exv10w18



 




Exhibit 10.18





NON-DISCLOSURE, NON-COMPETITION, ARBITRATION & EMPLOYMENT AGREEMENT




     In consideration of employment with Global Employment Solutions, located at 9090 S. Ridgeline
Blvd, Ste. 205, Highlands Ranch, CO 80129 and TPS, Inc. located at 300 West Emery St., Ste. 205,
Dalton, GA 30722-1944 (hereinafter referred to as “Employer”), and Robert S. Pennington (herein
after referred to as “Employee”) hereby covenant and agree as follows:




	1.	 	Employment. Employer hereby employs the Employee and the Employee hereby
accepts employment upon the terms and conditions contained herein.






	 	1.1.	 	The Employer shall not require the Employee to relocate from Whitfield County, GA
without Employee’s consent.






	2.	 	Compensation. For the services rendered by the Employee to Employer, Employer shall
pay the Employee an annual salary of $165,000.






	 	2.1.	 	Bonus: In addition, throughout the employment period, Employer agrees to an
annual bonus of up to 50% of Employee’s annual salary. The conditions of this annual
bonus may change from year to year. The bonus plan conditions for 2003 are outlined in
Exhibit A.
	 
	 	2.2.	 	Benefits: Employee will be entitled to the Company’s standard benefits
for insurance, personal and vacation time and paid holidays.






	3.	 	Termination of Employment. This employment agreement shall commence on March
13th, 2003 and shall end upon the third anniversary of the Commencement Date,
unless earlier terminated pursuant to section 3.1. The Employment Period shall be extended
for successive one-year periods unless, not less than 90 days prior to the then-current
expiration date, either party gives written notice of non-renewal to the other party.






	 	3.1.	 	Employment Period shall terminate prior to its scheduled expiration date on the first
to occur of (i) the date of Employee’s death, (ii) Disability (disability defined as
Employee’s inability to perform normal duties for a period of 90 days or more), (iii)
termination for cause, (iv) termination without cause.
	 
	 	3.2.	 	Except as expressly set forth in (4), all compensation and other benefits shall cease
to accrue upon termination of the Employment Period.
	 
	 	3.3.	 	CAUSE: For purposes of this agreement, “cause” shall mean: (i) embezzlement, theft
or other misappropriation of any material property of the Employer or any subsidiary, (ii)
gross or willful misconduct or negligent conduct resulting in a material loss to the
Employer or any subsidiary or material damage to the reputation of the Employer or any
subsidiary, (iii) an act involving moral turpitude which if the subject of a criminal
proceeding could reasonably result in a conviction for a felony involving moral turpitude,
fraud, or misrepresentation, (iv) continuing neglect of his assigned




/s/ Robert Pennington

 









 






	 	 	 	duties to the Employer or any subsidiary after receipt of a notice generally describing
the neglect and after a 30 day time period following such notice has elapsed without cure,
(v) material breach of his fiduciary obligations to the Employer or any subsidiary, (vi)
material breach of any provision of this agreement provided that to the extent such breach
is capable of being cured to Employer’s satisfaction, “cause” shall mean a continued
breach of any provisions of this Agreement after the Employee’s receipt of a notice of
such breach and the passage of 30 days after such notice or (vii) any chemical dependence
which materially affects the performance of his duties and responsibilities to the
Employer or any subsidiary.






	4.	 	Severance: Employee is entitled to 6 months severance (base compensation only) if
Employee is subject to termination without cause, as stated in section 3.1 (iv), as long as
Employee complies with the restrictions set forth in sections 6 – 9 of this agreement.
	 
	5.	 	Duties and Extent of Services. The Employee is engaged as an executive officer for
Employer’s TPS, Inc. division on a Full-time basis. The precise services of the Employee may
be extended or curtailed, from time to time, at the sole discretion of Employer in the role of
executive officer of the TPS, Inc. division. The Employee shall devote the Employee’s
entire working time, attention and energies to the business of Employer, and shall assume and
perform such further responsibilities and duties as may be assigned to the Employee from time
to time by Employer.
	 
