Exhibit 10.7





Exhibit 10.7




AGREEMENT AND RELEASE





CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS AGREEMENT AND RELEASE.




BY SIGNING THIS AGREEMENT AND RELEASE, YOU GIVE UP AND WAIVE IMPORTANT LEGAL RIGHTS.



This is an agreement and release (the “Agreement”) between TeamStaff, Inc., its stockholders
(solely in their capacity as stockholders TeamStaff, Inc.), subsidiaries, affiliates, divisions,
successors and assigns, their respective past and present officers, directors, employees, agents,
attorneys, whether as individuals or in their official capacity, and each of their respective
successors and assigns (hereinafter collectively referred to as “TSTF” or the “Company”) and by his
own free will, Rick J. Filippelli (“Filippelli” or “Employee”). As used herein, the term
“Execution Date” shall mean the later of the two dates on which this agreement has been executed by
Employee and TSTF, as specified on the signature page of this agreement.




WHEREAS, Filippelli has been an employee of TSTF, and



WHEREAS, Filippelli has been employed pursuant to a written employment agreement dated as of
November 2, 2009 (the “Employment Agreement”); and




WHEREAS, Employee and TSTF each desire an amicable cessation of the employment relationship,



NOW, THEREFORE, in consideration of the covenants and promises contained herein and for other
good and valuable consideration, receipt of which is hereby acknowledged, Employee and TSTF (who
hereinafter collectively may be referred to as the “Parties”) hereby agree as follows:



1. Employee acknowledges and agrees that effective the close of business February 5, 2010,
Employee’s position as President and Chief Executive Officer and the Employment Agreement shall be
terminated (the “Termination Date”), and except as otherwise stated, all terms of the Employment
Agreement shall be deemed superseded by this Agreement.




	 	a.	 	Employee agrees to voluntarily resign as a director of the Company
effective as of the Termination Date.







	 	b.	 	Employee will cooperate in completing any action necessary to fully
implement his resignation, including the execution of any documentation necessary
to effectuate his removal from and/or the transfer of any position he has held as
an officer, director, or committee member of TSTF.






 


 









 





2. In consideration for Employee’s execution of this Agreement, and for the release of claims
against TSTF, the Company will give Employee the following:




	 	a.	 	Solely for the purpose of determining the benefits under the Employment
Agreement, the termination of Employee’s Employment shall be deemed a termination
without cause.







	 	b.	 	Employee shall receive and be paid a severance payment, in accordance
with the terms and conditions of the Employment Agreement, the sum of Two Hundred
Ninety Thousand dollars ($290,000) representing 12 months of Base Salary (the
“Severance Payment”). The Severance Payment shall be payable in equal installments
on each of the Company’s regular pay dates for executives during the twelve months
commencing on the first regular executive pay date following the Termination Date.







	 	c.	 	All unvested stock options and restricted stock awards shall been
deemed vested as of the Termination Date. The options shall remain exercisable for
their original Exercise Period.







	 	d.	 	Notwithstanding the foregoing, Employee agrees that Employee will not
sell the 35,000 restricted shares of the Company’s Common Stock originally
scheduled to vest in January 2011, and the 30,000 shares of Common Stock underlying
the option granted pursuant to Section 11.2 of the Employment Agreement, until the
earlier of a change of control, as defined in the Employment Agreement, or January
31, 2011. Notwithstanding the foregoing, Employee shall be entitled to take
advantage of the COBRA benefits to the maximum amount permitted by law.







3. Benefits:




	 	a.	 	Employee’s current health and insurance benefits will continue until
February 5, 2010 as provided in the Employment Agreement, and except as otherwise
expressly provided in this Agreement, Employee will not be entitled to receive any
other benefits after the Termination Date. TSTF shall be responsible for providing
equivalent health benefits or paying all “COBRA” charges through February 5, 2011.







	 	b.	 	To the extent Employee has unreimbursed business expenses, incurred
through the Termination Date, Employee must immediately submit the expenses with
all appropriate documentation; those expenses which meet the Company’s guidelines
will be reimbursed. Any expense account that Employee has with the Company
terminates effective on the Termination Date, and any expenses already incurred
will be reviewed and processed in accordance with the policies and procedures of
the Company. No new expenses may be incurred after the Termination Date. Employee
agrees to promptly pay any outstanding balance on these accounts that represent
non-reimbursable expenses.






