<PAGE>1
U.S. 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
APRIL 30, 1996.
[ ] 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 0-23144
PERSONNEL MANAGEMENT, INC.
(Exact name of registrant as specified in its charter)
INDIANA 35-1671569
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1499 Windhorst Way, Suite 100
Greenwood, Indiana 46143
(Address of principal executive offices) (Zip Code)
(317) 888-4400
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) filed all reports
required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1994 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:
Class Outstanding at May 28, 1996
Common Stock, without par value 2,020,156 shares.<PAGE>
<PAGE>2
PERSONNEL MANAGEMENT, INC.
INDEX
PART I - FINANCIAL INFORMATION
Item 1 - Consolidated Financial Statements
(Unaudited)
Condensed Consolidated Balance Sheets
at April 30, 1996 and October 31, 1995 3
Condensed Consolidated Statements of
Income for the three months ended
April 30, 1996 and 1995 4
Condensed Consolidated Statements of
Income for the six months ended
April 30, 1996 and 1995 5
Condensed Consolidated Statements of
Cash Flows for the six months ended
April 30, 1996 and 1995 6
Notes to Condensed Consolidated
Financial Statements 7
Item 2 - Management's Discussion and Analysis
of Financial Condition and Results
of Operations 10
PART II - OTHER INFORMATION
Item 4 - Submission of Matters to a Vote of
Security Holders 13
Item 5 - Other Information 13
Item 6 - Exhibits and Reports on Form 8-K 14
SIGNATURE 14
EXHIBIT INDEX 15
<PAGE>
<PAGE>3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
PERSONNEL MANAGEMENT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
<TABLE>
<CAPTION>
April 30, October 31,
1996 1995
(unaudited) (audited)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $ 291,334 $ 171,848
Accounts receivable, net 6,230,735 6,175,233
Current portion of notes
receivable, other 150,016 144,978
Income taxes receivable 11,579 42,622
Prepaid expenses 244,712 286,607
Other current assets 31,213 25,737
Deferred tax asset 241,500 241,500
Total Current Assets 7,201,089 7,088,525
Property and equipment, net 1,294,743 1,265,484
Notes receivable, shareholder 487,538 468,664
Notes receivable, other 5,387 76,571
Goodwill, net 6,433,084 5,519,592
Other 165,609 166,885
Total Assets $15,587,450 $14,585,721
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Cash overdraft $ 341,040 $ 121,031
Bank credit facility 3,492,000 -
Accounts payable 553,553 229,923
Accrued compensation and benefits 1,489,011 1,480,418
Accrued workers' compensation claims 557,218 508,422
Income taxes payable 46,028 60,828
Other current liabilities 99,680 32,254
Current portion of notes payable 149,616 116,436
Total Current Liabilities 6,728,146 2,549,312
Note payable and bank credit
facility 96,456 3,737,933
Deferred tax liability 76,200 76,200
SHAREHOLDERS' EQUITY
Common stock 7,784,429 7,683,156
Retained earnings 902,219 539,120
Total Shareholders' Equity 8,686,648 8,222,276
Total Liabilities and Shareholders'
Equity $15,587,450 $14,585,721
See accompanying notes.
/TABLE
<PAGE>
<PAGE>4
PERSONNEL MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED APRIL 30,
1996 1995
<S> <C> <C>
Revenues $16,388,262 $15,380,148
Expenses
Cost of services 12,981,063 12,352,243
General and administrative 2,625,215 2,368,170
Selling 128,427 99,612
Amortization of goodwill 85,242 68,927
15,819,947 14,888,952
Income from operations 568,315 491,196
Interest expense, net (65,621) (72,375)
Net income before income taxes 502,694 418,821
Income taxes 221,194 201,182
Net income $ 281,500 $ 217,639
Net income per share $ 0.14 $ 0.11
See accompanying notes.
/TABLE
<PAGE>
<PAGE>5
PERSONNEL MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED APRIL 30,
1996 1995
<S> <C> <C>
Revenues $30,418,378 $30,677,355
Expenses
Cost of services 24,209,657 24,769,190
General and administrative 5,031,169 4,864,535
Selling 226,112 204,891
Amortization of goodwill 167,198 137,855
29,634,136 29,976,471
Income from operations 784,242 700,884
Interest expense, net (135,842) (157,941)
Income before income taxes 648,400 542,943
Income taxes 285,300 260,805
Net income $ 363,100 $ 282,138
Net income per share $ 0.18 $ 0.14
See accompanying notes.
/TABLE
<PAGE>
<PAGE>6
PERSONNEL MANAGEMENT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED APRIL 30,
1996 1995
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 363,100 $ 282,138
Adjustments to reconcile net income to
net cash provided by operating activities:
Amortization and depreciation 339,873 275,047
Deferred income taxes - (112,000)
Interest earned on shareholder loan (18,874) (13,518)
Changes in operating assets and
liabilities:
Accounts and notes receivable (55,502) 482,572
Prepaid expenses and other assets 134,883 (193,483)
Accounts payable 323,630 (448,999)
Accrued liabilities and other payables 110,015 69,984
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,197,125 341,741
INVESTING ACTIVITIES
Purchases of businesses and additions to
goodwill (1,168,972) (375,626)
Purchases of property and equipment (113,652) (324,661)
NET CASH USED BY INVESTING ACTIVITIES (1,282,624) (700,287)
FINANCING ACTIVITIES
Proceeds from exercise of common stock
options 224,625 -
Loan to officer (123,352) -
Cash dividends - (71)
Tax benefit resulting from exercise of
stock options - 152,500
Payments on notes payable (28,297) (372,420)
Net borrowings (payments) on line of
credit (88,000) 270,000
NET CASH PROVIDED (USED)BY FINANCING
ACTIVITIES (15,024) 50,009
Decrease in cash (100,523) (308,537)
Cash at beginning of year 50,817 133,019
CASH AT END OF PERIOD $ (49,706) $ (175,518)
See accompanying notes.
</TABLE>
<PAGE>
<PAGE>7
PERSONNEL MANAGEMENT, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 1996
(unaudited)
1. Basis of Presentation
The accompanying financial statements have been
prepared by the Company, pursuant to the rules and
regulations of the Securities and Exchange
Commission (SEC). This Report on Form 10-Q should
be read in conjunction with the Company's financial
statements and notes thereto for the year ended
October 31, 1995, included in the Company's 1995
Annual Report to Shareholders. Certain information
and footnote disclosures that are normally included
in financial statements prepared in accordance with
generally accepted accounting principles have been
condensed or omitted pursuant to SEC rules and
regulations. The information reflects all normal
and recurring adjustments that, in the opinion of
management, are necessary for a fair presentation
of the financial position of the Company and its
results of operations for the interim periods set
forth herein. The results for the three months and
six months ended April 30, 1996, are not
necessarily indicative of the results to be
expected for the full year. The financial
statements include the consolidated financial
position, operations and cash flows for Personnel
Management, Inc. and its wholly-owned subsidiaries,
hereafter referred as "the Company". The Company
intends to file concurrently with this report an
amendment to its Quarterly Report on Form 10-QSB/A
for the purpose of amending and restating its
financial statements for the three and six month
periods ended April 30, 1995. The Company has
previously reported in its 1995 Annual Report to
Shareholders restated results of operations for
each of its 1995 quarterly periods. The results
for the three and six month periods ended April 30,
1995 in this report are restated on the basis of
the results that will be included in the amendment
on Form 10-QSB/A.
2. Per Share Disclosures
Per share amounts are based on the weighted average
number of common shares outstanding during the
respective periods (retroactively adjusted to give
effect to subsequent stock dividends). Stock
options and warrants are considered common stock
<PAGE>
<PAGE>8
equivalents and are included in the computation of
the number of outstanding shares using the treasury
stock method, unless anti-dilutive.
3. Shareholders' Equity
On November 1, 1995, options to purchase 29,069
shares with an exercise price of $7.73 per share
were exercised. Proceeds of $224,625 were received
by the Company.
On April 15, 1996, the Company extended a loan to
an officer of the Company in the amount of $123,352
for the purpose of paying income taxes in
connection with the officer's December 29, 1994
exercise of non-qualified stock options to purchase
49,486 shares of common stock of the Company. The
loan bears interest at the prime rate which was
8.5% as of the date of the loan, and is secured by
24,670 shares of common stock of the Company. The
loan is reflected as a deduction from common stock
and interest is credited to income as it accrues.
4. Acquisitions
The Company acquired the assets of a temporary
services firm in Atlanta, Georgia, with one office
and annual revenues of approximately $2,000,000 on
November 13, 1995. The business was acquired for
approximately $600,000, plus 42% of future income
before taxes and other adjustments derived from the
areas served by the business through October 2000.
The business operations acquired in Georgia provide
mostly temporary clerical services.
On February 5, 1996, the Company acquired the
assets of a temporary services firm in northeastern
Florida with annual revenues of approximately
$4,700,000. The business was acquired for
approximately $250,000, plus 71% of future income
before taxes and other adjustments derived from one
significant customer served by the business through
January 2001. The business in northeastern Florida
provides temporary clerical and warehousing
services to its customers.
<PAGE>
<PAGE>9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
The following should be read in conjunction with
"Management's Discussion and Analysis of Financial
Condition and Results of Operations" included in the
Company's 1995 Annual Report to Shareholders and the
comparable discussion and analysis included in the
Company's quarterly report on Form 10-Q for the first
quarter of the 1996 fiscal year.
SELECTED INCOME STATEMENT COMPARISONS
REVENUES. For the three months ended April 30, 1996,
revenues increased by $1,008,114 or 6.6% compared to the
1995 period, to $16,388,262. The increase was a result
of same office sales growth in the Tampa, Florida area,
and the acquisition of temporary services companies in
Atlanta, Georgia during November 1995, and Jacksonville,
Florida during February 1996. Revenues from the
Company's Indiana customer base for the second quarter,
which accounted for approximately 69% of consolidated
revenues, decreased 13.7% compared to the previous year
period. This decrease was due primarily to reduced
demand and competitive pressures. Revenues remained
constant for the Company's Indiana customer base between
the first and second quarters of 1996.
For the six months ended April 30, 1996, revenues
decreased $258,977 or 0.8% compared to the 1995 period,
to $30,418,378. This decrease was due to a 14.7%
decrease in revenues from the Company's Indiana customer
base compared to the prior year period. Revenues from
the Company's southeastern U.S. operations, which
accounted for approximately 26% of consolidated revenues
for the six month period, almost entirely offset the
decrease in the Indiana revenues.
COST OF SERVICES. Cost of services for the three months
ended April 30, 1996 increased $628,820 or 5.1% compared
to the 1995 period, to $12,981,063. This increase was a
result of increased volume of services to clients. Cost
of services as a percentage of revenues for the quarter
was 79.2% compared to 80.3% in the prior year period.
This improvement was a result of favorable pricing of
temporary help services and lower workers' compensation
costs.
Cost of services for the six months ended April 30, 1996
decreased $559,533 or 2.3% compared to the 1995 period,
to $24,209,657. As a percentage of revenues, cost of
services improved from 80.7% in 1995 to 79.6% in 1996.
<PAGE>
<PAGE>10
SELLING EXPENSES. Selling expenses for the three and six
months ended April 30, 1996 increased 28.9% and 10.4%,
respectively, compared to the 1995 periods as a result of
the Company's Atlanta, Georgia and Jacksonville, Florida
operations. These operations were acquired by the
Company in the current fiscal year. Selling expenses as
a percentage of revenues increased slightly from 0.7% in
the prior year quarter to 0.8%
in the current year quarter.
GENERAL AND ADMINISTRATIVE EXPENSES. General and
administrative expenses for the three months ended April
30, 1996 increased $257,044 or 10.9% compared to the 1995
period, to $2,625,215. This increase was due entirely to
the G&A expenses associated with the businesses purchased
by the Company in the current fiscal year. G&A expenses
related to the Indiana and Tampa operations decreased
$8,500. The results of the Company's ongoing expense
reduction program is reflected in the decreased G&A
expenses for the Indiana and Tampa operations but is
partially offset by higher professional fees and bad debt
expense. Expenses related to the expense reduction
program decreased approximately $225,000 for the quarter
compared to the prior year period. Professional fees and
bad debt expenses were higher compared to the prior year
quarter by approximately $25,000 and $100,000,
respectively. Additional professional fees were incurred
for nonrecurring services related to the year-end
financial disclosures. Credit policies and procedures
have been strengthened to address the credit problems
experienced by the Company in the current fiscal year.
As a percentage of revenues, G&A expenses for the quarter
increased from 15.5% in the 1995 fiscal year to 16.1% in
the current fiscal year.
G&A expenses for the six months ended April 30, 1996
increased $166,633 or 3.4% compared to the prior year
period due entirely to the expenses associated with the
new businesses acquired by the Company in the current
fiscal year. G&A expenses for the Indiana and Tampa
operations decreased approximately $153,000 primarily as
a result of the ongoing expense reduction program.
Partially offsetting this decrease in G&A expenses for
the Indiana and Tampa operations were higher professional
fees and bad debt expense of approximately $114,000 and
$157,000, respectively, compared to the prior year
period. As a percentage of revenues, G&A expenses for
the six months increased from 15.9% in the 1995 fiscal
year to 16.6% in the current fiscal year.
<PAGE>
<PAGE>11
AMORTIZATION OF GOODWILL. Goodwill represents the
unamortized cost in excess of fair value of net assets
acquired and is being amortized on a straight-line basis
over 20 years. Goodwill amortization for the three and
six month periods ended April 30, 1996 increased 23.7%
and 21.3%, respectively, compared to the 1995 periods.
These increases were a result of the amortization of
goodwill related to the two businesses acquired in the
current fiscal year and the amortization of payments of
additional purchase price to the prior owners of acquired
businesses under the earnout provisions of the
acquisition agreements.
INTEREST EXPENSE, NET. The decrease in interest expense,
net for the three and six months ended April 30, 1996
compared to the prior year periods is due to lower
interest rates on borrowings.
INCOME TAXES. Income tax expense for the three and six
months ended April 30, 1996 increased 9.9% and 9.4%,
respectively, compared to the prior year period as a
result of the increases in net income before income
taxes. The effective income tax rate was 44% in the
current fiscal year compared to 48% in the prior fiscal
year.
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities during the six
months ended April 30, 1996 was $1,197,125 which resulted
primarily from net income before depreciation and
amortization, and an increase in accounts payable
outstanding.
