UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 29, 2006
SYKES ENTERPRISES, INCORPORATED
(Exact name of registrant as specified in its charter)
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Florida
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0-28274
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56-1383460
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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400 N. Ashley Drive,
Tampa, Florida
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33602
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(Address of principal
executive offices)
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(Zip Code)
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Registrants telephone number, including area code: (813) 274-1000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry into a Material Definitive Agreement.
Equity Compensation Awards to Executive Officers
On March 29, 2006, the Compensation Committee of the Registrant approved awards of
performance-based restricted shares and stock appreciation rights under the Registrants 2001
Equity Incentive Plan (the Plan), as well as performance-based cash bonus awards, to certain
executive officers as set forth below.
2006-2008 Performance Awards
On March 29, 2006, the Compensation Committee of the Registrant approved awards of
performance-based restricted shares and stock appreciation rights under the Plan to certain
executive officers as set forth below:
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Restricted
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Name
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Title
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SARs
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Shares
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Charles Sykes
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President & Chief Executive Officer
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47,117
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68,510
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W. Michael Kipphut
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SVP, Finance
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20,731
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30,371
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Lawrence R. Zingale
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SVP, Global Sales and Client Management
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14,156
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21,053
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James Hobby
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SVP, Global Operations
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12,764
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18,982
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Bruce Woods
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SVP, Healthcare & President, Sykes Canada
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10,443
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15,531
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David Pearson
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SVP & Chief Information Officer
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5,907
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8,654
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Daniel Hernandez
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SVP, Global Strategy
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5,626
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8,242
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Jenna Nelson
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SVP, Human Resources
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5,626
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8,242
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Restricted Shares
The restricted shares are shares of the Registrants common stock which are issued to the
participant subject to (a) restrictions on transfer for a period of time and (b) forfeiture under
certain conditions. With regard to 2/3 of the restricted shares (the Income Based Restricted
Shares), such Income Based Restricted Shares vest and the restrictions on their transfer lapse
with respect to such vested shares on March 29, 2009, provided that (i) the Income from Operations
of the Registrant, as reported in its audited Consolidated Statement of Operations, has increased
during fiscal years 2006, 2007 and 2008 (measured as of December 31, 2008) at least an amount equal
to 10% compounded annual growth over the amount reported for the 2005 fiscal year (Income from
Operations Calculation), and (ii) the participant is employed by the Registrant or a subsidiary on
such date. The number of the Income Based Restricted Shares which will vest, and with regard to
which the restrictions will lapse will be a number equal to 53.3% of the Income Based Restricted
Shares in the event the Income from Operations Calculation is 10%, and will increase on a pro-rata
basis up to a number equal to 66.7% of the Income Based Restricted Shares in the event the Income
from Operations Calculation is 12.5%. In the event the Income from Operations Calculation is
between 12.5% and 18.75%, the number of Income Based Restricted Shares which will vest, and with
regard to which the restrictions will lapse will increase on a pro-rata basis between a number
equal to 66.7% of the Income Based Restricted Shares up to a number equal to 100% of the Income
Based Restricted Shares.
With regard to the other 1/3 of the restricted shares (the Revenue Based Restricted Shares),
such Revenue Based Restricted Shares vest and the restrictions on their transfer lapse with respect
to such vested shares on March 29, 2009, provided that (i) the Gross Revenue from Operations of the
Registrant, as reported in its audited Consolidated Statement of Operations, has increased during
fiscal years 2006, 2007 and 2008 (measured as of December 31, 2008) at least an amount equal to 4%
compounded annual growth over the amount reported for the 2005 fiscal year (Gross Revenue from
Operations Calculation), and (ii) the participant is employed by the Registrant or a subsidiary on
such date. The number of the Revenue Based Restricted Shares which will vest, and with regard to
which the restrictions will lapse will be a number equal to 53.3% of the Revenue Based Restricted
Shares in the event the Gross Revenue from Operations Calculation is 4%, and will increase on a
pro-rata basis up to a number equal to 66.7% of the Revenue Based Restricted Shares in the event
the Gross Revenue from Operations Calculation is 5%. In the event the Gross Revenue from
Operations Calculation is between 5% and 7.5%, the number of Revenue Based Restricted Shares which
will vest, and with regard to which the restrictions will lapse will increase on a pro-rata basis
between a number equal to 66.7% of the Revenue Based Restricted Shares up to a number equal to 100%
of the Revenue Based Restricted Shares.
In the event of a change in control (as defined in the Plan) prior to the date the restricted
shares vest, all of the restricted shares will vest and the restrictions on transfer will lapse
with respect to such vested shares on the date of the change in control, provided that participant
is employed by the Registrant or a subsidiary on the date of the change in control.
If the participants employment with the Registrant or subsidiary is terminated for any
reason, either by the Registrant or participant, prior to the date on which the restricted shares
have vested and the restrictions have lapsed with respect to such vested shares, any restricted
shares remaining subject to the restrictions (together with any dividends paid thereon) will be
forfeited, unless there has been a change in control prior to such date.
Stock Appreciation Rights
The stock appreciation rights (
SARs
) represent the right to receive that number of
shares of common stock of the Registrant determined by dividing (i) the total number of shares of
stock subject to the SARs being exercised by the participant, multiplied by the amount by which the
fair market value (as defined in the Plan) of a share of stock on the day the right is exercised
exceeds the fair market value of a share of stock on the date of grant of the SAR, by (ii) the fair
market value of a share of stock on the exercise date.
The SARs have a term of 10 years, and 1/3 of the SARs vest and become exercisable on and after
each of March 29, 2007, March 29, 2008 and March 29, 2009, provided that participant is employed by
the Registrant or a subsidiary on such date. In the event of a change in control, the SARs will
vest on the date of the change in control, provided that participant is employed by the Registrant
or a subsidiary on the date of the change in control.
If the participant: (i) dies while employed by the Registrant or a subsidiary or within the
period when the SARs could have otherwise been exercised by the participant; (ii) terminates
employment with the Registrant or a subsidiary by reason of the permanent and total disability of
the participant; or (iii) terminates employment with the Registrant or a subsidiary as a result of
the participants retirement, provided that the Registrant or such subsidiary has consented in
writing to the participants retirement, then, in each such case, the participant, or the
representatives of the participant, will have the right, at any time within three months after the
death, disability or retirement of the participant, and prior to the tenth anniversary of the date
of grant of the SARs, to exercise the SARs to the extent the SARs were exercisable by the
participant immediately prior to the participants death, disability or retirement.
The SARs are exercisable only within three months after the termination of the participants
employment with the Registrant or a subsidiary, other than by reason of the participants death,
permanent disability or retirement with the consent of the Registrant or a subsidiary, but only if
and to the extent the SARs were exercisable immediately prior to such termination. If the
participants employment is terminated for cause, or the participant terminates his or her own
employment with the Registrant, any portion of the SARs not yet exercised (whether or not vested)
terminates immediately on the date of termination of employment.
The restricted stock and SARs were awarded pursuant to a Restricted Share and Stock
Appreciation Right Award Agreement in the form filed as Exhibit 99.1 to this report.
2005-2007 Performance Awards
On March 29, 2006, the Compensation Committee of the Registrant approved awards of
performance-based restricted shares under the Plan, as well as performance-based cash bonus awards,
to certain executive officers as set forth below:
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Restricted
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Name
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Title
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$Bonus
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Shares
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Charles Sykes
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President & Chief Executive Officer
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72,800
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20,000
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W. Michael Kipphut
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SVP, Finance
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45,500
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12,500
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James Hobby
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SVP, Global Operations
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29,120
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8,000
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Bruce Woods
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SVP, Healthcare & President, Sykes Canada
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29,120
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8,000
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David Pearson
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SVP & Chief Information Officer
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$
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29,120
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8,000
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Daniel Hernandez
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SVP, Global Strategy
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$
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29,120
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8,000
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Jenna Nelson
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SVP, Human Resources
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$
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29,120
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8,000
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Restricted Shares
The restricted shares vest and the restrictions lapse with respect to such vested shares on
March 29, 2008, provided that (i) the Income from Operations of the Registrant, as reported in its
audited Consolidated Statement of Operations, has increased during fiscal years 2006 and 2007
(measured as of December 31, 2007) at least an amount equal to 10% compounded annual growth
over the amount reported for the 2005 fiscal year, and (ii) the participant is employed by the
Registrant or a subsidiary on such date. In the event of a change in control prior to the date the
restricted shares vest, all of the restricted shares will vest and the restrictions will lapse with
respect to such vested shares on the date of the change in control, provided that participant is
employed by the Registrant or a subsidiary on the date of the change in control.
