Document:

EX-10.1  Employment Agreement

Exhibit 10.1

EMPLOYMENT AGREEMENT

          THIS AGREEMENT, dated as of July 14, 2008, is by and between SPHERION
CORPORATION, a Delaware corporation (hereinafter referred to as the “Company”), and Loretta
A. Penn (hereinafter the “Executive”).

RECITALS

          A.     The Executive currently serves as the Company’s Senior Vice President and Chief Service
Excellence Officer, and her services and knowledge are valuable to the Company in connection with
the management of its business.

          B.     The Company desires to continue to employ the Executive and to enter into this agreement
embodying the terms of such employment which supercedes any prior employment agreements.

          E.     The Executive desires to continue the Executive’s employment and to enter into an agreement
embodying the terms of such employment.

AGREEMENTS

          NOW, THEREFORE, to induce the Executive to remain in the employ of the Company and its
subsidiaries, and for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Executive agree as follows:

          1.     Employment.

          During the Term of Employment (as defined in Section 2 hereof), the Executive shall serve as
Senior Vice President and Chief Service Excellence Officer. The Executive shall perform and assume
all duties and responsibilities customary to such position and shall devote all of her business
time and energies thereto. In carrying out such duties and responsibilities, the Executive shall
report to, and be subject to the direction of, the President and Chief Executive Officer and the
Board of Directors of the Company (the “Board”).

          2.     Term.

          The Term of Employment under this Agreement shall commence as of the date of this Agreement
and shall continue at the will of the Company and the Executive (the “Term of Employment”).
Either party may terminate the Executive’s employment at any time and for any reason.

          3.     Base Salary.

          The Company shall pay the Executive, in accordance with the Company’s regular payroll
practices applicable to salaried employees, an annualized base salary at the rate in effect
on the date of this Agreement, as the same may from time to time be increased or decreased at
the sole discretion of the Compensation Committee of the Board (the “Compensation
Committee”).

 

 

          4.     Incentive Awards.

          a)     The Executive shall participate in the Company’s annual incentive plan for senior-level
executives as in effect from time to time, subject to the performance standards set by the
Compensation Committee. Payment of any annual incentive award shall be made at the same time that
such awards are paid to other senior-level executives of the Company. The Executive’s annual
incentive award target shall be set by the Compensation Committee.

          b)     The Executive shall be eligible to receive grants under the Company’s long-term incentive
plans as in effect from time to time; provided, however, that the size, type and other terms and
conditions of any such grant to the Executive shall be determined by the Compensation Committee.

          5.     Benefits, Fringes and Perquisites.

          The Executive shall be entitled to participate in all employee pension and welfare benefit,
fringe benefit and perquisite plans and programs made available to the Company’s senior-level
executives as in effect from time to time.

          6.     Vacation.

          The Executive shall be entitled to vacation in accordance with the Company’s vacation policy
applicable to its senior-level executives. Vacations shall be arranged in order that they not
materially interfere with the normal functioning of the Company’s business activities or the
performance of the Executive’s duties hereunder.

          7.     Business Expenses.

          The Company shall reimburse the Executive for any ordinary, necessary and reasonable business
expenses that the Executive incurs in connection with the performance of her duties under this
Agreement, in accordance with the Company’s policy regarding the reimbursement of business
expenses.

          8.     Termination of Employment.

          a)     Death or Disability. The Executive’s employment shall terminate upon the
Executive’s Death, and Company may terminate the Executive’s employment due to Disability (as
defined herein). If, during the Term of Employment, the Executive’s employment is terminated due
to Death or Disability, the Executive (or Executive’s estate or legal representative, as the case
may be) shall be entitled to receive:

          i)     Executive’s base salary through the date of such termination of employment (the
“Termination Date”) at the rate in effect at the time thereof;

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          ii)     an amount, payable at the same time that annual incentive awards for the year in
which the Executive’s employment so terminates are paid to senior-level executives of the
Company, equal to the product of the Executive’s annual incentive award target for such year
and a fraction, the numerator of which is the number of days in such year through the date
of such termination of employment, and the denominator of which is 365; provided, however,
that no such amount shall be paid to the Executive (or to Executive’s estate or legal
representative, as the case may be) if annual incentive awards for such year are not paid to
senior-level executives of the Company generally;

          iii)     reimbursement for expenses incurred by the Executive in accordance with the
Company’s policy but not reimbursed prior to the date of such termination of employment;

          iv)     any vested deferred base salary and vested annual incentive awards (including,
without limitation, interest or other credits on such vested deferred amounts); and

          v)     any other compensation or benefits that may be owed or provided to the Executive in
accordance with the terms and conditions of any applicable plans and programs of the
Company.

     For purposes of this Agreement, “Disability” shall mean the Executive’s inability, by
reason of illness or other physical or mental disability, to perform the principal duties required
by the position held by the Executive at the inception of such illness or disability, for any
consecutive 180-day period. A determination of Disability shall be subject to the certification of
a qualified medical doctor agreed to by the Company and the Executive or, in the Executive’s
incapacity to designate a doctor, the Executive’s legal representative. If the Company and the
Executive cannot agree on the designation of a doctor, then each party shall nominate a qualified
medical doctor and the two doctors shall select a third doctor, and the third doctor shall make the
determination as to Disability.

          b)     For Cause. The Company may terminate the Executive’s employment for Cause (as
defined herein) if the Board determines that Cause exists and serves written notice of such
termination to the Executive. If, during the Term of Employment, the Company terminates the
Executive’s employment for Cause, all of the Executive’s annual incentive awards, long-term
incentive awards, stock options and other stock or long-term incentive grants which are not then
vested or not then exercisable shall be canceled as of the date of the Board’s written notice of
termination, and the Executive shall be entitled to receive:

          i) Executive’s base salary through the date of such termination of employment at the
rate in effect at the time thereof;

          ii) reimbursement for expenses incurred by the Executive in accordance with the
Company’s policy but not reimbursed prior to the date of such termination of employment;

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          iii) any vested deferred base salary and vested deferred annual
incentive awards (including, without limitation, interest or other credits on such
vested deferred amounts but not including unvested annual incentive awards or amounts
payable for the year in which the Board’s written notice of termination for Cause is made,
or unvested annual incentive awards or amounts payable after the Board’s written notice of
termination for Cause is made); and

          iv) any other compensation or benefits that may be owed or provided to the Executive in
accordance with the terms and conditions of any applicable plans and programs of the
Company.

     The Executive shall be entitled to receive no other compensation or benefits, whether
pursuant to this Agreement or otherwise, except as and to the extent required by law.

