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EXHIBIT 10.40
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STOCKHOLDERS AGREEMENT
AMONG
NORRELL CORPORATION,
THE CROSS COUNTRY GROUP, LLC
AND
NORCROSS INC.
Dated August 15, 1996
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STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (as amended from time to time, this
"Agreement"), is made and entered into as of August 15, 1996 (the "Effective
Date"), by and among Norcross Inc., a Delaware corporation (the "Company"),
Norrell Corporation, a Georgia corporation ("Norrell"), and The Cross Country
Group, LLC, a Massachusetts limited liability company ("CCG").
RECITALS
A. As of the Effective Date, the Initial Stockholders together own, or
will own, all of the issued and outstanding shares of Common Stock;
B. As of the Effective Date, Norrell owns, or will own, all of the issued
and outstanding shares of Preferred Stock; and
C. The Initial Stockholders believe it is in the Stockholders' and the
Company's best interests to enter into certain agreements associated with the
ownership of the Shares and to make certain other agreements as set forth in
this Agreement.
In consideration of the covenants contained in this Agreement, the above
recitals, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, hereby agree as follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the
following meanings:
1.1 "AAA" shall have the meaning set forth in Section 8.1
1.2 "Acquired Initial Stockholder" shall have the meaning set forth in
Section 15.1(a).
1.3 "Additional Contributions" shall have the meaning set forth in Section
3.2(a).
1.4 "Additional Stockholders" shall mean any Stockholder other than CCG or
Norrell.
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1.5 "Affected Shares" shall have the meaning set forth in Section 10.1 and
10.2(a).
1.6 "Affiliate" of a specified Person at a specified time shall mean a
Person that, at that time, directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with,
that Person, "control" being defined as the ability, through ownership of voting
equity interests of an entity or otherwise, to control the management and
business decisions of the entity.
1.7 "Board of Directors" shall mean the board of directors of the
Company.
1.8 "CCG" shall have the meaning set forth in the Preamble.
1.9 "Call Option" shall have the meaning set forth in Section 15.1(b).
1.10 "Capital Calls" shall have the meaning set forth in Section 3.2(a).
1.11 "Certificate of Incorporation" shall mean the Certificate of
Incorporation of the Company filed with the Delaware Secretary of State, as the
same may be properly amended from time to time.
1.12 "Change of Control Notice" shall have the meaning set forth in Section
15.1(a).
1.13 "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
1.14 "Common Stock" shall mean the Company's $.01 par value per share
common stock, described in more detail in the Company's Certificate of
Incorporation. References in this Agreement to a Stockholder's percentage
ownership of the Common Stock shall be deemed to refer to the percentage of all
issued and outstanding Common Stock owned by the Stockholder.
1.15 "Common Stock Call shall have the meaning set forth in Section
3.2(a).
1.16 "Common Stock Purchase Price" shall have the meaning set forth in
Section 3.1.
1.17 "Company" shall have the meaning set forth in the Preamble.
1.18 "Company Customer" shall have the meaning set forth in Section
7.3(a).
1.19 "Competitive Position" shall have the meaning set forth in Section
7.2.
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1.20 "Confidential Information" shall have the meaning set forth in
Section 7.1.
1.21 "Contributed Amount" shall have the meaning set forth in Section
3.3(a).
1.22 "Contributed Preferred Amount" shall have the meaning set forth in
Section 3.3(b).
1.23 "Contributing Stockholder" shall have the meaning set forth in
Section 3.3(a).
1.24 "DGCL" shall mean the General Corporation Law of the State of
Delaware, as amended from time to time.
1.25 "Defaulted Amount" shall have the meaning set forth in Section
3.3(a).
1.26 "Defaulted Preferred Amount" shall have the meaning set forth in
Section 3.3(b).
1.27 "Defaulting Stockholder" shall have the meaning set forth in Section
3.3(a).
1.28 "Designated Value" shall have the meaning set forth in Section
15.1(c).
1.29 "Direct Competitor" shall mean a Person whose principal business is,
or who derives in excess of ten percent (10%) of its consolidated revenues
from, supplying Outsourced Teleservices (which do not fall within the
definition of Excluded Business).
1.30 "Direct Transferee" shall mean any Person to whom an Initial
Stockholder directly conveys any Shares.
1.31 "Director" shall mean a member of the Board of Directors.
1.32 "Dispute" shall have the meaning set forth in Section 8.1.
1.33 "Dispute Notice" shall have the meaning set forth in Section 8.3
1.34 "Effective Date" shall have the meaning set forth in the Preamble.
1.35 "Exercise Notice" shall have the meaning set forth in Section
15.1(b).
1.36 "Excluded Business" shall have the meaning set forth in Section
2.4(b).
1.37 "Excluded Disputes" shall have the meaning set forth in Section 8.1.
1.38 "Initial Contributions" shall have the meaning set forth in Section
3.1.
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1.39 "Initial Stockholders" shall mean, collectively, Norrell and its
Affiliates and CCG and its Affiliates.
1.40 "Initial Term" shall have the meaning set forth in Section 14.1.
1.41 "IPO Registration Statement" shall have the meaning set forth in
section 4.2.
1.42 "Laws" shall mean collectively statutes, common law and any
regulation, directive, order or ruling by a governmental body or delegate that
is generally regarded as having the force of law.
1.43 "Minority Stockholder" shall have the meaning set forth in Section
4.4(a).
1.44 "Negotiator" shall have the meaning set forth in Section 8.3(a).
1.45 "New Issuance" shall have the meaning set forth in Section 9.1(a).
1.46 "1933 Act" shall have the meaning set forth in Section 17.1.
1.47 "Non-Defaulting Stockholder" shall have the meaning set forth in
Section 3.3(a).
1.48 "Nonoffering Initial Stockholder" shall have the meaning set forth in
Section 10.1.
1.49 "Norrell" shall mean Norrell Corporation, a Georgia corporation.
1.50 "Notice of Call" shall have the meaning set forth in Section 3.2(b).
1.51 "Offer Notice" shall have the meanings set forth in Section 10.1 and
Section 10.2.
1.52 "Offer Termination Date" shall have the meaning set forth in Section
10.1.
1.53 "Offering Initial Stockholder" shall have the meaning set forth in
Section 10.1.
1.54 "Offering Stockholder" shall have the meaning set forth in Section
10.2(a).
1.55 "Outsourced Teleservices" shall have the meaning set forth in Section
2.4(a).
1.56 "Oversubscribed Contribution" shall have the meaning set forth in
Section 3.3(a).
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1.57 "Parties" shall mean, collectively, Norrell, CCG, the Company and any
other Person that becomes a party to this Agreement.
1.58 "Permitted Business" shall have the meaning set forth in Section
2.4(a).
1.59 "Person" shall mean an individual, a corporation, a partnership
(general or limited), a limited liability company, an association, a joint-stock
company, a business trust, a trust, an estate or other organization.
1.60 "Pledge" shall have the meaning set forth in Section 10.3.
1.61 "Preferred Stock" shall refer to the Company's Seven Percent (7%)
Non-Voting Preferred Stock, described in more detail in the Company's
Certificate of Incorporation. References in this Agreement to a Stockholder's
percentage ownership of the Preferred Stock shall be deemed to refer to the
percentage of all issued and outstanding Preferred Stock owned by the
Stockholder.
1.62 "Preferred Stock Call" shall have the meaning set forth in Section
3.2(a).
1.63 "Preferred Stock Purchase Price" shall have the meaning set forth in
Section 3.1.
1.64 "Pro-Rata" when used to describe an allocation of rights or
liabilities among Stockholders, shall mean in the proportion that such
Stockholder's Common Stock bears to all Common Stock.
1.65 "Protected Percentage" shall have the meaning set forth in Section
9.1(a).
1.66 "Purchasing Initial Stockholder" shall have the meaning set forth in
Section 9.2(a).
1.67 "Put Option" shall have the meaning set forth in Section 15.2(b).
1.68 "Referee" shall have the meaning set forth in Section 8.3(b) and
15.1(c)(ii).
1.69 "Registration Statement" shall have the meaning set forth in Section
17.1.
1.70 "Regulations" shall mean the regulations of the Department of Treasury
promulgated under the Code.
1.71 "Remaining Initial Stockholder" shall have the meaning set forth in
Section 15.1(a).
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1.72 "Restricted Employee" shall have the meaning set forth in Section
7.3(b).
1.73 "SEC" shall have the meaning set forth in Section 17.1.
1.74 "Selling Initial Stockholder" shall have the meaning set forth in
Section 9.2(a).
1.75 "Share Transfer" shall have the meaning set forth in Section 10.1.
1.76 "Shares" shall mean shares of Common Stock and Preferred Stock that
are issued and outstanding and owned by the Stockholders.
1.77 "Stockholders" shall mean, collectively, CCG, Norrell and the
Additional Stockholders.
1.78 "Term" shall have the meaning set forth in Section 14.1.
1.79 "Term Sheet" shall have the meaning set forth in Section 8.3(b).
1.80 "Third Party Purchasers" shall have the meaning set forth in Sections
10.1 and 10.2(d).
1.81 "Trade Secret" or "Trade Secrets" shall have the meaning set forth in
Section 7.1.
ARTICLE II
BUSINESS OF THE COMPANY; ADDRESSES AND AGENT
2.1 The Company. The Company shall be incorporated as a Delaware
corporation under the name "Norcross Inc." All business of the Company shall be
conducted under such name or under any other name adopted by the Board of
Directors (to the extent permitted by applicable Law).
