EXHIBIT 10.2


 


EMPLOYMENT AGREEMENT


 


This Employment Agreement (“Agreement”) deemed
effective as of June 16, 2008 and is entered into by and among Westaff
Support, Inc., Westaff (USA), Inc. and Westaff, Inc. (collectively,
the “Company”) and Christa Leonard (the “Executive”). The parties agree to the
following terms and conditions of the Executive’s employment.


 


1.  EMPLOYMENT.  The Company hereby employs the Executive, and
the Executive hereby accepts such employment, upon the terms and subject to the
conditions hereinafter set forth.


 


2.  DUTIES.


 


(a)           Position and Responsibilities. The Executive shall be employed as the Company’s Senior Vice President
and Chief Financial Officer.  The Executive
shall devote her full working time, attention and energies to the performance
of her duties for the Company and the Executive shall at all times comply with
the Company’s Conflict of Interest Policy and Code of Business Conduct and
Ethics and abide by the rules, regulations, and practices as adopted or modified
from time to time by the Company.


 


(b)           Term. The Executive’s
employment shall commence on Monday, June 16, 2008, and her employment
shall be of indefinite duration, subject to termination under Section 4 of
this Agreement. The Executive acknowledges that there is no express or implied
agreement between her and the Company or any of its subsidiaries, whether
domestic or foreign, for any specific period of employment or for continuing or
long-term employment.


 


(c)           Other
Activities.  Except upon
the prior written consent of the Company, the Executive will not, during the
term of this Agreement, (i) accept any other employment, or (ii) engage,
directly or indirectly, in any other business activity (whether or not pursued
for pecuniary advantage) that might interfere with Executive’s duties and
responsibilities hereunder or create a conflict of interest with the Company.


 


(d)           No
Conflict.  Executive
represents and warrants that her execution of this Agreement, employment with
the Company, and the performance of her proposed duties under this Agreement
shall not violate any obligations she may have to any other employer, person or
entity, including any obligations with respect to proprietary or confidential
information of any other person or entity.


 


3.  COMPENSATION AND BENEFITS.  In consideration for the
services of the Executive, the Company shall compensate the Executive as
follows:


 


(a)           Base Salary. The
Company shall pay the Executive an initial annual base salary of $250,000 (“Base
Salary”), less required and authorized withholdings, which shall be paid to the
Executive in accordance with the Company’s normal payroll practices and
schedule.


 


(b)           Benefits.  As the Executive becomes eligible, she shall
have the right to participate in and to receive benefits from all present and
future employee benefit plans specified in the Company’s policies and generally
made available to similarly situated employees of the Company. The amount and
extent of benefits to which the Executive is entitled shall be governed by the
specific benefit plan, as amended.


 


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(c)           Expenses. The
Company shall reimburse the Executive for all reasonable travel and other
business expenses incurred by the Executive in the performance of her duties,
in accordance with Company policies, as they may be amended in the Company’s
sole discretion.


 


(d)           Incentive Compensation. The
Executive shall be eligible for an annual bonus of up to 50% of his Base
Salary, prorated for FY 2008.  The bonus
will be based on the Company’s performance metrics and will be approved
annually by the Compensation Committee. 
The Executive will not be eligible for any bonus or incentive
compensation payment if his employment with the Company terminates for Cause
before such bonus or incentive compensation payment is earned or paid.   If the Executive’s employment with the
Company terminates without Cause prior to such bonus or incentive compensation
payment being earned or paid, Executive will be entitled to a prorated portion
of such bonus or incentive compensation.


 


(e)           Stock Options.  Subject to approval from the Company’s Board of Directors (or a duly
authorized committee of the Company’s Board of Directors) (the “Board”),  the Executive will be eligible to
participate in the Company’s 2006 Stock Incentive Plan (the “Stock Option Plan”).  If approved, Executive will be awarded 100,000
stock options pursuant to the terms stated in the Company’s Stock Option Plan
and the Notice of Stock Option Award (including, but not limited to the vesting
schedule for the option shares).


 


(f)            Vacation.  The Executive shall
accrue four (4) weeks of vacation per year, subject to the Company’s
policies with respect to maximum vacation accruals.