     For purposes of this Agreement, “Cause” shall mean one or more of the
following:

     (I) the material violation of any of the terms and conditions of this Agreement or any
written agreements the Executive may from time to time have with the Company (after 30 days
following written notice from the Board specifying such material violation and Executive’s
failure to cure or remedy such material violation within such 30-day period);

     (II) inattention to or failure to perform Executive’s assigned duties and
responsibilities competently for any reason other than due to Disability (after 30 days
following written notice from the Board specifying such inattention or failure, and
Executive’s failure to cure or remedy such inattention or failure within such 30-day
period);

     (III) engaging in activities or conduct injurious to the reputation of the Company or
its affiliates including, without limitation, engaging in immoral acts which become public
information or repeatedly conveying to one person, or conveying to an assembled public
group, negative information concerning the Company or its affiliates;

     (IV) commission of an act of dishonesty, including, but not limited to,
misappropriation of funds or any property of the Company;

     (V) commission by the Executive of an act which constitutes a misdemeanor (involving an
act of moral turpitude) or a felony;

     (VI) the material violation of any of the Policies referred to in Section 9 hereof
(after 30 days following written notice from the Board specifying such failure, and the
Executive’s failure to cure or remedy such inattention or failure within such 30-day
period);

     (VII) refusal to perform the Executive’s assigned duties and responsibilities or other
insubordination (after 30 days following written notice from the Board specifying
such refusal or insubordination, and the Executive’s failure to cure or remedy such
refusal or insubordination within such 30-day period); or

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     (VIII) unsatisfactory performance of duties by the Executive as a result of alcohol or
drug use by the Executive.

          c)     Without Cause. The Company may terminate the Executive’s employment without Cause.
If, during the Term of Employment, the Company terminates the Executive’s employment without Cause,
other than due to Death or Disability, then in lieu of any amount otherwise payable under this
Agreement, or as damages for termination of Executive’s employment without Cause, the Executive
shall be entitled to receive:

          i) A cash severance payment (reduced by any applicable payroll or other taxes required
to be withheld) equal to the sum of the Executive’s annual salary for the current year plus
the Prorated Bonus Payment (as defined hereafter). The Prorated Bonus Payment shall equal
the product of (x) the Executive’s annual incentive award target for the current year and
(y) a fraction, the numerator of which is the number of days in such year through the date
of such termination of employment, and the denominator of which is 365. The severance
payment shall be payable in a lump sum amount beginning within thirty (30) days of the date
of the Board’s written notice of termination without Cause. If the notice of termination is
given prior to the determination of the Executive’s salary or annual incentive award target
for the year in which the notice of termination is given, then the amounts shall be based on
the annual salary for the prior year and the greater of the annual incentive award target
for the prior year or the actual annual incentive award earned by the Executive for the
prior year. The current year shall be (A) for purposes of determining the Executive’s
annual salary, the year then generally used by the Company for setting salaries for
senior-level executives (currently April 1 through the following March 31), and (B) for
purposes of determining annual incentive award targets, the fiscal year then generally used
by the Company for setting annual incentive award targets for senior-level executives, in
which the Board gives the Executive written notice of termination, and the prior year shall
be the twelve-month period immediately preceding the current year;

          ii) Reimbursement for expenses incurred by the Executive in accordance with the
Company’s policy but not reimbursed prior to the date of such termination of employment;

          iii) Any vested deferred base salary and vested deferred annual incentive awards
(including, without limitation, interest or other credits on such vested deferred amounts);
and

          iv) Any other compensation or benefits that may be owed or provided to the Executive in
accordance with the terms and conditions of any applicable plans and programs of the
Company.

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Employee stock options, restricted stock and deferred stock units (and other stock awards)
are governed by the terms of the grant documents and will terminate in accordance therewith
and are only exercisable to the extent provided therein. The payment of the severance
payment (calculated in Section 8.c.i.) as well as all other payments and benefits provided
by the Company to the Executive under this Agreement shall be conditioned on the following:
(i) Executive’s continued compliance with the non-competition and confidentiality provisions
provided herein; (ii) the Executive’s execution of a full release and settlement of any and
all claims against the Company; and (iii) the Executive’s execution of a non-disparagement
agreement and continued compliance therewith.

          d)     Voluntary Termination. If, during the Term of Employment, the Executive terminates
her employment other than due to Retirement, the Executive shall be entitled to receive:

     i) Executive’s base salary through the date of such termination of employment at the
rate in effect at the time thereof;

     ii) reimbursement for expenses incurred by the Executive in accordance with the
Company’s policy but not reimbursed prior to the date of such termination of employment;

     iii) any vested deferred base salary and vested deferred annual incentive awards
(including, without limitation, interest or other credits on such vested deferred amounts);
and

     iv) no other compensation or benefits except as and to the extent required by law.

          e) Ineligibility for Severance Plan Payments. Anything in this Agreement to
the contrary notwithstanding, Executive shall not be entitled to any payment under any of
the Company’s severance plans, programs or arrangements.

          f) Payment of Deferred Compensation. Notwithstanding anything contained herein
to the contrary, to the extent the Executive is deemed a “key employee” for purposes of
Section 409A of the Internal Revenue Code of 1986, as amended, and notwithstanding any
contrary provision which exists in any of the Company’s deferred compensation plans, any
distribution of deferred compensation to the Executive will be delayed for a period of 6
months after the Termination Date as required by Section 409A of the Internal Revenue Code
of 1986, as amended.

          9. Company Policies.

          The Executive shall strictly follow and adhere to all written policies of the Company which
are not inconsistent with this Agreement or applicable law including, without limitation,
securities laws compliance (including, without limitation, use or disclosure of material
nonpublic information, restrictions on purchases and sales of Company stock, and reporting
requirements), conflicts of interest (including, without limitation, doing business with the
Company or its affiliates without the prior approval of the Board), and employee harassment.

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          10. Confidentiality.

          The Executive will not at any time (whether during or after Executive’s employment with the
Company) disclose or use for Executive’s own benefit or purposes, or for the benefit or purpose of
any other person, firm, partnership, joint venture, association, corporation or other business
organization, entity or enterprise, any trade secrets, information, data, or other confidential
information relating to customers, employees, job applicants, services, development programs,
prices, costs, marketing, trading, investment, sales activities, promotion, processes, systems,
credit and financial data, financing methods, plans, proprietary computer software, request for
proposal documents, or the business and affairs of the Company generally, or of any affiliate of
the Company; provided, however, that the foregoing shall not apply to information which is
generally known to the industry or the public other than as a result of the Executive’s breach of
this covenant. The Executive agrees that upon termination of her employment with the Company for
any reason, she will return to the Company immediately all memoranda, books, papers, plans,
information, letters and other data, and all copies thereof or therefrom (whether in written,
printed or electronic form), in any way relating to the business of the Company and its affiliates.

          The Executive acknowledges and agrees that the Company’s remedies at law for a breach or
threatened breach of any of the provisions of this Section would be inadequate and, in recognition
of this fact, the Executive agrees that, in the event of such a breach or threatened breach, in
addition to any remedies at law, the Company, without posting any bond, shall be entitled to obtain
equitable relief in the form of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy which may then be available.

          11. Covenant Not to Compete.

          a) In General. The Executive agrees that during Executive’s employment with the
Company and for a period of one (1) year after the termination of such employment for whatever
reason (the “Non-Compete Period”), she shall not, anywhere in the United States:

     i) act as an employee, director, consultant, partner, principal, agent, representative,
owner or stockholder (other than as a stockholder of less than a one percent (1%) equity
interest) for (1) any public company that derives any revenue from any business line in
which the Company derives $25 million or more in annualized revenues as of the Termination
Date or from the principal business line in which the Executive was directly involved
immediately prior to the Termination Date (collectively, the “Business Lines”) or
(2) any private company that derives $25 million or more in annualized revenues from any
combination of one or more of the Business Lines;

     ii) solicit business from, or perform services for, or induce others to perform
services for, any company or other business entity which at any time during the
one (1) year period immediately preceding the Termination Date was a client of the
Company or its affiliates; or

     iii) offer, or cause to be offered, employment with any business, whether in corporate,
proprietorship, or partnership form or otherwise, either on a full-time, part-time or
consulting basis, to any person who was employed by the Company or its affiliates or for
whom the Company or its affiliates performed outplacement services, in either case at any
time during the one (1) year period immediately preceding the Termination Date.