Net cash used by investing activities during the six
months ended April 30, 1996 was $1,282,624 due to the
acquisitions of Temporaries of Atlanta, Inc. in November
1995 and Progressive Personnel II, Inc. in February 1996,
and payments of additional purchase price to owners of
previously acquired businesses under the earnout
provisions of the acquisition agreements.
Management believes that cash provided by operations,
augmented by borrowings for working capital purposes
under the bank credit facility, will be adequate to
satisfy the Company's operating cash requirements during
fiscal 1996. Due to the relatively short maturity of the
Company's bank credit facility in February 1997, the
Company may consider seeking new debt or equity financing
<PAGE>
<PAGE>12
during fiscal 1996 or prior to the maturity of the credit
facility in February 1997. Since the bank credit
facility will mature within a twelve month period, the
amount outstanding as of April 30, 1996 has been
reclassified on the balance sheet from a noncurrent to a
current liability. Depending on market conditions, the
performance of the Company and other factors, this new
financing may be public or private. This information
concerning the possibility that the Company may seek
additional financing is a forward-looking statement, and
the Company has not engaged in any discussions with
investors, banks, or financial intermediaries looking
toward such a financing transaction. Furthermore, there
is no assurance that such financing would be available to
the Company if sought, or that such financing, even if
available, would carry terms that shareholders of the
Company would find attractive.
<PAGE>
<PAGE>13
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security
Holders
The Company held its 1996 Annual Meeting of Shareholders
on March 28, 1996. At the Annual Meeting the
Shareholders elected as Directors the two nominees
proposed by the Board of Directors and approved the 1994
Director Stock Option Plan. Joseph C. Cook and Max K.
DeJonge were both elected for a three year term to the
Board of Directors. In addition to these two
individuals, Directors whose term of office continued
after the Annual Meeting consisted of Richard VonDerHaar,
David L. Swider, Don R. Taylor and Elizabeth McFarland.
The results of the proxy solicitation were as follows:
<TABLE>
<CAPTION>
Votes Votes Votes
Cast For Withheld Abstained Non-Votes
<S> <C> <C> <C> <C>
Nominee:
Joseph C. Cook 1,877,505 1,100
Max K. DeJonge 1,877,505 1,100
1994 Director Stock
Option Plan 1,846,359 9,060 4,479 18,707
</TABLE>
Item 5. Other Information
On June 20, 1996, the Registrant announced the
appointment of Gary Hentschel as its Chief Operating
Officer, effective July 15, 1996. Mr. Hentschel held the
position as Executive Vice President and Corporate
Banking Manager of the Central Indiana Region with
KeyBank, N.A. KeyBank is a $65 billion financial
services organization headquartered in Cleveland, Ohio.
Prior to joining the KeyBank organization in 1986, Mr.
Hentschel held a number of commercial banking positions
<PAGE>
<PAGE>14
with NBD, Indiana. His educational background includes
an MBA degree in finance from Butler University in
Indianapolis and a bachelors degree in marketing and
economics from Miami University in Oxford, Ohio.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The exhibits listed in the Exhibit Index on page 15
(which Exhibit Index is incorporated herein by reference)
are filed as part of this report.
(b) Reports on Form 8-K
A current report on Form 8-K dated February 5, 1996 was
filed on February 19, 1996 to report under Item 2 the
Company's acquisition of Progressive Personnel II, Inc.,
and under Item 5 the appointment of Robert R. Millard as
the Company's new Chief Financial Officer and Vice
President of Finance and Administration.
A current report on Form 8-K/A dated February 5, 1996 was
filed on April 19, 1996 to report under Item 7 the
financial statements and pro forma financial information
for the Progressive Personnel II, Inc. acquisition.
SIGNATURE
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.
PERSONNEL MANAGEMENT, INC.
Dated: June 21, 1996 By: /s/ Robert R. Millard
Robert R. Millard, Vice
President of Finance and
Administration (Principal
Financial Officer and
Authorized Signatory)<PAGE>
<PAGE>15
EXHIBIT INDEX
Exhibit No. Description of Exhibit
10.1 Amended Schedule of Options
Granted Under 1994 Director
Stock Option Plan
10.2 Employment Agreement between
the Company and Don R. Taylor,
dated November 8, 1995
10.3 Employment Agreement between
the Company and Elizabeth McFarland,
dated November 8, 1995
10.4 Employment Agreement between
the Company and Robert R. Millard,
dated February 5, 1996
10.5 Change of Control Severance
Benefits Agreement between the
Company and Don R. Taylor,
dated November 8, 1995
10.6 Change of Control Severance
Benefits Agreement between the
Company and Elizabeth McFarland,
dated November 8, 1995
10.7 Change of Control Severance
Benefits Agreement between the
Company and Robert R. Millard,
dated February 5, 1996
10.8 Incentive Stock Option Agreement
between the Company and Robert R.
Millard, dated February 5, 1996
10.9 Promissory Note between the
Company and Elizabeth McFarland,
dated April 15, 1996
10.10 Pledge Agreement between the
Company and Elizabeth McFarland,
dated April 15, 1996
11.1 Statement Re: Computation of
Earnings Per Share for the Three
Months Ended April 30, 1996
<PAGE>
<PAGE>16
11.2 Statement Re: Computation of
Earnings Per Share for the Six
Months Ended April 30, 1996
27.1 Financial Data Schedule
<PAGE>1
<TABLE>
AMENDED SCHEDULE OF OPTIONS GRANTED
UNDER 1994 DIRECTOR STOCK OPTION PLAN
<CAPTION>
Number of Date of Option Option
Grantee Options Granted* Grant Price* Period
<S> <C> <C> <C> <C>
Joseph C. Cook, Jr.** 550 1/31/95 $12.09 1/30/2000
1,100 4/30/95 16.73 4/29/2000
550 7/31/95 13.75 7/30/2000
1,100 10/31/95 9.08 10/30/2000
825 01/31/96 5.90 1/30/2001
550 04/30/96 8.75 04/29/2001
David L. Swider 825 1/31/95 $9.95 1/30/2000
(for the quarter
ended 10/31/94)
1,100 1/31/95 12.09 1/30/2000
1,100 4/30/95 16.73 4/29/2000
550 7/31/95 13.75 7/30/2000
1,100 10/31/95 9.08 10/30/2000
1,100 01/31/96 5.90 01/30/2001
1,100 04/30/96 8.75 04/29/2001
* All numbers retroactively adjusted for ten percent stock dividend paid on
April 24, 1995.
**In Exhibit 10.2 of the Company's Quarterly Report on Form 10-QSB for the
quarter ended April 30, 1995, the Company reported that Mr. Cook had been granted
550 options for the quarter ended October 31, 1994, which report was incorrect
and is hereby amended.<PAGE>
<PAGE>2
Richard L. VonDerHaar 825 1/31/95 $9.95 1/30/2000
(for the quarter
ended 10/31/94)
1,100 1/31/95 12.09 1/30/2000
1,100 4/30/95 16.73 4/29/2000
550 7/31/95 13.75 7/30/2000
1,100 10/31/95 9.08 10/30/2000
1,100 01/31/96 5.90 01/30/2001
550 04/30/96 8.75 04/29/2001
Max K. DeJonge 550 10/31/95 $9.08 10/30/2000
550 01/31/96 5.90 01/30/2001
550 04/30/96 8.75 01/29/2001
</TABLE>
0669\EDGAR\EXH10.1
<PAGE>1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made
and entered into the 8th day of November, 1995, by and
between PERSONNEL MANAGEMENT, INC., an Indiana
corporation (the "Corporation"), and DON R. TAYLOR (the
"Executive").
WITNESSETH:
WHEREAS, the Executive is the President and chief
executive officer of the Corporation and is an integral
part of its management; and
WHEREAS, the Corporation and the Executive have
previously executed an Employment Agreement dated January
1, 1994 and a First Amendment to Employment Agreement
dated September 12, 1995 (collectively, the "Original
Agreement"); and
WHEREAS, the Corporation and the Executive mutually
desire to terminate and cancel the Original Agreement;
and
WHEREAS, concurrently herewith the Corporation and
the Executive are executing in separate instruments a
Noncompetition and Confidentiality Agreement and a Change
of Control Severance Benefits Agreement;
NOW, THEREFORE, in consideration of the mutual
covenants and promises contained herein and other
valuable consideration, including services performed and
to be performed by the Executive and compensation and
benefits paid and provided and to be paid and provided by
the Corporation, the parties hereby agree as follows:
1. Effect and Effective Date. This Agreement
amends, restates, cancels, replaces and supersedes the
Original Agreement in its entirety and shall be effective
upon the date hereof. The Original Agreement is mutually
cancelled concurrently with, and shall be null, void and
of no further force or effect upon, the execution of this
Agreement.
2. Employment. The Corporation hereby agrees to
employ the Executive, and the Executive hereby agrees to
be employed by the Corporation, on a full-time basis upon
and subject to the terms and conditions set forth herein.
<PAGE>
<PAGE>2
3. Term and Termination. The Executive's
employment hereunder shall be on an at-will basis,
terminable at any time with or without cause by either
party. In the event the Executive terminates the
Executive's employment with the Corporation, the
Executive agrees to give notice of such termination to
the Corporation as far in advance of such termination as
is reasonably possible under the circumstances (up to 60
days' advance notice).
4. Compensation. For all services rendered by the
Executive in any capacity to or for the Corporation
during the Executive's employment by the Corporation,
including, without limitation, services as an executive
officer, director, employee or member of any committee of
the Corporation or of any subsidiary, division or
affiliate of the Corporation (including the Corporation,
all such subsidiaries, divisions and affiliates are
referred to individually as a "PMI Company" and
collectively as the "PMI Companies"), the Executive shall
be paid as compensation (including compensation paid by
any of the PMI Companies):
(a) a base salary, payable not less often
than monthly, and such increases or decreases in
such salary, if any, in an amount as shall be
determined from time to time by the Board of
Directors of the Corporation (the "Board") or any
authorized committee of the Board and communicated
to the Executive;
(b) such bonuses and other cash incentive
awards as shall be awarded from time to time by the
Board or any authorized committee of the Board; and
(c) such other compensation and/or benefits
as the Board or any authorized committee of the
Board may grant or make available to the Executive
from time to time.
If the Executive's employment with the Corporation is
terminated, the Executive's monthly (or other payroll
period) salary shall be prorated to reflect the
percentage of the payroll period for which the Executive
was employed by the Corporation.
5. Duties of Loyalty. The Executive shall perform
such duties and responsibilities as may from time to time
be assigned or delegated to him by the Board or any
authorized committee of the Board. The Executive shall
not engage during the Executive's employment with the
<PAGE>
<PAGE> 3
Corporation in any activity, employment or business
venture, directly or indirectly, whether or not for
remuneration, that might reasonably be expected to be
detrimental to any of the PMI Companies, conflict with
the Executive's commitment and loyalty to the PMI
Companies, compete with any of the PMI Companies, result
in a conflict of interest with any of the PMI Companies,
or adversely affect the proper discharge of the
Executive's duties or responsibilities to any of the PMI
Companies.
6. Severance Benefits.
(a) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Corporation shall pay
the Executive in cash an amount equal to one
month's base salary then in effect for the
Executive. Except for the additional severance
compensation and/or benefits, if any, granted by
the Corporation pursuant to Section 6(b) hereof,
the severance benefits provided for by this Section
6(a) shall constitute the entire obligation of the
Corporation for the payment of severance
compensation or benefits to the Executive under
this Agreement.
(b) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Board, or an
authorized committee of the Board, shall consider
and make a determination as to whether, under the
circumstances, severance compensation and/or
benefits in addition to the severance benefits
granted in Section 6(a) should be awarded to the
Executive. The Corporation shall be under no
obligation to award any such additional severance
compensation and/or benefits and the determination
of whether to award such additional severance
compensation and/or benefits shall be in the sole
discretion of the Board or such committee.
(c) Nothing in this Agreement shall be
construed as affecting the Executive's right to
severance compensation or benefits under any other
agreements between the Corporation and the
Executive.
<PAGE>
<PAGE>4
(d) For purposes of this Agreement,
"misconduct" means:
(i) the failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment
(other than any such failure resulting from
the Executive's incapacity due to physical or
mental illness); or
(ii) any act that constitutes on the part
of the Executive common law fraud or
dishonesty regardless of whether such fraud or
dishonesty resulted in, or was intended to
result in, a benefit to the Executive at the
expense of the Corporation; or
(iii) the conviction of the Executive
of, or the plea by the Executive of nolo
contendere to, a felony or a crime involving
moral turpitude; or
(iv) any violation by the Executive in
any material respect of any of the
Corporation's policies or of any term or
provision of any employment or other agreement
between the Executive and the Corporation; or
(v) the Executive's unexcused total
abandonment or neglect of the Executive's
duties and responsibilities in connection with
the Executive's employment with the
Corporation (other than absences due to
illness, physical or mental incapacity,
vacations, or other excused absences) for a
continuous period of ten working days.
(e) The Corporation shall withhold from the
severance benefits granted in Section 6(a) (and any
discretionary severance compensation and/or
benefits otherwise paid to the Executive) all
federal, state, city, county or other taxes as
shall be required pursuant to any law or
governmental regulation or ruling.
7. Notices. Any notice, request, demand and other
communication to be given hereunder shall be in writing
and personally delivered or mailed in the continental
United States by registered or certified mail, postage
prepaid, at the address stated below or to such changed
<PAGE>
<PAGE> 5
address as the addressee may have given by a similar
notice:
To the Corporation: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
To the Executive: Don R. Taylor
11123 Sloop Court
Indianapolis, Indiana 46236
8. Succession. All of the terms and provisions of
this Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective heirs,
executors, administrators, legal representatives,
successors and assigns of the parties hereto, except that
the duties and responsibilities of the Executive
hereunder are of a personal nature and shall not be
assignable or delegable in whole or in part by the
Executive.
9. Governing Law. The validity, interpretation,
construction and performance of this Agreement shall be
governed by the laws of the State of Indiana.
10. Headings; Pronouns. The titles to sections in
this Agreement are intended solely for convenience and no
provision of this Agreement is to be construed by
reference to the title of any section. All pronouns in
this Agreement and any variations thereof shall be deemed
to refer to the masculine, feminine, neuter, singular or
plural as the identity of the person or persons may
require.
11. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board or any authorized
committee of the Board and shall be agreed to in writing,
signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
<PAGE>
<PAGE>6
12. Severability. In the event that any term,
provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason,
such unenforceability or invalidity shall not affect the
enforceability or validity of the remaining terms,
provisions and portions of this Agreement.
13. Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will
constitute the same instrument.