 


(g)           Indemnification.  The Company and
the Executive shall enter into the Company’s customary form of indemnification
agreement applicable to directors and executive officers of the Company, in the
form attached as Exhibit A (the “Indemnification Agreement”).


 


4.  TERMINATION OF EMPLOYMENT.


 


(a)           Termination of Employment For Cause.  For
purposes of this Agreement, the Company may terminate the Executive’s
employment for “Cause” at any time, without any notice, if the Executive does
any one or more of the following:


 


(i)            acts in
bad faith, or in breach of trust, to the detriment of the Company;


 


(ii)           refuses
or fails to act in accordance with any policy of the Company or any specific
direction or order of the Company;


 


(iii)          exhibits,
in regard to her employment and as determined by the Company in its sole
discretion, unfitness or unavailability for service, unsatisfactory or
inadequate performance (including but not limited to the Executive’s failure or
inability to meet the Company’s expectations, goals, standards and/or deadlines
with respect to her duties), misconduct, dishonesty, habitual neglect of duties
or incompetence;


 


(iv)          commits,
is convicted of, or pleads no contest to a crime involving dishonesty, breach
of trust, moral turpitude, or physical harm to any person;


 


(v)           breaches
any material term of this Agreement or any other agreement that the Executive
has entered into with the Company (including but not limited to her
Confidentiality, Invention, Design Agreement, which is attached hereto and
incorporate herein as Exhibit B);


 


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(vi)          dies;
or


 


(vii)         becomes
disabled and therefore unable to perform the essential duties of her position
for a period of more than 12 workweeks within any twelve (12)-month period.


 


If the Executive’s employment shall be terminated
by the Company for Cause as defined above, the Company shall pay the Executive her
earned but unpaid Base Salary and accrued but unused vacation pay, and shall
provide her benefits under the applicable benefit plans through the date of
termination and otherwise as required by law. 
The Executive shall not be eligible or entitled to a severance payment
described in Section 4(b) below if her employment is terminated for
Cause and no other compensation or benefits will accrue or be owed to the Executive
for any period after the effective date of termination in the event of a
termination for Cause.


 


(b)           Termination by Employer Not For Cause.  The
Company may terminate the Executive’s employment at any time for any reason.  If the Executive’s employment is terminated without
Cause, the Company shall pay the Executive her earned but unpaid Base Salary, her
accrued but unused vacation pay and her earned but unpaid bonus, if any, and
shall provide her benefits under the applicable benefit plans through the date
of termination and otherwise as required by law.  In addition, the Executive shall be entitled
to a severance payment, as set forth below (the “Severance Payment”), provided she
signs a separation agreement and general release of claims (to be prepared by
the Company at the time of termination) in exchange for such severance payment:


 


(i)            If the
Executive’s employment is terminated without Cause within one year from his
date of hire, or if the Company relocates its headquarter offices outside a
thirty-five (35) mile radius of 298 N. Wiget Lane, Walnut Creek, CA  94598, or Executive’s duties and
responsibilities are significantly reduced without Cause, Executive’s Severance
Payment shall be equal to six (6) months’ pay at his current Base Salary,
less required and authorized withholdings, which shall be paid to the Executive
in the form of salary continuation for a period of six (6) months
following the effective date of termination, payable in accordance with the
Company’s normal payroll practices and schedule.


 


The Company
shall be entitled to cease its payment of the Severance Payment in the event
that the Executive breaches or violates any of her obligations under this
Agreement or her Confidential Information and Invention Agreement during the
applicable severance period.  Notwithstanding any other provision of this
Agreement to the contrary, the Company, in its sole discretion and without the Executive’s
consent, may amend or modify this Agreement in any manner to provide for the
application and effects of Section 409A of the Internal Revenue Code (the “Code”)
(relating to deferred compensation arrangements) and any related regulatory or
administrative guidance issued by the Internal Revenue Service.  The Company shall have the authority to delay
the payment of any benefits described under this Agreement to the extent it
deems necessary or appropriate to comply with Section 409A(a)(2)(B)(i) of
the Code (relating to payments made to certain “key employees” of certain
publicly-traded companies) and in such event, any such payments to which the Executive
would otherwise be entitled during the six (6) month period immediately
following the Executive’s separation from service will be paid on the first
business day following the expiration of such six (6) month period.