2.2 Registered Office and Agent. The Company's registered office shall
be located at 1209 Orange Street, Wilmington, Delaware, 19801. The name of its
registered agent is CT Corporation.
2.3 Principal Office. The principal office of the Company shall be
located in Boston, Massachusetts or at such other location as determined by the
Board of Directors.
2.4 Business of the Company.
(a) The Company shall engage only in the business of furnishing or
managing of inbound or outbound teleservices on behalf of third-party customers
by the
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provision of labor for such purposes while simultaneously providing: (i)
teleservice equipment and/or systems, (ii) facilities at which such services
shall be performed; and/or (iii) management and administration of such
equipment, systems or facilities (such business, together with any additional
services or products necessary and incidental to the provision of the services
described in (i), (ii) and (iii) being referred to as either "Outsourced
Teleservices" or the "Permitted Business"). The Permitted Business shall not
include and the Company, without the consent of the Initial Stockholders (which
consent may be withheld by an Initial Stockholder in its sole and unfettered
discretion, without regard to any fiduciary or quasi-fiduciary duties of the
Initial Stockholder to the Company), may not pursue any Excluded Business. The
Company shall have the authority to do all things necessary or appropriate in
conjunction with the Permitted Business subject to any limitations in this
Agreement, the Company's other governance documents and Law.
(b) Notwithstanding the foregoing provisions of this Section 2.4, the
following types of Outsourced Teleservices business opportunities are not
subject to the referral covenants of Section 3.7(a) and the Company may not
pursue the following business or the specific products or services referenced
in the description of the business (collectively, the "Excluded Business"):
(i) any Outsourced Teleservices being provided by either Initial
Stockholder to a customer as of the Effective Date, provided that this
restriction shall only prohibit provision of services or products (or offering
or soliciting to do so) by the Company at the same sites where the Stockholder
was providing those services or products to the customer or at any additional
location if such services or products are being provided by the Stockholder to
the customer under the same contract or a successor contract as a result of a
rebidding of the original contract;
(ii) any Outsourced Teleservices business of either Initial Stockholder
where the teleservices are incidental to an otherwise excluded product, service
or industry described in clause (iii), (iv), (v), (vi) or (vii);
(iii) any Outsourced Teleservices business between either Norrell or CCG
and an Affiliate of Norrell or CCG, respectively, where the general business of
the Affiliate is not Outsourced Teleservices;
(iv) any Outsourced Teleservices business, regardless of industry, with
respect to the following products or services: roadside or travelers
assistance, homeowners and appliance assistance, address change notification,
real estate and move-related services and claim reporting services; provided,
however, that CCG may permit the Company to provide Outsourced Teleservices
with respect to any one or more of these products or services on a contract by
contract basis, in which case the Company's permission will be limited to the
contracts specifically approved by CCG unless CCG expressly permits the Company
to provide Outsourced Teleservices with respect to any of these restricted
products
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or services without limitation to a particular contract, in which case
such Outsourced Teleservices shall be within the definition of "Permitted
Business" from that point forward;
(v) any Outsourced Teleservices business with respect to any
teleservices product or service within the automotive, real estate and
insurance industries; provided, however, that CCG may permit the Company to
provide Outsourced Teleservices within these industries on a contract by
contract basis, in which case the Company's permission will be limited to the
contracts specifically approved by CCG unless CCG expressly permits the
Company to provide Outsourced Teleservices products or services within the
automotive, insurance or real estate industry without limitation to a
particular contract, in which case such Outsourced Teleservices shall be
within the definition of "Permitted Business" from that point forward;
(vi) any Outsourced Teleservices business where the only services
provided are staffing services (as opposed to, for example, furnishing or
managing equipment or systems);
(vii) any reservation center, federal government, or catalogue, mail
order or direct sales Outsourced Teleservices business; provided, however, that
Norrell may permit the Company to provide these restricted types of Outsourced
Teleservices on a contract by contract basis, in which case the Company's
permission will be limited to the contracts specifically approved by Norrell
unless Norrell expressly permits the Company to provide any of these restricted
types of Outsourced Teleservices without limitation to a particular contract,
in which case such permitted Outsourced Teleservices shall be within the
definition of "Permitted Business" from that point forward;
(viii) any relationship between Norrell with respect to United Parcel
Services, International Business Machine Corporation, Cinergy Inc., or Thompson
Consumer Electronics Corporation (as to its Indianapolis locations); and
(ix) any business opportunity or relationship that does not otherwise
fall within the definition of "Outsourced Teleservices."
ARTICLE III
INITIAL CONTRIBUTIONS; ADDITIONAL CONTRIBUTIONS;
CONTRIBUTIONS IN KIND
3.1 Initial Contributions. The per-Share purchase price for all Shares
purchased pursuant to this Article III shall be $100 for Common Stock and
$1,000 for Preferred Stock (respectively, the "Common Stock Purchase Price" and
the "Preferred Stock Purchase Price"). Within thirty (30) days after the
Effective Date, the Initial Stockholders shall
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purchase Shares for an aggregate purchase price of Two Million Dollars
($2,000,000), which purchase obligation shall be allocated between the two
Initial Stockholders as follows:
COMMON STOCK
Amount
Committed Number
Stockholder to be Paid of Shares
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Norrell $ 918,000 9,180
CCG $ 882,000 8,820
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Total $1,800,000 18,000
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PREFERRED STOCK
Amount
Committed Number
Stockholder to be Paid of Shares
----------- ---------- ---------
Norrell $200,000 200
Total $200,000 200
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The amounts committed to be paid by the Initial Stockholders under this Section
3.1 are sometimes referred to hereinafter collectively as the "Initial
Contributions."
3.2 Additional Contributions.
(a) If the Board of Directors from time to time determines that,
taking into account all of the Company's existing resources and its future
business prospects, the Company's existing funds are not adequate for it to
conduct its business in the manner intended by the Board of Directors (for
example, such funds are not adequate for the Company to pay (i) the operating
costs of the Company, (ii) all capital needs of the Company or (iii) all other
costs and expenses necessary or appropriate in order for the Company to take
any actions which the Company is permitted or required to take hereunder),
then the Board of Directors may make capital calls ("Capital Calls") requiring
then existing Stockholders to contribute to the Company such sums as the Board
of Directors determines are needed by the Company ("Additional Contributions").
Each Capital Call shall be in the form of a notice to Stockholders in accordance
with Section 3.2(b), and, except as otherwise provided in this Agreement, shall
consist of a call for the purchase of additional Shares of
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Common Stock (a "Common Stock Call") on a Pro-Rata basis, representing ninety
percent (90%) of the Additional Contribution subject to the Capital Call, and
Preferred Stock (a "Preferred Stock Call"), representing the remaining ten
percent (10%) of the Additional Contribution subject to the Capital Call.
Notwithstanding anything to the contrary in this Agreement, the rights of the
Board of Directors under this Article III to make further Capital Calls shall
terminate immediately upon the earliest to occur of (A) upon the effectiveness
of an IPO Registration Statement (as defined in Section 4.2), or (B) the total
contribution of $18,000,000 through Capital Calls, or (C) the date that is ten
(10) years after the Effective Date. For example, if the Board of Directors
calls for and the Initial Stockholders pay the maximum amount of Additional
Contributions, the Initial Stockholders shall own the following amounts of
Common Stock and Preferred Stock:
COMMON STOCK
Amount
Committed Number
Stockholder to be Paid of Shares
----------- ---------- ---------
Norrell $ 9,180,000 91,800
CCG $ 8,820,000 88,200
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Total $18,000,000 180,000
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PREFERRED STOCK
Amount
Committed Number
Stockholder to be Paid of Shares
----------- ---------- ---------
Norrell $2,000,000 2,000
Total $2,000,000 2,000
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(b) If the Board of Directors determines to make a Capital Call, it shall
notify the Stockholders of such decision in writing (the "Notice of Call"),
which notice shall set forth the amount required to be contributed, the terms
and conditions of the contribution and the deadline for making the contribution,
which must be at least sixty (60) days after the date of the Notice of Call. The
Stockholders shall endeavor to make the Additional Contribution as soon as
possible but in any event no later than the deadline specified in the Notice of
Call.
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(c) Norrell shall be the only Party subject to Preferred Stock Calls.
Notwithstanding anything to the contrary in this Agreement, once Capital Calls
have totalled Four Million Dollars ($4,000,000), before the Board of Directors
can issue an additional Common Stock Call, the next One Million Four Hundred
Thousand Dollars ($1,400,000) of Capital Calls shall be exclusively Preferred
Stock Calls, after which there shall be no further Preferred Stock Calls.
Notwithstanding anything to the contrary in this Agreement, Norrell shall be
subject to Preferred Stock Calls only for as long as it owns more than fifty
percent (50%) of the Common Stock.
