any, attributable to any complete fiscal year
of the Corporation ended before the Date of Termination;
(C) as the incentive bonus for the year in which
termination occurs to be paid under the Compensation
Agreement, the Corporation will pay you an amount equal
to the largest annual bonus awarded to you for the
three fiscal years of the Corporation immediately
preceding the Date of Termination, prorated for the
actual number of days you were employed by the Manpower
Group during the year in which the termination occurs;
(D) the Corporation will pay as a severance benefit to
you a lump-sum payment equal to twice the sum of (i)
your annual base salary in effect at the time Notice of
Termination is given and (ii) the amount of your
largest incentive bonus for the three fiscal years of
the Corporation immediately preceding the Date of
Termination; and
(E) for an eighteen-month period after the Date of
Termination, the Corporation will arrange to provide
you and your eligible dependents, at the Corporation's
expense, with benefits under the medical, dental, life,
and disability plans of the Manpower Group, or benefits
substantially similar to the benefits you were
receiving during the 90-day period immediately prior to
the time Notice of Termination is given under the named
plans; provided, however, that benefits otherwise
receivable by you pursuant to this Subsection
2(c)(i)(E) will be reduced to the extent other
comparable benefits are actually received by you during
the eighteen-month period following your termination,
and any such benefits actually received by you will be
reported to the Corporation; provided, further that any
insurance continuation coverage that you may be
entitled to receive under the Consolidated Omnibus
Budget Reconciliation Act of 1986 ("COBRA") will
commence on the Date of Termination.
(ii) If your employment with the Manpower Group is
terminated during the Term for any reason not specified
in Subsection 2(a) or (b), above, and Subsection
2(c)(i) does not apply to the termination, you will be
entitled to the following:
(A) the Corporation will pay you your full base salary
through the Date of Termination at the rate then in
effect;
<PAGE>
(B) the Corporation will pay you your unpaid incentive
bonus, if any, attributable to any complete fiscal year
of the Corporation ended before the Date of
Termination;
(C) as the incentive bonus for the year in which
termination occurs to be paid pursuant to the
Compensation Agreement, the Corporation will pay you an
amount equal to your largest annual incentive bonus for
the three fiscal years of the Corporation immediately
preceding the Date of Termination, prorated for the
actual number of days you were employed by the Manpower
Group during the fiscal year in which the Date of
termination occurs;
(D) the Corporation will pay as a severance benefit to
you a lump-sum payment equal to the amount of your
annual base salary as then in effect plus the amount of
your largest annual incentive bonus for the three
fiscal years of the Corporation immediately preceding
the Date of Termination; and
(E) for the twelve-month period after the Date of
Termination, you and your eligible dependents will
continue to receive benefits under the medical and
dental plans of the Corporation as if your employment
by the Corporation did not terminate; provided, that
the payments or benefits otherwise receivable by you
pursuant to this Subsection 2(c)(ii)(E) will be reduced
to the extent other comparable payments or benefits are
actually received by you during the twelve-month period
following your termination, and any such payments or
benefits actually received by you will be reported to
the Corporation; and provided, further that any
insurance continuation coverage that you may be
entitled to receive under the Consolidated Omnibus
Budget Reconciliation Act of 1986 or similar state laws
will commence on the Date of Termination;
The amounts paid to you pursuant to Subsections
2(c)(i)(D) or 2(c)(ii)(D) will not be included as
compensation for purposes of any qualified or
nonqualified pension or welfare benefit plan of
the Manpower Group.
(d) Golden Parachute Tax.
(i) Notwithstanding anything contained in this letter
to the contrary, in the event that any payment or
distribution to or for your benefit pursuant to the
terms of this letter (a "Payment" or "Payments") would
be subject to the excise tax imposed by Section 4999 of
the Internal
<PAGE>
Revenue Code of 1986, as amended (the "Code"),
or any interest or penalties are incurred by
you with respect to such excise tax (such excise tax,
together with any interest and penalties, are
collectively referred to as the "Excise Tax"), then you
shall be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after
payment by you of all taxes (including any interest or
penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up
Payment, you retain an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments.
(ii) A determination shall be made as to whether and
when a Gross-Up Payment is required pursuant to this
Subsection 2(d) and the amount of such Gross-Up
Payment, such determination to be made within fifteen
business days of the Date of Termination, or such other
time as requested by the Corporation or by you
(provided you reasonably believe that any of the
Payments may be subject to the Excise Tax). Such
determination shall be made by a national independent
accounting firm selected by you (the "Accounting
Firm"). All fees, costs and expenses (including, but
not limited to, the cost of retaining experts) of the
Accounting Firm shall be borne by the Corporation and
the Corporation shall pay such fees, costs and expenses
as they become due. The Accounting Firm shall provide
detailed supporting calculations, acceptable to you,
both to the Corporation and you. The Gross-Up Payment,
if any, as determined pursuant to this Subsection
2(d)(ii) shall be paid by the Corporation to you within
five business days of the receipt of the Accounting
Firm's determination. Any such initial determination
by the Accounting Firm of whether or when a Gross-Up
Payment is required and, if such a payment is required,
the amount thereof shall be binding upon the
Corporation and you subject to the application of
Subsection 2(d)(iii).
