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) May 3, 2005

 


 

Robert Half International Inc.

(Exact name of registrant as specified in its charter)

 


 

Delaware   01-10427   94-1648752

(State or other jurisdiction

of incorporation)

  (Commission File Number)  

(IRS Employer

Identification No.)

 

2884 Sand Hill Road, Menlo Park, CA   94025
(Address of principal executive offices)   (Zip Code)

 

Registrant’s telephone number, including area code (650) 234-6000

 

NO CHANGE

(Former name or former address, if changed since last report.)

 


 

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):

 

  ¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

  ¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

  ¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

  ¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 



Item 1.01 Entry into a Material Definitive Agreement.

 

Approval of Stock Incentive Plan

 

On May 3, 2005, following stockholder approval at the Company’s Annual Meeting of Stockholders, the Stock Incentive Plan (The “Plan”) became effective and replaced the Company’s five then existing equity plans. Employees (including officers), consultants and directors of the Company and its subsidiaries and affiliates are eligible to participate under the Plan.

 

The Plan provides for the grant of stock options (both nonstatutory and incentive stock options), restricted stock, stock units, and stock appreciation rights. Awards under the Plan will be evidenced by an agreement with the Plan participant or a notice to the Plan participant. 10,000,000 shares of the Company’s Common Stock (“Shares”) are available for awards under the Plan. Under the Plan, no participant may be granted awards covering in excess of 2,000,000 Shares per fiscal year, and nonemployee directors may be granted awards covering no more than 15,000 Shares per fiscal year. Such Share amounts may be adjusted by the Plan administrator in the event of stock splits and other events.

 

Awards under the Plan to the Company’s officers (within the meaning of Rule 16a-1(f) of the Securities Exchange Act of 1934 (the “Exchange Act”)) must be made subject to a performance condition utilizing the Company’s diluted earnings per share as a performance goal.

 

Under the Plan, all awards granted to a participant fully vest upon the participant’s death or termination due to total and permanent disability (as defined in the Plan). In addition, all awards granted to an individual who is subject to Section 16 of the Exchange Act also vest upon a change in control or such individual’s retirement (as such terms are defined in the Plan). Each stock option or stock appreciation right held by an individual who is subject to Section 16 of the Exchange Act that vests as described in this paragraph will remain outstanding until the earlier of its exercise or its remaining term.

 

The Board or Compensation Committee of the Board (the “Compensation Committee”) may amend the Plan at any time, subject to any required stockholder approval. The Board or Compensation Committee may terminate the Plan at any time, and the Plan is currently set to terminate at the 2008 Annual Meeting of Stockholders unless re-adopted or extended by the stockholders prior to or on such date.

 

The foregoing description of the Plan is only a summary and is qualified in its entirety by reference to the Plan, which is filed as an exhibit hereto.

 

Approval of Annual Performance Bonus Plan

 

On February 15, 2005, the Board approved the amendment and restatement, effective May 3, 2005, of the Company’s Annual Performance Bonus Plan (the “Performance Plan”), subject to approval by the Company’s stockholders. At the Company’s Annual Meeting of Stockholders held on May 3, 2005, the Company’s stockholders approved the Performance Plan.

 

The Performance Plan provides for the annual grant of performance-based cash bonuses to elected executive officers and to such other senior executives as may be designated from time to time by the Performance Plan administrator (currently the Compensation Committee). Bonuses are paid based on the Company’s performance against a diluted earnings per share target set by the Performance Plan administrator at the beginning of the performance period. The Performance Plan administrator has the authority to alter, amend or discontinue the Performance Plan at any time without stockholder approval, except as required by applicable law. No individual may receive a bonus in any year in excess of $9,000,000.


Material changes from the prior version of the Performance Plan are:

 

    The Performance Plan administrator no longer has the discretion to pay bonuses in shares of Company stock rather than cash.

 

    Diluted earnings per share for purposes of calculating any bonus shall be determined without regard to the effect of mergers, acquisitions, dispositions and material restructuring of the Company’s business occurring after the target diluted earnings per share was established.

 

    Previously, the maximum bonus payable to an individual in any year was four times the highest bonus paid with respect to 1999 (a maximum possible bonus of $6,374,324). This has been changed to approximately three times the highest bonus paid with respect to 2004 (a maximum possible bonus of $9,000,000).

 

The foregoing description of the Performance Plan is only a summary and is qualified in its entirety by reference to the Performance Plan, which is filed as an exhibit hereto.

 

Item 9.01    Financial Statements and Exhibits.

 

(c)    Exhibits

 

Exhibit

    

Description


99.1      Stock Incentive Plan.
99.2      Annual Performance Bonus Plan.
99.3      Stock Incentive Plan—Form of Restricted Share Agreement for Executive Officers.
99.4      Stock Incentive Plan—Form of Stock Option Agreement for Executive Officers.
99.5      Stock Incentive Plan—Form of Restricted Share Agreement for Outside Directors.
99.6      Stock Incentive Plan—Form of Stock Option Agreement for Outside Directors.


SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

   

Robert Half International Inc.

Date: May 4, 2005

 

By:

 

/s/    M. Keith Waddell


   

Name:

 

M. Keith Waddell

   

Title:

  Vice Chairman, President and Chief Financial Officer

Exhibit 99.1

 

ROBERT HALF INTERNATIONAL INC.

 

STOCK INCENTIVE PLAN

 

(Effective May 3, 2005)

 

SECTION 1. ESTABLISHMENT AND PURPOSE.

 

The purpose of the Plan is to promote the long-term success of the Company and the creation of stockholder value by (a) encouraging Participants to focus on critical long-range objectives, (b) encouraging the attraction and retention of individuals with exceptional qualifications and (c) linking Participants directly to stockholder interests through increased stock ownership. The Plan seeks to achieve this purpose by providing for Awards in the form of Restricted Shares, Stock Units, Options (which may constitute incentive stock options or nonstatutory stock options) or stock appreciation rights. Subject to approval by RHI’s stockholders, this Plan supersedes the Existing Equity Plans, as described herein.

 

SECTION 2. DEFINITIONS.

 

Actual Performance Goal ” shall mean the actual results for the Performance Goal for the Performance Period.

 

Affiliate ” shall mean any entity other than a Subsidiary, if RHI and/or one of more Subsidiaries own not less than fifty percent (50%) of such entity.

 

Award ” shall mean any award of an Option, a SAR, a Restricted Share or a Stock Unit under the Plan.

 

Board of Directors ” shall mean the Board of Directors of RHI, as constituted from time to time.

 

Certification Date ” means the date that the Committee makes its written certification of a Final Award.

 

Change in Control ” shall mean the occurrence of any of the following events:

 

(i)        Any person or group (as such terms are defined in Section 13(d)(3) of the Exchange Act), other than an employee benefit plan sponsored by the Company or a corporation owned (directly or indirectly), by the stockholders of the Company in substantially the same proportions of the ownership of stock of the Company, shall become the beneficial owner of securities of RHI representing 20% or more, or commences a tender or exchange offer following the successful consummation of which the offerer and its affiliates would beneficially own securities representing 20% or more, of the combined voting power of then outstanding securities ordinarily (and apart from rights accruing in special circumstances) having the right to vote in the election of directors, as a result of a tender or exchange offer, open market purchases, privately negotiated purchases or otherwise; provided, however, that a Change in Control shall not be deemed to include the acquisition by any such person or group of securities representing 20% or more of RHI if such party has acquired such securities not with the purpose nor with the effect of changing or influencing the control of RHI, nor in connection with or as a participant in any transaction having such purposes or effect, including, without limitation, not in connection with such party (A) making any public announcement with respect to the voting of such shares at any meeting to consider a merger, consolidation, sale of substantial assets or other business combination or extraordinary transaction involving RHI, (B) making, or in any way participating in, any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A under the Exchange Act) to vote any voting securities of RHI (including, without limitation, any such solicitation subject to Rule 14a-11 under the Exchange Act) or seeking to advise or influence any party with respect to the voting of any voting securities of RHI, directly or indirectly, relating to a merger or other business combination involving RHI or the sale or transfer of substantial assets of RHI, (C) forming, joining or in any

 


way participating in any “group” within the meaning of Section 13(d)(3) of the Exchange Act with respect to any voting securities of RHI, directly or indirectly, relating to a merger or other business combination involving RHI or the sale or transfer of any substantial assets of RHI, or (D) otherwise acting, alone or in concert with others, to seek control of RHI or to seek to control or influence the management or policies of RHI.

 

(ii)        The stockholders of RHI shall approve any plan or proposal for the liquidation or dissolution of RHI.

 

(iii)        A change in the composition of the Board of Directors occurring within a two-year period, as a result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who either (A) are directors of RHI as of the date hereof, or (B) are elected, or nominated for election, to the Board of Directors with the affirmative votes of at least a majority of the Incumbent Directors at the time of such election or nomination (but shall not include an individual whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors to RHI). As a result of or in connection with any cash tender offer, merger, or other business combination, sale of assets or contested election, or combination of the foregoing, the persons who were directors of RHI just prior to such event shall cease within one year to constitute a majority of the Board of Directors.

 

(iv)        RHI’s stockholders approve a definitive agreement providing for a transaction in which RHI will cease to be an independent publicly owned corporation.

 

(v)        The stockholders of RHI approve a definitive agreement (A) to merge or consolidate RHI with or into another corporation in which the holders of the Stock immediately before such merger or reorganization will not, immediately following such merger or reorganization, hold as a group on a fully-diluted basis both the ability to elect at least a majority of the directors of the surviving corporation and at least a majority in value of the surviving corporation’s outstanding equity securities, or (B) to sell or otherwise dispose of all or substantially all of the assets of RHI.

 

Code ” shall mean the Internal Revenue Code of 1986, as amended.

 

Committee ” shall mean a committee of one or more members of the Board of Directors appointed by the Board of Directors (or, as the context permits, a subcommittee of one or more members of the Board appointed by the Committee) to administer the Plan in accordance with the provisions hereof.

 

Company ” shall mean Robert Half International Inc., a Delaware corporation, and its Subsidiaries.

 

Consultant ” shall mean a consultant or advisor who provides bona fide services to the Company or an Affiliate as an independent contractor.

 

Earnings Per Share ” means diluted Earnings Per Share, determined in accordance with generally accepted accounting principles. For purposes of the foregoing sentence, earnings shall mean income before extraordinary items, discontinued operations and cumulative effect of changes in accounting principles and after full accrual for the bonuses paid under this Plan. Earnings shall also be determined without regard to the effects of mergers, acquisitions, dispositions and material restructuring of the business that occur after the grant date.

 

Eligible Participant ” shall mean (i) any individual who is a common-law employee of the Company or an Affiliate; (ii) a member of the Board of Directors; (iii) a member of the board of directors of a Subsidiary or an Affiliate; or (iv) a Consultant.

 

Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended.

 

Executive Officer ” shall mean an officer as defined in Rule 16a-1(f) under the Exchange Act, or any successor provision.

 


Exercise Price ” shall mean, in the case of an Option, the amount for which one Share may be purchased upon exercise of such Option, as specified in the applicable Stock Option Award. “Exercise Price,” in the case of a SAR, shall mean an amount, as specified in the applicable SAR Award, which is subtracted from the Fair Market Value of a Share in determining the amount payable upon exercise of such SAR.