4. Employee understands that neither this Agreement (nor anything contained herein) nor the
making of this Agreement is intended, and shall not be construed, as an admission that the Company
has violated any federal, state or local law (statutory, decisional or common law), or any
ordinance or regulation, or has committed any wrong whatsoever with respect to the Employee
(including, but not limited to, breach of any contract, actual or implied).


 


 









 





5. Employee acknowledges that the consideration provided in this Agreement exceed that to
which Employee would otherwise be entitled under the normal operation of any benefit plan, policy
or procedure of the Company or under any previous agreement (written or oral) between Employee and
the Company. Employee further acknowledges that the agreement by TSTF to provide consideration
pursuant to this Agreement beyond Employee’s entitlement is conditioned upon Employee’s release of
all claims against TSTF and Employee’s compliance with all the terms and conditions of this
Agreement. Furthermore, except as provided in this Agreement, Employee gives up Employee’s right to
individual damages in connection with any administrative or court proceeding with respect to any
claim that has been waived herein, arising out of Employee’s employment or separation from
employment from the Company and if Employee is awarded or accepts money damages, Employee will
assign to the Company any right and interest to such money damages.



6. The Parties agree that, except as provided for herein, there shall be no other payments or
benefits payable to Employee, including but not limited to, salary, bonuses, commissions, finder’s
fees and/or other payments.




7. Arbitration:




	 	a.	 	The Parties specifically and knowingly and voluntarily agree to
arbitrate any controversy, dispute or claim which has arisen or should arise in
connection with Employee’s employment, the cessation of Employee’s employment, or
in any way related to the terms of this Agreement. The Parties agree to arbitrate
any and all such controversies, disputes, and claims before a single arbitrator in
the State of New Jersey in accordance with the Rules of the American Arbitration
Association. The arbitrator shall be selected by the Association and shall be an
attorney-at-law experienced in the field of corporate law and admitted to practice
in the State of New Jersey. In the course of any arbitration pursuant to this
Agreement, Employee and the Company agree (i) to request that a written award be
issued by the arbitrator and (ii) that each side is entitled to receive any and all
relief it would be entitled to receive in a court proceeding. The Parties knowingly
and voluntarily agree to enter into this arbitration clause and, except for claims
contemplated in paragraphs 9 and 10 below, waive any rights that might otherwise
exist to request a jury trial or other court proceeding. This paragraph is
intended to be both a post-dispute and pre-dispute arbitration clause. Any
judgment upon any arbitration award may be entered in any court, federal or state,
having competent jurisdiction of the parties.







	 	b.	 	The Parties’ agreement to arbitrate disputes includes, but is not
limited to, any claims of unlawful discrimination and/or unlawful harassment under
Title VII of the Civil Rights Act of 1964, as amended, the Age Discrimination in
Employment Act 1967, as amended, the Americans with Disabilities Act, the New
Jersey and New York Civil Rights Laws, the New Jersey Law Against Discrimination,
the New York Executive Law, the New York City Human Rights Law, the New Jersey
Conscientious Employee Protection Act, the New Jersey Family Leave Act, or any
other federal, state or local law relating to discrimination in employment and any
claims relating to wage and hour claims and any other statutory or common law
claims.