(iii) As a result of the uncertainty in the
application of Sections 4999 and 280G of the Code, it
is possible that a Gross-Up Payment (or a portion
thereof) will be paid which should not have been paid
(an "Overpayment") or a Gross-Up Payment (or a portion
thereof) which should have been paid will not have been
paid (an "Underpayment"). An Underpayment shall be
deemed to have occurred upon notice (formal or
informal) to you from any governmental taxing authority
that your tax liability (whether in respect of your
then current taxable year or in respect of any prior
taxable year) may be increased by reason of the
imposition of the Excise Tax on a Payment or Payments
with respect to which the Corporation has failed to
make a sufficient Gross-Up Payment. An Overpayment
shall be deemed to have
<PAGE>
occurred upon a "Final Determination"
(as hereinafter defined) that the Excise
Tax shall not be imposed upon a Payment or Payments
with respect to which you had previously received a
Gross-Up Payment. A Final Determination shall be
deemed to have occurred when you have received from the
applicable governmental taxing authority a refund of
taxes or other reduction in your tax liability by
reason of the Overpayment and upon either (A) the date
a determination is made by, or an agreement is entered
into with, the applicable governmental taxing authority
which finally and conclusively binds you and such
taxing authority, or in the event that a claim is
brought before a court of competent jurisdiction, the
date upon which a final determination has been made by
such court and either all appeals have been taken and
finally resolved or the time for all appeals has
expired or (B) the expiration of the statute of
limitations with your applicable tax return. If an
Underpayment occurs, you shall promptly notify the
Corporation and the Corporation shall pay to you at
least five business days prior to the date on which the
applicable governmental taxing authority has requested
payment, an additional Gross-Up Payment equal to the
amount of the Underpayment plus any interest and
penalties imposed on the Underpayment. If an
Overpayment occurs, the amount of the Overpayment shall
be treated as a loan by the Corporation to you and you
shall, within ten business days of the occurrence of
such Overpayment, pay to the Corporation the amount of
the Overpayment plus interest at an annual rate equal
to the rate provided for in Section 1274(b)(2)(B) of
the Code from the date the Gross-Up Payment (to which
the Overpayment relates) was paid to you.
(iv) Notwithstanding anything contained in this letter
to the contrary, in the event it is determined that an
Excise Tax will be imposed on any Payment or Payments,
the Corporation shall pay to the applicable
governmental taxing authorities as Excise Tax
withholding, the amount of the Excise Tax that the
Corporation has actually withheld from the Payment or
Payments.
(e) Payment. The payments provided for in Subsections
2(c)(i)(A) through (D) or 2(c)(ii)(A) through (D),
above, will be made not later than the fifteenth
business day following the Date of Termination, except
as otherwise provided. If any of such payments is not
made when due (hereinafter a "Delinquent Payment"), in
addition to such principal sum, the Corporation will
pay you interest on any and all such Delinquent
Payments from the date due computed at the prime rate
as announced from time to time by Firstar Bank of
Milwaukee, compounded monthly.
<PAGE>
(f) No Mitigation. You will not be required to
mitigate the amount of any payment or benefit provided
for in this Section 2 by seeking other employment or
otherwise, nor will the amount of any payment provided
for in this Section 2, unless otherwise provided
herein, be reduced by any compensation earned by you as
the result of employment by another employer after the
Date of Termination, or otherwise.
(g) Release of Claims. Notwithstanding the foregoing,
the Corporation will not pay you, and you have no right
to receive, any benefits described in Section 2, above,
unless and until you execute, and there shall be
effective following any statutory period for
revocation, a release, in a form reasonably acceptable
to the Corporation, that irrevocably and
unconditionally releases, waives, and fully and forever
discharges the Manpower Group and its past and current
directors, officers, employees, and agents from and
against any and all claims, liabilities, obligations,
covenants, rights, demands and damages of any nature
whatsoever, whether known or unknown, anticipated or
unanticipated, relating to or arising out of your
employment with the Manpower Group, including without
limitation claims arising under the Age Discrimination
in Employment Act of 1967, as amended, Title VII of the
Civil Rights Act of 1964, as amended, the Civil Rights
Act of 1991, the Equal Pay Act, as amended, and any
other federal, state, or local law or regulation.