Cash Bonus
The Registrant has agreed to pay the cash bonuses on March 29, 2008, provided that (i) the
Income from Operations of the Registrant, as reported in its audited Consolidated Statement of
Operations, has increased during fiscal years 2006 and 2007 (measured as of December 31, 2007) at
least an amount equal to 10% compounded annual growth over the amount reported for the 2005 fiscal
year, and (ii) the participant is employed by the Registrant or a subsidiary on such date. In the
event of a change in control, the bonus will be payable on the date of the change in control,
provided that participant is employed by the Registrant or a subsidiary on the date of the change
in control.
If the participants employment with the Registrant or a subsidiary is terminated for any
reason, either by the Registrant or participant, prior to March 29, 2008, any unvested restricted
shares and any bonus not then payable will be forfeited, unless there has been a change in control
prior to such date.
The restricted stock and cash bonuses were awarded pursuant to a Restricted Share and Bonus
Award Agreement in the form filed as Exhibit 99.2 to this report.
New Employment Agreement with Jenna R. Nelson
On April 4, 2006, the Company and Jenna R. Nelson entered into an employment agreement, the
material terms and conditions of which are summarized below. This employment agreement replaces
Ms. Nelsons employment agreement dated March 5, 2004.
The employment agreement provides that Ms. Nelson will serve as an executive of the Company.
Ms. Nelson serves as Senior Vice President, Human Resources. The agreement will continue until
terminated by one of the parties. Under the agreement, effective March 6, 2006, Ms. Nelsons
annual base salary is to be not less than $200,000, and she is entitled to participate in a
performance-based bonus program and to standard executive fringe benefits.
If the agreement is terminated by the Company for any reason other than death, disability, or
cause (as defined in the agreement), the Company is required to pay Ms. Nelson an amount equal to
her weekly base salary for 52 weeks after the termination of the agreement. If Ms. Nelsons
employment is terminated by the Company due to her death, disability or cause, or voluntarily by
Ms. Nelson, then the Company will have no obligation to pay her any salary, bonus or other benefits
other than those payable through the date of termination. In any event, Ms. Nelson may not compete
with the Company in any area in which the Companys clients were conducting business during the
term of the agreement, or solicit the Companys employees,
for a period of one year after termination of her employment. The agreement also contains
customary confidentiality provisions.
Item 1.02. Termination of a Material Definitive Agreement.
The employment agreement between the Company and Jenna R. Nelson, dated March 5, 2004, was
terminated and replaced with a new employment agreement, as described in Item 1.01 above.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
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Exhibit 99.1
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Form of Restricted Share and Stock Appreciation Right Award Agreement
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Exhibit 99.2
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Form of Restricted Share and Bonus Award Agreement
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Exhibit 99.3
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Employment Agreement dated as of April 4, 2006, between Sykes Enterprises, Incorporated and Jenna R. Nelson.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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SYKES ENTERPRISES, INCORPORATED
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By:
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/s/ W. Michael Kipphut
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W. Michael Kipphut
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Senior Vice President and Chief Financial
Officer
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Date: April 4, 2006
Exhibit 99.1
RESTRICTED SHARE AND STOCK APPRECIATION RIGHT AWARD AGREEMENT
THIS RESTRICTED SHARE AND STOCK APPRECIATION RIGHT AWARD AGREEMENT (the
Agreement
),
made effective as of _________, 2006, between Sykes Enterprises, Incorporated, a Florida
corporation (the
Corporation
), and _________ (
Participant
).
RECITALS
In consideration of services to be rendered by the Participant and to provide an incentive to
the Participant to remain with the Corporation and its Subsidiaries, it is in the best interests of
the Corporation to make an award to Participant under the Sykes Enterprises, Incorporated 2001
Equity Incentive Plan (the
Plan
), which is incorporated herein by reference, consisting
of (i) shares of the Corporations common stock, par value $.01 per share (
Stock
) which
will be issued subject to (a) restrictions on transfer for a period of time and (b) divestiture
under certain conditions, all as described herein (
Restricted Stock
), and (ii) a Stock
Appreciation Right, in accordance with the terms of this Agreement.
The Participant hereby acknowledges receipt of a copy of the Plan. Unless otherwise provided
herein, terms used herein that are defined in the Plan and not defined herein shall have the
meanings attributable thereto in the Plan.
NOW, THEREFORE
, for and in consideration of the mutual premises, covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:
1.
Restricted Stock
.
1.1
Grant of Restricted Stock
. The Corporation hereby grants to Participant a total
of _______________(_________) shares of Stock (the
Restricted Shares
), subject to the
transfer restrictions and other conditions set forth in this Agreement. The Corporation shall
cause the Restricted Shares to be issued and a stock certificate representing the Restricted Shares
to be registered in the name of Participant promptly upon execution of this Agreement, but the
stock certificate shall be delivered to, and held in custody by, the Corporation until the
applicable restrictions lapse at the times specified in Section 1.3 below. On or before the date
of execution of this Agreement, Participant shall deliver to the Corporation one or more stock
powers endorsed in blank relating to the Restricted Shares, which will permit transfer to the
Corporation of all or any portion of the Restricted Shares and any securities constituting Retained
Distributions (as defined below in Section 1.2(a)(ii)) that shall be forfeited or that shall not
become vested in accordance with this Agreement.
1.2.
Restrictions
.
(a) Participant shall have all rights and privileges of a shareholder of the Corporation with
respect to the Restricted Shares, including voting rights and the right to receive dividends paid
with respect to such shares, except that the following restrictions shall apply, until such time or
times as restrictions lapse under Section 1.3 of this Agreement:
(i) Participant shall not be entitled to delivery of the certificate or certificates
for any of the Restricted Shares until the restrictions imposed by this Agreement have
lapsed with respect to those Restricted Shares, at the times defined in Section 1.3;
(ii) other than regular cash dividends and such other distributions as the Board of
Directors may in its sole discretion designate, the Corporation will retain custody of all
distributions (
Retained Distributions
) made or declared with respect to the
Restricted Shares (and such Retained Distributions will be subject to the same restrictions,
terms and conditions as are applicable to the Restricted Shares) until such time, if ever,
as the Restricted Shares with respect to which such Retained Distributions shall have been
made, paid or declared shall have become vested, and such Retained Distributions shall not
bear interest or be segregated in separate accounts;
(iii) the Restricted Shares may not be sold, transferred, assigned, pledged or
otherwise encumbered or disposed of by Participant before these restrictions have lapsed
pursuant to Section 1.3, except with the prior written consent of the Administrator; and
(iv) the Restricted Shares and Retained Distributions shall be subject to forfeiture
upon termination of Participants employment with the Corporation to the extent set forth in
Section 1.5 below and upon the breach of any restrictions, terms or conditions of this
Agreement.
Once any portion of Participants Restricted Stock award has become vested under Section 1.3,
the newly vested shares shall no longer be subject to the preceding restrictions, and shall no
longer be considered to be Restricted Shares.
(b) Any attempt to dispose of Restricted Shares in a manner contrary to the restrictions set
forth in this Agreement shall be ineffective.
1.3
When Restrictions Lapse
.
(a)
Restricted Shares Based Upon Operating Income
. With regard to 2/3 of the
Restricted Shares (the Income Based Restricted Shares), such Income Based Restricted Shares shall
vest and the restrictions set forth in this Agreement shall lapse with respect to such vested
shares on March 29, 2009, provided that (i) the Income from Operations of the Corporation, as
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reported in its audited Consolidated Statement of Operations, has increased during fiscal
years 2006, 2007 and 2008 (measured as of December 31, 2008) at least an amount equal to 10%
compounded annual growth over the amount reported for the 2005 fiscal year (Income from Operations
Calculation), and (ii) Participant is employed by the Corporation or a Subsidiary on such date.