3.3 Defaults With Respect to Capital Calls.
(a) If any Stockholder (the "Defaulting Stockholder") for any reason
fails to deliver to the Company all or any part of its Pro-Rata portion of a
required Initial or Additional Contribution (with such portion not being
contributed being referred to herein as the "Defaulted Amount") within the
applicable time period, each of the other Stockholders (the "Non-Defaulting
Stockholders") shall have the right, but not the obligation, within at least two
(2) business days after receiving notice from the Company of the default, to
contribute to the Company all or any portion of the Defaulted Amount (the
"Contributed Amount"), subject to the contingencies described below, which are
applicable in the event the amount such Non-Defaulting Stockholders wish to
contribute exceed the Defaulted Amount (an "Oversubscribed Contribution"). Any
Non-Defaulting Stockholders who contribute to the Company all or a portion of
the Defaulted Amount pursuant to this Section 3.3 are be referred to as a
"Contributing Stockholder." In the event of an Oversubscribed Contribution,
each Contributing Stockholder's contribution shall be limited to the
Contributing Stockholder's Pro-Rata portion of the entire Defaulted Amount plus
the Contributing Stockholder's Pro-Rata portion of the balance of the Defaulted
Amount not being contributed by other Stockholders; provided, however, that in
determining a Contributing Stockholder's Pro-Rata portion of the Defaulted
Amount, the Defaulting Stockholder shall be deemed to own no Shares. In
exchange for the Contributed Amount, the Contributing Stockholders shall each be
entitled to (i) receive from the Company that number of shares of Common Stock
issued at the Common Stock Purchase Price represented by its portion of the
Contributed Amount, and (ii) receive directly from the Defaulting Stockholder,
and the Defaulting Stockholder shall be obligated to transfer to each
Contributing Stockholder, that number of shares of Common Stock equal to
one-half (1/2) of the number of shares of Common Stock to be issued to it in
accordance with clause (i) of this sentence.
(b) If Norrell for any reason fails to deliver to the Company all or
any portion of funds subject to a Preferred Stock Capital Call within the
required time period (with such portion not being contributed being referred to
herein as the "Defaulted Preferred Amount"), then CCG shall have the right, but
not the obligation, to contribute to the Company all or any portion of the
Defaulted Preferred Amount (the "Contributed Preferred Amount") and CCG shall
receive from the Company in exchange therefor, at CCG's
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election, either (i) the number of shares of Preferred Stock issuable for the
Contributed Preferred Amount at the Preferred Stock Purchase Price, or (ii) that
number of shares of Common Stock issuable for the Contributed Preferred Amount
at the Common Stock Purchase Price. Regardless of whether CCG elects to receive
Common Stock pursuant to (ii) or Preferred Stock pursuant to (i) of the
preceding sentence, CCG shall also receive directly from Norrell, and Norrell
shall be obligated to transfer to CCG, that number of shares of Common Stock
owned by Norrell equal to five (5) times the number of shares of Preferred Stock
represented by the Contributed Preferred Amount.
3.4 Disputes. Any Referee resolving a dispute as to the appropriateness
of a Capital Call shall consider both (i) whether the Board of Directors acted
in accordance with the standard set forth in Section 3.2(a), and (ii) any other
relevant factors, including the reasonable interests of the Stockholders.
3.5 Collection of Amounts Required to be Contributed. In the event any
Stockholder shall fail to make any capital contribution that is required
hereunder and the other Stockholders do not tender to the Company the entire
amount of the default, then the Company shall be entitled to pursue the
collection of the unpaid balance of the Defaulted Amount, plus interest at the
rate of eighteen (18) percent per annum, and the defaulting Stockholder shall
be liable to the Company for any and all such amounts plus the costs of
collection, including court costs and attorneys' fees.
3.6 Limitation of Liability. Except as is specifically required by the
DGCL, no Stockholder shall be personally liable to any third party for or in
connection with any obligation, act or omission of the Company. No Stockholder
shall be responsible for any loss of any other Stockholder other than for
losses occasioned by a breach of this Agreement. The members of the Board of
Directors shall not be liable for the return of the capital contributions of
the Stockholders or any portion thereof.
3.7 Other Contributions to the Company.
(a) Each Initial Stockholder agrees to refer to the Company any
Outsourced Teleservices business opportunities that the Initial Stockholder
develops or that are presented to it while the Initial Stockholder owns ten
percent (10%) or more of the Common Stock, which opportunities the Board of
Directors can accept or decline. Provided that (i) the Board of Directors votes
to decline a business opportunity referred to it by an Initial Stockholder
pursuant to the requirements of the first sentence of this paragraph (a), and
(ii) the Director(s) nominated by the referring Initial Stockholder voted to
accept such business opportunity, the Initial Stockholder referring the business
opportunity shall be entitled to pursue the business opportunity itself, as long
as it does so on terms and conditions that are no more favorable than the terms
and conditions that would have been applicable to the Company had the Company
accepted the business opportunity. This Agreement does not
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restrict either Initial Stockholder from pursuing any Outsourced Teleservices
business opportunity that is within the definition of Excluded Business.
(b) If either Initial Stockholder ceases to own ten percent (10%) or
more of the Shares, the referral obligations set forth in paragraph (a) shall no
longer apply to that Initial Stockholder, but the foregoing referral obligations
will again apply if the Initial Stockholder's Share ownership again rises to ten
percent (10%) or more.
(c) Each Initial Stockholder, as long as it owns in excess of ten
percent (10%) of the Common Stock, shall provide the Company with the products,
services and rights set forth on Schedule 3.7, for use by the Company in the
Permitted Business (to the extent such products, services and rights can legally
be provided to the Company without material cost or hardship to the transferring
party). In return for these contributions, the Company shall pay each
contributing Initial Stockholder: for any contributed tangible assets an amount
equal to the net book value for the contributed asset (not to exceed fair market
value); for any contributed intangible assets an amount equal to the incremental
cost of providing such item to the Company; and for any other services provided
by an Initial Stockholder (except for those administrative services to be
provided by Norrell in accordance with Section 3.7(d)) to the Company an amount
equal to the cost of such services (not to exceed fair market value) as long as
the Initial Stockholders agree on such administrative services costs before they
are incurred.
(d) Norrell shall initially provide to the Company and the Company
shall acquire from Norrell "back office" administrative assistance that is
available directly from Norrell, including functions such as tax, accounting,
risk management and legal services. In return for such services, Norrell shall
be entitled to five percent (5%) of the difference between the revenues of the
Company for the period of time Norrell is providing the services and the amount
of any subcontract fees paid or payable to Norrell (excluding those fees
described in this Section 3.7(d)) during such period (provided further that
except as otherwise provided in the last sentence of this paragraph (d) Norrell
shall not receive any additional amounts as expenses, or third party
reimbursements for providing such services). After providing Norrell with at
least six (6) months prior notice of its intent to do so, the Company may elect
to obtain some or all of these administrative services from CCG or third
parties, if the Company determines that it would be in its best interests to do
so. Norrell will obtain the approval of the Board of Directors before
subcontracting with any third party for the provision of back office
administrative assistance, which approval may not be unreasonably withheld or
delayed.
(e) To the extent the Company needs any service or product that either
Initial Stockholder is in the business of providing to its customers (e.g.
temporary staffing, in the case of Norrell), the Company agrees to acquire such
service or product from the Initial Stockholder at a price that is as favorable
to the Company as the most favorable price provided by the Initial Stockholder
to any other customer or client for a comparable service
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or product in a comparable market (provided that the price charged to the
Company shall never be greater than the Initial Stockholder's average gross
margin for such services). Notwithstanding the foregoing, the Company shall not
be obligated to acquire any service or product from an Initial Stockholder if
the Company is willing and able to provide such service or product internally or
if the Company's Board of Directors reasonably and in good faith concludes that
the overall quality of the service or product is unacceptable or the price is
not reasonable. In no event shall a Stockholder be required to provide any such
service or product.
(f) Stockholders may be required by lenders of the Company to guarantee
certain loans or other financial obligations of the Company provided that the
amount of any such guarantee will be limited and allocated among the
Stockholders Pro-Rata. The amount guaranteed by any Stockholder will be
credited towards the Stockholder's share of the $20,000,000 aggregate capital
contribution limit; provided, however, that if within the ten-year period
following the Effective Date the Company's loan or financial obligation is
discharged or if the Stockholder's guarantee is otherwise released without
having been called by the lender, then the credit against the capital
contribution limit shall immediately cease to exist and the Stockholder's
obligations with respect to that capital contribution limit shall be as
otherwise set forth in this Agreement. In the event that an Initial Stockholder
intends to exercise any registration rights it may have with respect to any
Common Stock, such Initial Stockholder may require all Stockholders (but not
less than all) to replace any or all guarantees with Additional Capital
Contributions to be made in accordance with Article III.
ARTICLE IV
MANAGEMENT OF COMPANY
4.1 Board of Directors. The business and affairs of the Company shall be
managed by the Board of Directors except for those rights granted directly to
the any Stockholders in this Agreement. The rights and responsibilities of the
Board of Directors are generally set forth in the Company's Bylaws, as
supplemented by provisions in this Agreement. To the extent possible, with
respect to any issue involving the Board of Directors, the Bylaws should be
interpreted in a manner that is consistent with this Agreement and any
inconsistency should be resolved in favor of this Agreement.
4.2 Composition of Board of Directors. The Bylaws shall provide that
until the effective date of the first SEC registration statement filed under
the 1933 Act covering an initial public offering of the Company's Common Stock,
whether for the sale of Shares of Common Stock by the Company or by any
Stockholder (an "IPO Registration Statement") the Board of Directors shall
consist of an even number of members unless otherwise agreed to by Stockholders
owning at least seventy-six percent (76%) of the Common Stock. As long as both
Initial Stockholders own at least ten percent (10%) of the Common Stock, the
member of the Board of Directors serving as Chairman of the Board shall each
year alternate
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between an individual nominated by Norrell and an individual nominated by CCG
with the initial Chairman of the Board to be nominated by CCG.
4.3 Nomination of Directors if Either Initial Stockholder Owns More than
10% of the Common Stock. As long as either Initial Stockholder owns more than
ten percent (10%) of the Common Stock, (a) until the effectiveness of an IPO
Registration Statement, then that Initial Stockholder shall be entitled to and
shall nominate one-half of the members of the Board of Directors, and (b) from
and after the filing of the IPO Registration Statement that Initial Stockholder
shall be entitled to nominate one-half of the members of the Board of Directors
if there shall be an even number of directors, or one-half of one less than the
number of members of the entire Board of Directors, if there is an odd number
of Directors (with the final director being selected by agreement of the
Initial Stockholders).