 


 









 











8. Confidentiality




	 	a.	 	Employee further acknowledges and agrees that any non-public and/or
proprietary information of the Company and/or its customers disclosed to or
prepared by Employee during Employee’s employment remains confidential and may not
be used and/or disclosed by Employee hereafter without the prior written consent of
TSTF. Such information includes, without limitation, information concerning
products and services developed and under development, pending or completed Company
regulatory matters (internal or external), litigations, arbitrations, internal
investigations or reviews, internal compliance memoranda and reviews.







	 	b.	 	Employee further agrees that the provisions of Article VI of the
Employment Agreement (“Non-Disclosure”) shall remain in full force and effect.







	 	c.	 	Employee agrees that the terms and existence of this Agreement are and
shall remain confidential and agrees, to the maximum extent permitted by applicable
law, rule, code or regulation, not to disclose (directly or indirectly) the terms,
conditions or existence of this Agreement, or to talk or write about the
negotiation, execution or implementation of this Agreement, without the prior
written consent of TSTF, except as required by law, regulatory authorities,
internally to process this Agreement at TSTF, or in connection with any arbitration
or litigation arising out of this Agreement. Anything herein to the contrary
notwithstanding, Employee may disclose the terms of this Agreement to Employee’s
immediate family, financial advisor, accountant or attorney, provided that Employee
advises any individual to whom the terms, conditions or existence of this Agreement
has been disclosed (in accordance with this sentence) of the confidentiality
requirements of this paragraph and Employee shall use Employee’s best efforts to
ensure that the requirements are complied with in all respects. Further, nothing
in this paragraph shall preclude Employee from using this Agreement in any action
for breach of this Agreement. In that case, however, Employee shall seek to
protect the terms of this Agreement from public disclosure to the extent possible,
including filing this Agreement under seal where permissible to do so.







	 	d.	 	Employee agrees that in the event Employee is contacted by the media in
any form, including, but not limited to, any wire service, newspaper, magazine or
web-based news service, with respect to the Company, its clients and/or customers,
and/or Employee’s conduct and/or employment at the Company, Employee will
immediately refer all contacts directly to Ms. Cheryl Presuto, Chief Financial
Officer, or his successor at the Company.





 


 









 










9. Solely for the purpose of determining the applicability of the Restrictive Covenant in
Article VII of the Employment Agreement, Employee shall be deemed to have voluntarily terminated
his employment as of the Termination Date, and Employee hereby agrees that all of the provisions of
Article VII, as modified by this paragraph, shall remain in full force and effect.
Notwithstanding the provisions of Article VII of the Employment Agreement, the Company agrees
to delete the reference to temporary and/or permanent staffing of travel health professionals
and/or travel nurses related to non-government staffing. Further, in addition to the provisions of
Article VII, Employee also agrees that in consideration for the payments and other consideration
provided in this Agreement, Employee will not for a period of one year after the Termination Date,
either directly or indirectly, (a) solicit any person who is employed by TSTF (or who was employed
by TSTF within 90 days of the Termination date to: (i) terminate his employment with TSTF; (ii)
accept employment with anyone other than TSTF, or (iii) in any manner interfere with the business
of TSTF.



10. Employee agrees that for a period of three years following the Termination Date, Employee
agrees that he will not make any negative or derogatory statements in verbal, written, electronic
or any other form about the Company, including, but not limited to, a negative or derogatory
statement made in, or in connection with, any article or book, on a website, in a chat room or via
the internet except where such statement is required by law or regulation. Nothing contained in
this paragraph shall be construed as requiring the Employee to provide untruthful sworn testimony
in any legal proceeding.




11. Litigation




	 	a.	 	The payments to be made hereunder on conditioned on the full
cooperation by Employee with the Company in the prosecution or defense, as the case
may be, of any and all actions, governmental inquiries or other legal or regulatory
proceedings in which Employee’s assistance may be reasonably requested by the
Company. Reasonable expenses arising from the cooperation will be reimbursed within
the Company’s guidelines. Consistent with the Certificate of Incorporation of TSTF,
and the Company’s Amended and Restated By-Laws, TSTF will hold harmless and
indemnify Employee from and against any expenses (including attorneys’ reasonable
fees), judgments, fines and amounts paid in settlement arising from any claim, suit
or other action against Employee by any third party, on account of any action or
inaction by Employee taken or omitted to be taken by Employee on behalf of TSTF
during the course of his employment, up to his date of termination, provided that
such action or inaction by Employee was within the scope of Employee’s employment
and consistent with the Company’s policies and procedures.







