Exhibit 10.1

 

February 28, 2006

 

VIA HAND DELIVERY

Mr. Gregory M. Nichols, Esq.

 

 

RE:

Letter Agreement

 

Dear Greg:

 

This letter confirms our discussions regarding the terms and conditions under
which we have mutually agreed to accept your resignation as Senior Vice
President, General Counsel and Corporate Secretary of Gevity HR, Inc. (the
“Company”), effective as of the close of business on February 28, 2006 (the
“Effective Date”).

 

In recognition of your years of service to the Company, your willingness to
remain available to ensure a successful and smooth transition of your
responsibilities, and in full and complete settlement of any and all claims
(including any claim you may have for attorneys’ fees, expenses and costs), the
Company will, voluntarily and without prior obligation, continue your employment
through the Effective Date and continue to pay to you, at regularly scheduled
times of payment, an amount equal to $18,333.33 per month. For a period
commencing on March 1, 2006 through December 31, 2006 (the “Severance Period”)
the Company will pay to you, at regularly scheduled times of payment, an amount
equal to $220,000.00 at a rate of $22,000.00 per month (the “Severance Amount”).
Any payments made to you shall be less all applicable required withholdings and
any additional withholdings authorized by you through the Severance Period;
provided, however, that the obligation of the Company to pay you the Severance
Amount and any other amount payable to you hereunder is conditioned on your
signing and returning to the Company this letter agreement and the expiration of
the seven (7) day Revocation Period (as defined below) without any action by you
during such Revocation Period to revoke all or any part of this letter
agreement. No payments due you under this agreement will be paid on a regular
payment date unless and until execution and delivery of this agreement and
expiration of such Revocation Period.

 

Subject to the other terms of this letter, on or before the first regular pay
day after the end of the Severance Period, the Company will pay you an amount
equal to the number of hours of paid time off (less required deductions) which
would have accrued under the Company’s applicable paid time off plan(s) in
effect during the Severance Period as if you had continued your employment
through such period.

 

The Company shall also pay to you your performance-based annual incentive award
for 2005 at the target level of performance, which equals $88,000.00 (“Bonus

 

Mr. Gregory M. Nichols, Esq.

February 28, 2006

 

 

Payment”). The Bonus Payment will be made to you at the same time as similar
payments are paid to the other executive officers of the Company but in no event
later than February 28, 2006.

 

Options held by you to purchase common stock of the Company that vest on or have
vested prior to the Effective Date may be exercised by you during the next
ninety (90) days as provided in the plan under which the options were issued and
in the agreement granting such options.

 

With respect to benefits, to the extent permitted by the terms of the applicable
plans, you will be eligible to participate in the Company’s medical, dental,
life and disability plans in accordance with their respective terms as in effect
from time to time through the Severance Period. Thereafter, all benefits shall
cease, and you will be entitled to such COBRA continuation and conversion rights
as are then generally available under such plans. Information regarding your
rights and rights of your eligible dependents, if any, to continue healthcare
coverage under COBRA will be made available through the Company’s Benefits
Department.

 

During the Severance Period, you shall also be entitled to receive outplacement
services from a firm (“Placement Firm”) to be mutually agreed upon by you and
the Company, at an aggregate cost not to exceed $30,000.00 of which $20,000.00
shall be payable to the Placement Firm and up to $10,000.00 shall be payable to
you to reimburse your personal expenses of searching for and securing future
employment, including, but not limited to, travel, professional conferences, Bar
exams and associated review classes, continuing legal education and related
administrative expense. During the Severance Period, the Company will continue
its sponsorship of you in order for you to complete the Yale Leadership Exchange
and Analysis Program. In addition, you shall be entitled to continue to use the
Company provided cellular telephone, at Company expense, through the Severance
Period. At the end of the Severance Period you will be allowed to keep the phone
and the Company will execute such documents that may be required in order to
transfer the telephone number to you for your personal use.

 

In further consideration of the Severance Amount, you also agree to make
yourself available to the Company from time to time at the Company’s reasonable
request, at no expense to you, to assist the Company in answering questions
related to matters with respect to which you have had responsibility, in
defending any claims against the Company by others with respect to which your
advice or testimony may be required and otherwise as reasonably required by the
Company. You also agree to execute any documents necessary to effectuate your
resignation from any offices or positions held with the Company or any of its
subsidiaries, affiliates or benefit plans.