 

Existing Equity Plans ” shall mean RHI’s Equity Incentive Plan, StockPlus Plan, Stock Option Plan for Field Employees, Restricted Stock Plan for Field Employees, and Outside Directors’ Option Plan.

 

Fair Market Value ” shall mean the closing price on the New York Stock Exchange on the date the value is to be determined as reported in THE WALL STREET JOURNAL (Western Edition). If there are no trades on such date, the closing price on the latest preceding business day upon which trades occurred shall be the Fair Market Value.

 

Final Award ” shall mean the product of (i) the Multiplier and (ii) the Original Award.

 

ISO ” shall mean an employee incentive stock option described in Code Section 422.

 

Misconduct Termination ” shall mean a termination by the Company of a Participant’s Service by reason of the Participant’s willful dishonesty towards, fraud upon, or deliberate injury or attempted injury to the Company, or by reason of the Participant’s willful material breach of any employment agreement with the Company, which has resulted in material injury to the Company; provided, however, that a Participant’s Service shall not be deemed to have terminated in a Misconduct Termination if such termination took place as a result of any act or omission believed by the Participant in good faith to have been in the interest of the Company.

 

Multiplier ” shall mean (a) the sum of 0.1 and the Performance Goal Ratio, if the Performance Goal Ratio is greater than or equal to 0 and less than 0.9, (b) 1, if the Performance Goal Ratio is greater than or equal to 0.9, or (c) 0, if the Performance Goal Ratio is less than 0.

 

Nonstatutory Option ” or “NSO” shall mean an employee stock option that is not an ISO.

 

Option ” shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the holder to purchase Shares.

 

Optionee ” shall mean an individual or estate who holds an Option or SAR.

 

Original Award ” shall mean the number of shares initially granted pursuant to an Award made subject to a Performance Condition.

 

Other Agreement ” shall mean any written agreement, whether entered into prior to or subsequent to, the adoption of this plan or the making of an Award under this plan, between Participant and the Company.

 

Outside Director ” shall mean a member of the Board of Directors who is not a common-law employee of the Company.

 

Outside Director Retirement ” shall mean termination of an Outside Director’s Service after the later to occur of (i) the 7th anniversary of the Outside Director’s first day of service with RHI as a member of the Board of Directors or (ii) the Outside Director’s 62nd birthday.

 

Participant ” shall mean an individual or estate who holds an Award.

 

Performance Condition ” shall mean a performance condition established with respect to an Award in accordance with the provisions hereof.

 


Performance Goal ” shall mean one or more objective measurable performance factors as determined by the Committee with respect to each Performance Period based upon one or more factors, including, but not limited to: (i) operating income; (ii) earnings; (iii) cash flow; (iv) sales or revenue; (v) expenses; (vi) profit margin; (vii) working capital; (viii) return on equity or assets; (ix) Earnings Per Share; (x) stock price; (xi) price/earnings ratio; (xii) debt or debt-to-equity; (xiii) writeoffs; (xiv) cash; (xv) assets; and/or (xvi) liquidity, each with respect to the Company and/or one or more of its operating units. Awards to Participants who are not subject to the limitations of Code Section 162(m) may be determined without regard to Performance Goals and may involve Committee discretion.

 

Performance Goal Ratio ” shall mean the result obtained by dividing Actual Performance Goal by Target Performance Goal.

 

Performance Period ” shall mean the period of service to which the Performance Condition relates.

 

Plan ” shall mean this Stock Incentive Plan of Robert Half International Inc., as amended from time to time.

 

Protiviti Participant ” shall mean a Participant who is an employee of Protiviti Inc. (a Subsidiary) or its Subsidiaries.

 

Protiviti Retirement ” shall mean any voluntary termination of employment with the Company and its subsidiaries by the Protiviti Participant on or after the later to occur of: (a) the first day coinciding with or after the Protiviti Participant’s 56th birthday, (b) the Protiviti Participant’s completion of at least 25 years of cumulative service to the Company, Arthur Andersen LLP, Deloitte Touche Tohmatsu, PricewaterhouseCoopers, KPMG International, Ernst & Young International, and/or any of their respective affiliates, or any other industry-related service acceptable to the Committee, and (c) four and one-half years after the date that the Protiviti Participant was first employed by Protiviti Inc.

 

Purchase Price ” shall mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option), as specified by the Committee.

 

Restricted Share ” shall mean a Share awarded under the Plan.

 

Restricted Share Award ” shall mean the agreement between RHI and the recipient of a Restricted Share, or the notice to the recipient, which contains the terms, conditions and restrictions pertaining to such Restricted Shares.

 

RHI ” shall mean Robert Half International Inc., a Delaware corporation.

 

SAR ” shall mean a stock appreciation right granted under the Plan.

 

SAR Award ” shall mean the agreement between RHI and an Optionee, or the notice to the Optionee, which contains the terms, conditions and restrictions pertaining to his or her SAR.

 

Section 16 Participant ” shall mean a Participant who is subject to Section 16 of the Exchange Act with respect to transactions in RHI securities.

 

Securities Act ” shall mean the Securities Act of 1933, as amended.

 

Service ” shall mean service as an Eligible Participant.

 

Share ” shall mean one share of Stock, as adjusted in accordance with the adjustment provisions of the Plan (if applicable).

 


Staffing/Headquarters Participant ” shall mean a Participant other than a Protiviti Participant.

 

Staffing/Headquarters Retirement ” shall mean any voluntary termination by a Staffing/Headquarters Participant of employment with the Company on or after the later to occur of (a) the Staffing/Headquarters Participant’s 55 th birthday, or (b) the 20th anniversary of the Staffing/Headquarters Participant’s first day of service with the Company as a full-time employee.

 

Stock ” shall mean the Common Stock of RHI.

 

Stock Option Award ” shall mean the agreement between RHI and an Optionee, or the notice to the Optionee, which contains the terms, conditions and restrictions pertaining to his Option.

 

Stock Unit ” shall mean a bookkeeping entry representing the equivalent of one Share, as awarded under the Plan.

 

Stock Unit Award ” shall mean the agreement between RHI and the recipient of a Stock Unit, or the notice to the recipient, which contains the terms, conditions and restrictions pertaining to such Stock Unit.

 

Subsidiary ” shall mean any corporation, if RHI and/or one or more other Subsidiaries own not less than fifty percent (50%) of the total combined voting power of all classes of outstanding stock of such corporation. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.

 

Target Performance Goal ” shall mean the Performance Goal set with respect to an Award made subject to a Performance Condition.

 

Total and Permanent Disability ” shall mean a (i) a physical or mental condition which, in the judgment of the Committee based on competent medical evidence satisfactory to the Committee (including, if required by the Committee, medical evidence obtained by an examination conducted by a physician selected by the Committee), renders the Participant unable to engage in any substantial gainful activity for the Company and which condition is likely to result in death or to be of long, continued and indefinite duration, or (ii) a judicial declaration of incompetence.

 

SECTION 3. ADMINISTRATION.

 

(a)         Committee Procedures . One or more Committees appointed by the Board of Directors shall administer the Plan. The Board of Directors shall designate one of the members of the Committee as chairperson. Unless the Board of Directors provides otherwise, the Compensation Committee shall be the Committee. The Board of Directors may also at any time terminate the functions of the Committee and reassume all powers and authority previously delegated to the Committee.

 

The Committee shall have membership composition which enables (i) Awards to qualify for exemption under Rule 16b-3 with respect to persons who are subject to Section 16 of the Exchange Act and (ii) Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code to so qualify. Only the Board of Directors may make Award grants and administer the Plan with respect to Outside Directors.

 

The Compensation Committee may also appoint one or more separate subcommittees composed of one or more directors of RHI who need not qualify under either Rule 16b-3 or Section 162(m) of the Code, who may administer the Plan with respect to persons who are not subject to Section 16 of the Exchange Act and/or Awards that are not intended to qualify as “performance-based compensation” under Section 162(m) of the Code.

 

(b)         Committee Responsibilities . Subject to the provisions of the Plan, the Committee shall have full authority and discretion to take the following actions:

 

(i)        To interpret the Plan and to apply its provisions;

 


(ii)        To adopt, amend or rescind rules, procedures and forms relating to the Plan;

 

(iii)        To authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan;

 

(iv)        To determine when Awards are to be granted under the Plan;

 

(v)        To select the Eligible Participants who are to receive Awards under the Plan;

 

(vi)        To determine the number of Shares to be made subject to each Award;

 

(vii)        To prescribe the terms and conditions of each Award, including (without limitation) the Exercise Price or Purchase Price, the vesting of the Award (including accelerating the vesting of Awards) and to specify the provisions of the agreement relating to such Award;

 

(viii)        To prescribe the terms and conditions of each Option, including (without limitation) the Exercise Price, the vesting or duration of the Option (including accelerating the vesting of the Option), to determine whether such Option is to be classified as an ISO or as a Nonstatutory Option, and to specify the provisions of the Stock Option Award relating to such Option;

 

(ix)        To amend any outstanding Restricted Share Award, Stock Option, Award, SAR Award or Stock Unit Award subject to applicable legal restrictions and to the consent of the Participant who entered into such agreement;

 

(x)         To prescribe the consideration for the grant of each Award under the Plan and to determine the sufficiency of such consideration;

 

(xi)        To determine whether Awards under the Plan will be granted in replacement of other grants under an incentive or other compensation plan of an acquired business;

 

(xii)        To correct any defect, supply any omission, or reconcile any inconsistency in the Plan, any Restricted Share Award, Stock Option Award, SAR Award, or Stock Unit Award;

 

(xiii)        To take any other actions deemed necessary or advisable for the administration of the Plan;

 

(xiv)        To determine, at the time of granting an Award or thereafter, that such Award shall vest as to all or part of the Shares subject to such Award in the event of a Change in Control.

 

(xv)        To accelerate the vesting, or extend the post-termination exercise term, of Awards at any time and under such terms and conditions as it deems appropriate.

 

In addition, without amending the Plan, the Committee may grant awards under the Plan to eligible employees or consultants who are foreign nationals on such terms and conditions different from those specified in this Plan as may in the judgment of the Committee be necessary or desirable to foster and promote achievement of the purposes of the Plan, and, in furtherance of such purposes the Committee may make such modifications, amendments, procedures, subplans and the like as may be necessary or advisable to comply with provisions of laws in other countries in which the Company operates or has employees.

 

Subject to the requirements of applicable law, the Board of Directors may authorize one or more officers of RHI to grant Awards and the Committee may designate persons other than members of the Committee to carry out its responsibilities, and the Committee may prescribe such conditions and limitations as it may deem appropriate, except that the Board of Directors or the Committee may not delegate its authority with regard to Awards to persons subject to Section 16 of the Exchange Act or Awards intended to qualify as “performance-based compensation” under Section 162(m) of the Code. All decisions, interpretations and other actions of the Committee shall be final and binding on all Participants, and all persons deriving their rights from a Participant. No member of the Committee shall be liable for any action that he has taken or has failed to take in good faith with respect to the Plan or any Award.

 


Except arising from any action taken, or failure to act, in bad faith, each member of the Committee, or of the Board of Directors, shall be indemnified and held harmless by RHI against and from (i) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any agreement under the Plan, and (ii) from any and all amounts paid by him or her, with RHI’s prior approval, in settlement thereof or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall have given RHI a reasonable opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under RHI’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that RHI may have to indemnify them or hold them harmless.