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     iv) For purposes of this Agreement, affiliates of the Company include subsidiaries 50%
or more owned by the Company and the Company’s franchisees and licensees.

          b) Consideration. The consideration for the foregoing covenant not to compete, the
sufficiency of which is hereby acknowledged, is the Company’s agreement to employ the Executive and
provide compensation and benefits pursuant to this Agreement.

          c) Equitable Relief and Other Remedies. The Executive acknowledges and agrees that
the Company’s remedies at law for a breach or threatened breach of any of the provisions of this
Section would be inadequate and, in recognition of this fact, the Executive agrees that, in the
event of such a breach or threatened breach, in addition to any remedies at law, the Company,
without posting any bond, shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, a temporary or permanent injunction or any other
equitable remedy which may then be available.

          d) Reformation. If the foregoing covenant not to compete would otherwise be
determined invalid or unenforceable by a court of competent jurisdiction, such court shall exercise
its discretion in reforming the provisions of this Section to the end that the Executive be subject
to a covenant not to compete, reasonable under the circumstances, enforceable by the Company.

          12. Company Policies, Plans and Programs.

          Whenever any rights under this Agreement depend on the terms of a policy, plan or program
established or maintained by the Company, any determination of these rights shall be made on the
basis of the policy, plan or program in effect at the time as of which the determination is made.
No reference in this Agreement to any policy, plan or program established or maintained by the
Company shall preclude the Company from prospectively or retroactively changing or amending or
terminating that policy, plan or program or adopting a new policy, plan or program in lieu of the
then-existing policy, plan or program.

          13. Binding Agreement; Successors.

          a) This Agreement shall be binding upon and shall inure to the benefit of the Company and its
successors and assigns. The Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company, by agreement to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Company would be required
to perform it if no such succession had taken place. For purposes of this Agreement, “Company”
shall mean the Company as hereinbefore defined and any successor to its business and/or assets as
aforesaid.

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          b) This Agreement shall be binding up and shall inure to the benefit of the Executive and the
Executive’s personal or legal representatives, executors, administrators, successors, heirs,
distributees, beneficiaries, devises and legatees. If the Executive should die while any amounts
are payable to her hereunder, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to the Executive’s devisee, legatee, beneficiary or
other designee or, if there be no such designee, to the Executive’s estate.

          14. Change In Control Agreements.

          Prior to the execution and delivery of this Agreement, the Company and the Executive have
executed and delivered a Change In Control Agreement (“C-I-C Agreement”), which applies
under the circumstances and during the period described therein. If circumstances arise which
cause both the C-I-C Agreement and this Agreement to apply to the Company and the Executive, then,
to the extent of any inconsistency between the provisions of this Agreement and the C-I-C
Agreement, the terms of the C-I-C Agreement alone shall apply. However, if the C-I-C Agreement
does not apply (as, for example, if there is no Change in Control as described therein, or the
C-I-C Agreement has expired, or the C-I-C Agreement simply does not apply), then the provisions of
this Agreement shall control and be unaffected by the C-I-C Agreement.

          15. Notices.

          For the purposes of this Agreement, notices and all other communications provided for herein
shall be in writing and shall be deemed to have been duly given (i) on the date of delivery if
delivered by hand, (ii) on the date of transmission, if delivered by confirmed facsimile, (iii) on
the first business day following the date of deposit if delivered by guaranteed overnight delivery
service, or (iv) on the third business day following the date delivered or mailed by United States
registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

Loretta A. Penn

11549 Clara Barton Drive

Fairfax, VA 22039

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If to the Company:

Spherion Corporation

2050 Spectrum Boulevard

Fort Lauderdale, Florida 33309

Attention: Vice President Legal

or to such other address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

          16. Governing Law.

          The validity, interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Florida, without regard to principles of conflicts of laws.

          17. Entire Agreement; Amendment.

          This Agreement and the C-I-C Agreement contain the entire agreement between the parties
concerning the subject matter hereof and supersede all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or oral, between the parties with
respect to the subject matter hereof. No provisions of this Agreement may be amended, modified,
waived or discharged unless such amendment, waiver, modification or discharge is agreed to in
writing signed by the Executive and the Company. No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement.

          18. Counterparts.

          This Agreement may be executed in one or more counterparts, each of which shall be deemed to
be an original but all of which will constitute one and the same instrument.

          19. Non-Assignability.

          This Agreement is personal in nature and neither of the parties hereto shall, without the
consent of the other, assign, or transfer this Agreement or any rights or obligations hereunder,
except as provided in Section 13. Without limiting the foregoing, the Executive’s right to receive
payments hereunder shall not be assignable or transferable, whether by pledge, creation of a
security interest or otherwise, other than a transfer by her will or trust or by the laws of
descent or distribution, and in the event of any attempted assignment or transfer contrary to this
paragraph the Company shall have no liability to pay any amount so attempted to be assigned or
transferred.

          20. Resolution of Disputes.

          a) The parties shall submit any claim, demand, dispute, charge or cause of action (in any such
case, a “Claim”) arising out of, in connection with, or relating to this Agreement to
binding arbitration in conformance with the J*A*M*S/ENDISPUTE Streamlined
Arbitration Rules and Procedures or the J*A*M*S/ENDISPUTE Comprehensive Arbitration Rules and
Procedures, as applicable, but expressly excluding Rule 28 of the J*A*M*S/ ENDISPUTE Streamlined
Rules and Rule 33 of the J*A*M*S/ENDISPUTE Comprehensive Rules, as the case may be. All
arbitration procedures shall be held in Fort Lauderdale, Florida and shall be subject to the choice
of law provisions set forth in Section 16 of this Agreement.

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          b) In the event of any dispute arising out of or relating to this Agreement for which any
party is seeking injunctive relief, specific performance or other equitable relief, such matter may
be resolved by litigation. Accordingly, the parties shall submit such matter to the exclusive
jurisdiction of the United States District Court for the Southern District of Florida or, if
jurisdiction is not available therein, any other court located in Broward County, Florida, and
hereby waive any and all objections to such jurisdiction or venue that they may have. Each party
agrees that process may be served upon such party in any manner authorized under the laws of the
United States or Florida, and waives any objections that such party may otherwise have to such
process.

          21. No Setoff.

          The Company shall have no right of setoff or counterclaim in respect of any claim, debt or
obligation against any payment provided for in this Agreement.

          22. Non-Exclusivity of Rights.

          Nothing in this Agreement shall prevent or limit the Executive’s continuing or future
participation in any benefit, bonus, incentive or other plan or program provided by the Company or
any of its subsidiaries or successors and for which the Executive may qualify, nor shall anything
herein limit or reduce such rights as the Executive may have under any other agreements with the
Company or any of its subsidiaries or successors. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of the Company or any of its
subsidiaries shall be payable in accordance with such plan or program, except as explicitly
modified by this Agreement.