The number of the Income Based Restricted Shares which shall vest, and with regard to which the
restrictions shall lapse shall be a number equal to 53.3% of the Income Based Restricted Shares in
the event the Income from Operations Calculation is 10%, and shall increase on a pro-rata basis up
to a number equal to 66.7% of the Income Based Restricted Shares in the event the Income from
Operations Calculation is 12.5%. In the event the Income from Operations Calculation is between
12.5% and 18.75%, the number of Income Based Restricted Shares which shall vest, and with regard to
which the restrictions shall lapse shall increase on a pro-rata basis between a number equal to
66.7% of the Income Based Restricted Shares up to a number equal to 100% of the Income Based
Restricted Shares. Examples of this calculation are set forth on Exhibit A.
(b)
Restricted Shares Based Upon Revenue
. With regard to 1/3 of the Restricted Shares (the
Revenue Based Restricted Shares), such Revenue Based Restricted Shares shall vest and the
restrictions set forth in this Agreement shall lapse with respect to such vested shares on March
29, 2009, provided that (i) the Gross Revenue from Operations of the Corporation, as reported in
its audited Consolidated Statement of Operations, has increased during fiscal years 2006, 2007 and
2008 (measured as of December 31, 2008) at least an amount equal to 4% compounded annual growth
over the amount reported for the 2005 fiscal year (Gross Revenue from Operations Calculation),
and (ii) Participant is employed by the Corporation or a Subsidiary on such date. The number of
the Revenue Based Restricted Shares which shall vest, and with regard to which the restrictions
shall lapse shall be a number equal to 53.3% of the Revenue Based Restricted Shares in the event
the Gross Revenue from Operations Calculation is 4%, and shall increase on a pro-rata basis up to a
number equal to 66.7% of the Revenue Based Restricted Shares in the event the Gross Revenue from
Operations Calculation is 5%. In the event the Gross Revenue from Operations Calculation is
between 5% and 7.5%, the number of Revenue Based Restricted Shares which shall vest, and with
regard to which the restrictions shall lapse shall increase on a pro-rata basis between a number
equal to 66.7% of the Revenue Based Restricted Shares up to a number equal to 100% of the Revenue
Based Restricted Shares. Examples of this calculation are set forth on Exhibit B.
(c)
Vesting Upon Change in Control
. The foregoing notwithstanding, in the event of a
Change in Control (as defined in the Plan) prior to the date the Restricted Shares vest, all of the
Restricted Shares shall vest and the restrictions set forth in this Agreement shall lapse with
respect to such vested shares on the date of the Change in Control, provided that Participant is
employed by the Corporation or a Subsidiary on the date of the Change in Control.
1.4.
Issuance of Stock Certificates for Shares
. The stock certificate representing
the Restricted Shares shall be issued promptly following the execution of this Agreement, and shall
be delivered to the Corporate Secretary or such other custodian as may be designated by the
Corporation, to be held until the restrictions have lapsed under Section 1.3. Such stock
certificates shall bear the following legend:
-3-
The transferability of this certificate and the shares of stock represented
hereby are subject to the terms and conditions (including forfeiture) of a
Restricted Share and Stock Appreciation Right Award Agreement entered into
between the registered owner and Sykes Enterprises, Incorporated. A copy of
such Agreement is on file in the offices of, and will be made available for
a proper purpose by, the Corporate Secretary of Sykes Enterprises,
Incorporated.
Once the restrictions imposed by this Agreement have lapsed with respect to any portion of the
Restricted Shares, upon the written request of Participant, a stock certificate or certificates for
such portion of the Restricted Shares shall be returned and exchanged for new stock certificates
without the foregoing legend for the newly vested portion of the Restricted Shares. Upon the
written request of Participant, the certificates representing the newly vested shares shall be
delivered to Participant (or to the person to whom the rights of Participant shall have passed by
will or the laws of descent and distribution) promptly after the date on which the restrictions
imposed on such shares by this Agreement have lapsed, but not before Participant has made any tax
payment to the Corporation or made other arrangements for tax withholding, as required by
Section 3
. The certificate for any Restricted Shares which vest as a result of a Change in
Control, shall be delivered promptly after the date of the Change in Control.
1.5.
Forfeiture On Termination of Employment
. If the Participants employment with
the Corporation or Subsidiary is terminated for any reason, either by the Corporation or
Participant, prior to the date on which the Restricted Shares have vested and the restrictions set
forth in this Agreement have lapsed with respect to such vested shares pursuant to Section 1.3, any
Restricted Shares remaining subject to the restrictions imposed by this Agreement shall be
forfeited, unless there shall have been a Change in Control (as defined in the Plan) prior to such
date, in which event the provisions of Section 1.3(c) shall control.
2.
Stock Appreciation Right
.
2.1
Grant of Stock Appreciation Right
. The Corporation hereby grants to Participant,
as of the date hereof, a stock appreciation right (the
SAR
) with respect to
____________ (______) shares of Stock (the
Covered Shares
), which
represents the right to receive that number of shares of Stock determined by dividing (i) the total
number of shares of Stock subject to the SAR being exercised by the Participant, multiplied by the
amount by which the Fair Market Value of a share of Stock on the day the right is exercised exceeds
the Fair Market Value of a share of Stock on the date of grant of the SAR (such amount being
hereinafter referred to as the
Spread
), by (ii) the Fair Market Value of a share of Stock
on the exercise date. This SAR is in all respects limited and conditioned as hereinafter provided
and is subject to the terms and conditions of the Plan.
2.2.
Vesting
. Subject to the limitations herein, 1/3 of the SARs shall vest and be
exercisable on and after each of March 29, 2007, March 29, 2008 and March 29, 2009, provided
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that Participant is employed by the Corporation or a Subsidiary on such date. The foregoing
notwithstanding, in the event of a Change in Control (as defined in the Plan), the SAR shall vest
on the date of the Change in Control, provided that Participant is employed by the Corporation or a
Subsidiary on the date of the Change in Control.
2.3
Exercise of SAR
. Subject to the terms and conditions contained herein, including
Section 2.2, Section 2.4 and Section 3, and in the Plan, the SAR, to the extent vested, may be
exercised, in whole or in part, and the Participant shall become entitled to payment in Stock of
the Spread with respect to the exercised portion of the SAR, by written notice to the Corporation
at any time and from time to time, provided however, that the SAR shall terminate on, and shall not
be exercisable in any event after, the tenth anniversary of the date hereof. The SAR is subject to
cancellation as provided in the Plan.
2.4.
Conditions to Exercise
. The SAR may not be exercised by Participant unless the
following conditions are met:
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(a)
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except as provided in Section 2.5 or Section 2.6 below, the Participant is
employed by the Corporation or a Subsidiary on the date of exercise;
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(b)
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Participant shall have given written notice to the Corporation (to the
attention of the Corporations Secretary) with respect to the number of Covered Shares
Participant intends to exercise;
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(c)
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Participant shall have complied with Section 3 hereof with regard to any
withholding tax liability relating to such exercise; and
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(d)
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legal counsel for the Corporation must be satisfied at the time of exercise
that the issuance of the shares of Stock upon exercise will be in compliance with the
Securities Act and applicable United States Federal, state, local and foreign laws.
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2.5
Retirement, Death Or Disability
. If the Participant: (i) dies while employed by
the Corporation or a Subsidiary or within the period when the SAR could have otherwise been
exercised by the Participant; (ii) terminates employment with the Corporation or a Subsidiary by
reason of the permanent and total disability (within the meaning of Section 22(e)(3) of the Code)
of the Participant; or (iii) terminates employment with the Corporation or a Subsidiary as a result
of the Participants retirement, provided that the Corporation or such Subsidiary has consented in
writing to the Participants retirement, then, in each such case, the Participant, or the duly
authorized representatives of the Participant, shall have the right, at any time within three (3)
months after the death, disability or retirement of the Participant, as the case may be, and prior
to the termination of the SAR pursuant to
Section 2.3
above, to exercise the SAR to the
extent the SAR was exercisable by the Participant immediately prior to the Participants death,
disability or retirement.
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2.6
Other Termination of Employment
. The SAR shall be exercisable only within three
(3) months after the termination of the Participants employment with the Corporation or a
Subsidiary, other than by reason of the Participants death, permanent disability or retirement
with the consent of the Corporation or a Subsidiary as provided in Section 2.5 above, but only if
and to the extent the SAR was exercisable immediately prior to such termination. Notwithstanding
the foregoing, if the Participants employment is terminated for cause, or the Participant
terminates his or her own employment with the Corporation, any portion of the SAR not yet exercised
(whether or not vested) shall terminate immediately on the date of termination of employment.