	 	b.	 	Promptly after receipt by Employee under this paragraph 12 of notice of
the commencement of any action, suit or proceeding, Employee shall notify TSTF in
writing of the commencement thereof (but the failure so to notify shall not relieve
TSTF from any liability which it may have under this paragraph except to the extent
that it has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is brought against
Employee, and Employee notifies TSTF of the commencement thereof, TSTF will be
entitled to participate therein, and to the extent it may elect by written notice
delivered to the Employee promptly after receiving the aforesaid notice from
Employee, TSTF may assume the defense thereof with counsel





 


 









 





	 	 	 	
reasonably satisfactory to such Employee. Notwithstanding the foregoing, Employee
shall have the right to employ his own counsel in any such case but the fees and
expenses of such counsel shall be at the expense of Employee unless (i) the
employment of such counsel shall have been authorized in writing by the TSTF in
connection with the defense of such action at the expense of TSTF, or (ii) Employee
shall have reasonably concluded that there may be defenses available to him that are
different from or additional to those available to TSTF (in which case TSTF shall
not have the right to direct the defense of such action on behalf of Employee), in
any of which events such fees and expenses of one additional counsel shall be borne
by TSTF. Anything in this paragraph to the contrary notwithstanding, neither
Employee or TSTF shall be liable for any settlement of any claim or action effected
without its written consent; provided however, that such consent was
not unreasonably withheld.







	 	c.	 	As the result of a grand jury subpoena issued to RS Staffing Services,
Inc., the Company and the Employee are aware of an on-going government
investigation of violation of possible federal laws concerning procurement at the
Veterans Administration. Consistent with the provisions of this paragraph 11, the
Company will provide the Employee with counsel in connection with the investigation
if reasonably necessary. The Employee shall use his best efforts to cooperate with
the Company with respect to the investigation and shall immediately notify the
Company if contacted by any third party in connection with it.







	 	d.	 	Employee acknowledges that he has advised the Company completely and
candidly of all facts of which he is aware that may give rise to legal matters. The
Company is not aware of any claims or any facts giving rise to a claim against the
Employee by the Company.






12. You agree to cause all requests for references to be forwarded in writing to the Company,
attention: Office of the President. The Company will state in response to such inquiries your dates
of employment and positions held. The Company shall not be responsible for responses to reference
requests sought or obtained other than under the procedures set forth in this paragraph.



13. Employee realizes there are many laws and regulations prohibiting employment
discrimination, or otherwise regulating employment or claims related to employment pursuant to
which Employee may have rights or claims. These include but are not limited to Title VII of the
Civil Rights Act of 1964, as amended; the Americans with Disabilities Act of 1990; the Pregnancy
Discrimination Act; the National Labor Relations Act, as amended; 42 U.S.C 1981; the Employee
Retirement Income Security Act of 1974, as amended; the Age Discrimination in Employment Act of
1967, as amended; the Civil Rights Act of 1991; the Worker Adjustment and Retraining Notification
Act; the New York State and City Human Rights Laws; the New Jersey Law Against Discrimination; the
New Jersey Conscientious Employee Protection Act, the New Jersey Family Leave Act, Florida Civil
Rights Act, and other Federal, State and local human rights, fair employment and other laws.
Employee also understands there are other statutes and contract and tort laws which relate to
Employee’s employment and/or the termination of Employee’s employment. Employee hereby
knowingly and voluntarily agrees to waive and release any rights or claims Employee may have
under these and other laws, including, but not limited to, any right to allege retaliation under
the Sarbanes-Oxley Act of 2002 or any applicable federal or state False Claims Act statute, but
does not intend to, nor is Employee waiving any rights or claims that may arise after the date that
this Agreement is signed by Employee. Notwithstanding the foregoing sentence, Employee’s waiver and
release shall not extend to (i) any rights, remedies, or claims Employee may have in enforcing the
terms of the Agreement; and (ii) any rights Employee may have to receive vested amounts under
TSTF’s stock option plans or pension plans.


 


 









 





14. This Agreement shall be deemed to have been made within the County of Middlesex, State of
New Jersey, and shall be interpreted and construed and enforced in accordance with the laws of the
State of New Jersey without regard to its conflicts of law provision.