          23. Withholding.

          The Company may withhold from any amounts payable under this Agreement such federal, state and
local taxes as are required to be withheld (with respect to amounts payable hereunder or under any
benefit plan or arrangement maintained by the Company) pursuant to any applicable law or
regulation.

          24. Invalidity of Provisions.

          In the event that any provision of this Agreement is adjudicated to be invalid or
unenforceable under applicable law in any jurisdiction, the validity or enforceability of the
remaining provisions thereof shall be unaffected as to such jurisdiction and such adjudication
shall not affect the validity or enforceability of such provision in any other jurisdiction. To
the extent that any provision of this Agreement is adjudicated to be invalid or unenforceable
because it is overbroad, that provision shall not be void but rather shall be limited to the extent
required by applicable law and enforced as so limited. The parties expressly acknowledge and agree
that Sections 11 and 24 are reasonable in view of the parties’ respective interests.

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          25. Non-Waiver of Rights.

          The failure by the Company or the Executive to enforce at any time any of the provisions of
this Agreement or to require at any time performance by the other party of any of the provisions
hereof shall in no way be construed to be a waiver of such provisions or to affect either the
validity of this Agreement, or any part hereof, or the right of the Company or the Executive
thereafter to enforce each and every provision in accordance with the terms of this Agreement.

     PLEASE NOTE: BY SIGNING THIS AGREEMENT, THE EXECUTIVE IS HEREBY CERTIFYING THAT THE
EXECUTIVE (A) HAS RECEIVED A COPY OF THIS AGREEMENT FOR REVIEW AND STUDY BEFORE EXECUTING IT; (B)
HAS READ THIS AGREEMENT CAREFULLY BEFORE SIGNING IT; (C) HAS HAD SUFFICIENT OPPORTUNITY BEFORE
SIGNING THE AGREEMENT TO ASK ANY QUESTIONS THE EXECUTIVE HAS ABOUT THE AGREEMENT AND HAS RECEIVED
SATISFACTORY ANSWERS TO ALL SUCH QUESTIONS; AND (D) UNDERSTANDS THE EXECUTIVE’S RIGHTS AND
OBLIGATIONS UNDER THE AGREEMENT.

          THIS AGREEMENT IN SECTION 20 CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE PARTIES.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered as of the
day and year first above set forth.

	 	 	 	 	 
	 	SPHERION CORPORATION

 	 
	 	By:  	/s/  Roy G. Krause 	 
	 	 	Name:  	Roy G. Krause 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	EXECUTIVE

 	 
	 	By:  	/s/ Loretta A. Penn 	 
	 	 	Name:  	Loretta A. Penn 	 
	 	 	 	 
	 

12EX-10.2 Change in Control Agreement

Exhibit 10.2

CHANGE IN CONTROL AGREEMENT

     THIS AGREEMENT, dated as of the 14th day of July 2008, is by and between SPHERION
CORPORATION, a Delaware corporation (hereinafter referred to as the “Company”), and Loretta
A. Penn (hereinafter the “Executive”).

RECITALS

     A.     The Board of Directors of the Company (the “Board”) considers it essential to the
best interests of the Company and its stockholders that its key management personnel be encouraged
to remain with the Company and its subsidiaries and to continue to devote full attention to the
Company’s business in the event that any third person expresses its intention to complete a
possible business combination with the Company, or in taking any other action which could result in
a “Change in Control” (as defined herein) of the Company. In this connection, the Board
recognizes that the possibility of a Change in Control and the uncertainty and questions which it
may raise among management may result in the departure or distraction of key management personnel
to the detriment of the Company and its stockholders. The Board has determined that appropriate
steps should be taken to reinforce and encourage the continued attention and dedication of key
members of the Company’s management to their assigned duties without distraction in the face of the
potentially disturbing circumstances arising from the possibility of a Change in Control of the
Company.

     B.     The Executive currently serves as the Company’s Senior Vice President and Chief Service
Excellence Officer, and her services and knowledge are valuable to the Company in connection with
the management of its business.

     C.     The Board believes the Executive has made and is expected to continue to make valuable
contributions to the productivity and profitability of the Company and its subsidiaries. Should
the Company receive a proposal from a third person concerning a possible business combination or
any other action which could result in a Change in Control, in addition to the Executive’s regular
duties, the Executive may be called upon to assist in the assessment of such proposal, advise
management and the Board as to whether such proposal would be in the best interests of the Company
and its stockholders, and to take such other actions as the Board might determine to be necessary
or appropriate.

     D.     Should the Company receive any proposal from a third person concerning a possible business
combination or any other action which could result in a change in control of the Company, the Board
believes it imperative that the Company and the Board be able to rely upon the Executive to
continue in her position, and that the Company and the Board be able to receive and rely upon her
advice, if so requested, as to the best interests of the Company and its stockholders without
concern that she might be distracted by the personal uncertainties and risks created by such a
proposal, and to encourage Executive’s full attention and dedication to the Company.

     E.     The Company and the Executive desire to enter into this Agreement, upon the terms and
subject to the conditions hereinafter set forth.

 

 

TERMS AND CONDITIONS

     NOW, THEREFORE, to assure the Company and its subsidiaries that it will have the continued,
undivided attention, dedication and services of the Executive and the availability of the
Executive’s advice and counsel notwithstanding the possibility, threat or occurrence of a Change in
Control of the Company, and to induce the Executive to remain in the employ of the Company and its
subsidiaries, and for other good and valuable consideration, the adequacy and sufficiency of which
are hereby acknowledged, the Company and the Executive agree as follows.

     1.     Change in Control. For purposes of this Agreement, a “Change in
Control” of the Company shall be deemed to have occurred upon any of the following
events as such are defined in Section 409A of the Internal Revenue Code of 1986, as amended:
(i) a change in the ownership of the Company; (ii) a change in effective control of the
Company; or (iii) a change in the ownership of a substantial portion of the assets of the
Company.”

     2.     Adjustment of Benefits upon Change in Control

     (a)     The Company agrees that the Compensation Committee of the Board, or such other
committee succeeding to such committee’s responsibilities with respect to executive
compensation (collectively, the “Compensation Committee”) may make such equitable
adjustments to any performance targets contained in any awards under the Company’s current
incentive compensation plans, or any additional or successor plan in which the Executive is
a participant (collectively, the “Incentive Plans”), as the Compensation Committee
determines may be appropriate to eliminate any negative effects from any transactions
relating to a Change in Control (such as costs or expenses associated with the transaction
or any related transaction, including, without limitation, any reorganizations,
divestitures, recapitalizations or borrowings, or changes in targets or measures to reflect
the disruption of the business, etc.), in order to preserve reward opportunities and
performance objectives.

     (b)     In the case of a Change in Control, all restrictions and conditions applicable to
any awards of restricted stock or the vesting of stock options or other awards granted to
the Executive under the Company’s 2000 and 2006 Stock Incentive Plans, Deferred Stock Plan,
any similar, predecessor or successor plan, or otherwise shall be deemed to have been
satisfied as of the date the Change in Control occurs, and this Agreement shall be deemed to
amend any agreements evidencing such awards to reflect this provision.