4.4 Nomination of Directors if Either Initial Stockholder Owns More than
75% of the Common Stock. If, at any time and from time to time, either Initial
Stockholder owns more than seventy-five percent (75%) of the Common Stock,
then, for as long as the Initial Stockholder owns more than seventy-five
percent (75%) of such Shares, the nomination rights described in Section 4.3
shall cease to apply and each candidate for the Board of Directors shall be
nominated by the Board of Directors or as otherwise provided in the Bylaws.
4.5 Nomination of Directors in Other Situations. In all situations other
than those expressly covered in Section 4.3 and 4.4 or in instances where
Sections 4.3 or 4.4 do not specify how all of the members of the Board of
Directors shall be nominated, each candidate for the Board of Directors shall
be nominated by the Board of Directors or as otherwise provided by the Bylaws.
4.6 Modification of Rights. Notwithstanding anything to the contrary in
this Agreement, in the event that an Initial Stockholder's ownership of Common
Stock drops below twenty-five percent (25%), that Initial Stockholder shall
have the right, if it expressly so elects and notifies the other Initial
Stockholder and the Company of this election within five (5) days after its
ownership drops below 25% (and, from time to time thereafter, within five (5)
days after any further sale(s) of its Shares of Common Stock after which its
ownership remains below 25% but above 10%), to waive its rights under Section
4.3 to nominate fifty percent of the members of the Board of Directors (which
rights otherwise would apply as long as the Initial Stockholder owned more than
ten percent (10%) of the Common Stock), and in return for such election, to the
extent that the Initial Stockholder's ownership interest remains below
twenty-five percent: (a) the Initial Stockholder shall no longer be bound by
the referral obligations set forth in Section 3.7(a), (b) and (c); (b) the
non-competition covenant in Section 7.2 shall not be applicable to such Initial
Stockholder; and (c) the twenty-four month and twelve month non-solicitation
covenants set forth in Sections 7.3(a) and (b), respectively, shall commence.
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ARTICLE V
REIMBURSEMENT OF INITIAL STOCKHOLDER EXPENSES
5.1 Reimbursement of Expenses. Each Initial Stockholder shall be
reimbursed for all reasonable out-of-pocket expenses directly incurred on behalf
of the Company and approved by the Board of Directors, including, without
limitation, any organizational, incorporation and pre-subscription expenses
incurred on behalf of the Company that have been so approved by the Board of
Directors; provided, however, that each Initial Stockholder shall pay all of its
legal expenses, including but not limited to the expenses and fees associated
with drafting and negotiating this Agreement.
ARTICLE VI
DISTRIBUTIONS OF CASH
6.1 Cash Flow. The Board of Directors, in the exercise of its discretion,
shall determine whether the financial condition and financing agreements and
commitments of the Company will permit the distribution of any monies of the
Company; provided however, that the Board of Directors, in making such
determination, may provide for the retention of a reasonable cash reserve
(taking into consideration the availability in the future of other assets or
income of the Company), as determined by the Board of Directors, in an amount at
least equivalent to the sums determined by it in its discretion as necessary to
be retained for future contemplated capital expenditures, expenses and
obligations of the Company. The Board of Directors shall make a determination
at least as of the end of each calendar year as to whether or not there are
funds available for distribution.
6.2 Distribution of Cash Flow. All funds so determined by the Board of
Directors to be available for distribution shall be distributed as follows:
(a) First, to repay the currently due and payable portions of any
working or operating capital loan or advance (including principal and interest)
made by any Stockholder to the Company;
(b) Second, to discharge any accrued dividend, redemption or other
payment obligation (and any past obligation that the Company was unable to
meet) with respect to any outstanding Preferred Stock;
(c) Third, to repay the currently due and payable portions of any loan
(including principal and interest) made by a Stockholder to the Company other
than the loans described in (a) above; and
(d) Fourth, to the Stockholders as dividends in accordance with the
DGCL.
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6.3 Limitations on Distribution. No distribution shall be made to
Stockholders if prohibited by the DGCL.
ARTICLE VII
CONFIDENTIALITY AND RESTRICTIVE COVENANTS
7.1 Confidentiality Covenant. Ancillary to and in consideration of
each Stockholder's right to own its Shares, each Stockholder agrees that
Stockholder will not, other than directly for the benefit of or at the
direction of or with the express, prior written approval of the Company,
directly or indirectly, alone or in conjunction with one or more Persons,
redistribute, market, publish, disclose or divulge to any other person or
entity (except for disclosures by a Stockholder to prospective investors or
underwriters who execute a confidentiality agreement in form and substance
acceptable to the Company), or use or modify for use, directly or indirectly in
any way for any person or entity: (i) any "Confidential Information" (as
defined below) during the period of time that Stockholder owns Shares and for
twenty four (24) months after it ceases to own any Shares; and (ii) any "Trade
Secrets" (as defined below) at any time (during or after the period which it
owns Shares) during which such information or data shall continue to constitute
a "Trade Secret." Stockholder agrees to cooperate with any reasonable
confidentiality requirements of the Company. As used in this Article VII,
"Trade Secrets" shall have the meaning given that term under Delaware law and
"Confidential Information" shall mean all valuable, proprietary and confidential
information belonging to or pertaining to the Company or a Customer that does
not constitute a Trade Secret of the Company. With respect to any information
associated with any product, service or rights contributed to the Company by an
Initial Stockholder pursuant to Section 3.7(c) that meets the above definition
of Trade Secret or Confidential Information, for purposes of this Article VII,
shall be deemed to be the Trade Secret or Confidential Information of the
Company, but the Initial Stockholder making the contribution shall retain all
rights associated therewith (subject to the rights granted to the Company).
7.2 Limitation On Competition. Ancillary to and in consideration of
each Stockholder's right to own its Shares, each Stockholder agrees that such
Stockholder, as long as it owns at least ten percent (10%) of the Common Stock,
will not, other than with the express, prior written approval of the Company,
directly or indirectly, alone or in conjunction with one or more Persons,
engage in Outsourced Teleservices (except to the extent such activities are
within the definition of "Excluded Business") or enter into a "Competitive
Position" (as defined later below) (provided, however, that an Initial
Stockholder's providing, on an arm's length basis, to a Direct Competitor any
services or products that fall within the definition of "Excluded Business"
shall not, by itself, mean that such Initial Stockholder has a "Competitive
Position" with a Direct Competitor). For purposes of this Agreement, a
"Competitive Position" is an employment, directorship,
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partnership, advisory, agency, or control relationship, that is initiated
anywhere in the continental United States, between a Stockholder and a Direct
Competitor.
7.3 Limitation On Soliciting Customers Or Personnel. Ancillary to and in
consideration of each Stockholder's right to own its Shares, each Stockholder
agrees that it will not, other than with the express, prior written approval of
the Company, directly or indirectly, alone or in conjunction with one or more
Persons:
(a) during the period of time such Stockholder owns at least ten
percent (10%) of the Common Stock and for twenty-four (24) months after the last
date that such Stockholder owns at least ten percent (10%) of the Common Stock
provide (or offer or solicit to provide) any Person that was a customer of the
Company at any point within twelve (12) months prior to the date the Stockholder
ceases owning at least ten percent (10%) of the Common Stock or the Preferred
Stock (a "Company Customer") with any services or products in competition with
those the Company was providing to the Company Customer, provided that this
restriction shall only prohibit the provision of services or products (or
offering or soliciting to do so) by the Stockholder at the same sites where the
Company was providing those services or products to the Company Customer or at
any additional location if such services or products are being provided by the
Company to the Company Customer under the same contract or a successor contract
as a result of a rebidding of the original contract;
(b) during the period of time such Stockholder owns at least ten
percent (10%) of the shares of Common Stock or Preferred Stock and for twelve
(12) months after the last date that such Stockholder owns at least ten percent
(10%) of the shares of Common Stock or Preferred Stock (i) solicit any
management level employee, director or advisor of the Company located anywhere
in the continental United States (a "Restricted Employee") to leave the
employment of the Company or otherwise sever a contractual, directorship,
advisory, partnership relationship with the Company or (ii) hire or engage any
such management level employee, director or advisor of the Company, provided,
however, that, notwithstanding the foregoing, any employee who had previously
been employed by an Initial Stockholder prior to being employed by the Company
may return to the employ of such Initial Stockholder with the prior written
approval of the Company's Board of Directors.
ARTICLE VIII
DISPUTE RESOLUTION
8.1 Dispute Resolution. Any disputes arising under or in conjunction with
this Agreement or any Party's performance or non-performance of its obligations
under this Agreement, other than the "Excluded Disputes" described in Section
8.4 below, or any stalemate or tie vote by the Board of Directors (each of the
foregoing being herein referred to as a "Dispute") shall be resolved in
accordance with the dispute resolution provisions set
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forth in this Article VIII. The Parties agree to use reasonable and good faith
efforts to resolve any Dispute informally. If the Parties are unable to resolve
the Dispute informally within a reasonable period of time, the Dispute may be
settled in accordance with the following provisions.