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
"CORPORATION"
ATTEST: PERSONNEL MANAGEMENT, INC.
/s/ James E. Burnette By /s/ Elizabeth McFarland
James E. Burnette Elizabeth McFarland
Vice President - Vice President - Operations
Finance and Administration
Secretary and Treasurer
"EXECUTIVE"
/s/ Don R. Taylor
Don R. Taylor
0669\EDGAR\EMPL-AGR.TAY
<PAGE>1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made
and entered into the 8th day of November, 1995, by and
between PERSONNEL MANAGEMENT, INC., an Indiana
corporation (the "Corporation"), and ELIZABETH MCFARLAND
(the "Executive").
WITNESSETH:
WHEREAS, the Executive is the Vice President of
Operations of the Corporation and is an integral part of
its management; and
WHEREAS, the Corporation and the Executive have
previously executed an Employment Agreement dated January
1, 1994 and a First Amendment to Employment Agreement
dated September 12, 1995 (collectively, the "Original
Agreement"); and
WHEREAS, the Corporation and the Executive mutually
desire to terminate and cancel the Original Agreement;
and
WHEREAS, concurrently herewith the Corporation and
the Executive are executing in separate instruments a
Noncompetition and Confidentiality Agreement and a Change
of Control Severance Benefits Agreement;
NOW, THEREFORE, in consideration of the mutual
covenants and promises contained herein and other
valuable consideration, including services performed and
to be performed by the Executive and compensation and
benefits paid and provided and to be paid and provided by
the Corporation, the parties hereby agree as follows:
1. Effect and Effective Date. This Agreement
amends, restates, cancels, replaces and supersedes the
Original Agreement in its entirety and shall be effective
upon the date hereof. The Original Agreement is mutually
cancelled concurrently with, and shall be null, void and
of no further force or effect upon, the execution of this
Agreement.
2. Employment. The Corporation hereby agrees to
employ the Executive, and the Executive hereby agrees to
be employed by the Corporation, on a full-time basis upon
and subject to the terms and conditions set forth herein.
<PAGE>
<PAGE>2
3. Term and Termination. The Executive's
employment hereunder shall be on an at-will basis,
terminable at any time with or without cause by either
party. In the event the Executive terminates the
Executive's employment with the Corporation, the
Executive agrees to give notice of such termination to
the Corporation as far in advance of such termination as
is reasonably possible under the circumstances (up to 60
days' advance notice).
4. Compensation. For all services rendered by the
Executive in any capacity to or for the Corporation
during the Executive's employment by the Corporation,
including, without limitation, services as an executive
officer, director, employee or member of any committee of
the Corporation or of any subsidiary, division or
affiliate of the Corporation (including the Corporation,
all such subsidiaries, divisions and affiliates are
referred to individually as a "PMI Company" and
collectively as the "PMI Companies"), the Executive shall
be paid as compensation (including compensation paid by
any of the PMI Companies):
(a) a base salary, payable not less often
than monthly, and such increases or decreases in
such salary, if any, in an amount as shall be
determined from time to time by the Board of
Directors of the Corporation (the "Board") or any
authorized committee of the Board and communicated
to the Executive;
(b) such bonuses and other cash incentive
awards as shall be awarded from time to time by the
Board or any authorized committee of the Board; and
(c) such other compensation and/or benefits
as the Board or any authorized committee of the
Board may grant or make available to the Executive
from time to time.
If the Executive's employment with the Corporation is
terminated, the Executive's monthly (or other payroll
period) salary shall be prorated to reflect the
percentage of the payroll period for which the Executive
was employed by the Corporation.
5. Duties of Loyalty. The Executive shall perform
such duties and responsibilities as may from time to time
be assigned or delegated to her by the President of the
Corporation, the Board or any authorized committee of the
<PAGE>
<PAGE>3
Board. The Executive shall not engage during the
Executive's employment with the Corporation in any
activity, employment or business venture, directly or
indirectly, whether or not for remuneration, that might
reasonably be expected to be detrimental to any of the
PMI Companies, conflict with the Executive's commitment
and loyalty to the PMI Companies, compete with any of the
PMI Companies, result in a conflict of interest with any
of the PMI Companies, or adversely affect the proper
discharge of the Executive's duties or responsibilities
to any of the PMI Companies.
6. Severance Benefits.
(a) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Corporation shall pay
the Executive in cash an amount equal to one
month's base salary then in effect for the
Executive. Except for the additional severance
compensation and/or benefits, if any, granted by
the Corporation pursuant to Section 6(b) hereof,
the severance benefits provided for by this Section
6(a) shall constitute the entire obligation of the
Corporation for the payment of severance
compensation or benefits to the Executive under
this Agreement.
(b) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Board, or an
authorized committee of the Board, shall consider
and make a determination as to whether, under the
circumstances, severance compensation and/or
benefits in addition to the severance benefits
granted in Section 6(a) should be awarded to the
Executive. The Corporation shall be under no
obligation to award any such additional severance
compensation and/or benefits and the determination
of whether to award such additional severance
compensation and/or benefits shall be in the sole
discretion of the Board or such committee.
(c) Nothing in this Agreement shall be
construed as affecting the Executive's right to
severance compensation or benefits under any other
agreements between the Corporation and the
Executive.
<PAGE>
<PAGE>4
(d) For purposes of this Agreement,
"misconduct" means:
(i) the failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment
(other than any such failure resulting from
the Executive's incapacity due to physical or
mental illness); or
(ii) any act that constitutes on the part
of the Executive common law fraud or
dishonesty regardless of whether such fraud or
dishonesty resulted in, or was intended to
result in, a benefit to the Executive at the
expense of the Corporation; or
(iii) the conviction of the Executive
of, or the plea by the Executive of nolo
contendere to, a felony or a crime involving
moral turpitude; or
(iv) any violation by the Executive in
any material respect of any of the
Corporation's policies or of any term or
provision of any employment or other agreement
between the Executive and the Corporation; or
(v) the Executive's unexcused total
abandonment or neglect of the Executive's
duties and responsibilities in connection with
the Executive's employment with the
Corporation (other than absences due to
illness, physical or mental incapacity,
vacations, or other excused absences) for a
continuous period of ten working days.
(e) The Corporation shall withhold from the
severance benefits granted in Section 6(a) (and any
discretionary severance compensation and/or
benefits otherwise paid to the Executive) all
federal, state, city, county or other taxes as
shall be required pursuant to any law or
governmental regulation or ruling.
7. Notices. Any notice, request, demand and other
communication to be given hereunder shall be in writing
and personally delivered or mailed in the continental
United States by registered or certified mail, postage
prepaid, at the address stated below or to such changed
<PAGE>
<PAGE>5
address as the addressee may have given by a similar
notice:
To the Corporation: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
To the Executive: Elizabeth McFarland
8153 Lower Bay Lane
Indianapolis, Indiana 46236
8. Succession. All of the terms and provisions of
this Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective heirs,
executors, administrators, legal representatives,
successors and assigns of the parties hereto, except that
the duties and responsibilities of the Executive
hereunder are of a personal nature and shall not be
assignable or delegable in whole or in part by the
Executive.
9. Governing Law. The validity, interpretation,
construction and performance of this Agreement shall be
governed by the laws of the State of Indiana.
10. Headings; Pronouns. The titles to sections in
this Agreement are intended solely for convenience and no
provision of this Agreement is to be construed by
reference to the title of any section. All pronouns in
this Agreement and any variations thereof shall be deemed
to refer to the masculine, feminine, neuter, singular or
plural as the identity of the person or persons may
require.
11. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board or any authorized
committee of the Board and shall be agreed to in writing,
signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
<PAGE>
<PAGE>6
12. Severability. In the event that any term,
provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason,
such unenforceability or invalidity shall not affect the
enforceability or validity of the remaining terms,
provisions and portions of this Agreement.
13. Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will
constitute the same instrument.
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
"CORPORATION"
ATTEST: PERSONNEL MANAGEMENT, INC.
/s/ James E. Burnette By /s/ Don R. Taylor
James E. Burnette Don R. Taylor
Vice President - President
Finance and Administration
Secretary and Treasurer
"EXECUTIVE"
/s/ Elizabeth McFarland
Elizabeth McFarland
0669\EDGAR\EMPL-AGR.MCF
<PAGE>1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made
and entered into the 5th day of February, 1996, by and
between PERSONNEL MANAGEMENT, INC., an Indiana
corporation (the "Corporation"), and ROBERT R. MILLARD
(the "Executive").
WITNESSETH:
WHEREAS, the Executive is being employed as the Vice
President of Finance and Administration, Chief Financial
Officer, Secretary and Treasurer of the Corporation and
will be an integral part of its management; and
WHEREAS, concurrently herewith the Corporation and
the Executive are executing in separate instruments a
Noncompetition and Confidentiality Agreement and a Change
of Control Severance Benefits Agreement;
NOW, THEREFORE, in consideration of the mutual
covenants and promises contained herein and other
valuable consideration, including services to be
performed by the Executive and compensation and benefits
to be paid and provided by the Corporation, the parties
hereby agree as follows:
1. Effective Date. This Agreement shall be
effective February 5, 1996 (the "Effective Date"). Prior
to the Effective Date either party shall have the option
to terminate and cancel without obligation this Agreement
and the Noncompetition and Confidentiality Agreement and
Change of Control Severance Benefits Agreement, both of
even date herewith.
2. Employment. The Corporation hereby agrees to
employ the Executive, and the Executive hereby agrees to
be employed by the Corporation, on a full-time basis upon
and subject to the terms and conditions set forth herein.
3. Term and Termination. The Executive's
employment hereunder shall be on an at-will basis,
terminable at any time with or without cause by either
party. In the event the Executive terminates the
Executive's employment with the Corporation, the
Executive agrees to give notice of such termination to
the Corporation as far in advance of such termination as
is reasonably possible under the circumstances (up to 60
days' advance notice).
4. Compensation. For all services rendered by the
Executive in any capacity to or for the Corporation
during the Executive's employment by the Corporation,
<PAGE>
<PAGE>2
including, without limitation, services as an executive
officer, director, employee or member of any committee of
the Corporation or of any subsidiary, division or
affiliate of the Corporation (including the Corporation,
all such subsidiaries, divisions and affiliates are
referred to individually as a "PMI Company" and
collectively as the "PMI Companies"), the Executive shall
be paid as compensation (including compensation paid by
any of the PMI Companies):
(a) a base salary, payable not less often
than monthly, and such increases or decreases in
such salary, if any, in an amount as shall be
determined from time to time by the Board of
Directors of the Corporation (the "Board") or any
authorized committee of the Board and communicated
to the Executive;
(b) such bonuses and other cash incentive
awards as shall be awarded from time to time by the
Board or any authorized committee of the Board; and
(c) such other compensation and/or benefits
as the Board or any authorized committee of the
Board may grant or make available to the Executive
from time to time.
If the Executive's employment with the Corporation is
terminated, the Executive's monthly (or other payroll
period) salary shall be prorated to reflect the
percentage of the payroll period for which the Executive
was employed by the Corporation.
5. Duties of Loyalty. The Executive shall perform
such duties and responsibilities as may from time to time
be assigned or delegated to him by the President of the
Corporation, the Board or any authorized committee of the
Board. The Executive shall not engage during the
Executive's employment with the Corporation in any
activity, employment or business venture, directly or
indirectly, whether or not for remuneration, that might
reasonably be expected to be detrimental to any of the
PMI Companies, conflict with the Executive's commitment
and loyalty to the PMI Companies, compete with any of the
PMI Companies, result in a conflict of interest with any
of the PMI Companies, or adversely affect the proper
discharge of the Executive's duties or responsibilities
to any of the PMI Companies.
6. Severance Benefits.
<PAGE>
<PAGE>3
(a) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Corporation shall pay
the Executive in cash an amount equal to one
month's base salary then in effect for the
Executive. Except for the additional severance
compensation and/or benefits, if any, granted by
the Corporation pursuant to Section 6(b) hereof,
the severance benefits provided for by this Section
6(a) shall constitute the entire obligation of the
Corporation for the payment of severance
compensation or benefits to the Executive under
this Agreement.
(b) Upon termination of the Executive's
employment with the Corporation for any reason or
under any circumstance other than on account of the
death or "misconduct" (as defined in Section 6(d)
hereof) of the Executive, the Board, or an
authorized committee of the Board, shall consider
and make a determination as to whether, under the
circumstances, severance compensation and/or
benefits in addition to the severance benefits
granted in Section 6(a) should be awarded to the
Executive. The Corporation shall be under no
obligation to award any such additional severance
compensation and/or benefits and the determination
of whether to award such additional severance
compensation and/or benefits shall be in the sole
discretion of the Board or such committee.
(c) Nothing in this Agreement shall be
construed as affecting the Executive's right to
severance compensation or benefits under any other
agreements between the Corporation and the
Executive.
(d) For purposes of this Agreement,
"misconduct" means:
(i) the failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment
(other than any such failure resulting from
the Executive's incapacity due to physical or
mental illness); or
<PAGE>
<PAGE>4
(ii) any act that constitutes on the part
of the Executive common law fraud or
dishonesty regardless of whether such fraud or
dishonesty resulted in, or was intended to
result in, a benefit to the Executive at the
expense of the Corporation; or
(iii) the conviction of the Executive
of, or the plea by the Executive of nolo
contendere to, a felony or a crime involving
moral turpitude; or
(iv) any violation by the Executive in
any material respect of any of the
Corporation's policies or of any term or
provision of any employment or other agreement
between the Executive and the Corporation; or
(v) the Executive's unexcused total
abandonment or neglect of the Executive's
duties and responsibilities in connection with
the Executive's employment with the
Corporation (other than absences due to
illness, physical or mental incapacity,
vacations, or other excused absences) for a
continuous period of ten working days.
(e) The Corporation shall withhold from the
severance benefits granted in Section 6(a) (and any
discretionary severance compensation and/or
benefits otherwise paid to the Executive) all
federal, state, city, county or other taxes as
shall be required pursuant to any law or
governmental regulation or ruling.
7. Notices. Any notice, request, demand and other
communication to be given hereunder shall be in writing
and personally delivered or mailed in the continental
United States by registered or certified mail, postage
prepaid, at the address stated below or to such changed
address as the addressee may have given by a similar
notice:
To the Corporation: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
To the Executive: Robert R. Millard
8125 Springwater Drive West
Indianapolis, Indiana 46256
<PAGE>
<PAGE>5
8. Succession. All of the terms and provisions of
this Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective heirs,
executors, administrators, legal representatives,
successors and assigns of the parties hereto, except that
the duties and responsibilities of the Executive
hereunder are of a personal nature and shall not be
assignable or delegable in whole or in part by the
Executive.