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     3.     Termination Following Change in Control

     (a)     The Executive’s employment may be terminated for any reason by the Company
following a Change in Control of the Company. If the Executive’s employment is terminated
by the Company for any reason other than for the reasons set forth in subparagraphs (i),
(ii), (iii), (iv) or (v) below within two years following a Change in Control, then the
Executive shall be entitled to the benefits set forth in this Agreement in lieu of any
termination, separation, severance or similar benefits under the Executive’s Employment
Agreement, if any, or under the Company’s termination, separation, severance or similar
plans or policies, if any. If the Executive’s employment is terminated for any of the
reasons set forth in subparagraphs (i), (ii), (iii), (iv) or (v) below, then the Executive
shall not be entitled to any termination, separation, severance or similar benefits under
this Agreement, and the Executive shall be entitled to benefits under the Executive’s
Employment Agreement, if any, or under the Company’s termination, separation, severance or
similar plans or policies, if any, only in accordance with the terms of such Employment
Agreement, or such plans or policies.

          (i) termination by reason of the Executive’s death, provided the Executive has
not previously given a “Notice of Termination” pursuant to Section 4;

          (ii) termination by reason of the Executive’s “Disability,” provided
the Executive has not previously given a “Notice of Termination” pursuant to Section
4;

          (iii) termination by reason of “retirement” at or after age 65,
provided the Executive has not previously given “Notice of Termination”
pursuant to Section 4;

          (iv) termination by the Company for “Cause;” or

          (v) voluntary termination by the Executive (other than for “Good Reason” as
provided in section 3(b) below).

          For the purposes of this Agreement, “Disability” shall be defined as the
Executive’s inability by reason of illness or other physical or mental disability to perform
the principal duties required by the position held by the Executive at the inception of such
illness or disability for any consecutive 180-day period. A determination of disability
shall be subject to the certification of a qualified medical doctor agreed to by the Company
and the Executive or, in the Executive’s incapacity to designate a doctor, the Executive’s
legal representative. If the Company and the Executive cannot agree on the designation of a
doctor, each party shall nominate a qualified medical doctor and the two doctors shall
select a third doctor and the third doctor shall make the determination as to disability.

          For purposes of this Agreement, “retirement” shall mean the Company’s
termination of the Executive’s employment at or after the date on which the Executive
attains age 65.

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          For purposes of this Agreement, “Cause” shall mean one or more of the
following:

          (I)     the material violation of any of the terms and conditions of this Agreement or any
written agreements the Executive may from time to time have with the Company (after 30 days
following written notice from the Board specifying such material violation and Executive’s
failure to cure or remedy such material violation within such 30-day period);

          (II)     inattention to or failure to perform Executive’s assigned duties and
responsibilities competently for any reason other than due to Disability (after 30 days
following written notice from the Board specifying such inattention or failure, and
Executive’s failure to cure or remedy such inattention or failure within such 30-day
period);

          (III)     engaging in activities or conduct injurious to the reputation of the Company or
its affiliates including, without limitation, engaging in immoral acts which become public
information or repeatedly conveying to one person, or conveying to an assembled public
group, negative information concerning the Company or its affiliates;

          (IV)     commission of an act of dishonesty, including, but not limited to,
misappropriation of funds or any property of the Company;

          (V)     commission by the Executive of an act which constitutes a misdemeanor (involving an
act of moral turpitude) or a felony;

          (VI)     the material violation of any of the written Policies of the Company which are not
inconsistent with this Agreement or applicable law (after 30 days following written notice
from the Board specifying such failure, and the Executive’s failure to cure or remedy such
inattention or failure within such 30-day period);

          (VII)     refusal to perform the Executive’s assigned duties and responsibilities or other
insubordination (after 30 days following written notice from the Board specifying such
refusal or insubordination, and the Executive’s failure to cure or remedy such refusal or
insubordination within such 30-day period); or

          (VIII)     unsatisfactory performance of duties by the Executive as a result of alcohol or
drug use by the Executive.

          (b)     The Executive may terminate her employment with the Company following a Change in
Control of the Company for “Good Reason” by giving Notice of Termination at any time
within two years after the Change in Control. Any failure by the Executive to give such
immediate notice of termination for Good Reason shall not be deemed to constitute a waiver
or otherwise to affect adversely the rights of the Executive hereunder, provided the
Executive gives notice to receive such benefits prior to the expiration of such two year
period. If the Executive terminates her employment as provided in this Section 3(b), then
the Executive shall be entitled to the benefits set forth in this Agreement in lieu of any
termination, separation, severance or similar benefits under the Executive’s Employment
Agreement, if any, or under the Company’s termination, separation, severance or similar
plans or policies, if any.

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     For purposes of this Agreement, “Good Reason” shall mean the occurrence of any
one or more of the following events:

          (I)     The assignment to the Executive of any duties inconsistent in any material adverse
respect with her position, authority or responsibilities with the Company and its
subsidiaries immediately prior to the Change in Control, or any other material adverse
change in such position, including titles, authority, or responsibilities, as compared with
the Executive’s position immediately prior to the Change in Control;

          (II)     A reduction by the Company in the amount of the Executive’s base salary or annual
or long term incentive compensation paid or payable as compared to that which was paid or
made available to Executive immediately prior to the Change in Control; or the failure of
the Company to increase Executive’s compensation each year by an amount which is
substantially the same, on a percentage basis, as the average annual percentage increase in
the base salaries of other executives of comparable status with the Company;

          (III)     The failure by the Company to continue to provide the Executive with
substantially similar perquisites or benefits the Executive in the aggregate enjoyed under
the Company’s benefit programs, such as any of the Company’s pension, savings, vacation,
life insurance, medical, health and accident, or disability plans in which she was
participating at the time of the Change in Control (or, alternatively, if such plans are
amended, modified or discontinued, substantially similar equivalent benefits thereto, when
considered in the aggregate), or the taking of any action by the Company which would
directly or indirectly cause such benefits to be no longer substantially equivalent, when
considered in the aggregate, to the benefits in effect at the time of the Change in Control;

          (IV)     The Company’s requiring the Executive to be based at any office or location more
than 50 miles from that location at which she performed her services immediately prior to
the Change in Control, except for a relocation consented to in writing by the Executive, or
travel reasonably required in the performance of the Executive’s responsibilities to the
extent substantially consistent with the Executive’s business travel obligations prior to
the Change in Control;

          (V)     Any failure of the Company to obtain the assumption of the obligation to perform
this Agreement by any successor as contemplated in Section 11 herein; or

          (VI)     Any breach by the Company of any of the material provisions of this Agreement or
any failure by the Company to carry out any of its obligations hereunder, in either case,
for a period of thirty business days after receipt of written notice from the Executive and
the failure by the Company to cure such breach or failure during such thirty business day
period.