 

SECTION 4. ELIGIBILITY.

 

(a)         General Rule . Only Eligible Participants may be granted Restricted Shares, Stock Units, NSOs or SARs. In addition, only individuals who are employed as common-law employees by the Company may be granted ISOs.

 

(b)         Limitation on Awards . In any fiscal year of RHI, no individual shall receive Options, SARs, Restricted Shares and/or Stock Units covering in excess of 2,000,000 Shares in the aggregate; provided, however, that Outside Directors may only receive Awards covering up to 15,000 Shares in the aggregate per Outside Director in any fiscal year of RHI. The limitations under this Subsection shall be subject to adjustment pursuant to the adjustment provisions of the Plan.

 

SECTION 5. STOCK SUBJECT TO PLAN.

 

(a)         Basic Limitation . Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares. The maximum aggregate number of Options, SARs, Stock Units and Restricted Shares awarded under the Plan shall not exceed 10,000,000 Shares. This limit shall be subject to the provisions of the next Subsection and shall be subject to adjustment pursuant to the adjustment provisions of the Plan. No fractional Shares shall be issued under the Plan.

 

(b)         Additional Shares . If Restricted Shares are forfeited, then such Shares shall again become available for Awards under the Plan. If Stock Units, Options or SARs are forfeited or terminate for any reason before being exercised, then the corresponding Shares shall again become available for Awards under the Plan. If Stock Units are settled, then only the number of Shares (if any) actually issued in settlement of such Stock Units shall reduce the number of Shares available under the Plan and the balance shall again become available for Awards under the Plan. If SARs are exercised, then only the number of Shares (if any) actually issued in settlement of such SARs shall reduce the number of Shares available under the Plan and the balance shall again become available for Awards under the Plan.

 

(c)         Dividend Equivalents . Any dividend equivalents paid or credited under the Plan shall not be applied against the number of Restricted Shares, Stock Units, Options or SARs available for Awards, whether or not such dividend equivalents are converted into Stock Units.

 

SECTION 6. RESTRICTED SHARES.

 

(a)         Restricted Share Award . Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Share Award between the recipient and RHI. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan, including those specified in any Other Agreement. The provisions of the various Restricted Share Awards entered into under the Plan need not be identical.

 


(b)         Payment for Awards . Subject to the following sentence and applicable law, Restricted Shares may be sold or awarded under the Plan for such consideration as the Committee may determine, including (without limitation) cash, cash equivalents, past services and future services. To the extent that an Award consists of newly issued Restricted Shares, the Award recipient shall furnish consideration with a value not less than the par value of such Restricted Shares in the form of cash, cash equivalents, or past services rendered to the Company, as the Committee may determine. To the extent an Award of Restricted Shares consists solely of treasury shares, the Award may be made without consideration furnished by the recipient.

 

(c)         Vesting . Each Award of Restricted Shares shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Share Award or as specified in any Other Agreement. Unless the Restricted Share Award or an Other Agreement provides otherwise, each grant of Restricted Shares shall vest with respect to twenty-five percent (25%) of the Shares covered by the grant on each of the first through fourth anniversaries of the date of grant, provided that the Participant’s Service has not terminated on the applicable vesting date. A Restricted Share Award may provide for accelerated vesting in the event of the Participant’s Protiviti Retirement, Staffing/Headquarters Retirement, a Change in Control, or other events, including as provided in any Other Agreement. To the extent that an Award of Restricted Shares has not vested prior to, or concurrently with, termination of a Participant’s Service, such Award shall immediately terminate.

 

(d)         Voting and Dividend Rights . The holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as RHI’s other stockholders.

 

(e)         Assignment or Transfer of Restricted Shares . Except as provided herein, or in a Restricted Share Award, or as required by applicable law, Restricted Shares shall not be anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law. Any act in violation of this Subsection shall be void. However, this Subsection shall not preclude a Participant from designating a beneficiary who will receive any outstanding Restricted Shares in the event of the Participant’s death, nor shall it preclude a transfer of Restricted Shares by will or by the laws of descent and distribution.

 

SECTION 7. TERMS AND CONDITIONS OF OPTIONS.

 

(a)         Stock Option Award . Each grant of an Option under the Plan shall be evidenced by a Stock Option Award between the Optionee and RHI. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the Plan, including those specified in any Other Agreement. The Stock Option Award shall specify whether the Option is an ISO or an NSO. The provisions of the various Stock Option Awards entered into under the Plan need not be identical. A Stock Option Award may not provide that a new Option will be granted automatically to the Optionee when he or she exercises a prior Option and pays the Exercise Price.

 

(b)         Number of Shares . Each Stock Option Award shall specify the number of Shares that are subject to the Option and shall provide for the adjustment of such number in accordance with the adjustment provisions of the Plan. The maximum aggregate number of ISOs awarded under the Plan shall not exceed the number of Shares subject to the Plan under Section 5(a). The limitation of this Subsection shall be subject to adjustment pursuant to the adjustment provisions of the Plan.

 

(c)         Exercise Price . Each Stock Option Award shall specify the Exercise Price. The Exercise Price of an Option shall not be less than 100 percent (100%) of the Fair Market Value of a Share on the date of grant. Subject to the foregoing in this Subsection, the Exercise Price under any Option shall be determined by the Committee at its sole discretion. The Exercise Price shall be payable in one of the forms permitted under the Plan.

 


(d)         Exercisability and Term . Unless the Stock Option Award or an Other Agreement provides otherwise, each Option shall become exercisable with respect to twenty-five percent (25%) of the Shares covered by such Option on each of the first through fourth anniversaries of the date of grant, provided that the Participant’s Service has not terminated on the applicable vesting date. The term of an Option shall be ten (10) years from the date of grant unless the Stock Option Award provides for a shorter term. A Stock Option Award may provide for accelerated vesting in the event of the Optionee’s Protiviti Retirement, Staffing/Headquarters Retirement, a Change in Control, or other events, including as provided in any Other Agreement, and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service, subject to the provisions of any Other Agreement. Options may be awarded in combination with SARs, and such an Award may provide that the Options will not be exercisable unless the related SARs are forfeited. Subject to the foregoing in this Subsection, the Committee at its sole discretion shall determine when all or any installment of an Option is to become exercisable and when an Option is to expire.

 

(e)         Nontransferability . Except as set forth in a Stock Option Award, or as provided by an Other Agreement, with respect to an NSO, during an Optionee’s lifetime, his Option(s) shall be exercisable only by him and shall not be transferable, and in the event of an Optionee’s death, his Option(s) shall not be transferable other than by will or by the laws of descent and distribution.

 

(f)         Exercise of Options Upon Termination of Service . Each Stock Option Award shall set forth the extent to which the Optionee shall have the right to exercise the Option following termination of the Optionee’s Service, and the right to exercise the Option of any executors or administrators of the Optionee’s estate or any person who has acquired such Option(s) directly from the Optionee by bequest or inheritance. Such provisions shall be determined in the sole discretion of the Committee, need not be uniform among all Options issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination of Service. Unless the Stock Option Award or an Other Agreement provides otherwise, Options which are unvested at the time of an Optionee’s termination of Service shall expire upon such termination, and any vested Options shall remain outstanding and exercisable until the earlier of 90 days following such termination and the expiration of the Option’s term. Notwithstanding the foregoing, if exercise of an Option during the 90-day period described in the previous sentence would subject the Optionee to liability under Section 16 of the Exchange Act by reason of transactions by the Optionee prior to the Optionee’s termination of service (“Prior Transaction”), such Option shall be exercisable until the earliest of (a) its normal termination date and (b) the 30 th day after the first date upon which the Optionee would not be subject to Section 16 liability by reason of the Prior Transaction. Notwithstanding the foregoing, in the event of an Optionee’s Misconduct Termination, effective as of the date notice of such termination is given by the Committee to the Optionee, all of the Optionee’s vested and unvested Options shall automatically terminate and lapse, unless the Committee shall determine otherwise.

 

(g)         Modification, Extension and Renewal of Options . Within the limitations of the Plan, the Committee may modify, extend or renew outstanding Options. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair his rights or increase his obligations under such Option. Options may not be repriced without the approval of RHI’s stockholders.

 

SECTION 8. PAYMENT FOR OPTION SHARES.

 

(a)         General Rule . The entire Exercise Price of Shares issued under the Plan shall be payable in lawful money of the United States of America, as permitted under this Section. Payment may be made by any combination of the methods described in this Section.

 

(b)         Cash . Payment may be made by cash, check, wire transfer or similar means, subject to the requirements of applicable law.

 

(c)         Surrender of Stock . Payment may be made all or in part by surrendering, or attesting to the ownership of, Shares which have been owned by the Optionee or his representative for such period of time

 


required to avoid RHI’s recognition of additional compensation expense with respect to the Option for financial reporting purposes as a result of the surrender or attestation of such previously owned shares. Such Shares shall be valued at their Fair Market Value on the date when the new Shares are purchased under the Plan.

 

(d)         Cashless Exercise . To the extent permitted by applicable law, payment may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker to sell Shares and to deliver all or part of the sale proceeds to RHI in payment of the aggregate Exercise Price and applicable tax withholding.

 

(e)         Other Forms of Payment . To the extent that a Stock Option Award so provides, payment may be made in any other form that is consistent with applicable laws, regulations and rules.

 

Notwithstanding anything to the contrary in this Section or in any agreement under the Plan, the Committee may disallow the use of any type of payment that the Committee determines, in its sole discretion, would result in adverse accounting or legal consequences to the Company or Affiliate.

 

SECTION 9. STOCK APPRECIATION RIGHTS.

 

(a)         SAR Award . Each grant of a SAR under the Plan shall be evidenced by a SAR Award between the Optionee and RHI. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan, including those specified in any other Agreement. The provisions of the various SAR Awards entered into under the Plan need not be identical. A SAR Award may not provide that a new SAR will be granted automatically to the holder thereof when he or she exercises a prior SAR.

 

(b)         Number of Shares . Each SAR Award shall specify the number of Shares to which the SAR pertains and shall provide for the adjustment of such number in accordance with the adjustment provisions of the Plan.

 

(c)         Exercise Price . Each SAR Award shall specify the Exercise Price, which may not be less than 100 percent (100%) of the Fair Market Value of a Share on the date of grant. A SAR Award may specify an Exercise Price that varies in accordance with a predetermined formula while the SAR is outstanding.

 

(d)         Exercisability and Term . Unless the SAR Award or an Other Agreement provides otherwise, each SAR shall become exercisable with respect to twenty-five percent (25%) of the Shares covered by such SAR on each of the first through fourth anniversaries of the date of grant, provided that the Participant’s Service has not terminated on the applicable vesting date. The term of the SAR shall be ten (10) years from the date of grant unless the SAR Award provides for a shorter term. A SAR Award may provide for accelerated exercisability in the event of the Optionee’s Protiviti Retirement, Staffing/Headquarters Retirement, a Change in Control, or other events, including as provided in any Other Agreement, and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service, subject to the provisions of any Other Agreement. SARs may be awarded in combination with Options, and such an Award may provide that the SARs will not be exercisable unless the related Options are forfeited. A SAR may be included in an ISO only at the time of grant but may be included in an NSO at the time of grant or thereafter. A SAR granted under the Plan may provide that it will be exercisable only in the event of a Change in Control.