8.2 Disputes Among Directors. If, at the time of any Dispute on the Board
of Directors, there is (are) serving on the Board of Directors, individuals who
were not nominated by either Initial Stockholder, at the request of any Director
the Dispute shall be submitted to a committee of the Board of Directors
consisting of all such individuals, which committee shall be empowered to
recommend a final resolution to the Board of Directors. The Board of Directors
shall in good faith consider any proposed resolution offered by the independent
director(s). If the independent director(s) are unable to propose a resolution
of the Dispute that is acceptable to the Board of Directors involved in the
Dispute, or if there are no independent directors then in office, the Dispute
may be settled in accordance with the provisions of Section 8.3, if and only if
(a) an IPO Registration Statement has not yet become effective, and (b) the
matter has been considered and remained the subject of a tie vote at two
consecutive meetings of the Board of Directors when all directors were in
attendance.
8.3 Dispute Resolutions. If a Dispute of the Board of Directors cannot
be resolved in accordance with Section 8.2, then either Initial Stockholder may
remove the matter from consideration by the Board of Directors in accordance
with the Bylaws and submitted to the dispute resolution provisions of this
Section 8.3. In addition, if the issue or Dispute does not involve an action
proposed to be taken by the Board of Directors, the parties to the dispute
shall resolve the matter in accordance with this Section 8.3 promptly upon the
occurrence thereof. Any Dispute may be submitted to dispute resolution by any
Stockholder empowered hereunder by its giving written notice of its intention
to do so (the "Dispute Notice") to the Initial Stockholders, the Company (if
the matter has been voted on by the Board of Directors or otherwise is an issue
arising between the Company and one or more Stockholders) and all other
Stockholders who are parties to this Agreement and whose interests are directly
involved. The Dispute Notice shall identify the nature of the Dispute, and the
individual empowered to negotiate any resolution on behalf of the party sending
the Dispute Notice.
(a) Each party receiving a Dispute Notice shall, within twenty (20)
days following receipt of the Dispute Notice, also appoint an individual
empowered to negotiate the issue (the "Negotiator"), and shall notify the
Stockholder issuing the Dispute Notice of the identity of its Negotiator by
that date. The failure by any such Party to appoint a Negotiator as required
hereby shall constitute a waiver of that Party's right to do so, and the
remaining individual(s) shall act as the resolution panel hereunder.
(b) Each Negotiator, within fifteen (15) days after his appointment,
shall determine his position on the Dispute and present a Term Sheet containing
all of the Terms
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of his proposed resolution (a "Term Sheet"). If after exchange of the Term
Sheets the Negotiators cannot reach a conclusion within five (5) days, then by
that date the Negotiators shall agree upon a referee (the "Referee") whose
responsibility shall be, within fifteen (15) days after his appointment, to
review the Term Sheets submitted by the Negotiators (and all available written
evidence supporting the Term Sheet) and select the Term Sheet with the terms to
be the one that the Referee believes most closely represents the appropriate
resolution of the Dispute to be the solution to be taken. The Term Sheet so
selected by the Referee shall be reported by the Referee to each of the parties
as the resolution of the Dispute by written notice within twenty (20) days of
the Referee's appointment.
The Referee's determination shall consist of the following elements: (i)
findings of fact; (ii) rulings of law (if any are required); and (iii) the
remedy, which shall consist of selection of the Term Sheet described and an
order that it be implemented. The findings of fact and the rulings of law
shall be stated with sufficient particularity and precision so that both
parties and a reviewing court may reasonably comprehend the basis for the
remedy. The Referee shall apply the same substantive law that a Massachusetts
court would apply in deciding the same issues. The Referee's resolution of the
Dispute shall be binding upon the parties, provided, however, that any party may
seek review on the following grounds: (i) that the Referee's determination was
clearly erroneous under Law; or (ii) that there was no substantive evidence to
support the Referee's findings.
(c) If the Negotiators cannot agree on the identity of the Referee, the
Washington, D.C. office of the American Arbitration Association shall be
requested to nominate three individuals to serve as Referees pursuant to the
rules and regulations of such Association. If within three days of the receipt
of that listing, the parties cannot agree on which of the three shall serve as
Referee, the Referee shall be selected by such Association in accordance with
its rules then pertaining.
(d) Each Stockholder shall be solely responsible for paying the expenses
of its Negotiators. Upon receipt of the Referee's award, all parties shall
promptly execute any instruments, and take any action, including the execution
of consent votes and other agreements as are reasonably required by the
proponent of the Term Sheet selected by the Referee, to fully effectuate and
adopt the position set forth on that Term Sheet.
8.4 Excluded Disputes. The Parties may but shall not be obligated to
resolve the following matters in accordance with the dispute resolution
provisions of this Article VIII: (a) claims for injunctive or other equitable
relief; (b) disputes relating to acquisitions by the Company of another entity;
(c) disputes involving matters that under this Agreement or Law are to be
decided by Stockholders acting as stockholders in their individual interests in
the first instance; (d) disputes relating to Capital Calls in excess of an
aggregate of $20,000,000; (e) disputes arising under Sections 10.1 or 10.2 as
to whether the Company should be a purchaser of Shares or Article XV if the
issue is a determination of price established by a Referee thereunder, (f)
decisions by the Board of Directors under Section 7.3(b) regarding
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approvals of employees returning to an Initial Stockholder, or (g) disputes
arising among the Board of Directors after the effective date of an IPO
Registration Statement.
ARTICLE IX
MISCELLANEOUS INITIAL STOCKHOLDER RIGHTS
9.1 Rights to Maintain Proportionate Ownership.
(a) The Company grants each Initial Stockholder a continuing option,
in the event that the Company issues new shares of Common Stock (including, but
not limited to, the issuance of Common Stock in an initial public offering) to a
Person other than in response to a Capital Call (any such issuance being
referred to as a "New Issuance"), to purchase additional shares of Common Stock
to prevent any dilution of the Initial Stockholder's percentage ownership of all
issued and outstanding Common Stock prior to the New Issuance (the Initial
Stockholder's "Protected Percentage"), subject to the terms and conditions of
this Section 9.1. In the event of a New Issuance resulting from an Initial
Stockholder's exercise of demand registration rights under Article XVII at a
time when the Initial Stockholders collectively own at least eighty percent
(80%) of the Common Stock, then if each Initial Stockholder wishes to exercise
its rights under this Section 9.1, the Initial Stockholder exercising demand
registration rights shall be entitled to acquire under this Section 9.1 only
that number of Shares equal to its Pro-Rata portion of the New Issuance, but the
other Initial Stockholder shall be entitled to acquire not only its Pro-Rata
portion of the New Issuance but also its Pro-Rata portion of the Shares issued
under this Section 9.1 to the Initial Stockholder exercising demand registration
rights.
(b) The purchase price and other terms applicable to any exercise by
an Initial Stockholder of its purchase option under this Section 9.1 shall be
the same as those applicable to the Party or Parties acquiring the Common Stock
in connection with the New Issuance.
(c) The Company shall notify each Initial Stockholder in writing
whenever the Board of Directors approves a New Issuance and such notice shall
state the number of Shares proposed to be issued and the purchase price and
other terms and conditions associated with the New Issuance. The Initial
Stockholder's purchase option must be exercised, if at all, by a written notice
from the Initial Stockholder to the Company not later than thirty (30) days
after it has received the written notice of the New Issuance from the Company.
If an Initial Stockholder duly notifies the Company of its exercise of its
purchase option under this Section 9.1, the Company and the Initial Stockholder
must consummate the closing of the purchase no later than the later to occur of
(i) thirty (30) days after the receipt by the Company of notice from the Initial
Stockholder that it is exercising its purchase option, or (ii) fifteen (15) days
after the consummation of the New Issuance giving rise to the purchase option.
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(d) Notwithstanding the foregoing, an Initial Stockholder shall be
entitled to exercise the purchase option under this Section 9.1 with respect to
a New Issuance proceeding, or which is an issuance registered on, an IPO
Registration Statement and in any event only if (i) the Initial Stockholders
collectively own, immediately prior to the New Issuance, at least fifty percent
(50%) of the Common Stock, and (ii) such Initial Stockholder then owns at least
ten percent (10%) of the Common Stock.
9.2 Purchase Rights of Initial Stockholders.
(a) This Section 9.2 gives an Initial Stockholder (for purposes of
this Section 9.2, the "Purchasing Initial Stockholder") the right to purchase a
certain amount of Common Stock from the other Initial Stockholder (the "Selling
Initial Stockholder") in the event that the Selling Initial Stockholder desires
to sell Common Stock to a third party.
(b) If at any time, and from time to time, when the Selling Initial
Stockholder owns fifty one percent (51%) of all Common Stock and the Purchasing
Initial Stockholder owns at least forty-eight percent (48%) of all Common Stock,
the Selling Initial Stockholder desires to sell any Common Stock to a third
party, the Selling Initial Stockholder shall first notify the Purchasing Initial
Stockholder in writing of this intention, informing the Purchasing Initial
Stockholder of the terms and conditions of the proposed sale, including the
purchase price. This notice shall constitute an offer from the Selling Initial
Stockholder to the Purchasing Initial Stockholder to sell the Purchasing Initial
Stockholder an amount of Common Stock that is equal to two percent (2%) of all
Common Stock. The Purchasing Initial Stockholder shall have fifteen (15) days
from the date it receives the notice from the Selling Initial Stockholder to
notify the Selling Initial Stockholder that it wishes to accept this offer if it
intends to do so. If it elects to make this purchase and duly notifies the
Selling Initial Stockholder, the Purchasing Initial Stockholder shall have
thirty (30) days from the date of its notice electing to exercise this purchase
right to consummate the purchase of the two percent interest of Common Stock at
a purchase price that is equal to the Selling Initial Stockholder's capital cost
associated with the purchase Common Stock together with interest (at the Prime
Rate published in the Wall Street Journal) beginning as of the date the Selling
Initial Stockholder acquired the Common Stock.