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     4.     Notice of Termination

          Any termination of the Executive’s employment following a Change in Control, other than
a termination as contemplated by Sections 3(a)(i) or 3(a)(iii) shall be communicated by
written “Notice of Termination” by the party affecting the termination to
the other party hereto. Any “Notice of Termination” shall set forth (a) the
effective date of termination, which shall not be less than 15 or more than 30 days after
the date the Notice of Termination is delivered (the “Termination Date”); (b) the
specific provision in this Agreement relied upon; and (c) in reasonable detail the facts and
circumstances claimed to provide a basis for such termination and the entitlement, or lack
of entitlement, to the benefits set forth in this Agreement. Notwithstanding the foregoing,
if within fifteen (15) days after any Notice of Termination is given, the party receiving
such Notice of Termination notifies the other party that a good faith dispute exists
concerning the termination, the actual Termination Date shall be the date on which the
dispute is finally determined in accordance with the provisions of Section 18 hereof. In
the case of any good faith dispute as to the Executive’s entitlement to benefits under this
Agreement resulting from any termination by the Company for which the Company does not
deliver a Notice of Termination, the actual Termination Date shall be the date on which the
dispute is finally determined in accordance with the provisions of Section 18 hereof.
Notwithstanding the pendency of any such dispute referred to in the two preceding sentences,
the Company shall continue to pay the Executive her full compensation then in effect and
continue the Executive as a participant in all compensation, benefits and perquisites in
which she was then participating, until the dispute is finally resolved, provided
the Executive is willing to continue to provide full time services to the Company and its
subsidiaries in substantially the same position, if so requested by the Company. Amounts
paid under this Section 4 shall be in addition to all other amounts due under this Agreement
and shall not be offset against or reduce any other amounts due under this Agreement. If a
final determination is made, pursuant to Section 18, that Good Reason did not exist in the
case of a Notice of Termination by the Executive, the Executive shall have the sole right to
nullify and void her Notice of Termination by delivering written notice of same to the
Company within three (3) business days of the date of such final determination. If the
parties do not dispute the Executive’s entitlement to benefits hereunder, the Termination
Date shall be as set forth in the Notice of Termination.

     5.     Termination Benefits

     (a)     Severance Payment. Subject to the conditions set forth in this Agreement,
on the Termination Date the Company shall pay the Executive (reduced by any applicable
payroll or other taxes required to be withheld) a lump sum severance payment, in cash, equal
to two (2) times the sum of Executive’s annual salary for the current year plus her annual
incentive award target for the current year (provided that if the Notice of Termination is
given prior to the determination of the Executive’s salary or annual incentive award target
for the year in which the Termination Date occurs, the amounts shall be based on the annual
salary for the prior year and the greater of the annual incentive award target for the prior
year or the actual incentive award earned by the Executive for the prior year). The current
year shall be (A) for the purposes of determining annual salary, the year then generally
used by the Company for setting salaries for senior-level executives (currently April 1
through the following March 31), and (B) for purposes of determining annual incentive award
target, the fiscal year then generally used by the Company for setting annual incentive
award targets for senior-level executives, in which the Termination Date occurs, and the
prior year shall be the twelve-month period immediately preceding the current year;

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     (b)     Expenses. Reimbursement for expenses incurred by the Executive in
accordance with the Company’s policy but not reimbursed prior to the date of such
termination of employment;

     (c)     Payment of Deferred Compensation. Any compensation that has been earned by
the Executive but is unpaid as of the Termination Date, including any compensation that has
been earned but deferred pursuant to the Company’s Deferred Compensation Plan or otherwise,
shall be paid in full to the Executive on the Termination Date.

     (d)     Key Employee Exception. Notwithstanding anything contained herein to the
contrary, to the extent the Executive is deemed a “key employee” for purposes of Section
409A of the Internal Revenue Code of 1986, as amended, and notwithstanding any contrary
provision which exists in any of the Company’s deferred compensation plans, any distribution
of deferred compensation to the Executive will be delayed for a period of 6 months after the
Termination Date as required by Section 409A of the Internal Revenue Code of 1986, as
amended.

          6.     Other Benefits

          Subject to the conditions set forth in this Agreement hereof, the following benefits (subject
to any applicable payroll or other taxes required to be withheld) shall be paid or provided to the
Executive:

     (a)     Health/Welfare Benefits

               (i)     During the twenty-four (24) months following the Termination Date (the
“Continuation Period”), the Company shall continue to keep in full force and effect
all programs of medical, dental, vision, accident, disability, life insurance, including
optional term life insurance, and other similar health or welfare programs with respect to
the Executive and her dependents with the same level of coverage, upon the same terms and
otherwise to the same extent as such programs shall have been in effect immediately prior to
the Termination Date (or, if more favorable to the Executive, immediately prior to the
Change in Control), and the Company and the Executive shall share the costs of the
continuation of such insurance coverage in the same proportion as such costs were shared
immediately prior to the Termination Date (or, if more favorable to the Executive,
immediately prior to the Change in Control) or, if the terms of such programs do not permit
continued participation by the Executive (or if the Company otherwise determines it
advisable to amend, modify or discontinue such programs for employees generally), the
Company shall otherwise provide benefits substantially similar to and no less favorable to
the Executive in terms of cost or benefits (“Equivalent Benefits”) than she was
entitled to receive at the end of the period of coverage, for the duration of the
Continuation Period.

               (ii)     All benefits which the Company is required by this Section 6(a) to provide, which
will not be provided by the Company’s programs described herein, shall be
provided through the purchase of insurance unless the Executive is uninsurable. If the
Executive is uninsurable, the Company will provide the benefits out of its general assets.

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               (iii)     If the Executive obtains other employment during the Continuation Period which
provides health or welfare benefits of the type described in Section 6(a)(i) hereof
(“Other Coverage”), then Executive shall notify the Company promptly of such other
employment and Other Coverage and the Company shall thereafter not provide the Executive and
her dependents the benefits described in Section 6(a)(i) hereof to the extent that such
benefits are provided under the Other Coverage. Under such circumstances, the Executive
shall make all claims first under the Other Coverage and then, only to the extent not paid
or reimbursed by the Other Coverage, under the plans and programs described in Section
6(a)(i) hereof.

     (b)     Retirement Benefits

               (i)     For purposes of this Agreement, “Retirement” shall mean the Company’s
termination of the Executive’s employment within two years following a Change in Control of
the Company and at or after the date on which the Executive attains age 65; provided,
however, that any termination for Cause or due to Death or Disability shall not constitute
Retirement.

               (ii)     Subject to Section 6(b)(ii), the Executive shall be deemed to be completely vested
under the Company’s 401(k) Plan, Deferred Compensation Plan or other similar or successor
plans which are in effect as of the date of the Change in Control (collectively, the
“Plans”), regardless of the Executive’s actual vesting service credit thereunder.

               (iii)     Any part of the foregoing retirement benefits which are otherwise required to be
paid by a tax-qualified Plan but which cannot be paid through such Plan by reason of the
laws and regulations applicable to such Plan, shall be paid by one or more supplemental
non-qualified Plans or by the Company.

               (iv)     The payments calculated hereunder which are not actually paid by a Plan shall be
paid thirty (30) days following the Date of Termination in a single lump sum cash payment
(of equivalent actuarial value to the payment calculated hereunder using the same actuarial
assumptions as are used in calculating benefits under the Plan but using the discount rate
that would be used by the Company on the Date of Termination to determine the actuarial
present value of projected benefit obligations).

     (c)     Executive Outplacement Counseling. During the Continuation Period, unless
the Executive shall reach normal retirement age during the Continuation Period, the
Executive may request in writing and the Company shall at its expense engage within a
reasonable time following such written request an outplacement counseling service to assist
the Executive in obtaining employment.