 

Except as provided in the second following paragraph, in consideration for the
promises and undertakings made by the Company and the payment of the Severance
Amount, you hereby irrevocably and unconditionally release, acquit and forever
discharge the Company from and agree that you will not institute or pursue
against the Company, any and all charges, complaints, controversies, damages,
actions, causes of

 

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Mr. Gregory M. Nichols, Esq.

February 28, 2006

 

 

action, suits, rights, demands, costs, losses, debts, and expenses (including
attorneys’ fees and costs actually incurred) of any nature whatsoever, known or
unknown, suspected or unsuspected, including, but not limited to any claims for
breach of contract (implied or otherwise), back pay, front pay, wages,
commissions, benefits, severance, vacation pay, sick pay, bonus or any other
form of compensation, relocation expenses, residential lease expenses, any
covenant of good faith and fair dealing, or any tort, or any federal, state or
other governmental statute, regulation, or ordinance, including, without
limitation, the Age Discrimination in Employment Act and the Older Workers
Benefits Protection Act, which you now have, or at any time heretofore could
have asserted against the Company.

 

Reciprocally, except as provided in the next paragraph, the Company releases you
from all claims, demands, actions, causes of action, suits, damages, losses and
expenses, of any and every nature which the Company may have or claim to have
against you as a result of actions or omissions occurring through the date of
your signature hereon.

 

You and the Company agree that the respective obligations of the Company and you
contained in the Indemnification Agreement dated between you and the Company
shall remain in full force and effect hereafter.

 

This release shall not in any way be construed as an admission by the Company
that it has acted wrongfully with respect to you or to any other person, or that
you have any rights whatsoever against the Company other than those set forth in
this release. The Company specifically disclaims and denies any liability to, or
wrongful acts against, you or any other person, on the part of itself, its
employees, agents or representatives.

 

Reciprocally, this release shall not in any way be construed as an admission by
you that you have acted wrongfully with respect to the Company, or that the
Company has any rights whatsoever against you other than those described in this
release. You specifically disclaim and deny any liability to, or wrongful acts
against, the Company.

 

You agree that you will not disparage, or communicate any adverse information
about, the Company. Reciprocally, the Company agrees not to disparage you to any
third party or otherwise to communicate any adverse information about you to any
third party and will provide, at your request, positive references and
recommendation regarding your employment, resignation and performance while with
the Company.

 

You agree to deliver to the Company, on or before February 28, 2006, all keys,
equipment, computers, memoranda, notes, plans, records, reports, computer disks
and memory, and other documentation (and copies thereof) relating to the Company
or its affiliates, or which contain confidential information regarding the
Company or its operations, however stored or recorded, that you possess or had
under your control.

The release and other representations and agreements made by you in this letter
agreement are made solely in exchange for the payment of the Severance Amount,
to

 

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Mr. Gregory M. Nichols, Esq.

February 28, 2006

 

 

which you would not be otherwise entitled except in exchange for your executing
this letter agreement; you have been advised to consult with an attorney and tax
advisor (including, seeking advice regarding the implications, if any, of
application of Section 409A of the Internal Revenue Code of 1986, as amended, to
the transactions contemplated by this letter agreement) prior to signing this
release; by entering into this release, you do not waive rights or claims that
may arise after the date you execute this release; and you have twenty-one (21)
days after receiving this release to consider whether to sign and return this
release to the Company. Also, you may revoke this release in writing at any time
during the seven (7) day period following the date on which you sign this
release (the “Revocation Period”).

 

As used in this letter agreement, all references to “Gevity” or the “Company”
will also be construed to refer to the Company’s employees, partners, managers,
attorneys, agents, officers, directors, owners, shareholders, subsidiaries,
affiliates, and their respective successors and assigns. This release will inure
to and be binding upon the parties hereto and their respective heirs,
representatives, successors, transferees and assigns.

 

This letter agreement shall not become effective until the eighth (8th) day
after the date you sign this document as indicated above your signature below.
Your signature below will indicate your agreement to these terms and conditions.
Your signed letter should be returned to the Company, to my attention, within
twenty-one (21) days after today.

 

Greg, it has been a pleasure working with you, and we wish you success in your
future endeavors.

 

 

 

Kindest regards,

 

 

 

 

Edwin E. Hightower, Jr.

 

 

I HEREBY ACKNOWLEDGE THAT I HAVE READ THIS LETTER AGREEMENT, UNDERSTAND ITS
CONTENTS AND AGREE TO ITS TERMS AND CONDITIONS KNOWINGLY, VOLUNTARILY AND OF MY
OWN FREE WILL.

 

Signed on the ______ day of February, 2006

 

 

_____________________________

Gregory M. Nichols

 

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