(c) If at any time, and from time to time, when the Selling Initial
Stockholder owns fifty one percent (51%) of all Common Stock and the Purchasing
Initial Stockholder owns less than forty-eight percent (48%) but more than ten
percent (10%) of all Common Stock, the Selling Initial Stockholder desires to
sell to a third party any Common Stock, the Selling Initial Stockholder shall
first notify the Purchasing Initial Stockholder in writing of this intention,
informing the Purchasing Initial Stockholder of the terms and conditions of the
proposed sale, including the purchase price. This notice shall constitute an
offer from the Selling Initial Stockholder to the Purchasing Initial Stockholder
to sell the Purchasing Initial Stockholder an amount of Common Stock that is
equal to one percent (1%) of all Common Stock. The Purchasing Initial
Stockholder shall have fifteen (15) days from the date it
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receives the notice from the Selling Initial Stockholder to notify the Selling
Initial Stockholder that it wishes to accept this offer if it intends to do so.
If it elects to make this purchase and duly notifies the Selling Initial
Stockholder, the Purchasing Initial Stockholder shall have thirty (30) days from
the date of its notice electing to exercise this purchase right to consummate
the purchase of the one percent interest of Common Stock at a purchase price
that is equal to the greater of (i) the per share purchase price to be charged
to the third party or (ii) the Selling Initial Stockholder's capital cost
associated with the purchase Common Stock together interest (at the Prime Rate
published in the Wall Street Journal) beginning as of the date the Selling
Initial Stockholder acquired the Common Stock.
9.3 Certain Rights to Sell Shares. Notwithstanding anything to the
contrary in this Agreement, neither Initial Stockholder may sell or transfer
any of its Shares to a third party during the one year period beginning as of
the Effective Date without the prior written consent of the other Initial
Stockholder. At any point after the one year anniversary of the Effective
Date, either Initial Stockholder (a) may sell all or a portion of its Shares in
a public offering with each Initial Stockholder sharing in the overall costs
(other than internal costs) in proportion to its participation in the offering,
or (b) may negotiate a sale of all or a portion of its Shares to the other
Initial Stockholder. At any point after the second anniversary of the
Effective Date, either Initial Stockholder may sell all or a portion of its
Shares to a third party, subject to the provisions of Article X.
9.4 Bar on Sale of Shares To Company Competitor. Every Stockholder shall
be prohibited, unless such prohibition is waived by the Board of Directors and
both Initial Stockholders, from selling any Shares to a Direct Competitor.
ARTICLE X
RIGHT OF FIRST OFFER PROVISIONS
10.1 Right of First Offer Applicable to Initial Stockholders and the
Company. Except as otherwise specifically set forth in this Agreement, any
Initial Stockholder (the "Offering Initial Stockholder") that desires to offer
to sell all or any of the Initial Stockholder's Shares to a third party (a
"Share Transfer") shall not complete any such sale without first offering to
sell such Shares (the "Affected Shares") by simultaneous written notice to both
the other Initial Stockholder (the "Nonoffering Initial Stockholder") and the
Company (for purposes of this Section 10.1 only, an "Offer Notice"). For
purposes of this Article X, the right of first offer provisions shall not apply
to a sale of Shares by a Stockholder to an Affiliate of that Stockholder. The
Nonoffering Initial Stockholder shall have twenty (20) business days to
determine whether it wishes to purchase all but not less than all of the
Affected Shares at the prices and on the terms presented in the Offer Notice. If
the Nonoffering Initial Stockholder declines to purchase the Affected Shares in
accordance with the Offer Notice, then the Company shall have the right to
purchase all, but not less
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than all, of such Shares, as long as it does so by the "Offer Termination Date,"
which shall be the date that is five (5) business days after the earlier of the
date the Nonoffering Initial Stockholder declines to purchase such Affected
Shares or the date such purchase right lapses unexercised. If either the
Nonoffering Initial Stockholder or the Company wishes to purchase the Affected
Shares, it must consummate the purchase within thirty (30) days after it
provides notice to the Offering Initial Stockholder of its purchase decision. If
the Company declines or fails to timely purchase the Affected Shares in
accordance with the Offer Notice, then the Offering Initial Stockholder shall be
free to sell the Affected Shares to any one or more third parties ("Third Party
Purchasers") at any price equal to or greater than, and on terms equal to or
less favorable than those presented in the Offer Notice, provided that the
Offering Initial Stockholder must close the Share Transfer within one hundred
eighty (180) days after the Offer Termination Date. Notwithstanding the
foregoing, if the Nonoffering Stockholder or the Company gives notice of its
decision to purchase, and then fails to close such purchase (other than due to
the fault of the Offering Stockholder), no restrictions hereunder shall
thereafter apply to those Shares.
10.2 Right of First Offer Applicable to Other Stockholders.
(a) Except as otherwise set forth in Section 10.2(e) or elsewhere in
this Agreement, any Stockholder other than an Initial Stockholder (an "Offering
Stockholder") that desires to offer to sell any of its Shares (the "Affected
Shares") shall first notify each of the Initial Stockholders and the Company of
its intentions to sell and the terms and conditions of the proposed sale. This
notice (for purposes of this Section 10.2 only, an "Offer Notice") shall
constitute an offer by the Offering Stockholder to sell (i) to each Initial
Stockholder all (but not less than all) of the Initial Stockholder's Pro-Rata
portion of the Affected Shares, and (ii) in the event that one or both of the
Initial Stockholders do not elect to purchase the Shares, to the Company those
Affected Shares not purchased by the Initial Stockholders at the price and on
the terms specified in the Offer Notice.
(b) If an Initial Stockholder wishes to exercise its right to purchase
its Pro-Rata portion of the Affected Shares, it shall notify the Offering
Stockholder and the Company of this intention within twenty (20) business days
of its receipt of the Offer Notice. An Initial Stockholder that desires to
purchase its Pro-Rata portion of the Affected Shares, and that duly notifies the
Offering Stockholder and the Company of this fact, shall consummate the purchase
of such sale within thirty (30) business days after the date of its notice to
the Offering Stockholder and the Company that it wishes to purchase the Shares
upon the terms of the Offer Notice.
(c) If one or both of the Initial Stockholders do not elect to purchase
its Pro-Rata portion of the Affected Shares pursuant to paragraph (b) above,
then the Company shall have the right to purchase all (but not less than all) of
the non-purchased Shares, and if it intends to exercise this right, the Company
shall notify the Offering Stockholder of this intention within five (5) business
days of the date that the Company's purchase right arises.
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The Company shall consummate the purchase of such Shares on the last day for
timely consummation of an Initial Stockholder's purchase if there is to be one;
otherwise, within thirty (30) business days after the date of its notice to the
Offering Stockholder that it wishes to make the purchase at the price and on the
terms specified in the Offer Notice.
(d) The Offering Stockholder shall be free to sell any Affected Shares not
purchased by the Initial Stockholders or the Company under (b) or (c) to any one
or more Third Party Purchasers at any price equal to or greater than or on terms
equal to or less favorable than those offered to the Initial Stockholders and
the Company, provided that the Offering Stockholder must close the sale within
one hundred eighty (180) days after the Company declines to purchase the
Affected Shares or the date that the Company is no longer able to elect to
purchase the Affected Shares, whichever is earlier to occur.
(e) Notwithstanding the foregoing, if the Offering Stockholder under this
Section 10.2 is a direct Transferee of either Initial Stockholder and that
Initial Stockholder still owns at least ten percent (10%) or more of all shares
of Common Stock, then the first offer right shall first be extended by the
Offering Stockholder to that Initial Stockholder alone (rather than to both
Initial Stockholders), and that Initial Stockholder shall have the
thirty-business day right to purchase all Affected Shares and if that Initial
Stockholder does not so purchase the Affected Shares, the right shall be
extended to the other Initial Stockholder, and then to the Company, with the
remaining provisions of this Section 10.2 remaining applicable. In the event
that the Initial Stockholder from which the Transferee directly acquired its
Shares no longer owns at least ten percent (10%) of all Shares, then the right
of first offer shall be extended to the other Initial Stockholder alone first,
and then to the other Initial Stockholder, and then to the Company.
10.3 Right to Pledge or Encumber Shares. Except as otherwise expressly
provided in this Agreement, no Stockholder may hypothecate, encumber, pledge or
grant any lien, security or other interest in or to any Shares (any of the
foregoing being referred to as a "Pledge") other than a Pledge in favor of the
Company. Any Pledge of any Shares made or entered into not in accordance with
the provisions of this Section 10.3 shall be null and void and of no force or
effect. Notwithstanding the foregoing, an Initial Stockholder may pledge its
Shares to a qualified lending institution, but only if the Stockholder and the
lending institution agree that the other Initial Stockholder shall have a right
of first refusal to purchase such Shares at the greater of their fair market
value or collateral value in the event that the lending institution's
foreclosure rights are triggered and only if the Pledge secures an amount that
is not greater than the total amount of capital contributions made by the
Stockholder to date.
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ARTICLE XI
ACCOUNTING AND RECORDS; NONSOLICITATION UPON TRANSFER
11.1 Accounting Period. The Company's accounting period shall be a fiscal
year ending on the Sunday closest to the end of October. The Company may, by
majority vote of the Board of Directors, provide for an audit of the books and
records of the Company to be made at the Company's expense.
11.2 Records to be Maintained.
(a) At its principal office, the Company shall maintain its records,
including:
(i) a copy of the Certificate of Incorporation and all
amendments thereto;
(ii) copies of records that would enable a Stockholder to
determine the relative voting rights of the Stockholders;
(iii) copies of the Company's federal, foreign, state and
local income tax returns and reports, if any, for the three most
recent years; and
(iv) any financial statements of the Company for the
three most recent years.