9. Governing Law. The validity, interpretation,
construction and performance of this Agreement shall be
governed by the laws of the State of Indiana.
10. Headings; Pronouns. The titles to sections in
this Agreement are intended solely for convenience and no
provision of this Agreement is to be construed by
reference to the title of any section. All pronouns in
this Agreement and any variations thereof shall be deemed
to refer to the masculine, feminine, neuter, singular or
plural as the identity of the person or persons may
require.
11. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board or any authorized
committee of the Board and shall be agreed to in writing,
signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
12. Severability. In the event that any term,
provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason,
such unenforceability or invalidity shall not affect the
enforceability or validity of the remaining terms,
provisions and portions of this Agreement.
13. Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be
deemed to be an original, but all of which together will
constitute the same instrument.
<PAGE>
<PAGE>6
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
"CORPORATION"
ATTEST: PERSONNEL MANAGEMENT, INC.
/s/ Elizabeth McFarland By /s/ Don R. Taylor
Elizabeth McFarland Don R. Taylor
Vice President - Operations President
"EXECUTIVE"
/s/ Robert R. Millard
Robert R. Millard
0669\EDGAR\EMPLOY.MIL
<PAGE>1
CHANGE OF CONTROL
SEVERANCE BENEFITS AGREEMENT
THIS CHANGE OF CONTROL SEVERANCE BENEFITS AGREEMENT
(this "Agreement") is made and entered into as of the 8th
day of November, 1995, by and between PERSONNEL
MANAGEMENT, INC., an Indiana corporation (the
"Corporation"), and DON R. TAYLOR (the "Executive").
WITNESSETH:
WHEREAS, the Executive and the Corporation have
mutually agreed to cancel that certain Employment
Agreement between the Executive and the Corporation dated
January 1, 1994, as amended by that certain First
Amendment to Employment Agreement dated September 12,
1995 (as amended, the "Prior Employment Agreement"), and
have entered into a new Employment Agreement dated of
even date herewith; and
WHEREAS, the Executive and the Corporation have
agreed, concurrently with and in consideration of the
cancellation of the Prior Employment Agreement and for
their mutual benefit, to provide certain severance
benefits to the Executive that will be payable by the
Corporation if the Executive's employment with the
Corporation is terminated under certain circumstances;
and
WHEREAS, this Agreement is made for the purpose of
documenting the mutual agreements of the parties in that
regard;
NOW, THEREFORE, in consideration of the foregoing,
the mutual covenants and promises contained herein and
other valuable consideration, including services
performed and to be performed by the Executive, it is
hereby agreed by and between the parties as follows:
Section 1. Effect; Effective Date. This
Agreement shall be effective immediately upon its
execution by the parties hereto, but, anything in this
Agreement to the contrary notwithstanding, neither this
Agreement nor any provision hereof shall be operative
unless and until there has been a Change of Control of
the Corporation (as "Change of Control of the
Corporation" is defined in Section 7 of this Agreement).
Upon a Change of Control of the Corporation, this
Agreement shall become operative immediately.
<PAGE>
<PAGE>2
Section 2. Employment. This Agreement shall not
be construed as creating a contract of employment between
the Executive and the Corporation. The Executive is,
however, employed by the Corporation at the time this
Agreement is executed, and the Executive and the
Corporation have executed an Employment Agreement of even
date herewith with respect to such employment.
Section 3. Obligation to Provide Severance
Entitlement. If the Executive's employment with the
Corporation is terminated under any circumstances other
than a Disqualifying Termination (as defined in Section
8 of this Agreement) and if such termination of
employment occurs concurrently with or within three
months immediately preceding or twenty-four months
immediately following a Change of Control of the
Corporation, then the Corporation shall provide to the
Executive a severance benefit in the manner and amount as
provided in Section 4 of this Agreement (the "Severance
Entitlement").
Section 4. Manner and Amount of Severance
Entitlement. If the Corporation is obligated to provide
a Severance Entitlement to the Executive pursuant to
Section 3 of this Agreement, the manner in which the
Corporation shall provide such Severance Entitlement and
the amount thereof shall be as follows:
(a) The Corporation shall cancel all
indebtedness of the Executive to the Corporation
(if any) up to, but not in excess of, the amount of
the Severance Entitlement (as provided in Section
4(c) below).
(b) If the amount of indebtedness of the
Executive to the Corporation cancelled pursuant to
Section 4(a) above is less than the amount of the
Severance Entitlement to be provided to the
Executive by the Corporation, the Corporation shall
pay to the Executive, by check, an amount of money
equal to the difference between the amount of the
Executive's indebtedness that is cancelled and the
amount of the Severance Entitlement to be provided
to the Executive.
(c) The Severance Entitlement to be provided
by the Corporation to the Executive shall consist
of the cancellation of indebtedness and/or the
payment of money as provided in Sections 4(a) and
4(b) above. The aggregate dollar amount of the
Severance Entitlement, whether in debt cancellation
<PAGE>
<PAGE>3
or money or both, shall be equal to two times the
highest amount of base salary paid by the
Corporation to the Executive for any full calendar
year during which the Executive was employed by the
Corporation; provided, however, that if such
Severance Entitlement, either alone or together
with other payments which the Executive has the
right to receive from any PMI Company, would
constitute an "excess parachute payment" within the
meaning of Section 280G of the Internal Revenue
Code of 1986, as amended (the "Code"), then the
Corporation shall pay an additional amount of money
to the Executive that will equal (based upon the
Executive's good faith representations of the
Executive's income tax position for the year(s) of
payment(s)) the sum of (i) all excise tax imposed
upon the Executive by Section 4999 of the Code and
(ii) all additional state and federal income taxes
attributable to the additional payments to the
Executive pursuant to this proviso clause
(including all state and federal taxes on the
additional income tax payments). The determination
of the amounts of such payments pursuant to the
immediately preceding proviso shall be made by the
Corporation in good faith, and such determination
shall be conclusive and binding.
Section 5. Provision of Severance Entitlement.
With respect to a Severance Entitlement to be provided to
the Executive hereunder,the Corporation shall provide to
the Executive satisfactory written evidence of the amount
of any debt cancellation, and/or shall pay to the
Executive any money, to which the Executive is entitled
as a Severance Entitlement not later than 30 days after
the later of (i) the occurrence of the Change of Control
of the Corporation or (ii) the termination of the
Executive's employment.
Section 6. Withholding. The Corporation may
withhold or otherwise deduct from any Severance
Entitlement to be provided hereunder all federal, state,
city, county or other taxes as shall be required pursuant
to any law or governmental regulation or ruling.
Section 7. Change of Control of the Corporation.
For purposes of this Agreement, a "Change of Control of
the Corporation" shall be deemed to have occurred if,
after the date hereof either:
<PAGE>
<PAGE>4
(a) there shall have been consummated (i) any
reorganization, consolidation or merger of the
Corporation in which the Corporation is not the
continuing or surviving corporation or pursuant to
which shares of the Corporation's common stock
shall have been converted into cash, securities or
other property, or (ii) any sale, lease, exchange
or other transfer, directly or indirectly, (in one
transaction or a series of related transactions) of
all, or substantially all, of the assets of the
Corporation and its consolidated subsidiaries
unless, following such reorganization, merger,
consolidation, or transfer of assets,
(A) more than 60 percent of the
then outstanding shares of common stock
of the corporation resulting from such
reorganization, merger or consolidation
(or of the corporation receiving the
transferred assets) (the "Continuing
Corporation") and of the then outstanding
voting securities of the Continuing
Corporation entitled to vote generally in
the election of Directors are then
beneficially owned, directly or
indirectly, by all or substantially all
of the individuals and entities who were
the beneficial owners, respectively, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation
entitled to vote generally in the
election of Directors immediately prior
to such reorganization, merger,
consolidation or transfer of assets in
substantially the same proportions as
their ownership, immediately prior to
such reorganization, merger,
consolidation or transfer of assets, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation,
(B) no "person" (as that term is
used in Sections 13(d) and 14(d)(2) of
the Securities Exchange Act of 1934, as
amended) (excluding (aa) the Corporation,
(bb) any employee benefit plan (or
related trust) sponsored or maintained by
the Corporation or any entity controlled,
<PAGE>
<PAGE>5
directly or indirectly, by the Corporation or
the Continuing Corporation and (cc) any
"person" beneficially owning, immediately
prior to such reorganization, merger,
consolidation or transfer of assets, directly
or indirectly, 20 percent or more of the
outstanding shares of common stock of the
Corporation or the outstanding voting
securities of the Corporation) beneficially
owns, directly or indirectly, 20 percent or
more of, respectively, the then outstanding
shares of common stock of the Continuing
Corporation or of the combined voting power of
the then outstanding voting securities of the
Continuing Corporation entitled to vote
generally in the election of Directors, and
(C) at least a majority of the
members of the Board of Directors of the
Continuing Corporation were members of
the Board of Directors of the Corporation
at the time of the execution of the
initial agreement providing for such
reorganization, merger, consolidation or
transfer of assets;
(b) any "person" or "group" of persons
(as those terms are used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and
Regulations 13D-G and 14D thereunder) shall
have become the "beneficial owner" (within the
meaning of Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the
Corporation representing 20 percent or more of
the combined voting power of the Corporation's
then outstanding voting securities entitled to
vote generally in the election of Directors
(excluding (i) the Corporation, (ii) any
employee benefit plan (or related trust)
sponsored or maintained by the Corporation or
any entity controlled, directly or indirectly,
by the Corporation, (iii) any "person" who, on
the date of this Agreement, is the "beneficial
owner", directly or indirectly, of 20 percent
or more of the Corporation's outstanding
common stock, and (iv) any "group" of persons
that includes Don R. Taylor); or
<PAGE>
<PAGE>6
(c) during any period of two consecutive
years, individuals who constitute the Board of
Directors of the Corporation at the beginning
of such period cease for any reason to
constitute at least a majority thereof,
excluding individuals whose election, or
nomination for election by the Corporation's
shareholders was approved by a vote of at
least two-thirds of the Directors then still
in office who were Directors at the beginning
of such period, unless, for this purpose, any
such new Director's initial assumption of
office occurs as a result of either an actual
or threatened election contest (as such terms
are used in Rule 14a-11 or Regulation 14A
promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies
or consents by or on behalf of a person other
than the Board of Directors of the
Corporation.
Section 8. Disqualifying Termination. For
purposes of this Agreement, a "Disqualifying Termination"
of the Executive's employment with the Corporation shall
mean a termination of the Executive's employment under
any of the following circumstances:
(a) termination of the Executive's employment
by the Corporation for Cause (as defined in Section
9); or
(b) termination of the Executive's employment
by the Corporation for Disability (as defined in
Section 10); or
(c) termination of the Executive's employment
by the Executive without Good Reason (as defined in
Section 11) to do so; or
(d) termination of the Executive's employment
as a result of the death of the Executive.
(As provided in Section 3, the Executive shall not be
entitled to a Severance Entitlement under this Agreement
if the Executive's employment with the Corporation was
terminated under circumstances constituting a
Disqualifying Termination.)
<PAGE>
<PAGE>7
Section 9. Termination by the Corporation for
Cause. For purposes of this Agreement, the Corporation
shall be deemed to have terminated the Executive's
employment with the Corporation for "Cause" only if the
Corporation terminated the Executive's employment with
the Corporation for any of the following reasons:
(a) the continued failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment (other
than any such failure resulting from the
Executive's incapacity due to physical or mental
illness) if such failure is not corrected or cured
within 30 days after demand for substantial
performance is made in writing upon the Executive
by the Corporation specifically identifying the
manner in which the Corporation believes the
Executive has failed to substantially perform one
or more of the Executive's significant duties or
responsibilities (repetition of the same failure as
previously described in any such written demand
after the 30-day cure period following such written
demand shall be deemed to be "continued failure" to
substantially perform by the Executive); or
(b) any act that constitutes on the part of
the Executive common law fraud or dishonesty
regardless of whether such fraud or dishonesty
resulted in, or was intended to result in, a
benefit to the Executive at the expense of the
Corporation; or
(c) the conviction of the Executive of, or
the plea by the Executive of nolo contendere to, a
felony or a crime involving moral turpitude; or
(d) any continuing violation by the Executive
in any material respect of any of the Corporation's
policies or of any term or provision of any
employment or other agreement between the Executive
and the Corporation which, in any such case, is not
corrected or abated by the Executive within 30 days
after written notice of such violation is given by
the Corporation to the Executive (repetition of the
same violation as previously described in any such
written notice after the 30 day correction period
following such written notice shall be deemed to be
a "continuing violation" by the Executive); or
<PAGE>
<PAGE>8
(e) the Executive's unexcused total
abandonment or neglect of the Executive's duties
and responsibilities in connection with the
Executive's employment with the Corporation (other
than absences due to illness, physical or mental
incapacity, vacations, or other excused absences)
for a continuous period of ten working days.
Section 10. Termination by the Corporation for
Disability. For purposes of this Agreement, the
Executive shall be considered to have suffered a
"Disability" and the Corporation shall be deemed to have
terminated the Executive's employment with the
Corporation for Disability if such termination is made
after (and is identified by the Corporation as being on
account of the occurrence of) either of the following:
(a) the actual receipt by the Executive of
income continuation benefits or similar benefits
pursuant to a disability insurance policy as a
result of a determination under such policy that
the Executive is disabled, or
(b) the Executive's inability by reason of
physical and/or mental incapacity to substantially
perform the essential functions of the Executive's
duties and responsibilities to the Corporation on a
full-time basis for a period of 26 consecutive
weeks.
Section 11. Termination by the Executive for Good
Reason. For purposes of this Agreement, the Executive
shall be deemed to have terminated the Executive's
employment with the Corporation for "Good Reason" only if
the Executive terminated his employment with the
Corporation within 90 days after the Executive's base
salary was either (a) reduced to an amount that was less
than 95 percent of the Executive's base salary as of the
date of this Agreement, or (b) reduced by more than 5
percent for any calendar year from the amount paid in the
prior calendar year.
Section 12. No Mitigation. The Executive is not
required to mitigate the amount of the Severance
Entitlement to be provided by the Corporation pursuant to
this Agreement by seeking other employment or otherwise,
nor shall the amount of the Severance Entitlement payable
pursuant to this Agreement be reduced by any compensation
earned by the Executive as the result of employment by
another employer, or which might have been earned by the
Executive had the Executive sought other employment,
<PAGE>
<PAGE>9
after the date of termination of the Executive's
employment with the Corporation.