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     7.     Payment of Certain Costs

     Except as otherwise provided in Section 18, if a dispute arises regarding a termination
of the Executive or the interpretation or enforcement of this Agreement, subsequent to a
Change in Control, all of the reasonable legal fees and expenses incurred by the Executive
and all Arbitration Costs (as hereafter defined) in contesting any such termination or
obtaining or enforcing all or part of any right or benefit provided for in this Agreement or
in otherwise pursuing all or part of her claim will be paid by the Company, unless
prohibited by law. The Company further agrees to pay pre-judgment interest on any money
judgment obtained by the Executive calculated at the prime interest rate reported in The
Wall Street Journal in effect from time to time from the date that payment to her should
have been made under this Agreement.

     8.     This section intentionally left blank.

     9.     Mitigation

     The Executive is not required to seek other employment or otherwise mitigate the amount of any
payments to be made by the Company pursuant to this Agreement, and employment by the Executive will
not reduce or otherwise affect any amounts or benefits due the Executive pursuant to this
Agreement, except as otherwise provided in Section 6(a)(iii).

     10.     Continuing Obligations Regarding Confidential Information

     (a)     Acknowledgments by the Executive. The Executive hereby recognizes and
acknowledges the following:

               (i)     In connection with the Business, the Company has expended a great deal of time,
money and effort to develop and maintain the secrecy and confidentiality of substantial
proprietary trade secret information and other confidential business information which, if
misused or disclosed, could be very harmful to the Company’s business.

               (ii)     The Executive desires to become entitled to receive the benefits contemplated by
this Agreement but which the Company would not make available to the Executive but for the
Executive’s signing and agreeing to abide by the terms of this Section 10.

               (iii)     The Executive’s position with the Company provides the Executive with access to
certain of the Company’s confidential and proprietary trade secret information and other
confidential business information.

               (iv)     The Company compensates its employees to, among other things, develop and preserve
business information for the Company’s ownership and use.

               (v)     If the Executive were to leave the Company, the Company in all fairness would need
certain protection in order to ensure that the Executive does not
appropriate and misuse any confidential information entrusted to the Executive during
the course of the Executive’s employment with the Company.

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     (b)     Confidential Information

               (i)     The Executive agrees to keep secret and confidential, and not to use or disclose to
any third parties, except as directly required for the Executive to perform the Executive’s
employment responsibilities for the Company, or except as required by law, any of the
Company’s confidential and proprietary trade secret information or other confidential
business information concerning the Company’s business acquired by the Executive during the
course of, or in connection with, the Executive’s employment with the Company (and which was
not known by the Executive prior to the Executive’s being hired by the Company).
Confidential information means information which would constitute material, nonpublic
information under the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder, regardless of whether the Executive’s use or disclosure
of such information is in connection with or related to a securities transaction.

               (ii)     The Executive acknowledges that any and all notes, records, reports, written
information or documents of any kind, computer files and diskettes and other documents
obtained by or provided to the Executive, or otherwise made, produced or compiled during the
course of the Executive’s employment with the Company, regardless of the type of medium in
which it is preserved, are the sole and exclusive property of the Company and shall be
surrendered to the Company upon the Executive’s termination of employment and on demand at
any time by the Company.

     (c)     Acknowledgment Regarding Restrictions. The Executive recognizes and agrees
that the provisions of this Section 10 are reasonable and enforceable because, among other
things, (i) the Executive is receiving compensation under this Agreement and (ii) this
Section 10 therefore does not impose any undue hardship on the Executive. The Executive
further recognizes and agrees that the provisions of this Section 10 are reasonable and
enforceable in view of the Company’s legitimate interests in protecting its confidential
information.

     (d)     Breach. In the event of a breach of Section 10(b), the Company’s sole
remedy shall be the discontinuation of the payment, allocation, accrual or provision of any
amounts or benefits as provided in Sections 5 or 6. The Executive recognizes and agrees,
however, that it is the intent of the parties that neither this Agreement nor any of its
provisions shall be construed to adversely affect any rights or remedies that Company would
have had, including, without limitation, the amount of any damages for which it could have
sought recovery, had this Agreement not been entered into. Accordingly, the parties hereby
agree that nothing stated in this Section 10 shall limit or otherwise affect the Company’s
right to seek legal or equitable remedies it may otherwise have, or the amount of damages
for which it may seek recovery, in connection with matters covered by this Section 10 but
which are not based on breach or violation of this Section 10 (including, without
limitation, claims based on the breach of fiduciary or other duties of the Executive or any
obligations of the Executive arising under any other contracts, agreements or
understandings). Without limiting the generality of the foregoing, nothing in this Section 10
or any other provision of this Agreement shall limit or otherwise affect the Company’s
right to seek legal or equitable remedies it may otherwise have, or the amount of damages
for which it may seek recovery, resulting from or arising out of statutory or common law or
any Company policies relating to fiduciary duties, confidential information or trade
secrets. Further, the Executive acknowledges and agrees that the fact that Section 10(c) is
limited to the Continuation Period, and that the sole remedy of the Company hereunder is the
discontinuation of benefits, shall not reduce or otherwise alter any other contractual or
other legal obligations of the Executive during any period or circumstance, and shall not be
construed as establishing a maximum limit on damages for which the Company may seek
recovery.

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     11.     Binding Agreement; Successors

               (a)     This Agreement shall be binding upon and shall inure to the benefit of the Company
and its successors and assigns. The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company, by agreement to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. For purposes of this
Agreement, “Company” shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid.

               (b)     This Agreement shall be binding upon and shall inure to the benefit of the
Executive and the Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, beneficiaries, devises and legatees. If the Executive
should die while any amounts are payable to her hereunder, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this Agreement to
the Executive’s devisee, legatee, beneficiary or other designee or, if there be no such
designee, to the Executive’s estate.

     12.     Notices

          For the purposes of this Agreement, notices and all other communications provided for herein
shall be in writing and shall be deemed to have been duly given (i) on the date of delivery if
delivered by hand, (ii) on the date of transmission, if delivered by confirmed facsimile, (iii) on
the first business day following the date of deposit if delivered by guaranteed overnight delivery
service, or (iv) on the third business day following the date delivered or mailed by United States
registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

Loretta A. Penn

11549 Clara Barton Drive

Fairfax, VA 22039

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If to the Company:

Spherion Corporation

2050 Spectrum Boulevard

Fort Lauderdale, Florida 33309

Attention: Vice President Legal

or to such other address as either party may have furnished to the other in writing in accordance
herewith, except that notices of change of address shall be effective only upon receipt.

          13.     Governing Law

          The validity, interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Florida, without regard to principles of conflicts of laws.

          14.     Miscellaneous

          No provisions of this Agreement may be amended, modified, waived or discharged unless such
amendment, waiver, modification or discharge is agreed to in writing signed by the Executive and
the Company. No agreements or representations, oral or otherwise, express or implied, with respect
to the subject matter hereof have been made by either party which are not set forth expressly in
this Agreement. Section headings contained herein are for convenience of reference only and shall
not affect the interpretation of this Agreement.

          15.     Counterparts

          This Agreement may be executed in one or more counterparts, each of which shall be deemed to
be an original but all of which will constitute one and the same instrument.

          16.     Non-Assignability

          This Agreement is personal in nature and neither of the parties hereto shall, without the
consent of the other, assign, or transfer this Agreement or any rights or obligations hereunder,
except as provided in Section 11. Without limiting the foregoing, the Executive’s right to receive
payments hereunder shall not be assignable or transferable, whether by pledge, creation of a
security interest or otherwise, other than a transfer by his will or trust or by the laws of
descent or distribution, and in the event of any attempted assignment or transfer contrary to this
paragraph the Company shall have no liability to pay any amount so attempted to be assigned or
transferred.