Cause shall have the meaning set forth in any employment agreement then in effect between the
Participant and the Corporation or any of its Subsidiaries, or if the Participant does not have any
employment agreement, cause shall mean (i) if the Participant engages in conduct which has
caused, or is reasonably likely to cause, demonstrable and serious injury to the Corporation, (ii)
the material negligence of, or failure to perform, the Participants duties to the Corporation or
(iii) if the Participant is convicted of a felony or a misdemeanor which substantially impairs the
Participants ability to perform his or her duties to the Corporation.
2.7.
Payment of Spread
. Upon exercise of all or a portion of this SAR, Participant
shall be paid that number of shares of Stock equal to the quotient of (i) the Spread applicable to
the number of Covered Shares to which this SAR is exercised divided by (ii) the Fair Market Value
of a share of Stock on the date such notice was received by the Corporation (the
Exercise
Date
), less any shares of Stock withheld to satisfy obligations for the payment of withholding
taxes and other tax obligations relating to this SAR pursuant to Section 3. If any fractional
share of Stock would otherwise be issued to the Participant upon the exercise of some or all of the
SAR, the Participant shall be paid a cash amount equal to the same fraction of the Fair Market
Value of the Stock on the date of exercise.
2.8
Transfer
. This SAR (including the right to receive the shares of Stock) may not
be sold, transferred, pledged, assigned, encumbered or otherwise alienated or hypothecated by
Participant, other than by will or the laws of descent and distribution and, during the lifetime of
Participant, the SAR may be exercised only by Participant (or, if Participant is incapacitated, by
Participants legal guardian or legal representative). In the event of the death of Participant,
the exercise of the SAR may be made only by the executor or administrator of Participants estate
or the Person or Persons to whom Participants rights under the SAR pass by will or the laws of
descent and distribution. If Participant or anyone claiming under or through Participant attempts
to violate this Section 2.8, such attempted violation shall be null and void and without effect,
and all of the Corporations obligations hereunder shall terminate. Any shares of Stock received
upon exercise of this SAR are subject to the restrictions on transfer, if any, and other rights and
obligations set forth in the Plan.
2.9
No Rights as a Stockholder
. No Participant shall be deemed for any purpose to be
the owner of any Stock subject to any SAR unless and until (a) the SAR shall have been exercised
pursuant to the terms hereof, (b) the Corporation shall have issued and delivered the shares of
Stock to the Participant (or made a book entry registration thereof) and (c) the Participants name
shall have been entered as a stockholder of record on the books of the
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Corporation. Thereupon, Participant shall have full voting, dividend and other ownership rights
with respect to such shares of Stock.
3.
Tax Withholding
. Whenever the restrictions on Participants rights to some or all
of the Restricted Shares lapse under Section 1.3 of this Agreement, and whenever Participant shall
exercise some or all of the SAR under Section 2, or upon Participants notification to the
Corporation that Participant is filing an election with the Internal Revenue Service pursuant to
Section 83(b) of the Internal Revenue Code of 1986, as amended, with respect to the Restricted
Shares or SAR, the Corporation shall notify Participant of the amount of tax which must be withheld
by the Corporation under all applicable federal, state and local tax laws. Participant agrees to
make arrangements with the Corporation to (a) remit a cash payment of the required amount to the
Corporation, (b) to authorize the deduction of such amounts from Participants compensation, (c)
deliver to the Corporation shares of Stock currently held by the Participant (including newly
vested Restricted Shares) with a Fair Market Value on the date of delivery to the Corporation equal
to the required amount, or (d) to otherwise satisfy the applicable tax withholding requirement in a
manner satisfactory to the Corporation.
4.
Agreement Not to Affect Employment; No Implied Rights
. None of this Agreement, the
Restricted Shares or the SAR granted hereunder shall confer upon Participant any right to continued
employment with the Corporation or any Subsidiary, and shall not in any way modify or restrict the
Corporations or such Subsidiarys right to terminate such employment. This Agreement shall not
create or be construed to create a trust or separate fund of any kind or a fiduciary relationship
between the Corporation or any Subsidiary and the Participant or any other person.
5.
Agreement Subject to the Plan
. This Agreement and the rights and obligations of
the parties hereto are subject to and governed by the terms of the Plan as the same may be amended
from time to time, the provisions of which are incorporated by reference into this Agreement.
6.
Miscellaneous
.
(a) This Agreement may be executed in one or more counterparts, all of which taken together
will constitute one and the same instrument.
(b) The terms of this Agreement may only be amended, modified or waived by a written agreement
executed by both of the parties hereto.
(c) The validity, performance, construction and effect of this Agreement shall be governed by
the laws of the State of Florida, without giving effect to principles of conflicts of law.
(d) This Agreement constitutes the entire agreement between the parties hereto with respect to
the transactions contemplated herein.
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(e) The headings contained in this Agreement are for purposes of convenience only and shall
not affect the meaning or interpretation of this Agreement.
(f) Except as otherwise herein provided, this Agreement shall be binding upon and shall inure
to the benefit of the Corporation, its successors and assigns, and of Participant and Participants
personal representatives.
(g) This Agreement may be executed by either of the parties (the
Originating Party
)
and transmitted to the other party (the
Receiving Party
) by facsimile, telecopy, telex or
other form of written electronic transmission, and, upon confirmation of receipt thereof by the
Receiving Party, this Agreement shall be deemed to have been duly executed by the Originating
Party. Upon the request of the Receiving Party, the Originating Party shall provide the Receiving
Party with an executed duplicate original of this Agreement.
IN WITNESS WHEREOF
, the parties have executed this Restricted Share and Stock Appreciation
Right Award Agreement on the date and year first above written.
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Exhibit 99.2
RESTRICTED SHARE AND BONUS AWARD AGREEMENT
THIS RESTRICTED SHARE AND BONUS AWARD AGREEMENT
(the Agreement), made effective as of
, 2006, between SYKES ENTERPRISES, INCORPORATED, a Florida corporation (the
Corporation), and
(Participant).
RECITALS
In consideration of services to be rendered by the Participant and to provide an incentive to
the Participant to remain with the Corporation and its Subsidiaries, it is in the best interests of
the Corporation to make a Performance Award to Participant consisting of (i) shares of Restricted
Stock under the Sykes Enterprises, Incorporated 2001 Equity Incentive Plan (the Plan) which is
incorporated herein by reference, and (ii) a cash bonus, in accordance with the terms of this
Agreement.
The Participant hereby acknowledges receipt of a copy of the Plan. Unless otherwise provided
herein, terms used herein that are defined in the Plan and not defined herein shall have the
meanings attributable thereto in the Plan.
NOW, THEREFORE
, for and in consideration of the mutual premises, covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:
1.
Grant of Restricted Shares
.
The Corporation hereby grants to Participant a total of
(
) shares of
the common stock, $.01 par value per share, of the Corporation (the Restricted Shares), subject
to the transfer restrictions and other conditions set forth in this Agreement.
The Corporation shall cause the Restricted Shares to be issued and a stock certificate or
certificates representing the Restricted Shares to be registered in the name of Participant
promptly upon execution of this Agreement, but the stock certificate or certificates shall be
delivered to, and held in custody by, the Corporation until the applicable restrictions lapse at
the times specified in
Section 3
below. On or before the date of execution of this
Agreement, Participant shall deliver to the Corporation one or more stock powers endorsed in blank
relating to the Restricted Shares, which will permit transfer to the Corporation of all or any
portion of the Restricted Shares and any securities constituting Retained Distributions (as defined
below in Section 2(a)(ii)) that shall be forfeited or that shall not become vested in accordance
with this Agreement.
2.
Restrictions
.