Section 13. Notices. Any notice, request, demand
and other communication to be given hereunder shall be in
writing and personally delivered or mailed in the
continental United States by registered or certified
mail, postage prepaid, at the address stated below or to
such changed address as the addressee may have given by
a similar notice:
To the Company: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
To the Executive: Don R. Taylor
11123 Sloop Court
Indianapolis, Indiana 46236
Section 14. Legal Expenses. In the event that
either of the parties institutes any legal action to
enforce its rights under, or to recover damages for
breach of, this Agreement, the prevailing party shall be
entitled to recover from the other party any actual
expenses for attorney's fees, costs, expenses and
disbursements incurred by the prevailing party.
Section 15. Successors to the Executive. This
Agreement shall be binding upon and shall inure to the
benefit of the Executive, the Executive's heirs,
beneficiaries, devisees, successors and legal
representatives. No right or interest to or in any
payments hereunder shall be assignable by the Executive
except assignments to the Corporation in accordance with
applicable law; provided, however, that this provision
shall not preclude the Executive from designating one or
more beneficiaries to receive any amount that may be
payable after the Executive's death and shall not
preclude the legal representative of the Executive's
estate from assigning any right hereunder to the person
or persons entitled thereto under the Executive's will
or, in the case of intestacy, to the person or persons
entitled thereto under the laws of intestacy applicable
to the Executive's estate. The term "beneficiaries" as
used in this Agreement shall mean a beneficiary or
beneficiaries so designated to receive any such amount,
or, if no beneficiary has been so designated, the legal
representative of the Executive's estate. In the event
of the Executive's death, reference in this Agreement to<PAGE>
<PAGE>10
the Executive shall be deemed, where appropriate, to
refer to the Executive's legal representative or, where
appropriate, to the Executive's beneficiary or
beneficiaries.
Section 16. Successors to the Corporation. This
Agreement shall be binding upon and inure to the benefit
of the Corporation and any successor of the Corporation,
including, without limitation, any corporation or
corporations acquiring directly or indirectly all or
substantially all of the assets of the Corporation
whether by merger, consolidation, sale or otherwise (and
such successor shall thereafter be deemed the
"Corporation" for the purposes of this Agreement).
Section 17. Headings; Pronouns. The titles to
sections in this Agreement are intended solely for
convenience and no provision of this Agreement is to be
construed by reference to the title of any section. All
pronouns in this Agreement and any variations thereof
shall be deemed to refer to the masculine, feminine,
neuter, singular or plural as the identity of the person
or persons may require.
Section 18. Governing Law. The validity,
interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of
Indiana.
Section 19. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board of Directors of the
Corporation or any authorized committee of the Board of
Directors of the Corporation and shall be agreed to in
writing, signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
Section 20. Severability. The invalidity or
unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full
force and effect to the fullest extent permitted by law.
<PAGE>
<PAGE>11
Section 21. Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which together
will constitute the same instrument.
Section 22. PMI Companies. Although the
Corporation is the only one of the PMI Companies formally
executing this Agreement, the Executive understands,
acknowledges and agrees that this Agreement is made for
the benefit of all of the PMI Companies, as applicable,
each of whom shall be entitled to enforce this Agreement
as their respective interests may appear.
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
"CORPORATION"
ATTEST: PERSONNEL MANAGEMENT, INC.
/s/ James E. Burnette By /s/ Elizabeth McFarland
James E. Burnette Elizabeth McFarland
Vice President - Vice President - Operations
Finance and Administration
Secretary and Treasurer
"EXECUTIVE"
/s/ Don R. Taylor
Don R. Taylor
0669\EDGAR\SEV-BEN.AGR
<PAGE>1
CHANGE OF CONTROL
SEVERANCE BENEFITS AGREEMENT
THIS CHANGE OF CONTROL SEVERANCE BENEFITS AGREEMENT
(this "Agreement") is made and entered into as of the 8th
day of November, 1995, by and between PERSONNEL
MANAGEMENT, INC., an Indiana corporation (the
"Corporation"), and ELIZABETH MCFARLAND (the
"Executive").
WITNESSETH:
WHEREAS, the Executive and the Corporation have
mutually agreed to cancel that certain Employment
Agreement between the Executive and the Corporation dated
January 1, 1994, as amended by that certain First
Amendment to Employment Agreement dated September 12,
1995 (as amended, the "Prior Employment Agreement"), and
have entered into a new Employment Agreement dated of
even date herewith; and
WHEREAS, the Executive and the Corporation have
agreed, concurrently with and in consideration of the
cancellation of the Prior Employment Agreement and for
their mutual benefit, to provide certain severance
benefits to the Executive that will be payable by the
Corporation if the Executive's employment with the
Corporation is terminated under certain circumstances;
and
WHEREAS, this Agreement is made for the purpose of
documenting the mutual agreements of the parties in that
regard;
NOW, THEREFORE, in consideration of the foregoing,
the mutual covenants and promises contained herein and
other valuable consideration, including services
performed and to be performed by the Executive, it is
hereby agreed by and between the parties as follows:
Section 1. Effect; Effective Date. This
Agreement shall be effective immediately upon its
execution by the parties hereto, but, anything in this
Agreement to the contrary notwithstanding, neither this
Agreement nor any provision hereof shall be operative
unless and until there has been a Change of Control of
the Corporation (as "Change of Control of the
Corporation" is defined in Section 7 of this Agreement).
Upon a Change of Control of the Corporation, this
Agreement shall become operative immediately.
<PAGE>
<PAGE>2
Section 2. Employment. This Agreement shall not
be construed as creating a contract of employment between
the Executive and the Corporation. The Executive is,
however, employed by the Corporation at the time this
Agreement is executed, and the Executive and the
Corporation have executed an Employment Agreement of even
date herewith with respect to such employment.
Section 3. Obligation to Provide Severance
Entitlement. If the Executive's employment with the
Corporation is terminated under any circumstances other
than a Disqualifying Termination (as defined in Section
8 of this Agreement) and if such termination of
employment occurs concurrently with or within three
months immediately preceding or twenty-four months
immediately following a Change of Control of the
Corporation, then the Corporation shall provide to the
Executive a severance benefit in the manner and amount as
provided in Section 4 of this Agreement (the "Severance
Entitlement").
Section 4. Manner and Amount of Severance
Entitlement. If the Corporation is obligated to provide
a Severance Entitlement to the Executive pursuant to
Section 3 of this Agreement, the manner in which the
Corporation shall provide such Severance Entitlement and
the amount thereof shall be as follows:
(a) The Corporation shall cancel all
indebtedness of the Executive to the Corporation
(if any) up to, but not in excess of, the amount of
the Severance Entitlement (as provided in Section
4(c) below).
(b) If the amount of indebtedness of the
Executive to the Corporation cancelled pursuant to
Section 4(a) above is less than the amount of the
Severance Entitlement to be provided to the
Executive by the Corporation, the Corporation shall
pay to the Executive, by check, an amount of money
equal to the difference between the amount of the
Executive's indebtedness that is cancelled and the
amount of the Severance Entitlement to be provided
to the Executive.
(c) The Severance Entitlement to be provided
by the Corporation to the Executive shall consist
of the cancellation of indebtedness and/or the
payment of money as provided in Sections 4(a) and
4(b) above. The aggregate dollar amount of the
Severance Entitlement, whether in debt cancellation
<PAGE>
<PAGE>3
or money or both, shall be equal to two times the
highest amount of base salary paid by the
Corporation to the Executive for any full calendar
year during which the Executive was employed by the
Corporation; provided, however, that if such
Severance Entitlement, either alone or together
with other payments which the Executive has the
right to receive from any PMI Company, would
constitute an "excess parachute payment" within the
meaning of Section 280G of the Internal Revenue
Code of 1986, as amended (the "Code"), then the
Corporation shall pay an additional amount of money
to the Executive that will equal (based upon the
Executive's good faith representations of the
Executive's income tax position for the year(s) of
payment(s)) the sum of (i) all excise tax imposed
upon the Executive by Section 4999 of the Code and
(ii) all additional state and federal income taxes
attributable to the additional payments to the
Executive pursuant to this proviso clause
(including all state and federal taxes on the
additional income tax payments). The determination
of the amounts of such payments pursuant to the
immediately preceding proviso shall be made by the
Corporation in good faith, and such determination
shall be conclusive and binding.
Section 5. Provision of Severance Entitlement.
With respect to a Severance Entitlement to be provided to
the Executive hereunder,the Corporation shall provide to
the Executive satisfactory written evidence of the amount
of any debt cancellation, and/or shall pay to the
Executive any money, to which the Executive is entitled
as a Severance Entitlement not later than 30 days after
the later of (i) the occurrence of the Change of Control
of the Corporation or (ii) the termination of the
Executive's employment.
Section 6. Withholding. The Corporation may
withhold or otherwise deduct from any Severance
Entitlement to be provided hereunder all federal, state,
city, county or other taxes as shall be required pursuant
to any law or governmental regulation or ruling.
Section 7. Change of Control of the Corporation.
For purposes of this Agreement, a "Change of Control of
the Corporation" shall be deemed to have occurred if,
after the date hereof either:
<PAGE>
<PAGE>4
(a) there shall have been consummated (i) any
reorganization, consolidation or merger of the
Corporation in which the Corporation is not the
continuing or surviving corporation or pursuant to
which shares of the Corporation's common stock
shall have been converted into cash, securities or
other property, or (ii) any sale, lease, exchange
or other transfer, directly or indirectly, (in one
transaction or a series of related transactions) of
all, or substantially all, of the assets of the
Corporation and its consolidated subsidiaries
unless, following such reorganization, merger,
consolidation, or transfer of assets,
(A) more than 60 percent of the
then outstanding shares of common stock
of the corporation resulting from such
reorganization, merger or consolidation
(or of the corporation receiving the
transferred assets) (the "Continuing
Corporation") and of the then outstanding
voting securities of the Continuing
Corporation entitled to vote generally in
the election of Directors are then
beneficially owned, directly or
indirectly, by all or substantially all
of the individuals and entities who were
the beneficial owners, respectively, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation
entitled to vote generally in the
election of Directors immediately prior
to such reorganization, merger,
consolidation or transfer of assets in
substantially the same proportions as
their ownership, immediately prior to
such reorganization, merger,
consolidation or transfer of assets, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation,
(B) no "person" (as that term is
used in Sections 13(d) and 14(d)(2) of
the Securities Exchange Act of 1934, as
amended) (excluding (aa) the Corporation,
(bb) any employee benefit plan (or
related trust) sponsored or maintained by
the Corporation or any entity controlled,
<PAGE>
<PAGE>5 directly or indirectly, by the
Corporation or the Continuing Corporation
and (cc) any "person" beneficially
owning, immediately prior to such
reorganization, merger, consolidation or
transfer of assets, directly or
indirectly, 20 percent or more of the
outstanding shares of common stock of the
Corporation or the outstanding voting
securities of the Corporation)
beneficially owns, directly or
indirectly, 20 percent or more of,
respectively, the then outstanding shares
of common stock of the Continuing
Corporation or of the combined voting
power of the then outstanding voting
securities of the Continuing Corporation
entitled to vote generally in the
election of Directors, and
(C) at least a majority of the
members of the Board of Directors of the
Continuing Corporation were members of
the Board of Directors of the Corporation
at the time of the execution of the
initial agreement providing for such
reorganization, merger, consolidation or
transfer of assets;
(b) any "person" or "group" of persons
(as those terms are used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and
Regulations 13D-G and 14D thereunder) shall
have become the "beneficial owner" (within the
meaning of Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the
Corporation representing 20 percent or more of
the combined voting power of the Corporation's
then outstanding voting securities entitled to
vote generally in the election of Directors
(excluding (i) the Corporation, (ii) any
employee benefit plan (or related trust)
sponsored or maintained by the Corporation or
any entity controlled, directly or indirectly,
by the Corporation, (iii) any "person" who, on
the date of this Agreement, is the "beneficial
owner", directly or indirectly, of 20 percent
or more of the Corporation's outstanding
common stock, and (iv) any "group" of persons
that includes Don R. Taylor); or
<PAGE>
<PAGE>6
(c) during any period of two consecutive
years, individuals who constitute the Board of
Directors of the Corporation at the beginning
of such period cease for any reason to
constitute at least a majority thereof,
excluding individuals whose election, or
nomination for election by the Corporation's
shareholders was approved by a vote of at
least two-thirds of the Directors then still
in office who were Directors at the beginning
of such period, unless, for this purpose, any
such new Director's initial assumption of
office occurs as a result of either an actual
or threatened election contest (as such terms
are used in Rule 14a-11 or Regulation 14A
promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies
or consents by or on behalf of a person other
than the Board of Directors of the
Corporation.
Section 8. Disqualifying Termination. For
purposes of this Agreement, a "Disqualifying Termination"
of the Executive's employment with the Corporation shall
mean a termination of the Executive's employment under
any of the following circumstances:
(a) termination of the Executive's employment
by the Corporation for Cause (as defined in Section
9); or
(b) termination of the Executive's employment
by the Corporation for Disability (as defined in
Section 10); or
(c) termination of the Executive's employment
by the Executive without Good Reason (as defined in
Section 11) to do so; or
(d) termination of the Executive's employment
as a result of the death of the Executive.
(As provided in Section 3, the Executive shall not be
entitled to a Severance Entitlement under this Agreement
if the Executive's employment with the Corporation was
terminated under circumstances constituting a
Disqualifying Termination.)
<PAGE>
<PAGE>7
Section 9. Termination by the Corporation for
Cause. For purposes of this Agreement, the Corporation
shall be deemed to have terminated the Executive's
employment with the Corporation for "Cause" only if the
Corporation terminated the Executive's employment with
the Corporation for any of the following reasons:
(a) the continued failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment (other
than any such failure resulting from the
Executive's incapacity due to physical or mental
illness) if such failure is not corrected or cured
within 30 days after demand for substantial
performance is made in writing upon the Executive
by the Corporation specifically identifying the
manner in which the Corporation believes the
Executive has failed to substantially perform one
or more of the Executive's significant duties or
responsibilities (repetition of the same failure as
previously described in any such written demand
after the 30-day cure period following such written
demand shall be deemed to be "continued failure" to
substantially perform by the Executive); or
(b) any act that constitutes on the part of
the Executive common law fraud or dishonesty
regardless of whether such fraud or dishonesty
resulted in, or was intended to result in, a
benefit to the Executive at the expense of the
Corporation; or
(c) the conviction of the Executive of, or
the plea by the Executive of nolo contendere to, a
felony or a crime involving moral turpitude; or
(d) any continuing violation by the Executive
in any material respect of any of the Corporation's
policies or of any term or provision of any
employment or other agreement between the Executive
and the Corporation which, in any such case, is not
corrected or abated by the Executive within 30 days
after written notice of such violation is given by
the Corporation to the Executive (repetition of the
same violation as previously described in any such
written notice after the 30 day correction period
following such written notice shall be deemed to be
a "continuing violation" by the Executive); or
<PAGE>
<PAGE>8
(e) the Executive's unexcused total
abandonment or neglect of the Executive's duties
and responsibilities in connection with the
Executive's employment with the Corporation (other
than absences due to illness, physical or mental
incapacity, vacations, or other excused absences)
for a continuous period of ten working days.