          17.     Term of Agreement

          The term of this Agreement (the “Term”) shall commence on the date hereof and shall
continue in effect for a period of three (3) years, unless further extended or sooner terminated as
hereinafter provided. At the end of this three year period and on the first day of each one-year
anniversary thereafter, the Term shall automatically be extended for one additional year unless
either party shall have given notice to the other party, at least six months prior to such
anniversary that it does not wish to extend the Term. However, if a Change in Control of the
Company shall
have occurred during the original or any extended term of this Agreement, this Agreement shall
continue in effect for a period of twenty-four (24) months beyond the month in which such Change in
Control occurred; and, provided further, that if the Company shall become obligated
to make any payments or provide any benefits pursuant to Section 5 or 6 hereof, this Agreement
shall continue for the period necessary to make such payments or provide such benefits.

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          18.     Resolution of Disputes

          (a)     The parties hereby agree to submit any claim, demand, dispute, charge or cause of action
(in any such case, a “Claim”) arising out of, in connection with, or relating to this
Change in Control Agreement to binding arbitration in conformance with the J*A*M*S/ENDISPUTE
Streamlined Arbitration Rules and Procedures or the J*A*M*S/ ENDISPUTE Comprehensive Arbitration
Rules and Procedures, as applicable, but expressly excluding Rule 28 of the J*A*M*S/ENDISPUTE
Streamlined Rules and Rule 33 of the J*A*M*S/ENDISPUTE Comprehensive Rules, as the case may be.
All arbitration procedures shall be held in Fort Lauderdale, Florida and shall be subject to the
choice of law provisions set forth in Section 13 of this Agreement.

          (b)     In the event of any dispute arising out of or relating to this Agreement for which any
party is seeking injunctive relief, specific performance or other equitable relief, such matter may
be resolved by litigation. Accordingly, the parties shall submit such matter to the exclusive
jurisdiction of the United States District Court for the Southern District of Florida or, if
jurisdiction is not available therein, any other court located in Broward County, Florida, and
hereby waive any and all objections to such jurisdiction or venue that they may have. Each party
agrees that process may be served upon such party in any manner authorized under the laws of the
United States or Florida, and waives any objections that such party may otherwise have to such
process.

          19.     Release and Conditions

          Any and all payments and benefits provided by the Company to the Executive under this
Agreement shall be conditioned on the following: (i) Executive’s continued compliance with the
confidentiality provisions contained herein; (ii) the Executive’s execution of a full release and
settlement of any and all claims against the Company; and (iii) the Executive’s execution of a
non-disparagement agreement and continued compliance therewith.

          20.     No Setoff

          The Company shall have no right of setoff or counterclaim in respect of any claim, debt or
obligation against any payment provided for in this Agreement.

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          21.     Non-Exclusivity of Rights

          Nothing in this Agreement shall prevent or limit the Executive’s continuing or future
participation in any benefit, bonus, incentive or other plan or program provided by the Company or
any of its subsidiaries or successors and for which the Executive may qualify, nor shall anything
herein limit or reduce such rights as the Executive may have under any other agreements with the
Company or any of its subsidiaries or successors, except to the extent payments are made
pursuant to Section 5, they shall be in lieu of any termination, separation, severance or
similar payments pursuant to the Executive’s Employment Agreement, if any, and the Company’s then
existing termination, separation, severance or similar plans or policies, if any. Amounts which
are vested benefits or which the Executive is otherwise entitled to receive under any plan or
program of the Company or any of its subsidiaries shall be payable in accordance with such plan or
program, except as explicitly modified by this Agreement.

          22.     No Guaranteed Employment

          The Executive and the Company acknowledge that this Agreement shall not confer upon the
Executive any right to continued employment and shall not interfere with the right of the Company
to terminate the employment of the Executive at any time.

          23.     Invalidity of Provisions

          In the event that any provision of this Agreement is adjudicated to be invalid or
unenforceable under applicable law in any jurisdiction, the validity or enforceability of the
remaining provisions thereof shall be unaffected as to such jurisdiction and such adjudication
shall not affect the validity or enforceability of such provision in any other jurisdiction. To
the extent that any provision of this Agreement, including, without limitation, Section 10 hereof,
is adjudicated to be invalid or unenforceable because it is overbroad, that provision shall not be
void but rather shall be limited to the extent required by applicable law and enforced as so
limited. The parties expressly acknowledge and agree that this Section 23 is reasonable in view of
the parties’ respective interests.

          24.     Non-Waiver of Rights

          The failure by the Company or the Executive to enforce at any time any of the provisions of
this Agreement or to require at any time performance by the other party of any of the provisions
hereof shall in no way be construed to be a waiver of such provisions or to affect either the
validity of this Agreement, or any part hereof, or the right of the Company or the Executive
thereafter to enforce each and every provision in accordance with the terms of this Agreement.

          25.     Employment Agreement.

          If the Executive has an Employment Agreement with the Company, and if circumstances arise
which cause both the Employment Agreement and this Agreement to apply to the Company and the
Executive, then, to the extent of any inconsistency between the provisions of this Agreement and
the Employment Agreement, the terms of this Agreement alone shall apply. However, if this
Agreement does not apply, then the provisions of the Employment Agreement shall control and be
unaffected by this Agreement.

14

 

          26.     Unfunded Plan.

          The Company’s obligations under this Agreement shall be entirely unfunded until payments are
made hereunder from the general assets of the Company, and no provision shall be made to segregate
assets of the Company for payments to be made under this Agreement. The Executive shall have no
interest in any particular assets of the Company but rather shall have only the rights of a general
unsecured creditor of the Company.

     PLEASE NOTE: BY SIGNING THIS AGREEMENT, THE EXECUTIVE IS HEREBY CERTIFYING THAT THE
EXECUTIVE (A) HAS RECEIVED A COPY OF THIS AGREEMENT FOR REVIEW AND STUDY BEFORE EXECUTING IT; (B)
HAS READ THIS AGREEMENT CAREFULLY BEFORE SIGNING IT; (C) HAS HAD SUFFICIENT OPPORTUNITY BEFORE
SIGNING THE AGREEMENT TO ASK ANY QUESTIONS THE EXECUTIVE HAS ABOUT THE AGREEMENT AND HAS RECEIVED
SATISFACTORY ANSWERS TO ALL SUCH QUESTIONS; AND (D) UNDERSTANDS THE EXECUTIVE’S RIGHTS AND
OBLIGATIONS UNDER THE AGREEMENT.

     THIS AGREEMENT IN SECTION 18 CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE PARTIES.

          IN WITNESS WHEREOF, the parties have caused this Change in Control Agreement to be executed
and delivered as of the day and year first above set forth.

	 	 	 	 	 
	 	SPHERION CORPORATION

 	 
	 	By:  	/s/ Roy G. Krause 	 
	 	 	Name:  	Roy G. Krause 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	EXECUTIVE

 	 
	 	By:  	/s/ Loretta A. Penn 	 
	 	 	Name:  	Loretta A. Penn 	 
	 	 	 	 
	 

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