 

(e)         Exercise of SARs . The SAR Award may provide that, upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or her death) shall receive from RHI (a) Shares, (b) cash or (c) a combination of Shares and cash. Unless otherwise provided in the SAR Award or an Other Agreement, upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or her death) shall receive Shares from RHI. The amount of cash and/or the Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject to the SARs exceeds the Exercise Price. Unless the SAR Award or an Other Agreement provides otherwise, SARs which are unvested at the time of an Optionee’s termination of Service

 


shall expire upon such termination, and any vested SARs which have not been exercised shall remain outstanding and exercisable until the earlier of 90 days following such termination and the expiration of the SAR’s term. Notwithstanding the foregoing, if exercise of a SAR during the 90-day period described in the previous sentence would subject the Participant to liability under Section 16 of the Exchange Act by reason of transactions by the Participant prior to the Participant’s termination of service, such SAR shall be exercisable until the earliest of (a) its normal termination date and (b) the 30 th day after the first date upon which the Participant would not be subject to Section 16 liability by reason of the prior transactions. Notwithstanding the foregoing, in the event of an Optionee’s Misconduct Termination, effective as of the date notice of such termination is given by the Committee to the Optionee, all of the Optionee’s vested and unvested SARs shall automatically terminate and lapse, unless the Committee shall determine otherwise.

 

(f)         Modification or Assumption of SARs . Within the limitations of the Plan, the Committee may modify, extend or renew outstanding SARs. The foregoing notwithstanding, no modification of a SAR shall, without the consent of the Optionee, impair his rights or increase his obligations under such SAR. SARs may not be repriced without the approval of RHI’s stockholders.

 

SECTION 10. STOCK UNITS.

 

(a)         Stock Unit Award . Each grant of Stock Units under the Plan shall be evidenced by a Stock Unit Award between the recipient and RHI. Such Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan, including those specified in any Other Agreement. The provisions of the various Stock Unit Awards entered into under the Plan need not be identical.

 

(b)         Payment for Awards . To the extent that an Award is granted in the form of Stock Units, no cash consideration shall be required of the Award recipients.

 

(c)         Vesting Conditions . Each Award of Stock Units shall be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Stock Unit Award or as specified in any Other Agreement. Unless the Stock Unit Award or an Other Agreement provides otherwise, each grant of Stock Units shall become exercisable with respect to twenty-five percent (25%) of the Shares covered by the grant on each of the first through fourth anniversaries of the date of grant, provided that the Participant’s Service has not terminated on the applicable vesting date. A Stock Unit Award may provide for accelerated vesting in the event of the Participant’s Protiviti Retirement, Staffing/Headquarters Retirement, a Change in Control, or other events, including as provided in any Other Agreement. To the extent that an Award of Stock Units has not vested prior to, or concurrently with, termination of a Participant’s Service, such Award shall immediately terminate.

 

(d)         Voting and Dividend Rights . The holders of Stock Units shall have no voting rights. Prior to settlement or forfeiture, any Stock Unit awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Stock Unit is outstanding. Dividend equivalents may be converted into additional Stock Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions as the Stock Units to which they attach.

 

(e)         Form and Time of Settlement of Stock Units . Settlement of vested Stock Units may be made in the form of (a) cash, (b) Shares or (c) any combination of both, as determined by the Committee. Methods of converting Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of Shares over a series of trading days. Vested Stock Units may be settled in a lump sum or in installments. The distribution may occur or commence when all vesting conditions applicable to the Stock Units have been satisfied or have lapsed, or it may be deferred, in accordance with applicable law, to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Stock Units is settled, the number of such Stock Units shall be subject to adjustment pursuant to the adjustment provisions of the Plan.

 


(f)         Death of Recipient . Any Stock Units Award that becomes payable after the recipient’s death shall be distributed to the recipient’s beneficiary or beneficiaries. Each recipient of a Stock Units Award under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with RHI. A beneficiary designation may be changed by filing the prescribed form with RHI at any time before the Award recipient’s death. If no beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Stock Units Award that becomes payable after the recipient’s death shall be distributed to the recipient’s estate.

 

(g)         Creditors’ Rights . A holder of Stock Units shall have no rights other than those of a general creditor of RHI. Stock Units represent an unfunded and unsecured obligation of RHI, subject to the terms and conditions of the applicable Stock Unit Award.

 

(h)         Assignment or Transfer of Stock Units . Except as provided herein, or in a Stock Unit Award, or as required by applicable law, Stock Units shall not be anticipated, assigned, attached, garnished, optioned, transferred or made subject to any creditor’s process, whether voluntarily, involuntarily or by operation of law. Any act in violation of this Subsection shall be void. However, this Subsection shall not preclude a Participant from designating a beneficiary who will receive any outstanding Stock Units in the event of the Participant’s death, nor shall it preclude a transfer of Stock Units by will or by the laws of descent and distribution.

 

SECTION 11. NO RIGHTS AS A STOCKHOLDER

 

A Participant shall have no rights as a stockholder with respect to any Award until the date of the issuance of a stock certificate for any Shares covered by such award. No adjustments shall be made, except as provided in the adjustment provisions of the Plan.

 

SECTION 12. PERFORMANCE CONDITIONS.

 

(a)        Any Award to an Executive Officer shall be made subject to a Performance Condition with respect to which the Performance Goal shall be Earnings Per Share during the Performance Period in addition to any vesting requirements imposed upon such grant.

 

(b)        Awards to persons other than Executive Officers may, but need not, be made subject to a Performance Condition utilizing any Performance Goal in addition to any vesting requirements imposed upon such grant. The determination as to whether any such grant is subject to a Performance Condition shall be made on or prior to the date of grant.

 

(c)        The Performance Condition shall operate as specified in this Section.

 

(d)        Except in the case of Awards not intended to qualify as “performance-based compensation” under Code Section 162(m), if an Award is made subject to a Performance Condition, the Committee shall be required to establish the Performance Period and Target Performance Goal for such award no later than the time permitted by Section 162(m) of the Internal Revenue Code.

 

(e)        After the public release by RHI of its results for the last fiscal quarter of the Performance Period, the Chief Financial Officer shall, with respect to each Award made subject to a Performance Condition, (a) calculate the Actual Performance Goal, (b) determine the Multiplier, (c) calculate the Final Award, and (d) deliver such calculation to the Committee.

 

(f)        The Committee shall review the information submitted by the Chief Financial Officer and certify, in writing, each Final Award.

 

(g)        To the extent that a Final Award is less than the Original Award, the difference shall be forfeited by the Participant. The Final Award shall bear the same vesting schedule as the Original Award, and on each vesting date the percentage of the Final Award that vests shall be the same as the percentage of the Original Award that would have vested had there been no forfeiture as a result of the Performance Condition.

 


(h)        If all or a portion of an Award made subject to a Performance Condition shall vest prior to the Certification Date by reason of death, Total and Permanent Disability or, if applicable, a Change in Control, then the Performance Condition shall be cancelled and none of such Award shall be subject to reduction or forfeiture as provided by the Performance Condition. Such Award shall be treated in accordance with the terms of this plan relating to vested shares.

 

(i)        If all or a portion of an Award made subject to a Performance Condition shall vest prior to the Certification Date for any reason other than death, Total and Permanent Disability or a Change in Control, no portion of the Award shall be released to or exercised by the Participant until after the Certification Date. No such vesting prior to the Certification Date shall in any way be deemed a satisfaction, waiver or cancellation of the Performance Condition, and such Award shall remain subject to reduction and forfeiture as provided by the Performance Condition.

 

(j)        Once established, a Performance Condition for an Executive Officer may not be waived or cancelled by the Committee.

 

SECTION 13. TERMINATION OF SERVICE; LEAVES OF ABSENCE.

 

Subject to the last sentence of this Section, a Participant’s Service shall terminate when such person ceases to be an Eligible Participant as determined in the sole discretion of the Committee. A Participant’s Service does not terminate if he or she is a common-law employee and goes on a bona fide leave of absence of less than six (6) consecutive months that was approved by the Company in writing and the terms of the leave provide for continued service crediting, or when continued service crediting is required by applicable law. However, for purposes of determining whether an Option is entitled to ISO status, a common-law employee’s Service will be treated as terminating ninety (90) days after such employee went on leave, unless such employee’s right to return to active work is guaranteed by law or by a contract. Service terminates in any event when the approved leave ends, unless such employee immediately returns to active work. The Committee determines which leaves count toward Service, and when Service terminates for all purposes under the Plan. Notwithstanding the foregoing, an Outside Director’s Service shall terminate when he or she is neither a member of the Board of Directors or a consultant to RHI.

 

SECTION 14. DEATH; TOTAL AND PERMANENT DISABILITY.

 

All Awards granted to any Participant shall vest upon such Participant’s death or termination of the Participant’s Service due to Total and Permanent Disability.

 

SECTION 15. PERSONS SUBJECT TO SECTION 16 OF THE EXCHANGE ACT.

 

Any Award held by an individual who is a Section 16 Participant at either or both of (a) the grant date of such Award or (b) the effective date of the Change in Control, shall vest upon the effective date of such Change in Control. Any Award held by an individual who is a Section 16 Participant at either or both of (a) the grant date of such Award or (b) the effective date of such individual’s Outside Director Retirement, Protiviti Retirement or Staffing/Headquarters Retirement, as the case may be, shall vest upon the effective date of such retirement. Any Options or SARs held by a Section 16 Participant which vest by reason of the provisions of this Section or by reason of death or Total and Permanent Disability shall remain outstanding until the earlier of its exercise or its original term.

 

SECTION 16. ADJUSTMENT OF SHARES.

 

(a)         Adjustments . In the event of a subdivision of the outstanding Stock, or stock split or reverse stock split, a declaration of a dividend payable in Shares, a declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the price of Shares, a combination or consolidation of the outstanding Shares (by reclassification or otherwise) into a lesser number of Shares, a recapitalization,

 


reorganization, merger, liquidation, a spin-off, exchange of shares or a similar occurrence (as determined by the Committee in its sole discretion), the Committee shall make such adjustments as it, in its sole discretion, deems appropriate in one or more of:

 

(i)        The number of Shares, Options, SARs, Restricted Shares and Stock Units available for future Awards under the Plan;

 

(ii)        The per person per fiscal year limitations on Awards under the Plan and the maximum aggregate number of ISOs that may be awarded under the Plan;

 

(iii)        The number of Shares covered by each outstanding Award;

 

(iv)        The Exercise Price under each outstanding Option and SAR; or

 

(v)        The number of Stock Units included in any prior Award which has not yet been settled.

 

Except as provided in this Section, a Participant shall have no rights by reason of any issue by RHI of stock of any class or securities convertible into stock of any class, any subdivision or consolidation of shares of stock of any class, the payment of any dividend or any other increase or decrease in the number of shares of stock of any class.

 

(b)         Dissolution or Liquidation . To the extent not previously exercised or settled, Options, SARs and Stock Units shall terminate immediately prior to the dissolution or liquidation of RHI.

 

(c)         Reorganizations . In the event that RHI is a party to a merger or other reorganization, outstanding Awards shall be subject to the agreement of merger or reorganization. Such agreement may provide for:

 

(i)        The continuation of the outstanding Awards by RHI, if RHI is a surviving corporation;

 

(ii)        The assumption of the outstanding Awards by the surviving corporation or its parent or subsidiary;

 

(iii)        The substitution by the surviving corporation or its parent or subsidiary of its own awards for the outstanding Awards;

 

(iv)        Full exercisability or vesting and accelerated expiration of the outstanding Awards; or

 

(v)        Settlement of the full value of the outstanding Awards in cash or cash equivalents followed by cancellation of such Awards.