(a) Participant shall have all rights and privileges of a shareholder of the Corporation with
respect to the Restricted Shares, including voting rights and the right to receive dividends paid
with respect to such shares, except that the following restrictions shall apply, until such time or
times as restrictions lapse under
Section 3
of this Agreement:
(i) Participant shall not be entitled to delivery of the certificate or certificates
for any of the Restricted Shares until the restrictions imposed by this Agreement have
lapsed with respect to those Restricted Shares, at the times defined in
Section 3
;
(ii) other than regular cash dividends and such other distributions as the Board of
Directors may in its sole discretion designate, the Corporation will retain custody of all
distributions (Retained Distributions) made or declared with respect to the Restricted
Shares (and such Retained Distributions will be subject to the same restrictions, terms and
conditions as are applicable to the Restricted Shares) until such time, if ever, as the
Restricted Shares with respect to which such Retained Distributions shall have been made,
paid or declared shall have become vested, and such Retained Distributions shall not bear
interest or be segregated in separate accounts;
(iii) the Restricted Shares may not be sold, transferred, assigned, pledged or
otherwise encumbered or disposed of by Participant before these restrictions have lapsed
pursuant to
Section 3
, except with the consent of the Corporation; and
(iv) the Restricted Shares and Retained Distributions shall be subject to forfeiture
upon termination of Participants employment with the Corporation to the extent set forth in
Section 6
below and upon the breach of any restrictions, terms or conditions of this
Agreement.
Once any portion of Participants Restricted Share award has become vested under
Section
3
, the newly vested shares shall no longer be subject to the preceding restrictions, and shall
no longer be considered to be Restricted Shares.
(b) Any attempt to dispose of Restricted Shares in a manner contrary to the restrictions set
forth in this Agreement shall be ineffective.
3.
When Restrictions Lapse
.
The Restricted Shares shall vest and the restrictions set forth in this Agreement shall lapse
with respect to such vested shares on March 29, 2008, provided that (i) the Income from Operations
of the Corporation, as reported in its audited Consolidated Statement of Operations, has increased
during fiscal years 2006 and 2007 (measured as of December 31, 2007) at least an amount equal to
10% compounded annual growth over the amount reported for the 2005 fiscal year, and (ii)
Participant is employed by the Corporation or a Subsidiary on such date. The foregoing
notwithstanding, in the event of a Change in Control (as defined in the Plan) prior to the date the
Restricted Shares vest, all of the Restricted Shares shall vest and the restrictions set forth in
this Agreement shall lapse with respect to such vested shares on the date of the Change in Control,
provided that Participant is employed by the Corporation or a Subsidiary on the date of the Change
in Control.
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4.
Issuance of Stock Certificates for Shares
.
The stock certificate or certificates representing the Restricted Shares shall be issued
promptly following the execution of this Agreement, and shall be delivered to the Corporate
Secretary or such other custodian as may be designated by the Corporation, to be held until the
restrictions have lapsed under
Section 3
. Such stock certificate or certificates shall
bear the following legend:
The transferability of this certificate and the shares of stock represented
hereby are subject to the terms and conditions (including forfeiture) of a
Restricted Share Agreement entered into between the registered owner and
Sykes Enterprises, Incorporated. A copy of such Agreement is on file in the
offices of, and will be made available for a proper purpose by, the
Corporate Secretary of Sykes Enterprises, Incorporated.
Once the restrictions imposed by this Agreement have lapsed with respect to any portion of the
Restricted Shares, upon the written request of Participant, a stock certificate or certificates for
such portion of the Restricted Shares shall be returned and exchanged for new stock certificates
without the foregoing legend for the newly vested portion of the Restricted Shares. Upon the
written request of Participant, the certificates representing the newly vested shares shall be
delivered to Participant (or to the person to whom the rights of Participant shall have passed by
will or the laws of descent and distribution) promptly after the date on which the restrictions
imposed on such shares by this Agreement have lapsed, but not before Participant has made any tax
payment to the Corporation or made other arrangements for tax withholding, as required by
Section 6
. In the event all of some portion of the Restricted Shares vest and the
restrictions imposed by this Agreement lapse as a result of a Change in Control as provided in
Section 3 above, the certificate for such Restricted Shares shall be delivered promptly after the
date of the Change in Control, if such date occurs after the publication of the Corporations
audited Consolidated Statement of Operations for the prior year, or promptly following such
publication, if such Change in Control occurs after the end of the prior year but before such
publication.
5.
Cash Bonus
. The Corporation shall pay a cash bonus to the Participant, in the
amount of
Dollars ($
Bonus Amount) on March 29, 2008,
provided that (i) the Income from Operations of the Corporation, as reported in its audited
Consolidated Statement of Operations, has increased during fiscal years 2006 and 2007, (measured as
of December 31, 2007) at least an amount equal to 10% compounded annual growth over the amount
reported for the 2005 fiscal year, and (ii) Participant is employed by the Corporation or a
Subsidiary on such date. The foregoing notwithstanding, in the event a Change in Control (as
defined in the Plan) triggers the vesting of the Restricted Shares pursuant to the provisions of
paragraph 3 above, the Bonus Amount shall be payable on the date that the Restricted Shares vest.
This Agreement shall not create or be construed to create a trust or separate fund of any kind
or a fiduciary relationship between the Corporation or any Subsidiary and the Participant or
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any other person. To the extent that the Participant or any other person acquires a right to
receive payments from the Corporation or any Subsidiary pursuant to this Agreement, such right
shall be no greater than the right of any unsecured general creditor of the Corporation.
6.
Tax Withholding
.
Whenever the restrictions on Participants rights to some or all of the Restricted Shares
lapse under
Section 3
of this Agreement and some or all of the Bonus Amount becomes
payable, or upon Participants filing an election with the Internal Revenue Service pursuant to
Section 83(b) of the Internal Revenue Code of 1986, as amended, with respect to the Restricted
Shares, the Corporation shall notify Participant of the amount of tax which must be withheld by the
Corporation under all applicable federal, state and local tax laws. Participant agrees to make
arrangements with the Corporation to (a) remit a cash payment of the required amount to the
Corporation, (b) to authorize the deduction of such amounts from Participants compensation or (c)
to otherwise satisfy the applicable tax withholding requirement in a manner satisfactory to the
Corporation.
7.
Forfeiture On Termination of Employment
.
If the Participants employment with the Corporation or Subsidiary is terminated for any
reason, either by the Corporation or Participant, prior to March 29, 2008, any Restricted Shares
remaining subject to the restrictions imposed by this Agreement, and any Bonus Amount not then
payable, shall be forfeited, unless there shall have been a Change in Control (as defined in the
Plan) prior to such date, in which event the provisions of Section 3 and Section 5 shall control.
8.
Agreement Not to Affect Employment
.
Neither this Agreement nor the Restricted Shares granted hereunder shall confer upon
Participant any right to continued employment with the Corporation or any Subsidiary, and shall not
in any way modify or restrict the Corporations or such Subsidiarys right to terminate such
employment.
9.
Agreement Subject to the Plan
. This Agreement and the rights and obligations of
the parties hereto are subject to and governed by the terms of the Plan as the same may be amended
from time to time, the provisions of which are incorporated by reference into this Agreement.
10.
Miscellaneous
.
(a) This Agreement may be executed in one or more counterparts, all of which taken together
will constitute one and the same instrument.
(b) The terms of this Agreement may only be amended, modified or waived by a written agreement
executed by both of the parties hereto.
(c) The validity, performance, construction and effect of this Agreement shall be governed by
the laws of the State of Florida, without giving effect to principles of conflicts of law.
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(d) This Agreement constitutes the entire agreement between the parties hereto with respect to
the transactions contemplated herein.
(e) Except as otherwise herein provided, this Agreement shall be binding upon and shall inure
to the benefit of the Corporation, its successors and assigns, and of Participant and Participants
personal representatives.
(f) This Agreement may be executed by either of the parties (the Originating Party) and
transmitted to the other party (the Receiving Party) by facsimile, telecopy, telex or other form
of written electronic transmission, and, upon confirmation of receipt thereof by the Receiving
Party, this Agreement shall be deemed to have been duly executed by the Originating Party. Upon
the request of the Receiving Party, the Originating Party shall provide the Receiving Party with an
executed duplicate original of this Agreement.
IN WITNESS WHEREOF
, the parties have executed this Restricted Share Agreement effective as of
the date and year first above written.