Section 10. Termination by the Corporation for
Disability. For purposes of this Agreement, the
Executive shall be considered to have suffered a
"Disability" and the Corporation shall be deemed to have
terminated the Executive's employment with the
Corporation for Disability if such termination is made
after (and is identified by the Corporation as being on
account of the occurrence of) either of the following:
(a) the actual receipt by the Executive of
income continuation benefits or similar benefits
pursuant to a disability insurance policy as a
result of a determination under such policy that
the Executive is disabled, or
(b) the Executive's inability by reason of
physical and/or mental incapacity to substantially
perform the essential functions of the Executive's
duties and responsibilities to the Corporation on a
full-time basis for a period of 26 consecutive
weeks.
Section 11. Termination by the Executive for Good
Reason. For purposes of this Agreement, the Executive
shall be deemed to have terminated the Executive's
employment with the Corporation for "Good Reason" only if
the Executive terminated her employment with the
Corporation within 90 days after the Executive's base
salary was either (a) reduced to an amount that was less
than 95 percent of the Executive's base salary as of the
date of this Agreement, or (b) reduced by more than 5
percent for any calendar year from the amount paid in the
prior calendar year.
Section 12. No Mitigation. The Executive is not
required to mitigate the amount of the Severance
Entitlement to be provided by the Corporation pursuant to
this Agreement by seeking other employment or otherwise,
nor shall the amount of the Severance Entitlement payable
pursuant to this Agreement be reduced by any compensation
earned by the Executive as the result of employment by
another employer, or which might have been earned by the
<PAGE>
<PAGE>9
Executive had the Executive sought other employment,
after the date of termination of the Executive's
employment with the Corporation.
Section 13. Notices. Any notice, request, demand
and other communication to be given hereunder shall be in
writing and personally delivered or mailed in the
continental United States by registered or certified
mail, postage prepaid, at the address stated below or to
such changed address as the addressee may have given by
a similar notice:
To the Company: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
To the Executive: Elizabeth McFarland
8153 Lower Bay Lane
Indianapolis, Indiana 46236
Section 14. Legal Expenses. In the event that
either of the parties institutes any legal action to
enforce its rights under, or to recover damages for
breach of, this Agreement, the prevailing party shall be
entitled to recover from the other party any actual
expenses for attorney's fees, costs, expenses and
disbursements incurred by the prevailing party.
Section 15. Successors to the Executive. This
Agreement shall be binding upon and shall inure to the
benefit of the Executive, the Executive's heirs,
beneficiaries, devisees, successors and legal
representatives. No right or interest to or in any
payments hereunder shall be assignable by the Executive
except assignments to the Corporation in accordance with
applicable law; provided, however, that this provision
shall not preclude the Executive from designating one or
more beneficiaries to receive any amount that may be
payable after the Executive's death and shall not
preclude the legal representative of the Executive's
estate from assigning any right hereunder to the person
or persons entitled thereto under the Executive's will
or, in the case of intestacy, to the person or persons
entitled thereto under the laws of intestacy applicable
to the Executive's estate. The term "beneficiaries" as
used in this Agreement shall mean a beneficiary or
beneficiaries so designated to receive any such amount,
or, if no beneficiary has been so designated, the legal
representative of the Executive's estate. In the event
of the Executive's death, reference in this Agreement to
<PAGE>
<PAGE>10
the Executive shall be deemed, where appropriate, to
refer to the Executive's legal representative or, where
appropriate, to the Executive's beneficiary or
beneficiaries.
Section 16. Successors to the Corporation. This
Agreement shall be binding upon and inure to the benefit
of the Corporation and any successor of the Corporation,
including, without limitation, any corporation or
corporations acquiring directly or indirectly all or
substantially all of the assets of the Corporation
whether by merger, consolidation, sale or otherwise (and
such successor shall thereafter be deemed the
"Corporation" for the purposes of this Agreement).
Section 17. Headings; Pronouns. The titles to
sections in this Agreement are intended solely for
convenience and no provision of this Agreement is to be
construed by reference to the title of any section. All
pronouns in this Agreement and any variations thereof
shall be deemed to refer to the masculine, feminine,
neuter, singular or plural as the identity of the person
or persons may require.
Section 18. Governing Law. The validity,
interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of
Indiana.
Section 19. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board of Directors of the
Corporation or any authorized committee of the Board of
Directors of the Corporation and shall be agreed to in
writing, signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
Section 20. Severability. The invalidity or
unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full
force and effect to the fullest extent permitted by law.
<PAGE>
<PAGE>11
Section 21. Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which together
will constitute the same instrument.
Section 22. PMI Companies. Although the
Corporation is the only one of the PMI Companies formally
executing this Agreement, the Executive understands,
acknowledges and agrees that this Agreement is made for
the benefit of all of the PMI Companies, as applicable,
each of whom shall be entitled to enforce this Agreement
as their respective interests may appear.
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
"CORPORATION"
PERSONNEL MANAGEMENT, INC.
By /s/ Don R. Taylor
Don R. Taylor
President
ATTEST:
/s/ James E. Burnette
James E. Burnette
Vice President -
Finance and Administration
Secretary and Treasurer
"EXECUTIVE"
/s/ Elizabeth McFarland
Elizabeth McFarland
0669\EDGAR\SEV-BEN.MCF
<PAGE>1
CHANGE OF CONTROL
SEVERANCE BENEFITS AGREEMENT
THIS CHANGE OF CONTROL SEVERANCE BENEFITS AGREEMENT
(this "Agreement") is made and entered into as of the 5th
day of February, 1996, by and between PERSONNEL
MANAGEMENT, INC., an Indiana corporation (the
"Corporation"), and ROBERT R. MILLARD (the "Executive").
WITNESSETH:
WHEREAS, the Executive and the Corporation have
entered into an Employment Agreement dated of even date
herewith; and
WHEREAS, the Executive and the Corporation have
agreed for their mutual benefit to provide certain
severance benefits to the Executive that will be payable
by the Corporation if the Executive's employment with the
Corporation is terminated under certain circumstances;
NOW, THEREFORE, in consideration of the foregoing,
the mutual covenants and promises contained herein and
other valuable consideration, including services to be
performed by the Executive, it is hereby agreed by and
between the parties as follows:
Section 1. Effect; Effective Date. This
Agreement shall be effective February 5, 1996. Anything
in this Agreement to the contrary notwithstanding,
neither this Agreement nor any provision hereof shall be
operative unless and until there has been a Change of
Control of the Corporation (as "Change of Control of the
Corporation" is defined in Section 7 of this Agreement).
Upon a Change of Control of the Corporation this
Agreement shall become operative immediately.
Section 2. Employment. This Agreement shall not
be construed as creating a contract of employment between
the Executive and the Corporation. The Executive is,
however, employed by the Corporation at the time this
Agreement is executed, and the Executive and the
Corporation have executed an Employment Agreement of even
date herewith with respect to such employment.
Section 3. Obligation to Provide Severance
Entitlement. If the Executive's employment with the
Corporation is terminated under any circumstances other
than a Disqualifying Termination (as defined in Section
<PAGE>
<PAGE>2
8 of this Agreement) and if such termination of
employment occurs concurrently with or within three
months immediately preceding or twenty-four months
immediately following a Change of Control of the
Corporation, then the Corporation shall provide to the
Executive a severance benefit in the manner and amount as
provided in Section 4 of this Agreement (the "Severance
Entitlement").
Section 4. Manner and Amount of Severance
Entitlement. If the Corporation is obligated to provide
a Severance Entitlement to the Executive pursuant to
Section 3 of this Agreement, the manner in which the
Corporation shall provide such Severance Entitlement and
the amount thereof shall be as follows:
(a) The Corporation shall cancel all
indebtedness of the Executive to the Corporation
(if any) up to, but not in excess of, the amount of
the Severance Entitlement (as provided in Section
4(c) below).
(b) If the amount of indebtedness of the
Executive to the Corporation cancelled pursuant to
Section 4(a) above is less than the amount of the
Severance Entitlement to be provided to the
Executive by the Corporation, the Corporation shall
pay to the Executive, by check, an amount of money
equal to the difference between the amount of the
Executive's indebtedness that is cancelled and the
amount of the Severance Entitlement to be provided
to the Executive.
(c) The Severance Entitlement to be provided
by the Corporation to the Executive shall consist
of the cancellation of indebtedness and/or the
payment of money as provided in Sections 4(a) and
4(b) above. The aggregate dollar amount of the
Severance Entitlement, whether in debt cancellation
or money or both, shall be equal to the higher of
two times the current amount of base salary paid by
the Corporation to the Executive on an annualized
basis, or two times the highest amount of base
salary paid by the Corporation to the Executive for
any full calendar year during which the Executive
was employed by the Corporation; provided, however,
that if such Severance Entitlement, either alone or
together with other payments which the Executive
has the right to receive from any PMI Company,
would constitute an "excess parachute payment"
within the meaning of Section 280G of the Internal
<PAGE>
<PAGE>3
Revenue Code of 1986, as amended (the "Code"), then
the Corporation shall pay an additional amount of
money to the Executive that will equal (based upon
the Executive's good faith representations of the
Executive's income tax position for the year(s) of
payment(s)) the sum of (i) all excise tax imposed
upon the Executive by Section 4999 of the Code and
(ii) all additional state and federal income taxes
attributable to the additional payments to the
Executive pursuant to this proviso clause
(including all state and federal taxes on the
additional income tax payments). The determination
of the amounts of such payments pursuant to the
immediately preceding proviso shall be made by the
Corporation in good faith, and such determination
shall be conclusive and binding.
Section 5. Provision of Severance Entitlement.
With respect to a Severance Entitlement to be provided to
the Executive hereunder,the Corporation shall provide to
the Executive satisfactory written evidence of the amount
of any debt cancellation, and/or shall pay to the
Executive any money, to which the Executive is entitled
as a Severance Entitlement not later than 30 days after
the later of (i) the occurrence of the Change of Control
of the Corporation or (ii) the termination of the
Executive's employment.
Section 6. Withholding. The Corporation may
withhold or otherwise deduct from any Severance
Entitlement to be provided hereunder all federal, state,
city, county or other taxes as shall be required pursuant
to any law or governmental regulation or ruling.
Section 7. Change of Control of the Corporation.
For purposes of this Agreement, a "Change of Control of
the Corporation" shall be deemed to have occurred if,
after the date hereof either:
(a) there shall have been consummated (i) any
reorganization, consolidation or merger of the
Corporation in which the Corporation is not the
continuing or surviving corporation or pursuant to
which shares of the Corporation's common stock
shall have been converted into cash, securities or
other property, or (ii) any sale, lease, exchange
or other transfer, directly or indirectly, (in one
transaction or a series of related transactions) of
all, or substantially all, of the assets of the
Corporation and its consolidated subsidiaries
unless, following such reorganization, merger,
consolidation, or transfer of assets,
<PAGE>
<PAGE>4
(A) more than 60 percent of the
then outstanding shares of common stock
of the corporation resulting from such
reorganization, merger or consolidation
(or of the corporation receiving the
transferred assets) (the "Continuing
Corporation") and of the then outstanding
voting securities of the Continuing
Corporation entitled to vote generally in
the election of Directors are then
beneficially owned, directly or
indirectly, by all or substantially all
of the individuals and entities who were
the beneficial owners, respectively, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation
entitled to vote generally in the
election of Directors immediately prior
to such reorganization, merger,
consolidation or transfer of assets in
substantially the same proportions as
their ownership, immediately prior to
such reorganization, merger,
consolidation or transfer of assets, of
the outstanding shares of common stock of
the Corporation and of the outstanding
voting securities of the Corporation,
(B) no "person" (as that term is
used in Sections 13(d) and 14(d)(2) of
the Securities Exchange Act of 1934, as
amended) (excluding (aa) the Corporation,
(bb) any employee benefit plan (or
related trust) sponsored or maintained by
the Corporation or any entity controlled,
directly or indirectly, by the
Corporation or the Continuing Corporation
and (cc) any "person" beneficially
owning, immediately prior to such
reorganization, merger, consolidation or
transfer of assets, directly or
indirectly, 20 percent or more of the
outstanding shares of common stock of the
Corporation or the outstanding voting
securities of the Corporation)
beneficially owns, directly or
indirectly, 20 percent or more of,
respectively, the then outstanding shares
of common stock of the Continuing
Corporation or of the combined voting<PAGE>
<PAGE>5
power of the then outstanding voting
securities of the Continuing Corporation
entitled to vote generally in the
election of Directors, and
(C) at least a majority of the
members of the Board of Directors of the
Continuing Corporation were members of
the Board of Directors of the Corporation
at the time of the execution of the
initial agreement providing for such
reorganization, merger, consolidation or
transfer of assets;
(b) any "person" or "group" of persons
(as those terms are used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and
Regulations 13D-G and 14D thereunder) shall
have become the "beneficial owner" (within the
meaning of Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the
Corporation representing 20 percent or more of
the combined voting power of the Corporation's
then outstanding voting securities entitled to
vote generally in the election of Directors
(excluding (i) the Corporation, (ii) any
employee benefit plan (or related trust)
sponsored or maintained by the Corporation or
any entity controlled, directly or indirectly,
by the Corporation, (iii) any "person" who, on
the date of this Agreement, is the "beneficial
owner", directly or indirectly, of 20 percent
or more of the Corporation's outstanding
common stock, and (iv) any "group" of persons
that includes Don R. Taylor); or
(c) during any period of two consecutive
years, individuals who constitute the Board of
Directors of the Corporation at the beginning
of such period cease for any reason to
constitute at least a majority thereof,
excluding individuals whose election, or
nomination for election by the Corporation's
shareholders was approved by a vote of at
least two-thirds of the Directors then still
in office who were Directors at the beginning
of such period, unless, for this purpose, any
such new Director's initial assumption of
office occurs as a result of either an actual
or threatened election contest (as such terms
<PAGE>
<PAGE>6
are used in Rule 14a-11 or Regulation 14A
promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies
or consents by or on behalf of a person other
than the Board of Directors of the
Corporation.