15. Employee is hereby advised of Employee’s rights to review this Agreement with counsel of
Employee’s choice. Employee has had the opportunity to consult with an attorney and/or other
advisor of Employee’s choosing before signing the Agreement, and was given a period of twenty-one
(21) days to consider the Agreement. Employee is permitted, at his discretion, to return the
Agreement prior to the expiration of this 21-day period. Employee acknowledges that in signing this
Agreement, Employee has relied only on the promises written in this Agreement, and not on any other
promise made by the Company or any other entity or person.



16. Employee represents that Employee has not filed any complaints, charges or claims against
TSTF with any local, State, or Federal agency or court, or with any other forum.



17. Employee agrees to immediately return any TSTF property no matter where located to TSTF
including, but not limited to, TSTF I.D. card, corporate credit card, keys, computer disks, and
written/electronic material prepared in the course of employment at TSTF. Notwithstanding the
foregoing, Employee shall be allowed to retain possession of the Company issued laptop computer.
Employee represents and warrants that the only property of TSTF that he is in possession at the
present time is an IBM laptop computer and keys. Employee covenants and agrees that if he
determines any other TSTF property is in his possession in the future he will promptly notify TSTF
and return the property. The Company agrees to keep Employee’s current telephone extension of 5550
operational and assigned to Employee for a period of no less than 90 days from the Termination
Date. Employee agrees to transfer any Company related business calls to the current CFO.



18. If any provision of this Agreement, or any part thereof, is held to be invalid or
unenforceable because of the scope or duration of or the area covered by such provision, Employee
and TSTF agree that the court or other appropriate decision-making authority making such
determination shall reduce the scope, duration and/or area of such provision (and shall substitute
appropriate provisions for any such invalid or unenforceable provisions) in order to make such
provision enforceable to the fullest extent permitted by law and/or shall delete specific words and
phrases, and such modified provision shall then be enforceable and shall be enforced. In the event
that any court or other appropriate decision-making authority determines that the time period or
the area, or both, are unreasonable and that any of the covenants is to that extent invalid or
unenforceable, the parties hereto agree that such covenants will remain in full force and effect,
first, for the greatest time
period, and second, in the greatest geographical area that would not render them
unenforceable. If any provision of this Agreement is held to be invalid or unenforceable, the
remaining provisions of this Agreement shall nonetheless survive and be enforced to the fullest
extent permitted by law.


 


 









 





19. Except as otherwise expressly provided herein, this Agreement and Release, together with
the General Release constitute the entire agreement between the Parties and supersede any and all
prior agreements, whether written or oral. This Agreement may not be modified or changed, except in
a written agreement signed by both Parties.



20. The Agreement may be executed in multiple counterparts, each of which shall be considered
an original but all of which shall constitute one agreement.




IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates set forth below.



I have read this Agreement, and I understand all of its terms. I enter into and sign this
Agreement knowingly and voluntarily with full knowledge of what it means. I understand that I have
twenty-one (21) days to consider this Agreement and return it to TSTF. I also understand that I
have seven (7) days to revoke this Agreement in writing after I sign it. I understand that a
revocation will become effective only if I furnish TSTF with written notice, within such seven (7)
day period. This Agreement will not become effective or enforceable until TSTF’s receipt back of
Employee’s executed Agreement and the expiration of the seven day revocation period.



	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	Rick J. Filippelli
	 	 	 	Date	 	 
	 	 	 	 	 	 	 	 	 
	TeamStaff, Inc.
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By
	 	 	 	 	 	 	 	 
	 
	 	 

Authorized Representative
	 	 	 	 

Date
	 	 







 


 









 







CONSULT WITH AN ATTORNEY BEFORE SIGNING GENERAL RELEASE. BY SIGNING THIS GENERAL RELEASE, YOU GIVE
UP AND WAIVE IMPORTANT LEGAL RIGHTS.



GENERAL RELEASE





Rick J. Filippelli understands and, of my own free will, enters into this General Release.