	6.	 	Avoidance of Conflict of Interest. While employed by Employer, the Employee shall
not engage in any other business activity which conflicts with Employee’s duties to Employer.
Under no circumstances will the Employee work for any competitor while in the employ of
Employer or have any financial interest in any competitor of Employer. Further this
Agreement does not prohibit investment of a reasonable part of Employee’s assets in the stock
or securities of any competitor whose stock or securities are publicly traded on a United
States exchange. Employee shall not be prohibited from managing his personal investments of
a passive nature during the Employment Period, so long as such activities do not interfere in
any material respect with the performance of Employee’s duties.
	 
	7.	 	Confidentiality






	 	7.1.	 	For the purposes of this Agreement, “Trade Secret” shall mean the whole or any
portion or phase of Employer’s business plan, operation plans, technical information,
design, process, procedure, formula, improvement, confidential business or financial
information, listing of names, addresses, or telephone numbers, or other information
relating to any business or profession which is secret and of value, except that knowledge
of the Staffing industry which employee possessed prior to employment with TPS, Inc. And
was not known or understood by employee. “Confidential Information” shall mean any data or
information, other than trade secrets, that is material, competitively sensitive, and not
generally including known to the public, including training manuals, product development
plans, marketing strategies and internal performance statistics, except that knowledge of
the Staffing industry which employee possessed prior to employment with TPS, Inc.





/s/ Robert Pennington


 









 






	 	7.2.	 	Employee recognizes and acknowledges that the business design functionality (except
that knowledge of the Staffing industry which employee possessed prior to employment with
TPS, Inc.) and business operation of the systems and software which Employer owns, plans or
develops, or acquires from third parties, whether for its own use or for use by its
customers, are confidential in nature and shall be deemed to the Trade Secrets or
Confidential Information, proprietary to and the property of the Employer. Employee
further recognizes and acknowledges that in order to enable Employer to perform services for
its customers, such customers may furnish to Employer Trade Secrets or Confidential
Information concerning their business affairs, property, methods of operation or other data
and that the good will afforded to Employer depends upon, among other things,
Employer and the Employees keeping such services and information confidential.
	 
	 	7.3.	 	Employee shall not use or disclose any Trade Secrets or Confidential Information of
Employer or its customers during the term of Employee’s employment and thereafter, whether
or not the Trade Secrets or Confidential Information are written or in tangible form,
except as required to perform duties for Employer. Employee shall take all necessary
precautions against disclosure of such information to third parties during and after the
term of this Agreement.
	 
	 	7.4.	 	Employee shall keep in strictest confidence, both during the Employee’s employment and
subsequent to termination of employment, and shall not, during the period of employment or
thereafter, disclose or divulge to any person, firm or corporation, or use directly or
indirectly, for the Employee’s own benefit or the benefit of others, any Trade Secret or
Confidential Information including, without limitation, information as to sources of, and
arrangements for, Employer’s business plan(s) use of hardware or software supplied in any
way to Employer or customers of Employer, submission and proposal procedures of Employer,
customers or contact lists. Employer shall assume that this provision applies to employee
as of 3/13/98 forward.
	 
	 	7.5.	 	Upon the request of Employer and, upon the termination of employment, the Employee
shall return to and leave with the Employer all computer programs, documentation,
memoranda, notes, records, drawings, manuals, flow sheets or other documents pertaining to
Employer’s business or Employee’s employment (including all copies thereof). The Employee
will also leave with Employer all other materials involving or containing any Trade Secrets
or Confidential Information of Employer or Employer’s customers.