Section 8. Disqualifying Termination. For
purposes of this Agreement, a "Disqualifying Termination"
of the Executive's employment with the Corporation shall
mean a termination of the Executive's employment under
any of the following circumstances:
(a) termination of the Executive's employment
by the Corporation for Cause (as defined in Section
9); or
(b) termination of the Executive's employment
by the Corporation for Disability (as defined in
Section 10); or
(c) termination of the Executive's employment
by the Executive without Good Reason (as defined in
Section 11) to do so; or
(d) termination of the Executive's employment
as a result of the death of the Executive.
(As provided in Section 3, the Executive shall not be
entitled to a Severance Entitlement under this Agreement
if the Executive's employment with the Corporation was
terminated under circumstances constituting a
Disqualifying Termination.)
Section 9. Termination by the Corporation for
Cause. For purposes of this Agreement, the Corporation
shall be deemed to have terminated the Executive's
employment with the Corporation for "Cause" only if the
Corporation terminated the Executive's employment with
the Corporation for any of the following reasons:
(a) the continued failure of the Executive to
substantially perform any of the Executive's
significant duties or responsibilities in
connection with the Executive's employment (other
than any such failure resulting from the
Executive's incapacity due to physical or mental
illness) if such failure is not corrected or cured
within 30 days after demand for substantial
performance is made in writing upon the Executive
<PAGE>
<PAGE>7
by the Corporation specifically identifying the
manner in which the Corporation believes the
Executive has failed to substantially perform one
or more of the Executive's significant duties or
responsibilities (repetition of the same failure as
previously described in any such written demand
after the 30-day cure period following such written
demand shall be deemed to be "continued failure" to
substantially perform by the Executive); or
(b) any act that constitutes on the part of
the Executive common law fraud or dishonesty
regardless of whether such fraud or dishonesty
resulted in, or was intended to result in, a
benefit to the Executive at the expense of the
Corporation; or
(c) the conviction of the Executive of, or
the plea by the Executive of nolo contendere to, a
felony or a crime involving moral turpitude; or
(d) any continuing violation by the Executive
in any material respect of any of the Corporation's
policies or of any term or provision of any
employment or other agreement between the Executive
and the Corporation which, in any such case, is not
corrected or abated by the Executive within 30 days
after written notice of such violation is given by
the Corporation to the Executive (repetition of the
same violation as previously described in any such
written notice after the 30 day correction period
following such written notice shall be deemed to be
a "continuing violation" by the Executive); or
(e) the Executive's unexcused total
abandonment or neglect of the Executive's duties
and responsibilities in connection with the
Executive's employment with the Corporation (other
than absences due to illness, physical or mental
incapacity, vacations, or other excused absences)
for a continuous period of ten working days.
Section 10. Termination by the Corporation for
Disability. For purposes of this Agreement, the
Executive shall be considered to have suffered a
"Disability" and the Corporation shall be deemed to have
terminated the Executive's employment with the
Corporation for Disability if such termination is made
after (and is identified by the Corporation as being on
account of the occurrence of) either of the following:
<PAGE>
<PAGE>8
(a) the actual receipt by the Executive of
income continuation benefits or similar benefits
pursuant to a disability insurance policy as a
result of a determination under such policy that
the Executive is disabled, or
(b) the Executive's inability by reason of
physical and/or mental incapacity to substantially
perform the essential functions of the Executive's
duties and responsibilities to the Corporation on a
full-time basis for a period of 26 consecutive
weeks.
Section 11. Termination by the Executive for Good
Reason. For purposes of this Agreement, the Executive
shall be deemed to have terminated the Executive's
employment with the Corporation for "Good Reason" only if
the Executive terminated his employment with the
Corporation within 90 days after the Executive's base
salary was either (a) reduced to an amount that was less
than 95 percent of the Executive's base salary as of the
date of this Agreement, or (b) reduced by more than 5
percent for any calendar year from the amount paid in the
prior calendar year.
Section 12. No Mitigation. The Executive is not
required to mitigate the amount of the Severance
Entitlement to be provided by the Corporation pursuant to
this Agreement by seeking other employment or otherwise,
nor shall the amount of the Severance Entitlement payable
pursuant to this Agreement be reduced by any compensation
earned by the Executive as the result of employment by
another employer, or which might have been earned by the
Executive had the Executive sought other employment,
after the date of termination of the Executive's
employment with the Corporation.
Section 13. Notices. Any notice, request, demand
and other communication to be given hereunder shall be in
writing and personally delivered or mailed in the
continental United States by registered or certified
mail, postage prepaid, at the address stated below or to
such changed address as the addressee may have given by
a similar notice:
To the Company: Personnel Management, Inc.
1499 Windhorst Way
Suite 100
Greenwood, Indiana 46143
<PAGE>
<PAGE>9
To the Executive: Robert R. Millard
8125 Springwater Drive West
Indianapolis, Indiana 46256
Section 14. Legal Expenses. In the event that
either of the parties institutes any legal action to
enforce its rights under, or to recover damages for
breach of, this Agreement, the prevailing party shall be
entitled to recover from the other party any actual
expenses for attorney's fees, costs, expenses and
disbursements incurred by the prevailing party.
Section 15. Successors to the Executive. This
Agreement shall be binding upon and shall inure to the
benefit of the Executive, the Executive's heirs,
beneficiaries, devisees, successors and legal
representatives. No right or interest to or in any
payments hereunder shall be assignable by the Executive
except assignments to the Corporation in accordance with
applicable law; provided, however, that this provision
shall not preclude the Executive from designating one or
more beneficiaries to receive any amount that may be
payable after the Executive's death and shall not
preclude the legal representative of the Executive's
estate from assigning any right hereunder to the person
or persons entitled thereto under the Executive's will
or, in the case of intestacy, to the person or persons
entitled thereto under the laws of intestacy applicable
to the Executive's estate. The term "beneficiaries" as
used in this Agreement shall mean a beneficiary or
beneficiaries so designated to receive any such amount,
or, if no beneficiary has been so designated, the legal
representative of the Executive's estate. In the event
of the Executive's death, reference in this Agreement to
the Executive shall be deemed, where appropriate, to
refer to the Executive's legal representative or, where
appropriate, to the Executive's beneficiary or
beneficiaries.
Section 16. Successors to the Corporation. This
Agreement shall be binding upon and inure to the benefit
of the Corporation and any successor of the Corporation,
including, without limitation, any corporation or
corporations acquiring directly or indirectly all or
substantially all of the assets of the Corporation
whether by merger, consolidation, sale or otherwise (and
such successor shall thereafter be deemed the
"Corporation" for the purposes of this Agreement).
<PAGE>
<PAGE>10
Section 17. Headings; Pronouns. The titles to
sections in this Agreement are intended solely for
convenience and no provision of this Agreement is to be
construed by reference to the title of any section. All
pronouns in this Agreement and any variations thereof
shall be deemed to refer to the masculine, feminine,
neuter, singular or plural as the identity of the person
or persons may require.
Section 18. Governing Law. The validity,
interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of
Indiana.
Section 19. Amendment or Modification; Waiver. No
provision of this Agreement may be amended, modified or
waived unless such amendment, modification or waiver
shall be authorized by the Board of Directors of the
Corporation or any authorized committee of the Board of
Directors of the Corporation and shall be agreed to in
writing, signed by the Executive and by an officer of the
Corporation thereunto duly authorized. Except as
otherwise specifically provided in this Agreement, no
waiver by either party hereto of any breach by the other
party hereto of any condition or provision of this
Agreement to be performed by such other party shall be
deemed a waiver of a subsequent breach of such condition
or provision or a waiver of a similar or dissimilar
provision or condition at the same or at any prior or
subsequent time.
Section 20. Severability. The invalidity or
unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full
force and effect to the fullest extent permitted by law.
Section 21. Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which together
will constitute the same instrument.
Section 22. PMI Companies. Although the
Corporation is the only one of the PMI Companies formally
executing this Agreement, the Executive understands,
acknowledges and agrees that this Agreement is made for
the benefit of all of the PMI Companies, as applicable,
each of whom shall be entitled to enforce this Agreement
as their respective interests may appear.
<PAGE>
<PAGE>11
IN WITNESS WHEREOF, the Corporation and the
Executive have executed this Agreement as of the date and
year first above written.
PERSONNEL MANAGEMENT, INC.
By /s/ Don R. Taylor
Don R. Taylor
President
ATTEST:
/s/ Elizabeth McFarland
Elizabeth McFarland
Vice-President - Operations
"EXECUTIVE"
/s/ Robert R. Millard
Robert R. Millard
0669\EDGAR\SEV-BEN.MIL
<PAGE>1
February 5, 1996
Mr. Robert R. Millard
Personnel Management, Inc.
1499 Windhorst Way, Suite 100
Greenwood, Indiana 46143
Re: Incentive Stock Option Agreement
Dear Mr. Millard
Personnel Management, Inc. (the "Corporation"),
pursuant to the Personnel Management, Inc. 1994 Stock
Option Plan (the "Plan"), hereby grants to you as of
February 5, 1996 (the "Effective Date"), an incentive
stock option (the "Option"), which Option shall have the
following terms and conditions, in addition to those
provided in the Plan:
1. Number of Shares: The Option is for 50,000
shares of the Corporation's common stock, no
par value (the "Common Shares"), subject to
adjustment as provided in the Plan.
2. Exercise Price: The per share exercise price
shall be $6.30 (the average of the closing bid
and asked prices for the five trading days
immediately preceding the Effective Date of
the Option), subject to adjustment as provided
in the Plan.
3. Exercisability. The Option shall become
immediately exercisable with respect to 10,000
shares covered by the Option, and the
remaining 40,000 shares covered by the Option
shall vest and first become exercisable,
subject to your continued employment, in four
installments of 10,000 shares each on each of
the first four anniversaries of the Effective
Date. Notwithstanding the preceding sentence,
the Option shall become immediately
exercisable with respect to all shares covered
by the Option upon (a) your death, (b) your
"Permanent and Total Disability", as defined
in the Plan, (c) your becoming entitled to the
Severance Entitlement pursuant to and as
defined in Section 3 of the Change of Control
Severance Benefits Agreement dated February 5,
1996, between you and the Corporation, (d) the
<PAGE>
<PAGE>2
dissolution or liquidation of the Corporation,
(e) a reorganization, merger or consolidation
of the Corporation as a result of which the
outstanding securities of the class then
subject to the Option hereunder are changed
into or exchanged for cash or property or
securities not of the Corporation's issue, or
(f) a sale of substantially all the property
of the Corporation to another corporation or
person.
The Option will expire with respect to all unpurchased
shares at 5:00 p.m., E.S.T. on February 4, 2006.
The Option, which is intended to qualify as an
"incentive stock option" within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended,
shall be in all respects limited and conditioned as
provided in the Plan. You should consult with your
personal tax advisor regarding the tax consequences of
exercising "incentive stock options" in connection with
any future decision by you to exercise the Option in
whole or in part. Under Sections 6 and 8 of the Plan,
the Option generally cannot be voluntarily transferred by
you and the Option generally cannot be exercised by
anyone other than you during your lifetime. A copy of
the Plan is enclosed with this letter. Exercise of the
Option shall be subject to your making of the
representations set forth below and any representations
to such other matters as the Corporation's Stock Option
Committee, in its discretion, may determine to be
necessary or advisable to evidence compliance with
requirements under the Securities Act of 1933, as
amended, or state securities laws for registering or
exempting from registration any offer or sale of the
Corporation's securities pursuant to the Plan.
Neither this letter nor the Plan shall be construed
as giving you any right to be retained in the employ of
the Corporation and neither shall be construed as
limiting in any way the Corporation's right to terminate
or change the terms of your employment. The Option and
your right to purchase or receive shares pursuant to the
Option shall terminate within the time periods specified
by Section 8 of the Plan in the event your employment
with the Corporation is terminated.
<PAGE>
<PAGE>3
This letter, upon your delivery of an executed copy
to the Corporation, shall constitute a binding incentive
stock option agreement between you and the Corporation.
Very truly yours,
PERSONNEL MANAGEMENT, INC.
By /s/ Don R. Taylor
Don R. Taylor, President
<PAGE>
<PAGE>4
ACKNOWLEDGMENT AND AGREEMENT
I hereby acknowledge receipt of this letter granting
me the above Option as well as receipt of a copy of the
Plan, and I acknowledge and agree to be bound by the
following:
1. I have received a copy of this letter and the
Plan (and the Company's Memorandum dated October 31, 1994
addressed to Participants in the Plan, which Memorandum
constitutes part of the Prospectus covering securities
that have been registered under the Securities Act of
1933) and agree to be bound by the terms and conditions
set forth herein and therein.
2. I agree to be responsible for, and to cooperate
with the Corporation in connection with, the satisfaction
of all applicable federal, state or local income tax
withholding requirements and other like requirements
arising therefrom.
EXECUTED this 5th day of February, 1996.
/s/ Robert R. Millard
Robert R. Millard
0669\EDGAR\MILLARD.SOP
PROMISSORY NOTE
$123,352 Due Date: April 14, 2006
Greenwood, Indiana
April 15, 1996
FOR VALUE RECEIVED, Elizabeth McFarland, an Indiana resident
("Borrower"), promises to pay to the order of Personnel Management,
Inc., an Indiana corporation ("Holder"), at 1499 Windhorst Way,
Suite 100, Greenwood, Indiana 46143, or at such other place as
Holder may direct in writing, on or before April 14, 2006, the
principal amount of $123,352 with interest compounded and paid
annually on the anniversary date hereof on the unpaid principal
balance existing from time to time at a variable rate equal to the
"Prime Rate" (as hereinafter defined), determined and adjusted as
provided below, from the date of this Promissory Note (the "Note")
until paid in full, together with the Holder's reasonable attorneys'
fees and expenses of enforcement and collection, all without relief
from valuation and appraisement laws. The applicable interest rate
hereunder shall initially be a rate equal to the Prime Rate on the
last business day preceding the date of this Note and shall be
adjusted and reset annually on the anniversary date hereof to the
Prime Rate on the last business day preceding the date on which such
rate is to be adjusted and reset. "Prime Rate" means the prevailing
base rate on corporate loans charged by large U.S. banks as reported
in the Money Rates column of The Wall Street Journal as the
prevailing Prime Rate (or as otherwise reasonably determined by the
Holder if such publication is not made or available).