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SYKES ENTERPRISES, INCORPORATED
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EXHIBIT 99.3
EMPLOYMENT AGREEMENT
PLEASE READ THIS AGREEMENT CAREFULLY. THIS AGREEMENT DESCRIBES THE BASIC LEGAL AND ETHICAL
RESPONSIBILITIES THAT YOU ARE REQUIRED TO OBSERVE AS AN EXECUTIVE EXPOSED TO HIGHLY SENSITIVE
TECHNOLOGY AND STRATEGIC INFORMATION. CONSULT WITH YOUR LEGAL COUNSEL IF ALL THE TERMS AND
PROVISIONS OF THIS AGREEMENT ARE NOT FULLY UNDERSTOOD BY YOU.
THIS AGREEMENT is made as of the
4th day of April, 2006
, by and between SYKES ENTERPRISES,
INCORPORATED, a Florida corporation (the Company), and
Jenna R. Nelson
(the Executive).
W I T N E S S E T H :
WHEREAS, the Company desires to assure itself of the Executives continued employment in an
executive capacity; and
WHEREAS, the Executive desires to be employed by the Company on the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the parties
contained herein, and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto covenant and agree as follows:
1. EMPLOYMENT AND DUTIES.
Subject to the terms and conditions of this Agreement, the Company
shall employ the Executive during the Term (as hereinafter defined) in such management capacities
as may be designated from time to time by the Companys Chief Executive Officer and/or the Chief
Executive Officers designee. The Executive accepts such employment and agrees to devote his/her
best efforts and entire business time, skill, labor, and attention to the performance of such
duties. The Executive agrees to promptly provide a description of any other commercial duties or
pursuits engaged in by the Executive to the Companys Chief Executive Officer. If the Companys
Chief Executive Officer determines in good faith that such activities conflict with the Executives
performance of his/her duties hereunder, the Chief Executive Officer shall notify Executive within
thirty (30) days and the Executive shall promptly cease such activities to the extent as directed
by the Chief Executive Officer. If the Chief Executive Officer does not provide such notice,
Executive shall be free to engage in such commercial duties or pursuits. It is acknowledged and
agreed that such description shall be made regarding any such activities in which the Executive
owns more than 5% of the ownership of the organization or which may be in violation of Section 5
hereof, and that the failure of the Executive to provide any such description shall enable the
Company to terminate the Executive for Cause (as provided in Section 6(c) hereof). The Company
agrees to hold any such information provided by the Executive confidential and not disclose the
same to any person other than a person to whom disclosure is reasonably necessary or appropriate in
light of the circumstances. In addition, the Executive agrees to serve without additional
compensation
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if elected or appointed to any office or position, including as a director, of the
Company or any subsidiary or affiliate of the Company; provided, however, that the Executive shall
be entitled to receive such benefits and additional compensation, if any, that is paid to executive
officers of the Company in connection with such service.
2. TERM.
Subject to the terms and conditions of this Agreement, including, but not limited
to, the provisions for termination set forth in Section 6 hereof, the employment of the Executive
under this Agreement shall commence on the effective date hereof and shall continue until
terminated as provided herein (such term shall herein be defined as the Term). The Executive
agrees that some portions of this Agreement, including the Sections entitled Confidential
Information, Covenant Not-To-Compete And No Solicitation, Termination, and Arbitration of
Disputes, will remain in force after the termination of this Agreement.
3. COMPENSATION.
(a) Base Salary and Bonus. As compensation for the Executives services under this
Agreement, the Executive shall receive and the Company shall pay a weekly base salary set
forth on Exhibit A. Such base salary may be increased but not decreased during the Term
in the Companys discretion based upon the Executives performance and any other factors the
Company deems relevant. Such base salary shall be payable in accordance with the policy
then prevailing for the Companys executives. In addition to such base salary, the
Executive shall be entitled during the Term to a performance bonus and shall be eligible to
participate in and receive payments or awards from all other bonus and other incentive
compensation, stock option and restricted stock plans as may be adopted by the Company, all
as determined by the Compensation Committee of the Board of Directors in its sole
discretion.
(b) Payments. All amounts paid pursuant to this Agreement shall be subject to
withholding or deduction by reason of the Federal Insurance Contribution Act, federal income
tax, state and local income tax, if any, and comparable laws and regulations.
(c) Other Benefits. The Executive shall be reimbursed by the Company for all
reasonable and customary travel and other business expenses incurred by the Executive in the
performance of the Executives duties hereunder in accordance with the Companys standard
policy regarding expense verification practices. The Executive shall be entitled to that
number of weeks paid vacation per year that is available to other executive officers of the
Company in accordance with the Companys standard policy regarding vacations and such other
fringe benefits as may be set forth on Exhibit A and shall be eligible to participate in
such pension, life insurance, health insurance, disability insurance, and other executive
benefits plans, if any, which the Company may from time to time make available to its
executive officers generally.
4. CONFIDENTIAL INFORMATION.
(a) The Executive has acquired and will acquire information and knowledge respecting
the intimate and confidential affairs of the Company, including, without limitation,
confidential information with respect to the Companys technical data,
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research and development projects, methods, products, software, financial data, business plans, financial
plans, customer lists, business methodology, processes, production methods and techniques,
promotional materials and information, and other similar matters treated by the Company as
confidential (the Confidential Information). Accordingly, the Executive covenants and
agrees that during the Executives employment by the Company (whether during the Term hereof
or otherwise) and thereafter, the Executive shall not, without the prior written consent of
the Company, disclose to any person, other than a person to whom disclosure is reasonably
necessary or appropriate in connection with the performance by the Executive of the
Executives duties hereunder, any Confidential Information obtained by the Executive while
in the employ of the Company.
(b) The Executive agrees that all memoranda; notes; records; papers or other documents;
computer disks; computer, video or audio tapes; CD-ROMs; all other media and all copies
thereof relating to the Companys operations or business, some of which may be prepared by
the Executive; and all objects associated therewith in any way obtained by the Executive
shall be the Companys property. This shall include, but is not limited to, documents;
computer disks; computer, video and audio tapes; CD-ROMs; all other media and objects
concerning any technical data, methods, products, software, research and development
projects, financial data, financial plans, business plans, customer lists, contracts, price
lists, manuals, mailing lists, advertising materials; and all other materials and records of
any kind that may be in the Executives possession or under the Executives control. The
Executive shall not, except for the Companys use, copy or duplicate any of the
aforementioned documents or objects, nor remove them from the Companys facilities, nor use
any information concerning them except for the Companys benefit, either during the
Executives employment or thereafter. The Executive covenants and agrees that the Executive
will deliver all of the aforementioned documents and objects, if any, that may be in the
Executives possession to the Company upon termination of the Executives employment, or at
any other time at the Companys request.
(c) In any action to enforce or challenge these Confidential Information provisions,
the prevailing party is entitled to recover its attorneys fees and costs.
5. COVENANT NOT-TO-COMPETE AND NO SOLICITATION.
Executive recognizes that the Company is in
the business of employing individuals to provide specialized and technical services to the
Companys Clients. The purpose of these Covenant Not-to-Compete and No Solicitation provisions are
to protect the relationship which exists between the Company and its Clients while Executive is
employed and after Executive leaves the employ of the Company. The consideration for these
Covenant Not-to-Compete and No Solicitation provisions is the Executives employment with the
Company.
(a) Executive acknowledges the following:
(1) The Company expended considerable resources in obtaining contracts with its
Clients;
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(2) The Company expended considerable resources to recruit and hire employees
who could perform services for its Clients;
(3) Through his/her employ with the Company, Executive will develop a
substantial relationship with the Companys existing or potential Clients,
including, but not limited to, being the sole or primary contact between the Client
and the Company;
(4) Executive will be exposed to valuable confidential business information
about the Company, its Clients, and the Companys relationship with its Clients;
(5) By providing services on behalf of the Company, Executive will develop and
enhance the valuable business relationship between the Company and its Clients;
(6) The relationship between the Company and its Clients depends on the quality
and quantity of the services Executive performs;
(7) Through employment with the Company, Executive will increase his/her
opportunity to work directly for the Clients or for a competitor of the Company; and
(8) The Company will suffer irreparable harm if Executive breaches these
Covenant Not-to-Compete and No Solicitation provisions of this Agreement.