 


(c)           Resignation by Executive. At any time, the Executive may terminate her employment for any reason
by providing the Company two (2) weeks’ advance written notice.  If the Executive’s employment is terminated
due to the Executive’s resignation, the Company shall pay the Executive her
earned but unpaid Base Salary and accrued vacation pay, and shall provide her
benefits under the applicable benefit plans, through the date of termination
and otherwise as required by law.  The Executive
shall not be entitled to the Severance Payment under Section 4(b) if she
resigns for any reason, 


 


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and no other compensation or benefits will accrue or be
owed to the Executive for any period after the effective date of termination in
the event of that she resigns for any reason.


 


5.  TERMINATION OBLIGATIONS.


 


(a)           Representations and Warranties.  The Executive
shall sign, as a condition of employment, the Company’s Confidential
Information and Invention Agreement.  The
representations and warranties contained in this Agreement and the Executive’s
obligations under her Confidential Information and Invention Agreement shall
survive the termination of employment for any reason.  Nothing in this Agreement
shall be deemed to modify or limit the Executive’s obligations under her
Confidential Information and Invention Agreement, and nothing in the
Confidential Information and Invention Agreement shall be deemed to modify or
limit the Executive’s obligations under this Agreement.


 


(b)           Cooperation in Pending Work. Following any termination of employment, the Executive shall fully
cooperate with the Company in all matters relating to the winding up of pending
work on behalf of the Company and the orderly transfer of work to other executives/employees
of the Company or any of its domestic subsidiaries.


 


(c)           Return of Company Property.  All
property including, without limitation, all equipment, tangible Proprietary
Information as defined in Section 6(a), documents, books, records,
reports, notes, contracts, lists, computer disks (and other computer-generated
files and data), and copies thereof, created on any medium and furnished to,
obtained by, or prepared by the Executive in the course of or incident to her
employment, belongs to the Company or any of its subsidiaries, whether domestic
or foreign, and shall be returned promptly to the Company upon termination of
employment for any reason.  In addition,
the Executive shall immediately return to or arrange for prompt delivery to the
Company all equipment, supplies, keys, manuals, and other property or equipment
of whatever nature in her possession or control or which she may have entrusted
to any other party.


 


6.  PROPRIETARY INFORMATION AND NON-SOLICITATION.


 


(a)           Proprietary Information. The Executive recognizes and acknowledges that certain assets of the
Company or its subsidiaries, whether domestic or foreign, constitute “Proprietary
Information,” including all information that is known only to the Executive or
the Company or such subsidiaries, and relating to the business of the Company
or such subsidiaries (including, without limitation, information regarding
employees, clients, customers, bill and pay rates, employees’ pay and skills,
pricing policies, methods of operation, operating manuals, sales, sales
techniques, advertising materials, products, costs, markets, key personnel,
formulas, product applications, technical processes, other statistical
information, confidential data, and trade secrets), and that protection of such
information is essential to the interests of the Company and such subsidiaries.


 


(b)           Non-Solicitation of Employees and Clients. The Executive acknowledges and agrees that the pursuit of activities
forbidden by this subsection would necessarily involve the use or disclosure of
Proprietary Information in breach of the Company’s Confidential Information and
Invention Agreement.  To forestall this
disclosure, use, and breach, and in consideration of the employment under this
Agreement, the Executive agrees that for a period of one (1) year after
termination of her employment, she shall not, directly or indirectly, for or on behalf of any other person, firm,
corporation or other entity that directly competes with the Company:  (i) solicit, induce, or influence any
employee, consultant, or independent contractor of the Company or any of its
subsidiaries, whether domestic or foreign, to terminate her or her employment
or relationship with the Company or any of such subsidiaries or to work for any
other business entity or person; or (ii) solicit (other than on behalf of
the Company or such subsidiaries), divert, or attempt to divert the business of
any client or customer of the Company in any district, territory, 


 


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state or country where the Company conducts business, unless the Executive can prove that any
action taken in violation of this Section 6(b) was taken without the
use of any of the Company’s Proprietary Information. For purposes of
this non-solicitation covenant, a customer of the Company is defined as any
person, firm or corporation that the Company or any of its subsidiaries has
serviced within one year preceding the termination of the Executive’s
employment and with whom the Executive is or became familiar as a result of her
employment with the Company.  For purposes of this non-solicitation covenant,  an employee of the Company is defined as
any person who has received salary or wages from the Company or any of its
subsidiaries within one year preceding the termination of the Executive’s
employment and with whom the Executive is or became familiar as a result of her
employment with the Company.