(b) A Stockholder may, at such Stockholder's own expense, inspect
and copy any Company record upon reasonable request during ordinary
business hours.
11.3 Reports to be Furnished. The Company will mail the following reports
to each Stockholder for as long as such Stockholder is a holder of any Shares in
the Company:
(a) As soon as practicable after the end of each fiscal year, and
in any event within 90 days thereafter, such financial statements of the
Company as of the end of such fiscal year prepared in accordance with
GAAP, as the Board of Directors shall decide.
(b) As soon as practicable after the end of the first, second and
third quarterly accounting periods in each fiscal year of the Company and
in any event within 45 days thereafter, such quarterly financial
information of the Company for such period as the Board of Directors
shall decide.
(c) As soon as practicable after the end of each fiscal month and
in any event within 30 days thereafter, such monthly financial
information of the Company for such period as the Board of Directors
shall decide.
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(d) Within 30 days prior to the beginning of each fiscal year, an
Annual Budget, which shall be developed and approved by the Board of
Directors. The Annual Budget shall set forth full and complete
forecasted balance sheets, statements of operations and statements of
cash flows for such fiscal year and for each month within that year. The
Annual Budget shall also describe the marketing, production, research and
development, organization and staffing and financial strategies that
support the Annual Budget's forecasted figures.
ARTICLE XII
LEGEND ON STOCK CERTIFICATES
Each certificate representing Shares subject to this Agreement (excluding
any Shares issued or sold in a public offering), whether they be Shares
originally issued or issued or transferred pursuant to this Agreement, shall
bear on its face in conspicuous type the following legend and an appropriate
state and/or securities legend:
"The shares of stock represented by this certificate (and all
transfers or pledges hereof) are subject to the restrictions of and are
transferable only in compliance with the provisions of that certain
Stockholders Agreement dated as of August ___, 1996, by and among Norcross
Inc. (the "Company") and Norrell Corporation and The Cross Country Group
LLC, a copy of which is on file at the office of the Company. Any
attempted transfer or pledge hereof in violation of the terms of such
Stockholders' Agreement shall be null and void and may not be recognized
by the Company."
In the event that such legend cannot practicably be placed on the face of
such certificate, either alone or in connection with other legends required by
law or by agreement to be placed on the face of such certificate, the legend
shall be set out on the back of the certificate, and notice thereof shall be
given in conspicuous type on the front.
ARTICLE XIII
VOTING AGREEMENT
13.1 Election of Directors. The Stockholders hereby agree that, with
respect to any vote by them for the election of directors for the Company
(whether the vote shall be in writing, by consent or at a regular or special
meeting), the Stockholders shall at all times throughout the Term vote for, or
shall otherwise take such action as may be appropriate to cause the voting for,
the election of any individuals nominated by Norrell, CCG or any Additional
Stockholder pursuant to Section 4.3 or 4.4 provided such individuals meet any
requirements established by applicable law to serve on the Board of Directors.
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13.2 Other Voting Rights. The following actions require the approval of
the holders of not less than seventy-six percent (76%) of the outstanding Common
Stock: (a) any amendment to the Certificate of Incorporation or the Bylaws; (b)
the sale, exchange, lease or other transfer of all or substantially all of the
assets of the Company; (c) the dissolution of the Company pursuant to the DGCL;
(d) the merger of the Company pursuant to the DGCL; (e) the Company's incurring
of any indebtedness in excess of $5,000,000; and (f) any New Issuance other than
as provided in Article III of this Agreement or as the same may be issued
pursuant to Article XVII.
ARTICLE XIV
TERM
14.1 Normal Duration. This Agreement shall commence on the Effective Date
and shall, unless sooner terminated pursuant to Section 14.2, continue in full
force and effect as provided herein for an initial term (the "Initial Term") of
twenty-five (25) years thereafter. This Agreement shall be automatically
renewed for successive, additional twenty-five (25)-year periods after the
expiration of the Initial Term, unless any Party notifies the other Parties in
writing at least thirty (30) days prior to the expiration of the then current
twenty-year term that it does not wish to renew the Agreement in which case the
Agreement shall remain in effect for only those Stockholders that have not given
notice that they do not wish to renew.
14.2 Early Termination. This Agreement shall terminate on the occurrence
of any of the following events:
(a) the liquidation or dissolution of the Company;
(b) a single Stockholder becoming the owner of all of the outstanding
Shares;
(c) the execution of a written instrument to that effect by the Company
and all Stockholders of the Company who are then parties to this Agreement; or
(d) a good faith and reasonable decision by either Initial Stockholder
that, following at least twenty-four (24) consecutive months where the Company
is unprofitable (in accordance with GAAP standards), that the business of the
Company should be wound down and the Company ultimately liquidated, with the
termination of this Agreement not to be effective until the effective date of
such liquidation; provided that if the Company is wound down and liquidated
pursuant to this paragraph (d), then the Company shall (i) make no further
capital calls other than those reasonably necessary to enable the Company to
discharge existing contracts and wind its business down and (ii) liquidate the
business in the manner prescribed by the Board of Directors.
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14.3 Effect of Termination. Upon the termination of this Agreement, all
Shares shall be relieved from the terms and provisions of this Agreement, and
any certificates evidencing such Shares shall be surrendered to the Company for
cancellation and issuance of a new certificate without the legend provided for
in Article XII.
ARTICLE XV
MISCELLANEOUS COVENANTS AND OBLIGATIONS OF THE PARTIES
15.1 Change of Control of Initial Stockholder.
(a) In the event of a proposed sale of a controlling equity interest
in either Initial Stockholder to a Direct Competitor or in the event of a
proposed merger of either Initial Stockholder with a Direct Competitor where the
Direct Competitor is the surviving entity in the merger (excluding a sale or a
merger of any entity after which such entity is no longer an Affiliate of an
Initial Stockholder) (such sale or merger being referred to hereafter as a
"Change of Control Transaction"), then the Initial Stockholder whose equity is
being sold to a Direct Competitor or that is merging with a Direct Competitor
(in either case, the "Acquired Initial Stockholder") shall promptly notify the
other Initial Stockholder (the "Remaining Initial Stockholder") of the details
of the Change of Control Transaction at least thirty (30) days prior to the
consummation of the Change of Control Transaction (the "Change of Control
Notice").
(b) The delivery of a Change of Control Notice to the Remaining
Initial Stockholder shall give the Remaining Initial Stockholder the right to:
(i) require the Acquired Initial Stockholder to sell all of the Acquired Initial
Stockholder's Shares to the Remaining Initial Stockholder (a "Call Option"); or
(ii) require the Acquired Initial Stockholder to purchase all of the Remaining
Initial Stockholder's Shares (a "Put Option")(the Put Option and the Call Option
being referred to collectively as the "Change of Control Options"). The
Remaining Initial Stockholder shall have ten (10) business days after receipt of
the Change of Control Notice to notify the Acquired Initial Stockholder whether
or not it intends to exercise its right to conduct a determination of the
Designated Value (as defined in (c) below) of the Shares subject to the Change
of Control Option is determined as provided below (the "Exercise Notice").
(c) Promptly after the Remaining Initial Stockholder's delivery of an
Exercise Notice to the Acquired Initial Stockholder the process for determining
the price to be paid for the Shares to be purchased from or sold to the Acquired
Initial Stockholder (the "Designated Value") shall commence. The "Designated
Value" of the Shares shall be equal to the product of (1) the value of the
Company as a going business and (2) the Pro-Rata Percentage of the Shares to be
transferred.
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(i) The Remaining Initial Stockholder's Exercise Notice shall
include the name of an appraiser chosen by the Remaining Initial Stockholder.
The Acquired Initial Stockholder shall, within ten (10) days following receipt
of the Exercise Notice, also appoint an appraiser, and shall notify the
Remaining Initial Stockholder of the identity of its appraiser also by that
date. The failure by either such Party to appoint an appraiser as required
hereby shall constitute a waiver of that Party's right to do so, and the
remaining appraiser shall act as a sole appraiser hereunder.
(ii) Each appraiser, within thirty (30) days after his appointment,
shall make his determination of the Designated Value. If the Designated Values
presented by the appraisers so appointed differ by less than $200,000, then the
final Designated Value shall be equal to the arithematic average of the two
values. If the values of the appraisers differ by $200,000 or more, then the
two appraisers shall agree upon a referee (the "Referee") whose responsibility
shall be, within twenty (20) days after his appointment, to review the
appraisals submitted by the two appraisers (and all written evidence available
in support of each such appraisal) and select one of the two values put forth by
the appraisers with the selected value to be the one that the Referee believes
most closely represents the true Designated Value. The value so selected by the
Referee shall be reported by the Referee by written notice to each of the
parties as the final Designated Value within twenty (20) days of the Referee's
appointment.
The Referee's award shall consist of the following elements: (i)
findings of fact; (ii) rulings of law (if any are required); and (iii) the
remedy, which shall consist of a finding of the Designated Value. The findings
of fact and the rulings of law shall be stated with sufficient particularity and
precision so that both parties and a reviewing court may reasonably comprehend
the basis for the remedy. The Referee shall apply the same substantive law that
a Massachusetts court would apply in deciding the same issues. The Referee's
determination of the Designated Value shall be binding upon the parties,
provided, however, that any party may seek review on the following grounds: (i)
that the Referee's determination was clearly erroneous under Law; or (ii) that
there was no substantive evidence to support the Referee's findings.