(b) Executive agrees that:
(1) The relationship between the Company and its Clients (developed and
enhanced when the Executive performs services on behalf of the Company) is a
legitimate business interest for the Company to protect;
(2) The Companys legitimate business interest is protected by the existence
and enforcement of these Covenant Not-to-Compete and No Solicitation provisions;
(3) The business relationship which is created or exists between the Company
and its Client, or the goodwill resulting from it, is a business asset of the
Company and not the Executive; and
(4) Executive will not seek to take advantage of opportunities which result
from his/her employment with the Company and that entering into the
Agreement containing Covenant Not-to-Compete and No Solicitation provisions is
reasonable to protect the Companys business relationship with its Clients.
(c) Restrictions on Executive. During the Term of this Agreement and for the greater
of one (1) year or such other period during which Executive may receive
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Liquidated Damages hereunder, after the termination of this Agreement, for whatever reason, whether such
termination was by the Company or the Executive, voluntarily or involuntarily, and whether
with or without cause, Executive agrees that he/she shall not, as a principal, employer,
stockholder, partner, agent, consultant, independent contractor, employee, or in any other
individual or representative capacity:
(1) Directly or indirectly engage in, continue in, or carry on the business of
the Company or any business substantially similar thereto, including owning or
controlling any financial interest in any corporation, partnership, firm, or other
form of business organization which competes with or is engaged in or carries on any
aspect of such business or any business substantially similar thereto;
(2) Consult with, advise, or assist in any way, whether or not for
consideration of any kind, any corporation, partnership, firm, or other business
organization which is now, becomes, or may become a competitor of the Company in any
aspect of the Companys business during the Executives employment with the Company,
including, but not limited to, advertising or otherwise endorsing the products of
any such competitor or loaning money or rendering any other form of financial
assistance to or engaging in any form of transaction whether or not on an arms
length basis with any such competitor;
(3) Provide or attempt to provide or solicit the opportunity to provide or
advise others of the opportunity to provide any services of the type Executive
performed for the Company or the Companys Clients (regardless of whether and how
such services are to be compensated, whether on a salaried, time and materials,
contingent compensation, or other basis) to or for the benefit of any Client (i) to
which Executive has provided services in any capacity on behalf of the Company, or
(ii) to which Executive has been introduced to or about which the Executive has
received information through the Company or through any Client from which Executive
has performed services in any capacity on behalf of the Company;
(4) Retain or attempt to retain, directly or indirectly, for itself or any
other party, the services of any person, including any of the Companys employees,
who were providing services to or on behalf of the Company while Executive was
employed by the Company and to whom Executive has been introduced or about whom
Executive has received information through the Company or through any Client for
which Executive has performed services in any capacity on behalf of the Company;
(5) Engage in any practice, the purpose of which is to evade the provisions of
this Agreement or to commit any act which is detrimental to the successful
continuation of or which adversely affects the business or the Company; provided,
however, that the foregoing shall not preclude the Executives ownership of not more
than 2% of the equity securities of a company
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whose securities are registered under
Section 12 of the Securities Exchange Act of 1934, as amended;
(6) For purpose of these Covenant Not-to-Compete and No Solicitation
provisions, Client includes any subsidiaries, affiliates, customers, and clients of
the Companys Clients. The Executive agrees that the geographic scope of this
Covenant Not-to-Compete shall extend to the geographic area where the Companys
Clients conduct business at any time during the Term of this Agreement. For
purposes of this Agreement, Clients means any person or entity to which the
Company provides or has provided within a period of one (1) year prior to the
Executives termination of employment, labor, materials or services for the
furtherance of such entitys or persons business or any person or entity that
within such period of one (1) year the Company has pursued or communicated with for
the purpose of obtaining business for the Company.
(d) Enforcement. These Covenant Not-to-Compete and No Solicitation provisions shall be
construed and enforced under the laws of the State of Florida. In the event of any breach
of this Covenant Not-to-Compete, the Executive recognizes that the remedies at law will be
inadequate, and that in addition to any relief at law which may be available to the Company
for such violation or breach and regardless of any other provision contained in this
Agreement, the Company shall be entitled to equitable remedies (including an injunction) and
such other relief as a court may grant after considering the intent of this Section 5. It
is further acknowledged and agreed that the existence of any claim or cause of action on the
part of the Executive against the Company, whether arising from this Agreement or otherwise,
shall in no way constitute a defense to the enforcement of this Covenant Not-to-Compete, and
the duration of this Covenant Not-to-Compete shall be extended in an amount which equals the
time period during which the Executive is or has been in violation of this Covenant
Not-to-Compete. In the event a court of competent jurisdiction determines that the
provisions of this Covenant Not-to-Compete are excessively broad as to duration, geographic
scope, prohibited activities or otherwise, the parties agree that this covenant shall be
reduced or curtailed only to the extent necessary to render it enforceable.
(e) In an action to enforce or challenge these Covenant Not-to-Compete and No
Solicitation provisions, the prevailing party is entitled to recover its attorneys fees and
costs.
(f) By signing this Agreement, the Executive acknowledges that he/she understands the
effects of these Covenant Not-to-Compete and No Solicitation provisions and agrees to abide
by them.
6. TERMINATION
(a) Death. The Executives employment hereunder shall terminate upon his/her death.
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(b) Disability. If during the Term of this Agreement the Executive becomes physically
or mentally disabled in accordance with the terms and conditions of any disability insurance
policy covering the Executive, or, if due to such physical or mental disability the
Executive becomes unable for a period of more than six (6) consecutive months to perform
his/her duties hereunder on substantially a full-time basis as determined by the Company in
its sole reasonable discretion, the Company may, at its option, terminate the Executives
employment hereunder upon not less than thirty (30) days written notice so long as the
terms of any disability insurance policy then in effect provide for Executive to receive
disability payments from that date forward.
(c) Cause. The Company may terminate the Executives employment hereunder for Cause
effective immediately upon notice. For purposes of this Agreement, the Company shall have
Cause to terminate the Executives employment hereunder: (i) if the Executive engages in
conduct which has caused or is reasonably likely to cause demonstrable and serious injury to
Company; (ii) if the Executive is convicted of a felony as evidenced by a binding and final
judgment, order, or decree of a court of competent jurisdiction; (iii) for the Executives
failure or refusal to perform his/her duties or responsibilities hereunder as determined by
the Companys Chief Executive Officer in good faith, if such failure or refusal continues
for a period of ten (10) days after written notice of the same to the Executive; (iv) for
gross incompetence; (v) for the Executives violation of this Agreement, including, without
limitation, Section 5 hereof; (vi) for chronic absenteeism; (vii) for use of illegal drugs;
(viii) for insobriety by the Executive while performing his or her duties hereunder; and
(ix) for any act of dishonesty or falsification of reports, records, or information
submitted by the Executive to the Company.
(d) Termination by the Company for Convenience. Subject to the Companys obligation to
pay Liquidated Damages in accordance with the terms and conditions of this Agreement, the
Company may terminate Executives employment hereunder at any time, for the Companys
convenience and without reason, by delivering written notice of termination to the
Executive.
(e) Payments Upon Termination. In the event of a termination of the Executives
employment, all payments and Company benefits to the Executive hereunder, except the payment
of Liquidated Damages (if any) provided below, shall immediately cease and terminate. In
the event the Company terminates the Executives employment pursuant to Section 6(d) hereof,
the Company shall pay the Executive an amount equal to the Liquidated Damages defined in
this Section 6(f) in lieu of actual damages for such termination. If the Executives
employment terminates or is terminated for any reason other than as specified in the
preceding sentence, the Executive shall
not
be entitled to any Liquidated Damages.
Notwithstanding anything to the contrary herein contained, and in addition to any other
compensation which the Executive may be entitled to receive pursuant to this Agreement, the
Executive shall receive all compensation and other benefits to which he/she was entitled
under this Agreement or otherwise as an executive of the Company through the termination date. The Liquidated
Damages amount, if due as provided above, shall be equal to the weekly amount stated
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as Base Salary on Exhibit A for fifty two (52) weeks, or, if the termination giving rise to
Liquidated Damages takes effect during the initial two years of this Agreement, then the
Liquidated Damages amount shall be equal to the greater of (i) the weekly amount stated as
Base Salary on Exhibit A for fifty two (52) weeks, or (ii) the weekly amount stated as
Base Salary on Exhibit A for the remainder of the initial two year period of this
Agreement following the effective date of termination. The amount of Liquidated Damages
shall be paid biweekly in equal installments over such period.