 

(d)         Reservation of Rights . Except as provided in this Section, a Participant shall have no rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend or any other increase or decrease in the number of shares of stock of any class. Any issue by RHI of shares of stock of any class, or securities convertible into shares of stock of any class, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Shares subject to an Award or the Exercise Price. The grant of an Award pursuant to the Plan shall not affect in any way the right or power of RHI to make adjustments, reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.

 

SECTION 17. AWARDS UNDER OTHER PLANS.

 

RHI may grant awards under other plans or programs. Such awards may be settled in the form of Shares issued under this Plan. Such Shares shall be treated for all purposes under the Plan like Shares issued in settlement of Stock Units and shall, when issued, reduce the number of Shares available under the Plan.

 

SECTION 18. LEGAL AND REGULATORY REQUIREMENTS.

 

No Option may be exercised and no Stock may be issued pursuant to an Option or transferred pursuant to a Restricted Share award unless the Committee shall determine that such exercise, issuance or transfer complies

 


with all relevant provisions of law, including, without limitation, the Securities Act, the Exchange Act, applicable state securities laws, and rules and regulations promulgated under each of the foregoing, and the requirements of any stock exchange upon which the Stock may then be listed or quotation system upon which the Stock may be quoted, and shall be further subject to the approval of counsel for RHI with respect to such compliance. If the Stock subject to this Plan is not registered under the Securities Act and under applicable state securities laws, the Committee may require that the Participant deliver to RHI such documents as counsel for RHI may determine are necessary or advisable in order to substantiate compliance with applicable securities laws and the rules and regulations promulgated thereunder. In no event shall RHI deliver, or be deemed obligated to deliver, cash in lieu of any Share by reason of any failure to satisfy the foregoing provisions.

 

So long as any restrictions or obligations imposed pursuant to this Plan shall apply to a share, each certificate evidencing such share shall bear an appropriate legend referring to the terms, conditions and restrictions. In addition, RHI may instruct its transfer agent that shares of Stock evidenced by such certificates may not be transferred without the written consent of RHI. Any attempt to dispose of such shares of Stock in contravention of such terms, conditions and restrictions shall be invalid. Certificates representing shares that have not vested or with respect to which minimum withholding taxes have not been paid will be held in custody by RHI or such bank or other institution designated by the Committee.

 

SECTION 19. WITHHOLDING TAXES.

 

(a)         General . To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor shall make arrangements satisfactory to RHI for the satisfaction of any withholding tax obligations that arise in connection with the Plan. RHI shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied. In the event that such withholding taxes are not paid on a timely basis, as determined by RHI in its sole discretion, to the extent permitted by law RHI shall have the right, but not the obligation, to cause such withholding taxes to be satisfied by reducing the number of Shares or cash (if applicable) deliverable or by offsetting such withholding taxes against amounts otherwise due from the Company to the Participant. If withholding taxes are paid by reduction of the number of Shares deliverable to Optionee, such shares shall be valued at the Fair Market Value as of the date of exercise.

 

(b)         Share Withholding . Unless otherwise provided by the Committee, a Participant may satisfy all or part of his or her minimum withholding or income tax obligations by having RHI withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously acquired. Subject to applicable law and accounting considerations, such Shares shall be valued at their Fair Market Value on the date when taxes otherwise would be withheld in cash. A Participant may elect to surrender, or attest to the ownership of, previously acquired Shares in excess of the amount required to satisfy his or her minimum withholding or income tax obligations provided that such Shares have been held by the Participant for such period of time required to avoid RHI’s recognition of additional compensation expense for financial reporting purposes as a result of the surrender or attestation of such previously owned shares.

 

SECTION 20. NO EMPLOYMENT OR REELECTION RIGHTS.

 

No provision of the Plan, nor any right or Award granted under the Plan, shall be construed to give any person any right to become, to be treated as, or to remain an Eligible Participant. RHI and its Subsidiaries and Affiliates reserve the right to terminate any person’s Service at any time and for any reason, with or without notice. No provision of the Plan nor any right or Award granted under the Plan shall be construed to create any obligation on the part of the Board of Directors to nominate any Outside Director for reelection by RHI’s stockholders, or confer upon any Outside Director the right to remain a member of the Board of Directors for any period of time, or at any particular rate of compensation.

 


SECTION 21. DURATION AND AMENDMENTS.

 

(a)         Term of the Plan . The Plan, as set forth herein, shall terminate automatically on the meeting of the stockholders of RHI in 2008, unless re-adopted or extended by RHI’s stockholders prior to or on such date and may be terminated on any earlier date by the Board of Directors or the Compensation Committee, as described in the next Subsection.

 

(b)         Right to Amend or Terminate the Plan . The Board of Directors or, to the extent permitted by applicable laws, rules or regulations, the Compensation Committee may amend or terminate the Plan at any time and from time to time. Rights and obligations under any Award granted before amendment or termination of the Plan shall not be materially impaired by such amendment or termination, except with consent of the person to whom the Award was granted. An amendment of the Plan shall be subject to the approval of RHI’s stockholders to the extent required by applicable laws, regulations or rules, including, but not limited to, any applicable rules or regulations of the New York Stock Exchange. In addition, no material amendment may be made to the plan without the approval of RHI’s stockholders.

 

(c)         Effect of Amendment or Termination . No Shares shall be issued or sold under the Plan after the termination thereof, except upon exercise of an Award granted prior to such termination. The termination of the Plan, or any amendment thereof, shall not adversely affect any Shares previously issued or any Awards previously granted under the Plan.

 

SECTION 22. PLAN EFFECTIVENESS.

 

This Plan shall become effective upon its approval by RHI’s stockholders. Upon its effectiveness, the Plan shall supersede the Existing Equity Plans such that no further awards shall be made under the Existing Equity Plans. This Plan shall not, in any way, affect awards under the Existing Equity Plans that are outstanding as of the date this Plan becomes effective. If RHI’s stockholders do not approve this Plan, no Awards will be made under this Plan and the Existing Equity Plans will continue in effect in accordance with their terms.

 

Exhibit 99.2

 

ROBERT HALF INTERNATIONAL INC.

 

Annual Performance Bonus Plan

 

(As amended and restated effective May 3, 2005)

 

1.         DEFINITIONS . As used in this Plan, the following terms shall have the meanings set forth below:

 

Administrator means the Compensation Committee of the Board of Directors of the Company, or such other Committee as may be appointed by the Board.

 

Annual Determination means the Target EPS and Target Bonuses determined annually by the Administrator, as described in Section 4 of this Plan.

 

Award Date means the date that the Administrator makes its written certification of a Bonus pursuant to Section 5 or Section 6.

 

Bonus means a Preliminary Bonus, a Final Bonus, or both.

 

Bonus Year means the fiscal year with respect to which a Bonus is paid pursuant to the Plan.

 

Company means Robert Half International Inc., a Delaware corporation.

 

Eligible Executive means (a) any elected executive officer of the Company and (b) any executive of the Company who has senior management functions and responsibilities, as designated by the Administrator.

 

EPS means diluted earnings per share, determined in accordance with generally accepted accounting principles. For purposes of the foregoing sentence, earnings shall mean income before extraordinary items, discontinued operations and cumulative effect of changes in accounting principles and after full accrual for the bonuses paid under this Plan. Earnings shall also be determined, with respect to any Target Bonus without regard to the effects of mergers, acquisitions, dispositions and material restructuring of the business occurring after the Target EPS for such Target Bonus was established.

 

Final Bonus means the Year-End Bonus less the Preliminary Bonus, but only if such number is greater than zero.

 

Final EPS means EPS calculated as of the end of a fiscal year.

 

Final Multiplier means (a) the Final Ratio, if the Final Ratio is greater than or equal to .5 and less than or equal to 2, (b) 2, if the Final Ratio is greater than 2, or (c) 0, if the Final Ratio is less than .5.

 

Final Ratio means the result obtained by dividing Final EPS by Target EPS.

 

Nine-Month Period means the first three fiscal quarters of the Bonus Year.

 

Plan means this Annual Performance Bonus Plan.

 

Potential Preliminary Bonus means, with respect to each Eligible Executive, 85% of the Product of the Preliminary Multiplier and such Eligible Executive’s Target Bonus, but in no event may such amount be in excess of $9,000,000.

 

Potential Year-End Bonus means, with respect to each Eligible Executive, the product of the Final Multiplier and such Eligible Executive’s Target Bonus, but in no event may such amount be in excess of $9,000,000.

 

Preliminary Bonus means, with respect to each Eligible Executive, that amount that the Administrator determines in accordance with Section 5 hereof, but in no event may such amount be in excess of $9,000,000.

 

Preliminary EPS means 1.334 multiplied by EPS for a Nine-Month Period.

 


Preliminary Multiplier means (a) the Preliminary Ratio, if the Preliminary Ratio is greater than or equal to .5 and less than or equal to 2, (b) 2, if the Preliminary Ratio is greater than 2, or (c) 0, if the Preliminary Ratio is less than .5.

 

Preliminary Ratio means the result obtained by dividing Preliminary EPS by Target EPS.

 

Repayment Amount means that amount calculated in accordance with Section 7.3 hereof.

 

Target Bonus means that amount set forth, with respect to each Eligible Executive, in an Annual Determination.

 

Target EPS means the EPS goal set annually by the Administrator, as set forth in an Annual Determination.

 

Year-End Bonus means, with respect to each Eligible Executive, that amount that the Administrator determines in accordance with Section 6 hereof, but in no event may such amount be in excess of $9,000,000.

 

2.         PURPOSE . The purpose of the Plan is to attract, retain and motivate key senior management employees by providing additional compensation, in accordance with the terms and conditions set forth herein, based on the Company’s earnings.

 

3.         ADMINISTRATION . The Administrator is authorized to construe and interpret the Plan, to prescribe, amend and rescind rules and regulations relating to the Plan, and to make all determinations and to take all actions necessary or advisable for the Plan’s administration. Whenever the Plan authorizes or requires the Administrator to take any action, make any determination or decision, or form any opinion, then any such action, determination, decision or opinion by or of the Administrator shall be in the absolute discretion of the Administrator and shall be final and binding upon all persons in interest, including the Company and all Eligible Executives.

 

4.         ANNUAL DETERMINATION . On an annual basis, not later than the end of the first fiscal quarter of the Bonus Year, the Administrator shall determine the following with respect to the Bonus Year:

 

(i) the Eligible Executives;

 

(ii) the Target EPS for the Bonus Year;

 

(iii) the Target Bonus for the Bonus Year for each Eligible Executive; and

 

(iv) such other matters as are appropriate with respect to the Plan (together, the “Annual Determination”).

 

5.         DETERMINATION OF PRELIMINARY BONUS . Within five business days after the public release by the Company of its audited results for the third fiscal quarter of the Bonus Year, the Chief Financial Officer shall (a) calculate the Preliminary EPS, (b) determine the Preliminary Multiplier for the Bonus Year, (c) calculate, with respect to each Eligible Executive, his Potential Preliminary Bonus, (d) deliver each calculation to the Administrator. The Administrator shall, prior to the end of the Bonus Year, review the information submitted by the Chief Financial Officer and certify, in writing, each Eligible Executive’s Preliminary Bonus, which, except as provided in the next sentence, shall be the Potential Preliminary Bonus. Notwithstanding the foregoing, if any Eligible Executive’s Preliminary Bonus would be greater than his Target Bonus, the Administrator, in its sole discretion, may reduce the Preliminary Bonus of such Eligible Executive to such amount that is not less than the Target Bonus as it may determine.