 


(c)           Injunctive Relief for Violation. The Executive acknowledges that the obligations and restrictions set
forth in this Section 6 are reasonably necessary for the protection of the
Company’s business, goodwill, property, customer and employee
relationships.  The Executive
further acknowledges that the character, duration and geographical scope of her
obligations under this Section 6 are reasonable in light of the
circumstances as they exist on the date upon which this Agreement has been
executed. The Executive recognizes that
irreparable damage will result to the Company in the event of any violation of her
obligations under this Section 6 and agrees to the issuance of a
restraining order and/or an injunction against her for such a material
violation in addition to any other legal or equitable remedies that the Company
may have.


 


7.  GENERAL.


 


(a)           Severability. If any
provision of this Agreement is or becomes invalid, illegal or unenforceable in
any respect under any law, the validity, legality or enforceability of the
remaining provisions hereof shall not in any way be affected or impaired.  If any provision of this Agreement is found
by a court of competent jurisdiction to be invalid, illegal or unenforceable, the affected
provisions of this Agreement shall automatically and without requirement of
further action by the parties be deemed reformed solely to the extent required
to render such provisions valid, enforceable and legal and this Agreement,
including such reformed provisions, shall continue in full force and
effect.  If such reformation is not
possible, then the affected provisions shall be eliminated from this Agreement
to the extent necessary to permit the remaining provisions to be enforced.


 


(b)           Counterparts. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.


 


(c)           Entire Agreement.  This Agreement
is intended to be the final, complete, and exclusive statement of the terms of
the Executive’s employment by the Company and may not be contradicted by
evidence of any prior or contemporaneous statements or agreements, except for
agreements specifically referenced herein (including the Indemnification
Agreement attached as Exhibit A, the Confidentiality Agreement attached as
Exhibit B, and the Stock Plan and Stock Option Agreement of the
Company).  To the extent that the
practices, policies or procedures of the Company, now or in the future, apply
to the Executive and are inconsistent with the terms of this Agreement, the
provisions of this Agreement shall control. 
Any subsequent change in the Executive’s duties, position, or
compensation will not affect the validity or scope of this Agreement.


 


(d)           Amendments; Waivers. This
Agreement may not be amended except by an instrument in writing, signed by each
of the parties. No failure to exercise and no delay in exercising any right,
remedy, or power under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, remedy, or power under this
Agreement preclude any other or further exercise thereof, or the exercise of
any other right, remedy, or power provided herein or by law or in equity.


 


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(e)           Assignment; Successors and Assigns. The Executive agrees that she will not assign, sell, transfer, delegate,
or otherwise dispose of, whether voluntarily or involuntarily, or by operation
of law, any rights or obligations under this Agreement. Any such purported
assignment, transfer, or delegation shall be void. Nothing in this Agreement
shall prevent the consolidation of the Company with, or its merger into, any
other entity, or the sale by the Company of all or substantially all of its
assets, or the otherwise lawful assignment by the Company of any rights or
obligations under this Agreement. 
Subject to the foregoing, this Agreement shall be binding upon and shall
inure to the benefit of the parties and their respective heirs, legal
representatives, successors, and permitted assigns, and shall not benefit any
person or entity other than those specifically enumerated in this Agreement.


 


(f)            Governing Law. This
Agreement and the performance hereof shall be construed and governed in
accordance with the laws of the State of California.


 


The parties have duly executed this Agreement as
of the date and year first above written.


 


 


	
   

  	
  EXECUTIVE:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/C. Leonard

  	
   

  
	
   

  	
  Christa Leonard

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMPANY:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Michael T. Willis

  	
   

  
	
   

  	
   

  	
  Michael T. Willis

  	
   

  
	
   

  	
  Title: COB, President & CEO

  	
   

  



 


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