(iii) If the two appraisers cannot agree upon the identity of the
Referee, the American Arbitration Association shall be requested to nominate
three individuals to serve as Referees pursuant to the rules and regulations of
such Association. If within three days of the receipt of that listing, the
parties cannot agree on which of the three shall serve as Referee, the Referee
shall be selected by such Association in accordance with its pertinent rules.
(iv) Each Initial Stockholder shall be solely responsible for paying
the expenses of its appraiser.
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(d) Within five (5) days after the establishment of the final Designated
Value, the Remaining Initial Stockholder shall notify the Acquired Initial
Stockholder whether it will exercise a Call Option or a Put Option (the "Final
Notice"). The Acquired Initial Stockholder shall have five (5) days after
receiving the Final Notice to elect whether or not to terminate the Change of
Control Transaction or proceed with the Change of Control Transaction and allow
the Remaining Initial Stockholder to proceed with its Change of Control Option.
If the Acquired Initial Stockholder elects to proceed with the Change of Control
Transaction, the Put Option or the Call Option must be consummated within
fifteen (15) business days of the date the Acquired Initial Stockholder received
the Final Notice.
ARTICLE XVI
CERTAIN RIGHTS AND OBLIGATIONS OF TRANSFEREE
16.1 Condition Precedent. No sale or transfer of Shares under this
Agreement shall be effective until the Transferee has executed this Agreement
(excluding Transferees acquiring Shares acquired in an initial public offering
or otherwise on the open market).
16.2 Transferees Of Initial Stockholders. A Transferee of all of the
Shares of either Initial Stockholder shall be entitled to all of the rights and
shall be bound by all of the obligations associated with the Shares of the
transferring Initial Stockholder under this Agreement as if such Transferee
were an "Initial Stockholder," except that the Transferee shall not be bound by
the referral obligations set forth in Section 3.7(a). A Transferee of some but
not all of the Shares of either Initial Stockholder shall be entitled to all of
the rights and shall be bound by all of the obligations of the transferring
Initial Stockholder associated with the Shares of the Initial Stockholder under
this Agreement except that the Transferee shall not be bound by the referral
obligations set forth in Section 3.7(a) and the Transferee shall not be
entitled to receive offers as an "Initial Stockholder" for purposes of the
first offer provisions in Section 10.1 or 10.2.
ARTICLE XVII
REGISTRATION RIGHTS
17.1 Required Public Offering of Shares. If the Company has not
registered its Shares in an underwritten initial public offering within five
years after the Effective Date, then either Initial Stockholder may request in
writing that the Company file with the Securities and Exchange Commission (the
"SEC"), an IPO Registration Statement covering no less than Ten Million Dollars
($10,000,000) and no more than Fifty Million Dollars ($50,000,000) of Shares.
Upon receipt of any such request from an Initial Stockholder, the Company shall
promptly begin preparation of the Registration Statement and handling all
matters necessary and incidental thereto and shall use its reasonably diligent
efforts to cause the Registration Statement to become effective as soon as
possible after it is filed.
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17.2 Demand Registration Rights. Each Initial Stockholder shall have the
right at any point after the one-year anniversary of the Effective Date, which
right may be exercised up to two times, to request the Company to register under
the 1933 Act all or any portion of the Initial Stockholder's Shares (provided
that the Shares with which the Initial Stockholder's request applies must have a
Fair Market Value of not less than Five Million Dollars ($5,000,000)) for sale
in the manner specified in such notice. Following receipt of any such notice,
the Company shall use its best efforts to register under the 1933 Act for public
sale in accordance with the method of disposition specified in such notice from
the Initial Stockholder the number of Shares specified in such notice. Selling
Stockholders hereunder will bear all costs associated with exercise of their
rights hereunder.
17.3 Incidental Registration Rights. If the Company at any time after
registering its Shares in an underwritten initial public offering proposes to
register additional Shares under the 1933 Act for sale to the public, whether
for its own account or for the account of other Stockholders or both, each such
time it will give written notice to each Initial Stockholder of its intention to
do so. Upon the written request of either Initial Stockholder, received by the
Company within thirty (30) days after the giving of any such notice by the
Company, to register any of its Shares, the Company shall use its best efforts
to cause such Shares as to which registration shall have been so requested to be
included in the Shares to be covered by the registration statement proposed to
be filed by the Company.
17.4 Registration Rights Agreement. The Initial Stockholders and the
Company agree that the detailed terms and conditions associated with the
registration rights granted to them pursuant to Sections 17.1, 17.2, 17.3 and
17.5 will be set forth in a mutually acceptable definitive Registration Rights
Agreement consistent with this Article XVII to be executed by the Initial
Stockholders and the Company within sixty (60) days of the date they execute
this Agreement.
17.5 Standstill Agreement. If requested in writing by the underwriters
for the initial underwritten public offering of Shares of the Company, each
Stockholder shall agree not to sell publicly any Shares (other than Shares
being registered in such offering) without the consent of such underwriters for
a period of not more than six (6) months following the effective date of the
registration statement relating to such offering.
ARTICLE XVIII
MISCELLANEOUS PROVISIONS
18.1 Representations and Warranties. Each Party represents and
warrants to the other Parties that such Party has full power, capacity and
authority to execute and deliver this Agreement and to perform such Party's
obligations under this Agreements. Each Party represents and warrants to the
other Parties that no performance by it of its obligations under this Agreement
will result in any conflict with, breach of, or default or acceleration under,
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any mortgage, agreement, lease, indenture, or other instrument, order, judgment
or decree to which such Party is a party or by which such Party's properties or
assets may be bound or affected or violate any Law.
18.2 Entire Agreement. This Agreement represents the entire Agreement
among all the Stockholders of the Company. This Agreement may be amended only
as provided elsewhere in this Agreement.
18.3 Application of Delaware Law. This Agreement, the application and
interpretation hereof shall be governed exclusively by its terms and the laws
of the State of Delaware.
18.4 Construction. Whenever the singular form is used in this Agreement,
and when required by the context, the same shall include the plural and vice
versa, and the masculine gender shall include the feminine and neuter genders
and vice versa.
18.5 Headings; References. The headings in this Agreement are inserted
for convenience only and are in no way intended to describe, interpret, define,
or limit the scope, extent or intent of the Company Agreement or any provision
hereof. Any reference in this Agreement to an "Article", "Section", "Schedule"
or "Exhibit" shall mean the specified Article or Section of, or Schedule or
Exhibit to, this Agreement.
18.6 Waivers. The failure of any party to seek redress for violation
of or to insist upon the strict performance of any covenant or condition of
this Agreement shall not prevent a subsequent act, which would have originally
constituted a violation, from having the effect of an original violation.
18.7 Rights and Remedies Cumulative. Except as otherwise provided in
this Agreement, the rights and remedies provided by this Agreement are
cumulative and the use of any one right or remedy by any party shall not
preclude or waive the right not use any or all other remedies. Such rights and
remedies are given in addition to any other rights the parties may have by law,
statute, ordinance or otherwise.
18.8 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.
18.9 Certification of Non-Foreign Status. In order to comply with Section
1445 of the Code and the applicable Regulations, in the event of the disposition
by the Company of a United States real property interest as defined in the Code
and Regulations, each Stockholder shall provide to the Company, an affidavit
stating, under penalties of perjury, (i) the Stockholder's address, (ii) United
States taxpayer identification number, and (iii) that the Stockholder is not a
foreign person as that term is defined in the Code and Regulations.
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Failure by any Stockholder to provide such affidavit by the date of such
disposition shall authorize the Stockholders to withhold ten percent (10%) of
each such Stockholder's distribution share of the amount realized by the Company
on the disposition.
18.10 Further Assurances. The Stockholders each agree to cooperate, and to
execute and deliver in a timely fashion any and all additional documents
necessary to effectuate the purposes of this Agreement.
18.11 Time. TIME IS OF THE ESSENCE OF THIS AGREEMENT, AND TO ANY PAYMENTS,
ALLOCATIONS AND DISTRIBUTIONS SPECIFIED UNDER THIS AGREEMENT.
18.12 Assignment of Rights. No Party may assign its rights or obligations
under this Agreement to any other Person without the prior written consent of
the Initial Stockholders except in compliance with this Agreement, provided,
further, that a Party may assign such rights or obligations to an Affiliate
provided it furnishes written notice of the assignment to the Company and the
Initial Stockholders within five (5) days after the effective time of the
assignment and provided further that the assigning Party shall retain full and
primary liability for the full and complete performance of any assigned
obligations under this Agreement.
IN WITNESS WHEREOF, the parties have caused this Stockholders Agreement to
be duly executed as of the Effective Date.
NORRELL CORPORATION
By: /S/
--------------------------------------------
Title: E.V.P.
-----------------------------------------
THE CROSS COUNTRY GROUP, LLC
By: /S/ Jeffrey ?
--------------------------------------------
Title: Manager
-----------------------------------------
NORCROSS INC.
By:
--------------------------------------------
Title:
-----------------------------------------
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SCHEDULE 3.7
TO
STOCKHOLDERS AGREEMENT AMONG
NORRELL CORPORATION,
THE CROSS COUNTRY GROUP, LLC
AND NORCROSS, INC.
Dated August 15, 1996
Assets to be Provided
By Norrell:
Such services and assets are available to, or within the control of,
Norrell that may be useful to the Company in the Permitted Business.
By CCG:
A non-exclusive license to use, but not sell, decompile, alter or
sub-license, proprietary call processing software, including but not
limited to help-desk software, to the extent that (i) such software may
be licensed to the Company without the consent of third party providers,
and/or (ii) any necessary consents from third-party providers are
obtained.