 

6.         DETERMINATION OF YEAR-END BONUS . Within ten business days after the public release by the Company of its audited results for the Bonus Year, the Chief Financial Officer shall (a) calculate the Final EPS, (b) determine the Final Multiplier for the Bonus Year, (c) calculate, with respect to each Eligible Executive, the Potential Year-End Bonus and (d) deliver such calculations to the Administrator. The Administrator shall,

 


within 90 days of the end of the Bonus Year, review the information submitted by the Chief Financial Officer and certify, in writing, each Eligible Executive’s Year-End Bonus, which shall be the Potential Year-End Bonus; provided, however, that if any Eligible Executive’s Potential Year-End Bonus is greater than such Eligible Executive’s Preliminary Bonus, the Administrator may, in its sole discretion, reduce such Year-End Bonus to such amount that is not less than the Eligible Executive’s Preliminary Bonus as the Administrator may determine.

 

7.         BONUS PAYMENTS . Each Eligible Executive shall be paid a Bonus in accordance with the following:

 

7.1.         Preliminary Bonus . The Company shall pay the Preliminary Bonus to each Eligible Executive after such Preliminary Bonus is certified by the Administrator but prior to the end of the Bonus Year. Notwithstanding the foregoing, or anything appearing elsewhere herein, if an Eligible Executive is not employed by the Company on the date that Preliminary Bonuses are certified by the Administrator, then a pro-rated Preliminary Bonus shall be paid to such Eligible Executive (a) if the termination of employment was by reason of the Eligible Executive’s death, (b) as provided by any agreement or arrangement in existence on the date the Plan was approved by the stockholders or (c) under such circumstances as the Administrator, in its sole discretion, may determine; otherwise, no Preliminary Bonus in any amount shall be paid to such Eligible Executive.

 

7.2.         Final Bonus . The Company shall pay the Final Bonus to each Eligible Executive after such Final Bonus is certified by the Administrator but prior to the end of the first fiscal quarter following the Bonus Year. Notwithstanding the foregoing, or anything appearing elsewhere herein, if an Eligible Executive is not employed by the Company on the last day of the Bonus Year, then a pro-rated Final Bonus shall be paid to such Eligible Executive (a) if the termination of employment was by reason of the Eligible Executive’s death, (b) as provided by any agreement or arrangement in existence on the date the Plan was approved by the stockholders or (c) under such circumstances as the Administrator, in its sole discretion, may determine; otherwise, no Final Bonus in any amount shall be paid to such Eligible Executive.

 

7.3.         Repayment of Preliminary Bonus . If the Year-End Bonus for an Eligible Executive is less than such Eligible Executive’s Preliminary Bonus, such Eligible Executive shall repay such difference (the “Repayment Amount”) within fifteen (15) business days of notification thereof. To the extent the Repayment Amount is unpaid, the Company shall, consistent with applicable law, be entitled to deduct the Repayment Amount from any other amounts due by the Company to such Eligible Executive, and to pursue any and all other legal and equitable remedies to recover such Repayment Amount.

 

8.         EMPLOYMENT . The selection of an employee as an Eligible Executive shall not affect any right of the Company to terminate, with or without cause, such person’s employment at any time.

 

9.         WITHHOLDING TAXES . The Company shall, to the extent permitted by law, have the right to deduct from a Bonus any federal, state or local taxes of any kind required by law to be withheld with respect to such Bonus.

 

10.         AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN . The Administrator may at any time amend, alter, suspend, or discontinue this Plan.

 

11.         INDEMNIFICATION OF ADMINISTRATOR . Indemnification of members of the group constituting the Administrator for actions with respect to the Plan shall be in accordance with the terms and conditions of separate indemnification agreements, if any, that have been or shall be entered into from time to time between the Company and any such person.

 

12.         HEADINGS . The headings used in this Plan are for convenience only, and shall not be used to construe the terms and conditions of the Plan.

 

Exhibit 99.3

 

Robert Half International Inc.

 

Stock Incentive Plan

 

Restricted Share Agreement

 

This restricted share agreement (“Agreement”) is made and entered into as of                              (the “Grant Date”), between Robert Half International Inc., a Delaware corporation (the “Company”), and                                                       (“Participant”). Capitalized terms not defined herein shall have the meanings assigned to them in the Company’s Stock Incentive Plan (the “Plan”), a copy of which Participant represents, warrants, and acknowledges having received and reviewed. Participant also represents, warrants, and acknowledges having received and reviewed a copy of the Plan prospectus and the documents incorporated therein by reference. The Plan is incorporated by reference into this Agreement.

 

THE PARTIES AGREE AS FOLLOWS:

 

1.         Shares . Pursuant to the Plan, the Company hereby transfers to Participant, and Participant hereby accepts from the Company, an award consisting of                  Restricted Shares on the terms and conditions set forth herein and in the Plan (the “Restricted Share Award”).

 

2.         Vesting . The Restricted Share Award shall vest as to 25% of the amount thereof on each of                                                                           and                      , unless otherwise provided by the Plan or Section 3 hereof. The Restricted Shares are subject to Section 6(e) of the Plan to the extent they have not vested and shall be held in escrow by the Company until they have vested and the Participant has satisfied all applicable tax withholding obligations as provided in Section 6 below. In addition, any dividends paid in Shares with respect to unvested Restricted Shares by reason of Section 6(d) of the Plan or any Shares to which the Participant may be entitled by reason of application of Section 16 of the Plan to the unvested Restricted Shares shall, in each case, be subject to the same terms and conditions as are applicable to the unvested Restricted Shares under this Agreement and the Plan.

 

3.         Accelerated Vesting . Notwithstanding Section 2 hereof, the Restricted Share Award shall vest as provided from time to time by any other agreement between Participant and the Company or as provided by Section 3(b)(xv), Section 14 or Section 15 of the Plan, and in such case, the vesting date for any portion of the Restricted Share Award that vests under such circumstances shall be the date such portion of the award vests.

 

4.         Performance Condition . The Restricted Share Award shall be subject to the Performance Condition as specified in Section 12 of the Plan. The Target Performance Goal (with respect to which the Performance Goal shall be Earnings Per Share) and the Performance Period shall be determined by the Committee.

 

5.         Understanding of Participant Regarding Withholding Taxes . Participant hereby represents and acknowledges that (i) on each date that the Restricted Share Award vests, minimum withholding taxes become due, (ii) payment of such minimum withholding taxes to the Company is the responsibility of Participant and (iii) payment of such withholding taxes may require a significant cash outlay by Participant.

 

6.         Payment of Taxes . The Company shall notify the Participant or, if applicable, Participant’s estate, as to the amount of minimum withholding taxes required to be withheld by the Company as a result of the vesting of the Restricted Share Award. Participant shall make full payment of such minimum withholding taxes to the Company by check or in a manner permitted by Section 19(b) of the Plan. In the event that such payment is not made, the Company shall have the right to cause such Participant’s minimum withholding taxes obligation to be satisfied as specified in Section 19(a) of the Plan.

 


7.         Election to Recognize Gross Income in the Year of Grant . If Participant properly elects within thirty (30) days of the Grant Date to include in gross income for federal income tax purposes an amount equal to the fair market value of the Restricted Share Award on the Grant Date, such Participant shall pay in cash to the Company in the calendar month of such Grant Date, or make arrangements satisfactory to the Committee to pay to the Company, any minimum withholding taxes required to be withheld with respect to such shares.

 

8.         Restriction on Issuance of Shares .

 

8.1         Legality of Issuance . The Company shall not be obligated to transfer or issue any Restricted Shares pursuant to this Agreement if such transfer or issuance, in the opinion of the Company and the Company’s counsel, would constitute a violation by the Company of any provision of law, including without limitation the provisions of the Securities Act.

 

8.2         Registration or Qualification of Securities . The Company may, but shall not be required to, register or qualify the transfer or issuance of the Restricted Shares under the Securities Act or any other applicable law. The Company shall not be obligated to take any affirmative action in order to cause the transfer or issuance of the Restricted Shares pursuant hereto to comply with any law.

 

9.         Restriction on Transfer . Regardless of whether the transfer or issuance of the Restricted Shares has been registered under the Securities Act or has been registered or qualified under the securities laws of any state, the Company may impose additional restrictions upon the sale, pledge, or other transfer of the Restricted Shares (including the placement of appropriate legends on stock certificates and the issuance of stop-transfer instructions to the Company’s transfer agent) if, in the judgment of the Company and the Company’s counsel, such restrictions are necessary in order to achieve compliance with the provisions of the Securities Act, the securities laws of any state, or any other law.

 

10.         Stock Certificate Restrictive Legends . Stock certificates evidencing the Restricted Shares may bear such restrictive legends as the Company and the Company’s counsel deem necessary under applicable law or pursuant to this Agreement.

 

11.         Representations, Warranties, Covenants, and Acknowledgments of Optionee Upon Exercise of Option . Participant hereby agrees that in the event the Company and the Company’s counsel deem it necessary or advisable in the exercise of their discretion, the transfer or issuance of the Restricted Shares may be conditioned upon the person receiving Restricted Shares making certain representations, warranties, and acknowledgments relating to compliance with applicable securities laws.

 

12.         Tax Advice . Participant represents, warrants, and acknowledges that the Company has made no warranties or representations to Participant with respect to the income tax consequences of the transactions contemplated by this Agreement, and Participant is in no manner relying on the Company or the Company’s representatives for an assessment of such tax consequences.

 

13.         Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts entered into and wholly to be performed within the State of California by California residents. The parties agree that the exclusive jurisdiction and venue of any action with respect to this Agreement shall be in the Superior Court for the county in which the principal executive offices of the Company are located, or the United States District Court for the district in which the principal executive offices of the Company are located, and each of the parties hereby submits itself to the exclusive jurisdiction and venue of such courts for the purpose of such action. The parties agree that service of process in any such action may be effected by delivery of the summons and complaint in a manner provided for delivery of notices set forth herein.

 


14.         Notices . All notices, communications and documents under this Agreement shall be in writing. All notices, communications, and documents directed to the Company and related to the Agreement, if not delivered by hand, shall be mailed to the Company’s principal executive office, Attention: Secretary. The current address of the Company’s principal executive office is:

 

Robert Half International Inc.

2884 Sand Hill Road

Menlo Park, CA 94025

 

Unless and until the Company is notified in writing to the contrary, all notices, communications, and documents intended for Participant and related to this Agreement, if not delivered by hand, shall be mailed to Participant’s last known address as shown on the Company’s books or such other address as Participant may specify by notice complying with this section. Notices, communications, and documents not delivered by hand shall be mailed by registered or certified mail, return receipt requested, postage prepaid. All mailings and deliveries related to this Agreement shall be deemed received only when actually received.

 

15.         Binding Effect . Subject to the limitations set forth in this Agreement, this Agreement shall be binding upon, and inure to the benefit of, the executors, administrators, heirs, legal representatives, successors, and assigns of the parties hereto.