(f) Condition Precedent to Receipt of Liquidated Damages. Executive expressly agrees
that in the event of a termination of this Agreement, Executive will execute an agreement
containing waiver and release provisions in form and substance acceptable to the Company.
Executive agrees and acknowledges that the execution of such an agreement upon termination
of employment is a condition precedent to the obligation of the Company to pay any
Liquidated Damages hereunder. Executive acknowledges that the waiver and release provisions
required by the Company will provide for the release and waiver of important rights and/or
claims that Executive might have against the Company at the time of termination of this
Agreement.
7. NOTICE.
For 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 when hand-delivered, sent by
telecopier, facsimile transmission, or other electronic means of transmitting written documents (as
long as receipt is acknowledged) or mailed by United States certified or registered mail, return
receipt requested, postage prepaid, addressed as follows:
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If to the Executive, to the address set forth on the signature page.
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If to the Company:
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Sykes Enterprises, Incorporated
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400 North Ashley Drive, Suite 2800
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Tampa, Florida 33602
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Attention: Sr. VP of Human Resources
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with a copy to:
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Sykes Enterprises, Incorporated
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400 North Ashley Drive, Suite 2800
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Tampa, Florida 33602
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Attention: General Counsel
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or to such other address as either party may have furnished to the other in writing in accordance
herewith, except that a notice of change of address shall be effective only upon receipt.
8. ENFORCEMENT AND GOVERNING LAW.
It is stipulated that a breach by Executive of the
restrictive covenants set forth in Sections 4 and 5 of this Agreement will cause irreparable damage
to Company or its Clients, and that in the event of any breach of those provisions, Company is
entitled to injunctive relief restraining Executive from violating or continuing a violation of the restrictive covenants as well as other remedies it may have.
Additionally, such covenants shall be enforceable against the Executives heirs, executors,
administrators and legal representatives, and enforceable by Companys successors or assigns.
The validity, interpretation, construction, and performance of this Agreement shall be
governed by the internal laws of the State of Florida. Any litigation to enforce this Agreement
shall be brought in the state or federal courts of Hillsborough County, Florida, which
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is the
principal place of business for Company and which is considered to be the place where this
Agreement is made. Both parties hereby consent to such courts exercise of personal jurisdiction
over them.
9. ARBITRATION OF DISPUTES.
(a) Duty to Arbitrate. Except for any claim by the Company to enforce the restrictive
covenants set forth in Sections 4 and 5 above, Company and Executive agree to resolve by
binding arbitration any claim or controversy arising out of or related to Executives
employment by Company or this Agreement, to include all matters directly or indirectly
related to your recruitment, employment or termination of employment by the Company
including, but not limited to claims involving laws against discrimination whether brought
under federal and/or state law, and/or claims involving co-employees but excluding workers
compensation claims, whether such claim is based in contract, tort, statute, or any other
legal theory, including any claim for damages, equitable relief, or both. The duty to
arbitrate under this Section extends to any claim by or against any officer, director,
shareholder, employee, agent, representative, parent, subsidiary, affiliate, heir, trustee,
legal representative, successor, or assign of either party making or defending any claim
that would otherwise be arbitrable under this Section. However, this Section shall not be
interpreted to preclude either party from petitioning a court of competent jurisdiction for
temporary injunctive relief, solely to preserve the status quo pending arbitration of the
claim or controversy, upon a proper showing of the need for such relief.
(b) The Arbitrator. A single arbitrator will conduct the arbitration in Tampa,
Florida, U.S.A., in accordance with the Commercial Arbitration Rules of the American
Arbitration Association (the Rules), and judgment upon the written award rendered by the
arbitrator may be entered in any court of competent jurisdiction. Notwithstanding the
application of the Rules, however, discovery in the arbitration, including interrogatories,
requests for production, requests for admission, and depositions, will be fully available
and governed by the Federal Rules of Civil Procedure and Local Rules of the United States
District Court for the Middle District of Florida. The parties may agree upon a person to
act as sole arbitrator within thirty (30) days after submission of any claim or controversy
to arbitration pursuant to this Section. If the parties are unable to agree upon such a
person within such time period, an arbitrator shall be selected in accordance with the
Rules. The parties will pay their own respective attorneys fees, witness fees, and other
costs and expenses incurred in any investigations, arbitrations, trials, bankruptcies, and
appeals; provided, however, that the Company will pay the filing fees, hearing fees, and
processing fees associated with arbitration hereunder.
(c) Limitations Period. The parties agree that any claim or controversy that would be
arbitrable under this Section must be submitted to arbitration within one (1) year after the
claim or controversy arises and that a failure to institute arbitration proceedings within
such time period shall constitute an absolute bar to the institution of any proceedings, in
arbitration or in any court, and a waiver of all such claims. This Section will survive the
expiration or early termination of this Agreement.
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(d) Governing Law. This Agreement shall be governed in its construction,
interpretation, and performance by the laws of the State of Florida, without reference to
law pertaining to conflict of laws. However, the Federal Arbitration Act, as amended, will
govern the interpretation and enforcement of this Section.
(e) Attorneys Fees. The prevailing party in any arbitration or dispute, or in any
litigation, arising out of or related to Executives employment by Company or this
Agreement, shall be entitled to recover all reasonable attorneys fees incurred on all
levels and in all proceedings, unless otherwise provided by law.
(f) Severability. Each part of this Section is severable. A holding that any part of
this Section is unenforceable will not affect the duty to arbitrate under this Section.
10. MISCELLANEOUS.
No provision of this Agreement may be modified or waived unless such
waiver or modification is agreed to in writing signed by the parties hereto; provided, however,
that the terms of the performance bonus and fringe benefits set forth on Exhibit A may be amended
by the Company in its discretion without the Executives consent to the extent provided therein.
No waiver by any party hereto of any breach by any other party hereto shall be deemed a waiver of
any similar or dissimilar term or condition at the same or at any prior or subsequent time. This
Agreement is the entire agreement between the parties hereto with respect to the Executives
employment by the Company and there are no agreements or representations, oral or otherwise,
expressed or implied, with respect to or related to the employment of the Executive which are not
set forth in this Agreement. Any prior agreement relating to the Executives employment with the
Company is hereby superseded and void, and is no longer in effect. This Agreement shall be binding
upon and inure to the benefit of the Company, its respective successors and assigns, and the
Executive and his/her heirs, executors, administrators and legal representatives. Except as
expressly set forth herein, no party shall assign any of his/her or its rights under this Agreement
without the prior written consent of the other party and any attempted assignment without such
prior written consent shall be null and void and without legal effect; provided, however, that
Company may assign this Agreement to any party that acquires all or substantially all of Companys
assets or business, without Executives consent. The parties agree that if any provision of this
Agreement shall under any circumstances be deemed invalid or inoperative, the Agreement shall be
construed with the invalid or inoperative provision deleted and the rights and obligations of the
parties shall be construed and enforced accordingly. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which together will
constitute but one and the same instrument. This Agreement has been negotiated and no party shall
be considered as being responsible for such drafting for the purpose of applying any rule
construing ambiguities against the drafter or otherwise.
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IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first above written.
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SYKES ENTERPRISES, INCORPORATED
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EXECUTIVE
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By: /s/ James Holder
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By: /s/ Jenna R. Nelson
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James Holder, VP, General Counsel and
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Jenna R. Nelson, Senior VP, Human
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Corporate Secretary
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Resources
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Address:
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EXHIBIT A TO EMPLOYMENT AGREEMENT
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BASE SALARY:
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$3,846.15
per week payable biweekly beginning March 6,
2006
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PERFORMANCE BONUS:
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Eligible to participate in performance based bonus program(s) as defined by the
Company
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FRINGE BENEFITS:
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Eligible for standard executive benefits
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THE COMPANY RESERVES THE RIGHT, AT ITS DISCRETION, AT SUCH TIME OR TIMES AS IT ELECTS, TO CHANGE OR
ELIMINATE THE PERFORMANCE BONUS, INCENTIVES, OR OTHER BENEFITS.
IN WITNESS WHEREOF, the parties have executed this Exhibit A as of the
4th day of April,
2006.
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SYKES ENTERPRISES, INCORPORATED
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EXECUTIVE
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By: /s/ James Holder
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By: /s/ Jenna R. Nelson
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James Holder, VP, General Counsel and
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