(h) Forfeiture. Notwithstanding the foregoing, your
right to receive the payments and benefits to be
provided to you under this Section 2 beyond those
described in Subsection 2(a), above, is conditioned
upon your performance of the obligations stated in
Section 3, below, and in Section 6 of the Compensation
Agreement, and upon your breach of any such
obligations, you will immediately return to the
Corporation the amount of such payments and benefits
and you will no longer have any right to receive any
such payments or benefits.
3. Noncompetition Agreement.
(a) Noncompetition. During the term of your
employment with the Manpower Group, you will not assist
any competitor of any company in the Manpower Group in
any capacity. During the one-year period which
immediately follows the termination of your employment
with the Manpower Group, you will not, directly or
indirectly, provide services or assistance of a nature
similar to the services provided to the Manpower Group
during the term of your employment with the Manpower
Group to any entity engaged in the business of
providing temporary staffing services anywhere in the
United States or any other country in which the
Manpower Group conducts business as of the Date of
Termination which has, together with its affiliated
entities, annual revenues from such business in excess
of $500,000,000. You acknowledge that the scope of
this limitation is reasonable in that, among other
things, providing any such services or assistance
<PAGE>
during such one-year period would permit you to use
unfairly your close identification with the Manpower
Group and would involve the use or disclosure of
confidential information pertaining to the Manpower
Group.
(b) Injunction. You recognize that irreparable and
incalculable injury will result to the Manpower Group
and its businesses and properties in the event of your
breach of any of the restrictions imposed by Subsection
3(a), above. You therefore agree that, in the event of
any such actual, impending or threatened breach, the
Corporation will be entitled, in addition to the
remedies set forth in Subsection 2(h), above, and any
other remedies and damages, to temporary and permanent
injunctive relief (without the necessity of posting a
bond or other security) restraining the violation, or
further violation, of such restrictions by you and by
any other person or entity from whom you may be acting
or who is acting for you or in concert with you.
(c) Nonapplication. Notwithstanding the above, this
Section 3 will not apply if your employment with the
Corporation is terminated by you for Good Reason or by
the Corporation without Cause within two years after
the occurrence of a Change of Control.
4. Nondisparagement. Upon your termination of
employment with the Manpower Group for any reason, the
Manpower Group agrees to maintain a positive and
constructive attitude and demeanor toward you, and
agrees to refrain from making any derogatory comments
or statements of a negative nature about you. Upon
your termination of employment with the Manpower Group
for any reason, you agree to maintain a positive and
constructive attitude and demeanor toward the Manpower
Group, and agree to refrain from making derogatory
comments or statements of a negative nature about the
Manpower Group, its officers, directors, shareholders,
agents, partners, representatives and employees, to
anyone.
5. Successors; Binding Agreement. This letter
agreement will be binding on the Corporation and its
successors and will inure to the benefit of and be
enforceable by your personal or legal representatives,
heirs and successors.
6. Notice. Notices and all other communications
provided for in this letter will be in writing and will
be deemed to have been duly given when delivered in
person, sent by telecopy, or mailed by United States
registered or certified mail, return receipt requested,
postage prepaid, and properly addressed to the other party.
7. No Right to Remain Employed. Nothing contained in
this letter will be construed as conferring upon you
any right to remain employed by the Corporation or any
member of the Manpower Group or affect the right of the
Corporation or any member of the Manpower Group to
terminate your employment at any time for any reason or
no reason, subject to the obligations of the
Corporation and the Manpower Group as set forth herein.
<PAGE>
8. Modification. No provision of this letter may be
modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing by
you and the Corporation.
9. Withholding. The Corporation shall be entitled to
withhold from amounts to be paid to you hereunder any
federal, state, or local withholding or other taxes or
charges which it is, from time to time, required to
withhold under applicable law.
10. Previous Agreement. This letter, upon acceptance
by you, and the Compensation Agreement expressly
supersede any and all previous agreements or
understandings relating to your employment by the
Corporation or the Manpower Group or the termination of
such employment, and any such agreement or agreements
shall, as of the date of your acceptance, have no
further force or effect.
If you are in agreement with the foregoing, please
sign and return one copy of this letter which will
constitute our agreement with respect to the subject
matter of this letter.
Sincerely,
MANPOWER INC.
By: /s/Mitchell S. Fromstein
------------------------
Agreed as of the 22nd day of February, 1999.
/s/Michael J. Van Handel
- ------------------------
Michael J. Van Handel
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<LEGEND> THIS SCHEDULE CONTAINS
SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE FINANCIAL
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FOR THE THREE MONTHS ENDED
MARCH 31, 1999 AND IS
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0
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