 

16.         Damages . Participant shall be liable to the Company for all costs and damages, including incidental and consequential damages and attorneys’ fees, resulting from Participant’s breach of this Agreement. If any party to this Agreement seeks to enforce its rights under this Agreement by legal proceedings, each party shall pay its own costs and expenses including, without limitation, all attorneys’ fees.

 

17.         Counterparts . This Agreement may be signed in any number of counterparts with the same effect as if the signatures to each such counterpart were upon a single instrument, and all counterparts shall be deemed an original of this Agreement.

 

18.         Severability . If any provision of this Agreement is held to be unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible. In any event, all other provisions of this Agreement shall be deemed valid and enforceable to the full extent possible.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

ROBERT HALF INTERNATIONAL INC.

By    

 

Participant hereby accepts and agrees to be bound by all of the terms and conditions of this Agreement and the Plan.

 

     
   

Participant

 

Exhibit 99.4

 

Robert Half International Inc.

 

Stock Incentive Plan

 

Nonstatutory Stock Option Agreement

 

This stock option agreement (the “Agreement”) is made and entered into as of                      (the “Grant Date”), between Robert Half International Inc., a Delaware corporation (the “Company”) and                                  (“Optionee”). Capitalized terms not defined herein shall have the meanings assigned to them in the Company’s Stock Incentive Plan (the “Plan”), a copy of which Optionee represents, warrants, and acknowledges having received and reviewed. Optionee also represents, warrants, and acknowledges having received and reviewed a copy of the Plan prospectus and the documents incorporated therein by reference. The Plan is incorporated by reference into this Agreement.

 

THE PARTIES AGREE AS FOLLOWS:

 

1.         Grant of Option . Effective as of the Grant Date, the Company granted to Optionee, pursuant to the Plan, a Nonstatutory Option (the “Option”) to purchase all or any part of an aggregate of                      Shares (the “Option Shares”) of the Company’s Common Stock, $.001 par value (“Common Stock”), on the terms and conditions set forth herein and in the Plan.

 

2.         Exercise Price . The exercise price for purchase of the Option Shares shall be $              per Share (the “Exercise Price”) which is 100% of the Fair Market Value of a Share on the Grant Date.

 

3.         Term . The Option shall terminate ten years from the Grant Date unless terminated earlier pursuant to the Plan.

 

4.         Vesting . The Option shall vest as to 25% of the Option Shares covered thereby on each of                                          and                      , subject to Sections 3(b)(xv), 7(d), 14 and 15 of the Plan.

 

5.         Performance Condition . The Option shall be subject to the Performance Condition as specified in Section 12 of the Plan. The Target Performance Goal (with respect to which the Performance Goal shall be Earnings Per Share) and the Performance Period shall be determined by the Committee.

 

6.         Exercise of Options .

 

6.1         Manner of Exercise . Optionee may exercise all or any portion of the Option which is vested, by delivering to the Company at its principal executive office, to the attention of the Secretary of the Company, (a) an executed stock purchase agreement in the form attached hereto as Exhibit A or, at the option of the Company, in such other form as shall then be acceptable to the Company, (b) full payment of the Exercise Price, and (c) satisfaction of all applicable withholding taxes as required by Section 19 of the Plan. The date the Company receives all of the foregoing items will be considered as the date the Option was exercised.

 

6.2         Payment . The Exercise Price may be paid by any method authorized by Section 8 of the Plan.

 

7.         Restriction on Issuance of Shares .

 

7.1         Legality of Issuance . The Company shall not be obligated to sell or issue any Option Shares pursuant to this Agreement if such sale or issuance, in the opinion of the Company and the Company’s counsel, would constitute a violation by the Company of any provision of law, including without limitation the provisions of the Securities Act.

 


7.2         Registration or Qualification of Securities . The Company may, but shall not be required to, register or qualify the issuance of the Option or any Option Shares under the Securities Act or any other applicable law. The Company shall not be obligated to take any affirmative action in order to cause the grant or exercise of the Option or the issuance or sale of any Option Shares pursuant hereto to comply with any law.

 

8.         Restriction on Transfer . Regardless of whether the sale of the Option Shares has been registered under the Securities Act or has been registered or qualified under the securities laws of any state, the Company may impose restrictions upon the sale, pledge, or other transfer of Option Shares (including the placement of appropriate legends on stock certificates and the issuance of stop-transfer instructions to the Company’s transfer agent) if, in the judgment of the Company and the Company’s counsel, such restrictions are necessary in order to achieve compliance with the provisions of the Securities Act, the securities laws of any state, or any other law.

 

9.         Stock Certificate Restrictive Legends . Stock certificates evidencing Option Shares may bear such restrictive legends as the Company and the Company’s counsel deem necessary under applicable law or pursuant to this Agreement.

 

10.         Representations, Warranties, Covenants, and Acknowledgments of Optionee Upon Exercise of Option . Optionee hereby agrees that in the event the Company and the Company’s counsel deem it necessary or advisable in the exercise of their discretion, the issuance of Option Shares may be conditioned upon the person purchasing Option Shares making certain representations, warranties, and acknowledgments relating to compliance with applicable securities laws.

 

11.         Assignment; Binding Effect . The Option is not assignable or transferable by Optionee except as permitted by the Plan or pursuant to a domestic relations order. During the life of Optionee, the Option is exercisable only by Optionee or, in the event of disability of the Optionee, by Optionee’s guardian or legal representative. Any attempt by Optionee to assign, pledge, transfer, hypothecate, or otherwise dispose of the Option in a manner not herein permitted, and any levy of execution, attachment, or similar process on the Option, shall be null and void. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the executors, administrators, heirs, legal representatives, successors, and assigns of the parties hereto.

 

12.         Damages . Optionee shall be liable to the Company for all costs and damages, including incidental and consequential damages and attorneys’ fees, resulting from Optionee’s breach of this Agreement. If any party to this Agreement seeks to enforce its rights under this Agreement by legal proceedings, each party shall pay its own costs and expenses including, without limitation, all attorneys’ fees.

 

13.         Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts entered into and wholly to be performed within the State of California by California residents. The parties agree that the exclusive jurisdiction and venue of any action with respect to this Agreement shall be in the Superior Court for the county in which the principal executive offices of the Company are located, or the United States District Court for the district in which the principal executive offices of the Company are located, and each of the parties hereby submits itself to the exclusive jurisdiction and venue of such courts for the purpose of such action. The parties agree that service of process in any such action may be effected by delivery of the summons and complaint in a manner provided for delivery of notices set forth herein.

 

14.         Notices . A notice of exercise of the Option shall be in writing, and shall be delivered to the Company, Attention: Secretary, at the address specified below, by hand, by courier or by facsimile transmission. Notice complying with this subsection shall be deemed received on the date received by the Secretary of the Company.

 

All other notices, communications and documents under this Agreement shall be in writing. All notices, communications, and documents directed to the Company and related to the Agreement, if not delivered by hand,

 


shall be mailed to the Company’s principal executive office, Attention: Secretary. The current address of the Company’s principal executive office is:

 

Robert Half International Inc.

2884 Sand Hill Road

Menlo Park, CA 94025

 

Unless and until the Company is notified in writing to the contrary, all notices, communications, and documents intended for Optionee and related to this Agreement, if not delivered by hand, shall be mailed to Optionee’s last known address as shown on the Company’s books or such other address as Optionee may specify by notice complying with this section. Notices, communications, and documents not delivered by hand shall be mailed by registered or certified mail, return receipt requested, postage prepaid. All mailings and deliveries related to this Agreement shall be deemed received only when actually received.

 

15.         Tax Advice . Optionee represents, warrants, and acknowledges that the Company has made no warranties or representations to Optionee with respect to the income tax consequences of the transactions contemplated by this Agreement, and Optionee is in no manner relying on the Company or the Company’s representatives for an assessment of such tax consequences.

 

16.         Counterparts . This Agreement may be signed in any number of counterparts with the same effect as if the signatures to each such counterpart were upon a single instrument, and all counterparts shall be deemed an original of this Agreement.

 

17.         Severability . If any provision of this Agreement is held to be unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible. In any event, all other provisions of this Agreement shall be deemed valid and enforceable to the full extent possible.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

ROBERT HALF INTERNATIONAL INC.

By     

 

Optionee hereby accepts and agrees to be bound by all of the terms and conditions of this Agreement and the Plan.

 

 

Optionee

 

Exhibit 99.5

 

Robert Half International Inc.

 

Stock Incentive Plan

 

Restricted Share Agreement

 

This restricted share agreement (“Agreement”) is made and entered into as of                              (the “Grant Date”), between Robert Half International Inc., a Delaware corporation (the “Company”), and                                                   (“Participant”). Capitalized terms not defined herein shall have the meanings assigned to them in the Company’s Stock Incentive Plan (the “Plan”), a copy of which Participant represents, warrants, and acknowledges having received and reviewed. Participant also represents, warrants, and acknowledges having received and reviewed a copy of the Plan prospectus and the documents incorporated therein by reference. The Plan is incorporated by reference into this Agreement.

 

THE PARTIES AGREE AS FOLLOWS:

 

1.         Shares . Pursuant to the Plan, the Company hereby transfers to Participant, and Participant hereby accepts from the Company, an award consisting of              Restricted Shares on the terms and conditions set forth herein and in the Plan (the “Restricted Share Award”).

 

2.         Vesting . The Restricted Share Award shall vest as to 25% of the amount thereof on each of                                                                   and                          , unless otherwise provided by the Plan or Section 3 hereof. The Restricted Shares are subject to Section 6(e) of the Plan to the extent they have not vested and shall be held in escrow by the Company until they have vested. In addition, any dividends paid in Shares with respect to unvested Restricted Shares by reason of Section 6(d) of the Plan or any Shares to which the Participant may be entitled by reason of application of Section 16 of the Plan to unvested Restricted Shares shall, in each case, be subject to the same terms and conditions as are applicable to unvested Restricted Shares under this Agreement and the Plan.

 

3.         Accelerated Vesting . Notwithstanding Section 2 hereof, the Restricted Share Award shall vest as provided from time to time by any other agreement between Participant and the Company or as provided by Section 3(b)(xv), Section 14 or Section 15 of the Plan, and in such case, the vesting date for any portion of the Restricted Share Award that vests under such circumstances shall be the date such portion of the award vests.

 

4.         Restriction on Issuance of Shares .

 

4.1         Legality of Issuance . The Company shall not be obligated to transfer or issue any Restricted Shares pursuant to this Agreement if such transfer or issuance, in the opinion of the Company and the Company’s counsel, would constitute a violation by the Company of any provision of law, including without limitation the provisions of the Securities Act.

 

4.2         Registration or Qualification of Securities . The Company may, but shall not be required to, register or qualify the transfer or issuance of the Restricted Shares under the Securities Act or any other applicable law. The Company shall not be obligated to take any affirmative action in order to cause the transfer or issuance of the Restricted Shares pursuant hereto to comply with any law.

 

5.         Restriction on Transfer . Regardless of whether the transfer or issuance of the Restricted Shares has been registered under the Securities Act or has been registered or qualified under the securities laws of any state, the Company may impose additional restrictions upon the sale, pledge, or other transfer of the Restricted Shares (including the placement of appropriate legends on stock certificates and the issuance of stop-transfer instructions to the Company’s transfer agent) if, in the judgment of the Company and the Company’s counsel, such restrictions are necessary in order to achieve compliance with the provisions of the Securities Act, the securities laws of any state, or any other law.