In consideration of the payments, benefits, agreements, and other consideration to be provided
by TSTF as described in the Agreement of which this General Release is a part (such agreement, this
General Release, together, the “Agreement”), for himself and for his heirs, executors,
administrators, and their respective successors and assigns (collectively, “Employee”), HEREBY
RELEASES AND FOREVER DISCHARGES, to the maximum extent permitted by law, TeamStaff, Inc. its
stockholders, subsidiaries, affiliates, divisions, successors and assigns, their respective current
and former officers, directors, employees, agents, attorneys, whether as individuals or in their
official capacity, and each of their respective successors and assigns (hereinafter collectively
referred to as “TSTF”) of and from all or any manner of actions, causes and causes of action,
suits, debts, obligations, damages, complaints, liabilities, losses, covenants, contracts,
controversies, agreements, promises, variances, trespasses, judgments and expenses (including
attorneys’ fees and costs), extents, executions, claims and demands whatsoever at law or in equity
(“claims”), specifically including by way of example but not limitation, Title VII of the Civil
Rights Acts of 1964 and 1991, as amended; the Civil Rights Act of 1866; the Employee Retirement
Income Security Act of 1974, as amended; the National Labor Relations Act, as amended; the
Americans with Disabilities Act of 1990; the Age Discrimination in Employment Act of 1967, as
amended; the Worker Adjustment and Retraining Notification Act; the Pregnancy Discrimination Act,
the Sarbanes-Oxley Act of 2002 or any applicable federal or state False Claims Act statute; and all
Federal, State and local statutes, regulations, decisional law and ordinances and all human rights,
fair employment, contract and tort laws relating in any way to Employee’s employment with TSTF
and/or the termination thereof including, again by way of example but without limitation, the New
Jersey and New York Civil Rights Laws, the New Jersey Law Against Discrimination, the New York
Executive Law, the New York City Human Rights Law, the New Jersey Conscientious Employee Protection
Act, the New Jersey Family Leave Act, the Florida Civil Rights Act, any civil rights or human
rights law, as well as all claims for wrongful discharge, breach of contract, personal injury,
defamation, mental anguish, injury to health and reputation, sexual, harassment, which Employee
ever had, now has, or which Employee hereafter can, shall or may have for, upon or by reason of any
matter, cause or thing whatsoever arising out of Employee’s employment by TSTF or the termination
thereof, provided that this General Release shall not extend to (i) any rights, remedies, or claims
Employee may have in enforcing the terms of this Agreement; (ii) any rights Employee may have to
receive vested amounts under TSTF’s stock option plan, 401-K or pension plans; (iii) Employee’s
rights to medical benefit continuation coverage, on a self-pay basis, pursuant to federal law
(COBRA); and (iv) claims for indemnification (whether under state law, the Company’s by-laws or
otherwise) for acts performed as an officer or director of the Company or any of its affiliates.
Employee takes this action filly aware of Employee’s rights arising under the laws of the United
States (and any State or local governmental entity thereof) and voluntarily waives and releases all
such rights or claims under these or other laws, but does not intend to, nor is Employee waiving
any rights or claims that may arise after the date that this
Agreement is signed by Employee. The provisions of any laws providing in substance that
releases shall not extend to claims which are at the time unknown to or unsuspected by the person
executing such release, are hereby waived.


 


 









 





Employee represents that Employee has been advised to and has had an opportunity to consult
with an attorney and/or any other advisors of Employee’s choosing before signing this Agreement,
and was given a period of twenty-one (21) days to consider this Agreement. Employee is permitted,
at his discretion, to return the Agreement prior to the expiration of this 21-day period. Employee
has relied only on the promises written in the Agreement, and not on any other promise made by TSTF
or any other entity or person.



Employee has seven (7) days to revoke the Agreement after Employee signs it. The Agreement
will not become effective or enforceable until TSTF’s receipt back of Employee’s executed Agreement
and the expiration of the seven day revocation period.




Employee has read and understood the Agreement and enters into it knowingly and voluntarily.



IN WITNESS WHEREOF, Rick J. Filippelli has set his hand this
 _____ 
day of                     , 2010
having had the opportunity to review this with counsel of his or her choice.



	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

Rick J. Filippelli

	 	 	 	 

Date