Payment of accrued interest shall be made to Holder annually
on or before each anniversary date of this Note. This Note may be
prepaid in full or in part at any time without penalty.
Time is of the essence of this Note. Upon the occurrence of
an Event of Default (defined below) Holder may, at its option and
upon notice to Borrower, accelerate and declare immediately due and
payable all sums payable hereunder and, except as otherwise provided
herein, thereupon pursue all available remedies for the collection
of all sums payable hereunder to Holder. For purposes of this Note,
each of the following shall constitute an Event of Default ("Event
of Default"):
1. Borrower shall fail to pay any sum payable
hereunder when due and such default in payment continues for
a period of 10 days after the due date thereof.
2. Borrower's employment with Holder is terminated
for any reason or for no reason.
If Borrower's employment with Holder is terminated and if Holder
accelerates and declares immediately due and payable the sums
payable hereunder on account of such termination of employment, and
if at the time of such acceleration and declaration Borrower
reasonably believes that she may be legally unable to sell the
shares of Holder's common stock that are pledged to secure this Note
because such sale is prohibited by federal securities laws by reason
of material information known to Borrower about Holder that has not
been disclosed publicly, and if Borrower provides to Holder an
opinion of Borrower's counsel (who shall be of recognized standing
regarding securities law matters in the community in which such
counsel practices law) in form and substance satisfactory to Holder
to that effect, then Borrower may elect by written notice to Holder
to defer payment of all sums payable hereunder by reason of such
acceleration and declaration (with interest) to a date specified by
Borrower that is not later than 90 days after the date as of which
Holder accelerated and declared due and payable the payment of the
sums payable hereunder.
Borrower waives presentment, protest, notice of protest, and
notice of nonpayment or dishonor of this Note, and consents to
extensions of the time of payment of this Note. No delay or
omission on the part of Holder in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial
exercise by Holder of any right or remedy shall preclude other or
further exercise thereof or of any other right or remedy.
This Note shall be governed by the laws of the State of
Indiana.
This Note is secured by the pledge of 24,670 shares of common
stock of Holder owned by Borrower pursuant to a Pledge Agreement
executed concurrently herewith.
EXECUTED AND DELIVERED as of the 15th day of April, 1996.
/s/Elizabeth McFarland
Address: 8153 Lower Bay Lane
Indianapolis, Indiana 46236
0669\EDGAR\MCFARLAN.PN
<PAGE>1
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Agreement") is made and
entered into effective this 15th day of April, 1996, by
and between Elizabeth McFarland, an Indiana resident
("Pledgor"), and Personnel Management, Inc., an Indiana
corporation ("Pledgee").
WITNESSETH THAT:
WHEREAS, Pledgee has twice previously authorized the
making of a loan to Pledgor under the Personnel
Management, Inc. Loan Plan for Key Employees for the
purpose of paying income tax with respect to Pledgor's
December 29, 1994 exercise of non-qualified stock options
to purchase shares of common stock of Pledgee, which loan
was never disbursed, and Pledgor previously executed a
promissory note in connection with such loan, which
promissory note has been terminated and cancelled because
of such non-disbursement of funds; and
WHEREAS, concurrently with the execution of this
Agreement, Pledgee is making a loan to Pledgor outside of
the Loan Plan for Key Employees in the principal amount
of $123,352 (the "Loan") for the purpose of assisting
Pledgor in satisfying her personal tax obligations in
connection with Pledgor's option exercise; and
WHEREAS, the parties desire to enter into this
Agreement in order to secure the payment and performance
of Pledgor's obligations under the Promissory Note
executed by Pledgor in favor of Pledgee in connection
with the Loan and dated concurrently herewith (the Note);
NOW, THEREFORE, in consideration of the premises,
and of the mutual promises, covenants, agreements,
representations and warranties contained herein, and of
other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties
agree as follows:
1. Security Interest. Pledgor grants to Pledgee
a security interest in 24,670 of the shares of Common
Stock of Pledgee owned by Pledgor and all proceeds and
replacements thereof (the "Shares"). The security
interest granted to Pledgee shall secure the performance
and payment of all obligations of Pledgor under the Note
(all such obligations hereinafter being referred to as
the "Obligations"). Concurrently herewith Pledgor has
delivered to Pledgee certificates representing the Shares
<PAGE>
<PAGE>2
together with stock powers duly executed for transfer of
the Shares to Pledgee. Pledgee shall hold and dispose of
such certificates as provided in this Agreement.
2. Shareholders' Rights. Unless and until an
Event of Default (as defined herein) has occurred,
Pledgor shall be entitled:
(a) To exercise all voting rights with
respect to the Shares; and
(b) To receive and collect or to have paid
over all dividends and distributions declared or
paid on the Shares, except (i) dividends or
distributions constituting stock dividends, (ii)
dividends or distributions in kind, or (iii)
liquidating dividends (either partial or complete),
provided that any and all such excepted dividends
and distributions shall constitute additional
collateral for the purposes of this Agreement and
shall be delivered and pledged to Pledgee, together
with appropriate stock powers or other assignments,
and Pledgee shall have in respect thereof all of
the powers and rights as are herein provided in
respect to the initial Shares.
3. Representations and Warranties of Pledgor.
Pledgor represents, warrants, covenants, and agrees that:
(a) Pledgor is the owner beneficially and of
record of the Shares, free and clear of any lien,
security interest or other claim to the Shares,
except the security interest granted to Pledgee
under this Agreement.
(b) Pledgor has full power to transfer and
pledge the Shares without obtaining the consent or
approval of any other person, financial
institution, or governmental authority.
4. Event of Default.
(a) "Event of Default" shall mean the
occurrence of any of the following events:
(i) Pledgor fails to pay within ten (10)
days from and after the date when due any
amount required to be paid to Pledgee under
the Note (including sums that become payable
by reason of acceleration);
<PAGE>
<PAGE>3
(ii) Pledgor breaches any term,
condition, representation, covenant or
warranty contained in this Agreement;
(iii) Pledgor fails to perform any of
her obligations under this Agreement and such
failure to perform continues uncured for a
period of fifteen (15) days after written
notice of such failure to perform is delivered
to Pledgor by Pledgee, provided, however,
that if the nature of the failure to perform
is such that it can be cured by Pledgor but
cannot be cured within the fifteen (15) day
period provided above, and if Pledgor
commences efforts to effect such cure within
such fifteen (15) day period and thereafter
diligently proceeds to take such actions as
may be reasonably required to effect such
cure, the fifteen (15) day cure period
provided above shall be extended for a period
ending the earlier of (A) forty-five (45) days
after the expiration of such fifteen (15) day
cure period provided above, (B) the date as of
which Pledgor shall cease the diligent pursuit
of such actions as may be reasonably required
to effect such cure, or (C) the date as of
which the cure of such failure to perform by
Pledgor shall become impossible;
(iv) Pledgor admits to being insolvent, a
receiver is appointed for any of Pledgor's
property, Pledgor makes an assignment for the
benefit of creditors or any proceeding is
commenced either by Pledgor or against Pledgor
under any bankruptcy or insolvency laws and
remains undismissed for sixty (60) days.
(b) Upon the occurrence of an Event of
Default, Pledgee shall have all the rights and
remedies with respect to the Shares of a secured
party under the Indiana Uniform Commercial Code and
any other applicable law and may declare all
obligations secured hereby immediately due and
payable if they are not already due and payable.
Pledgor shall pay or reimburse Pledgee on demand
for all reasonable out of pocket costs and expenses
(including reasonable attorney fees and legal
expenses) incurred by Pledgee in connection with
the enforcement of this Agreement.
<PAGE>
<PAGE>4
5. Release of Shares. Upon payment in full of the
Obligations, Pledgee shall promptly return to Pledgor the
stock certificates and stock powers delivered to Pledgee
hereunder with respect to the Shares, except for any of
the Shares that might have been sold (or otherwise
applied to the Obligations) pursuant to this Agreement.
6. Waiver. None of the provisions in this
Agreement and no right of Pledgee hereunder shall be
deemed to have been waived by reason of any failure or
delay in the exercise of such right or the enforcement of
such provisions and none of the rights of Pledgee shall
be waived unless such waiver shall be expressed in a
writing duly signed by Pledgee. No waiver of any of the
provisions of this Agreement shall be deemed, or shall
constitute, a waiver of any other provision, whether or
not similar, nor shall any waiver constitute a continuing
waiver.
7. Binding Effect. All the terms, covenants and
conditions of this Agreement shall be binding upon, and
inure to the benefit of, and be enforceable by the
parties hereto and their respective successors, heirs,
beneficiaries, personal representatives, administrators,
executors, trustees and assigns.
8. Severability. If any term or application
thereof in this Agreement is held to be unenforceable or
invalid for any reason, then the validity of all the
remaining terms and applications shall not be affected,
and, if generally consistent with the basic purposes of
this Agreement, the rights and obligations of each of the
parties shall be construed and be in force as if this
Agreement did not contain such invalid term or
application.
9. Governing Law. This Agreement shall be
construed, interpreted and governed in all respects by
the laws of the State of Indiana.
10. Notices. Any notice, request, communication,
or other document to be given hereunder to any of the
parties by any other party shall be in writing and shall
be personally delivered or sent by prepaid same day or
overnight courier or certified mail, return receipt
requested, postage prepaid, addressed as follows (or
addressed to such other addresses as shall be given in
writing by any party to the others):
<PAGE>
<PAGE>5
If to Pledgor
addressed to: Elizabeth McFarland
8153 Lower Bay Lane
Indianapolis, Indiana 46236
If to Pledgee,
addressed to: Personnel Management, Inc.
1499 Windhorst Way, Suite 100
Greenwood, Indiana 46143
Attn: Don R. Taylor, President
11. Further Assurance. Pledgor agrees that, upon
the request of Pledgee, she will execute and deliver to
Pledgee such other documents or instruments as shall be
deemed reasonably necessary or appropriate by Pledgee to
confirm or perfect its pledge of Shares as expressed in
Section 1 above.
12. Additional Collateral. All certificates
evidencing any shares of Common Stock of Pledgee
hereafter issued to Pledgor on account of her ownership
of the Shares (including, without limitation, stock
splits and stock dividends), regardless of class or type,
or any other securities issued with respect to the Shares
including, without limiting the generality of the
foregoing, those issued pursuant to any rights or
warrants or by way of stock split or pursuant to a
merger, consolidation, reorganization or otherwise, or
any substituted securities issued upon conversion,
reorganization or otherwise, shall be forthwith pledged
and delivered by Pledgor to Pledgee, and the security
interest herein granted shall extend thereto.
13. Application of Proceeds. The proceeds of any
sale of all or any part of the Shares, and any other cash
at the time held by Pledgee under this Agreement, shall
be applied by Pledgee in the following order:
(a) to the payment of the reasonable costs
and expenses of any such sale, including sales
commissions paid by Pledgee and their agents and
counsel, and all other reasonable expenses,
liabilities and advances made or incurred by
Pledgee in connection herewith;
(b) to the payment of the amounts then due
and unpaid on the Obligations in such order as
Pledgee may determine; and
<PAGE>
<PAGE>6
(c) to Pledgor, her estate, heirs,
beneficiaries, successors or assigns, or as a court
of competent jurisdiction may direct, of any
surplus then remaining from such proceeds.
14. Pledge Absolute. This Agreement and the pledge
and security interest provided for hereunder shall be
absolute and unconditional, irrespective of the
regularity, validity or enforceability of the Obligations
and shall not be affected or impaired by any compromise,
release, renewal, extension, indulgence, alteration,
change in or modification of the Obligations. Upon the
occurrence of an Event of Default as defined in this
Agreement, there shall be no obligation on the part of
Pledgee at any time to resort for payment to Pledgee
before proceeding to exercise its rights under this
Agreement with respect to the Shares, or to resort to any
other collateral security or other rights or remedies
whatsoever and Pledgee shall have the right to enforce
this Agreement irrespective of whether or not other
proceedings or steps are pending seeking resort to or
realization for, or upon any of the foregoing.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement effective as of the date first above
written.
PLEDGEE
PERSONNEL MANAGEMENT, INC.
By /s/ Don R. Taylor
Don R. Taylor, President
PLEDGOR
/s/ Elizabeth McFarland
Elizabeth McFarland
0669\EDGAR\PLEDGE.AGR
<PAGE>
EXHIBIT 11.1
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
THREE MONTHS ENDED APRIL 30,
1996 1995
<S> <C> <C>
Weighted average shares outstanding 2,020,156 1,977,766
Net effect of dilutive stock options -
based on the treasury stock method
using average market price 11,695 84,775
2,031,851 2,062,541
Net income $ 281,500 $ 217,639
Net income per share $ 0.14 $ 0.11
</TABLE>
<PAGE>
EXHIBIT 11.2
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
SIX MONTHS ENDED APRIL 30,
1996 1995
<S> <C> <C>
Weighted average shares outstanding 2,020,156 1,968,321
Net effect of dilutive stock options -
based on the treasury stock method
using average market price 7,601 76,278
2,027,757 2,044,599
Net income $ 363,100 $ 282,138
Net income per share $ 0.18 $ 0.14
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS CONTAINED IN THE FILER'S FORM 10-Q FOR THE QUARTER ENDED
APRIL 30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS
</LEGEND>
<CIK> 0000916606
<NAME> PERSONNEL MANAGEMENT, INC.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-END> APR-30-1996
<CASH> 291,334
<SECURITIES> 0
<RECEIVABLES> 6,422,120
<ALLOWANCES> 191,385
<INVENTORY> 0
<CURRENT-ASSETS> 7,201,089
<PP&E> 2,096,551
<DEPRECIATION> 801,808
<TOTAL-ASSETS> 15,587,450
<CURRENT-LIABILITIES> 6,728,146
<BONDS> 96,456
<COMMON> 7,784,429
0
0
<OTHER-SE> 902,219
<TOTAL-LIABILITY-AND-EQUITY> 15,587,450
<SALES> 16,388,262
<TOTAL-REVENUES> 16,388,262
<CGS> 12,981,063
<TOTAL-COSTS> 13,109,490
<OTHER-EXPENSES> 2,584,808
<LOSS-PROVISION> 125,649
<INTEREST-EXPENSE> 82,233
<INCOME-PRETAX> 502,694
<INCOME-TAX> 221,194
<INCOME-CONTINUING> 281,500
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 281,500
<EPS-PRIMARY> 0.14
<EPS-DILUTED> 0.14
</TABLE>