	8.	 	Restrictions on Competition






	 	8.1.	 	Non-Competition: Employee agrees that during the Employment Period and for a
period of one year thereafter (the “Non-Compete Period”), Employee shall not directly or
indirectly own, manage, control, participate in, consult with, render services to, or in
any manner engage in, any enterprise that competes with any business of the Company
conducted or proposed to be conducted on the date of termination of the Employment Period
and actually commenced within 90 days thereafter, within the greater of the Company’s
actual market or 50 miles of any





/s/ Robert Pennington


 









 






	 	 	 	location at which the Company or its affiliates conduct business or plan to conduct
business on such date. Nothing herein shall prohibit Employee from continuing to hold his
existing passive investment in Michaels & Associates, Inc. or from being a passive owner
of not more than 5% of any publicly-traded class of capital stock of any entity engaged in
a competing business, provided that Employee has no other relationship with such entity.
	 
	 	8.2.	 	Non-Solicitation: During the Non-Compete Period, Employee shall not (i)
induce or attempt to induce any employee of the Company to terminate, or in any way
interfere with, the relationship between the Company and any employee thereof, (ii) hire
directly or through another entity any person who was an employee of the Company at any
time during the Employment Period or (iii) induce or attempt to induce any customer or
other business relation of the Companies to cease doing business with the Company, or in
any way interfere with the relationship between any such customer or business relation and
the Companies.
	 
	 	8.3.	 	Scope of Restriction: If, at the time of enforcement of this paragraph 2, a
court shall hold that the duration, scope or area restrictions stated herein are
unreasonable under circumstances then existing, the parties hereto agree that the maximum
duration, scope or area reasonable under such circumstances shall be substituted for the
stated duration, scope or area.






	9.	 	Ownership. Employee acknowledges that all developments relating to the business of
the employer, made and works created by Employee or under Employee’s direction in connection
with Employer’s assignments or in connection with the assignments of other Employees of
Employer, whether or not made exclusively at Employer’s premises and whether or not created
exclusively with Employer’s computers or other equipment, shall be the sole and complete
property of Employer and that all copyrights and other proprietary interest therein shall
belong to Employer and that all other provisions of this Agreement shall fully apply to all
such developments and works. Employee further agrees that all such developments relating to
the business of the employer made and works created by Employee shall be considered “works
made for hire” pursuant to the U.S. Federal Copyright Act of 1976, as amended. Upon request
of the Company, during and after Employees employment by the Company, Employee shall execute
patent and copyright applications and any other instruments, deemed necessary by the Company
for the prosecution of such patent applications or the acquisition of letters patent or
registration of copyrights in the United States and foreign countries based on any such
developments made or works created by Employee for such items as are related to the business
of the employer.
	 
	10.	 	Injunctive Relief. Employee acknowledges that disclosure of any Trade Secrets or
disclosure of any Confidential Information or any breach of any noncompetitive covenants or
agreements contained herein will irreparably injure Employer or customers of Employer, and
that damages will be insufficient to compensate Employer. Accordingly, Employer or, where
appropriate, a customer of Employer, may seek and obtain injunctive relief against the breach
or threatened breach of the foregoing undertakings, in addition to any other legal remedies
which may be available. The Employee further acknowledges






/s/ Robert Pennington




 









 












	 	 	and agrees that covenants contained herein are necessary for the protection of Employer’s
legitimate business interests and are reasonable in scope and content.






	11.	 	Miscellaneous.






	 	11.1.	 	This Agreement shall inure to the benefit of and be binding upon, Employer and its
subsidiaries and affiliates, together with their successors and assigns, and
Employee, together with Employee’s executor, administrator, personal
representative, heirs and legatees.
	 
	 	11.2.	 	This Agreement shall constitute the entire contract between the parties and
supersedes all existing agreements between them, whether oral or written, with respect to
the subject matter hereof. No change, modification or amendment of this Agreement shall be
of any effect unless in writing signed by the Employee and by the President of the
corporation.
	 
	 	11.3.	 	The failure of Employer to terminate this Agreement for the breach of any condition
or covenant herein by the Employee shall not affect Employer’s right to terminate for
subsequent breaches of the same or other conditions or covenants. The failure of either
party to enforce at any time or for any period of time any of the provisions of this
Agreement shall not be construed as a waiver of such provision or the right of the party
thereafter to enforce each and every such provision.
	 
	 	11.4.	 	Should any provision or portion of any provision of this Agreement not be
enforceable in any jurisdiction, the remainder of the Agreement shall not be affected
thereby.