6.         Stock Certificate Restrictive Legends . Stock certificates evidencing the Restricted Shares may bear such restrictive legends as the Company and the Company’s counsel deem necessary under applicable law or pursuant to this Agreement.

 

7.         Representations, Warranties, Covenants, and Acknowledgments of Optionee Upon Exercise of Option . Participant hereby agrees that in the event the Company and the Company’s counsel deem it necessary or advisable in the exercise of their discretion, the transfer or issuance of the Restricted Shares may be conditioned upon the person receiving Restricted Shares making certain representations, warranties, and acknowledgments relating to compliance with applicable securities laws.

 

8.         Tax Advice . Participant represents, warrants, and acknowledges that the Company has made no warranties or representations to Participant with respect to the income tax consequences of the transactions contemplated by this Agreement, and Participant is in no manner relying on the Company or the Company’s representatives for an assessment of such tax consequences.

 

9.         Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts entered into and wholly to be performed within the State of California by California residents. The parties agree that the exclusive jurisdiction and venue of any action with respect to this Agreement shall be in the Superior Court for the county in which the principal executive offices of the Company are located, or the United States District Court for the district in which the principal executive offices of the Company are located, and each of the parties hereby submits itself to the exclusive jurisdiction and venue of such courts for the purpose of such action. The parties agree that service of process in any such action may be effected by delivery of the summons and complaint in a manner provided for delivery of notices set forth herein.

 

10.         Notices . All notices, communications and documents under this Agreement shall be in writing. All notices, communications, and documents directed to the Company and related to the Agreement, if not delivered by hand, shall be mailed to the Company’s principal executive office, Attention: Secretary. The current address of the Company’s principal executive office is:

 

Robert Half International Inc.

2884 Sand Hill Road

Menlo Park, CA 94025

 

Unless and until the Company is notified in writing to the contrary, all notices, communications, and documents intended for Participant and related to this Agreement, if not delivered by hand, shall be mailed to Participant’s last known address as shown on the Company’s books or such other address as Participant may specify by notice complying with this section. Notices, communications, and documents not delivered by hand shall be mailed by registered or certified mail, return receipt requested, postage prepaid. All mailings and deliveries related to this Agreement shall be deemed received only when actually received.

 

11.         Binding Effect . Subject to the limitations set forth in this Agreement, this Agreement shall be binding upon, and inure to the benefit of, the executors, administrators, heirs, legal representatives, successors, and assigns of the parties hereto.

 

12.         Damages . Participant shall be liable to the Company for all costs and damages, including incidental and consequential damages and attorneys’ fees, resulting from Participant’s breach of this Agreement. If any party to this Agreement seeks to enforce its rights under this Agreement by legal proceedings, each party shall pay its own costs and expenses including, without limitation, all attorneys’ fees.

 

13.         Counterparts . This Agreement may be signed in any number of counterparts with the same effect as if the signatures to each such counterpart were upon a single instrument, and all counterparts shall be deemed an original of this Agreement.


14.         Severability . If any provision of this Agreement is held to be unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible. In any event, all other provisions of this Agreement shall be deemed valid and enforceable to the full extent possible.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

ROBERT HALF INTERNATIONAL INC.

By 

   

 

Participant hereby accepts and agrees to be bound by all of the terms and conditions of this Agreement and the Plan.

 

     
   

Participant

Exhibit 99.6

 

Robert Half International Inc.

 

Stock Incentive Plan

 

Stock Option Agreement

 

This stock option agreement (the “Agreement”) is made and entered into as of                              (the “Grant Date”), between Robert Half International Inc., a Delaware corporation (the “Company”) and                                                   (“Optionee”). Capitalized terms not defined herein shall have the meanings assigned to them in the Company’s Stock Incentive Plan (the “Plan”), a copy of which Optionee represents, warrants, and acknowledges having received and reviewed. Optionee also represents, warrants, and acknowledges having received and reviewed a copy of the Plan prospectus and the documents incorporated therein by reference. The Plan is incorporated by reference into this Agreement.

 

THE PARTIES AGREE AS FOLLOWS:

 

1.         Grant of Option . Effective as of the Grant Date, the Company granted to Optionee, pursuant to the Plan, a Nonstatutory Option (the “Option”) to purchase all or any part of an aggregate of              Shares (the “Option Shares”) of the Company’s Common Stock, $.001 par value (“Common Stock”), on the terms and conditions set forth herein and in the Plan.

 

2.         Exercise Price . The exercise price for purchase of the Option Shares shall be $              per Share (the “Exercise Price”) which is 100% of the Fair Market Value of a Share on the Grant Date.

 

3.         Term . The Option shall terminate ten years from the Grant Date unless terminated earlier pursuant to the Plan.

 

4.         Vesting . The Option shall vest as to 25% of the Option Shares covered thereby on each of                                                                           and                              , subject to Sections 3(b)(xv), 7(d), 14 and 15 of the Plan.

 

5.         Exercise of Options .

 

5.1         Manner of Exercise . Optionee may exercise all or any portion of the Option which is vested, by delivering to the Company at its principal executive office, to the attention of the Secretary of the Company, (a) an executed stock purchase agreement in the form attached hereto as Exhibit A or, at the option of the Company, in such other form as shall then be acceptable to the Company and (b) full payment of the Exercise Price. The date the Company receives both of the foregoing items will be considered as the date the Option was exercised.

 

5.2         Payment . The Exercise Price may be paid by any method authorized by Section 8 of the Plan.

 

6.         Restriction on Issuance of Shares .

 

6.1         Legality of Issuance . The Company shall not be obligated to sell or issue any Option Shares pursuant to this Agreement if such sale or issuance, in the opinion of the Company and the Company’s counsel, would constitute a violation by the Company of any provision of law, including without limitation the provisions of the Securities Act.

 

6.2         Registration or Qualification of Securities . The Company may, but shall not be required to, register or qualify the issuance of the Option or any Option Shares under the Securities Act or any other applicable law. The Company shall not be obligated to take any affirmative action in order to cause the grant or exercise of the Option or the issuance or sale of any Option Shares pursuant hereto to comply with any law.

 


7.         Restriction on Transfer . Regardless of whether the sale of the Option Shares has been registered under the Securities Act or has been registered or qualified under the securities laws of any state, the Company may impose restrictions upon the sale, pledge, or other transfer of Option Shares (including the placement of appropriate legends on stock certificates and the issuance of stop-transfer instructions to the Company’s transfer agent) if, in the judgment of the Company and the Company’s counsel, such restrictions are necessary in order to achieve compliance with the provisions of the Securities Act, the securities laws of any state, or any other law.

 

8.         Stock Certificate Restrictive Legends . Stock certificates evidencing Option Shares may bear such restrictive legends as the Company and the Company’s counsel deem necessary under applicable law or pursuant to this Agreement.

 

9.         Representations, Warranties, Covenants, and Acknowledgments of Optionee Upon Exercise of Option . Optionee hereby agrees that in the event the Company and the Company’s counsel deem it necessary or advisable in the exercise of their discretion, the issuance of Option Shares may be conditioned upon the person purchasing Option Shares making certain representations, warranties, and acknowledgments relating to compliance with applicable securities laws.

 

10.         Assignment; Binding Effect . The Option is not assignable or transferable by Optionee except as permitted by the Plan or pursuant to a domestic relations order. During the life of Optionee, the Option is exercisable only by Optionee or, in the event of disability of the Optionee, by Optionee’s guardian or legal representative. Any attempt by Optionee to assign, pledge, transfer, hypothecate, or otherwise dispose of the Option in a manner not herein permitted, and any levy of execution, attachment, or similar process on the Option, shall be null and void. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the executors, administrators, heirs, legal representatives, successors, and assigns of the parties hereto.

 

11.         Damages . Optionee shall be liable to the Company for all costs and damages, including incidental and consequential damages and attorneys’ fees, resulting from Optionee’s breach of this Agreement. If any party to this Agreement seeks to enforce its rights under this Agreement by legal proceedings, each party shall pay its own costs and expenses including, without limitation, all attorneys’ fees.

 

12.         Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of California applicable to contracts entered into and wholly to be performed within the State of California by California residents. The parties agree that the exclusive jurisdiction and venue of any action with respect to this Agreement shall be in the Superior Court for the county in which the principal executive offices of the Company are located, or the United States District Court for the district in which the principal executive offices of the Company are located, and each of the parties hereby submits itself to the exclusive jurisdiction and venue of such courts for the purpose of such action. The parties agree that service of process in any such action may be effected by delivery of the summons and complaint in a manner provided for delivery of notices set forth herein.

 

13.         Notices . A notice of exercise of the Option shall be in writing, and shall be delivered to the Company, Attention: Secretary, at the address specified below, by hand, by courier or by facsimile transmission. Notice complying with this subsection shall be deemed received on the date received by the Secretary of the Company.

 

All other notices, communications and documents under this Agreement shall be in writing. All notices, communications, and documents directed to the Company and related to the Agreement, if not delivered by hand, shall be mailed to the Company’s principal executive office, Attention: Secretary. The current address of the Company’s principal executive office is:

 

Robert Half International Inc.

2884 Sand Hill Road

Menlo Park, CA 94025

 


Unless and until the Company is notified in writing to the contrary, all notices, communications, and documents intended for Optionee and related to this Agreement, if not delivered by hand, shall be mailed to Optionee’s last known address as shown on the Company’s books or such other address as Optionee may specify by notice complying with this section. Notices, communications, and documents not delivered by hand shall be mailed by registered or certified mail, return receipt requested, postage prepaid. All mailings and deliveries related to this Agreement shall be deemed received only when actually received.

 

14.         Tax Advice . Optionee represents, warrants, and acknowledges that the Company has made no warranties or representations to Optionee with respect to the income tax consequences of the transactions contemplated by this Agreement, and Optionee is in no manner relying on the Company or the Company’s representatives for an assessment of such tax consequences.

 

15.         Counterparts . This Agreement may be signed in any number of counterparts with the same effect as if the signatures to each such counterpart were upon a single instrument, and all counterparts shall be deemed an original of this Agreement.

 

16.         Severability . If any provision of this Agreement is held to be unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible. In any event, all other provisions of this Agreement shall be deemed valid and enforceable to the full extent possible.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

ROBERT HALF INTERNATIONAL INC.

By     

 

Optionee hereby accepts and agrees to be bound by all of the terms and conditions of this Agreement and the Plan.

 

 

Optionee

 


Exhibit A

 

Robert Half International Inc.

 

Stock Incentive Plan

 

Exercise

 

The undersigned acknowledges the exercise of the following option previously granted under the Robert Half International Inc. Stock Incentive Plan:

 

Grant Date


  

Number of Shares


  

Per Share
Exercise Price


           
           

 

The aggregate exercise price is $              .

 

This exercise is governed by the terms and conditions of the Stock Incentive Plan, the terms and conditions of the Stock Option Agreement pursuant to which the foregoing option was granted and such other policies and procedures that have been adopted from time to time by the administrator of the Stock Incentive Plan. I have sought and received such tax and legal advice as I have deemed necessary in deciding to exercise this Option. My decision concerning this exercise is based solely upon my own evaluation and not upon any advice, counsel or inducement from Robert Half International Inc. or any of its directors, officers, employees or agents.