	12.	 	Arbitration Provision. Subject to the exceptions set forth below, Employee agrees
that any and all claims or disputes that Employee has with the Company, or any of its
employees, which arise out of Employee’s employment or under the terms thereof, shall be
resolved through final and binding arbitration, as specified herein. This shall include,
without limitation, disputes relating to this Agreement, Employee’s employment by the Employer
or the termination thereof, claims for breach of contract or breach of the covenant of good
faith and fair dealing, and any claims of discrimination or other claims under Title VII of
the Civil Rights Act of 1964, the Age Discrimination in Employment act, the Americans with
Disabilities Act, the Employee Retirement Income Securities Act, the Racketeer Influenced and
Corrupt Organizations Act, or any other federal, state or local law or regulation now in
existence or hereinafter enacted and as amended from time to time concerning in any way the
subject of Employee’s employment with the Company or its termination. The only claims or
disputes not covered by this paragraph are disputes related to (i) claims for benefits under
the unemployment insurance or workers’ compensation laws, and (ii) issues affecting the
validity, infringement or enforceability of any trade secret or patent rights held or sought
by the Company or which the Company could otherwise seek; in both of the foregoing cases such
claims or disputes shall not be subject to arbitration and will be resolved pursuant to
applicable law. Binding arbitration will be conducted in Highlands Ranch, Colorado in
accordance with the rules and




/s/ Robert Pennington


 









 






	 	 	regulations of the American Arbitration Association (AAA), by an arbitrator selected from the AAA
Commercial Disputes Panel with a minimum of five years experience in employment law. If, at the
time the dispute in question arose, Employee lives and works more than one hundred (100) miles from
Highlands Ranch, Colorado, then Employee has the option of requesting the arbitration take place in
the county in which the Company has an office that is nearest to Employee’s home. Employee
understands and agrees that the arbitration shall be instead of any jury trial and that the
arbitrator’s decision shall be final and binding to the fullest extent permitted by law and
enforceable by any court having jurisdiction thereof.






	13.	 	Applicable Law. This Agreement shall be construed in accordance with the Laws of the
State of Colorado and Georgia without regard to its conflicts of law provisions.




/s/ Robert Pennington

 









 




IN WITNESS WHEREOF, the parties have executed this Agreement as of the 14 day of
March, 2003.




	 	 	 	 	 	 	 	 	 	 	 
	Employee:	 	 	 	Global Employment Solutions	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Robert Pennington
	 	 	 	By:
	 	/s/ Howard Brill	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Robert Pennington
	 	 	 	 	 	Howard Brill	 	 






	 	 	 	 	 
	Social Security Number:

	 	 	 	 
	 

	 	 	 	 





	 	 	 
	Current Address:

	 	 





 




/s/ Robert Pennington






 





Steve Pennington




Exhibit A

Bonus Plan for 2005



In the event that TPS’s Measurement EBITDA for the fiscal year 2005 is equal to
$2,736,224.00 or greater than, you will qualify for the following bonus schedule:





	 	•	 	2005 Measurement of EBITDA from $2,736,224.00 to $3,041,147.00






	 	o	 	You qualify for a bonus = $36,400.00






	 	•	 	2005 Measurement of EBITDA from $3,041,148.00 to $3,499,000.00






	 	o	 	You qualify for a bonus = $54,600.00






	 	•	 	2005 Measurement of EBITDA of $3,500,000.00 or greater






	 	o	 	You qualify for a bonus = $91,000.00





You will also qualify for 2.5% of EBITDA in excess of $3,500.000.00




Notes:



Bonuses will be paid within 30 days following completion of audited financial statements.



Employee must be employed at the time bonus is to be paid to be eligible to receive earned bonus
payment.



Adjusted for any final audit entries affecting 2004 and 2005.



Global Employment Solutions Bonus Plans are subject to change at anytime with or without notice at
management’s discretion.




	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Date:
	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	Steve Pennington
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	Date:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	Howard Brill