10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2004

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

COMMISSION FILE NUMBER: 0-24484

MPS GROUP, INC.

(Exact name of registrant as specified in its charter)

Florida	59-3116655
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1 Independent Drive, Jacksonville, FL	32202
(Address of principal executive offices)	(Zip Code)

(Registrant’s telephone number including area code): (904) 360-2000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x     No  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    Yes  x     No  ¨

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of July 29, 2004:

105,277,037 shares of $0.01 par value Common Stock

FORWARD-LOOKING STATEMENTS

This report on Form 10-Q contains forward-looking statements that are subject to certain risks, uncertainties or assumptions and may be affected by certain factors, including but not limited to the specific factors discussed in Part I, Item 2 of this report and under the heading ‘Factors Which May Impact Future Results and Financial Condition.’ In some cases, you can identify forward-looking statements by terminology such as ‘will,’ ‘may,’ ‘should,’ ‘could,’ ‘expects,’ ‘plans,’ ‘indicates,’ ‘projects,’ ‘anticipates,’ ‘believes,’ ‘estimates,’ ‘appears,’ ‘predicts,’ ‘potential,’ ‘continues,’ ‘can,’ ‘hopes,’ ‘perhaps,’ ‘would,’ or ‘become’ or the negative of these terms or other comparable terminology. In addition, except for historical facts, all information provided in Part I, Item 3, under ‘Quantitative and Qualitative Disclosures About Market Risk’ should be considered forward-looking statements. Should one or more of these risks, uncertainties or other factors materialize, or should underlying assumptions prove incorrect, actual results, performance or achievements of the Company may vary materially from any future results, performance or achievements expressed or implied by such forward-looking statements.

Forward-looking statements are based on beliefs and assumptions of the Company’s management and on information currently available to such management. Forward looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events. Undue reliance should not be placed on such forward-looking statements, which are based on current expectations. Forward-looking statements are not guarantees of performance.

1

MPS Group, Inc. and Subsidiaries

Index

Part I	Financial Information
Item 1	Consolidated Financial Statements
	Unaudited Condensed Consolidated Balance Sheets as of June 30, 2004 and December 31, 2003	3
	Unaudited Condensed Consolidated Statements of Income for the Three and Six Months ended June 30, 2004 and 2003	4
	Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2004 and 2003	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3	Quantitative and Qualitative Disclosures About Market Risk	19
Item 4	Controls and Procedures	21
Part II	Other Information
Item 1	Legal Proceedings	22
Item 2	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities	22
Item 3	Defaults Upon Senior Securities	22
Item 4	Submission of Matters to a Vote of Security Holders	22
Item 5	Other Information	23
Item 6	Exhibits and Reports on Form 8-K	23
	Signatures	24
	Exhibits

2

Part I. Financial Information

Item 1. Financial Statements

MPS Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(dollar amounts in thousands except share amounts)	June 30, 2004			December 31, 2003
	(unaudited)			(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	127,486		$	124,830
Accounts receivable, net of allowance of $11,847 and $12,899		180,775			159,359
Prepaid expenses		8,332			6,417
Deferred income taxes		1,910			2,200
Other		13,400			10,662
Total current assets		331,903			303,468
Furniture, equipment, and leasehold improvements, net		28,203			29,488
Goodwill, net		499,995			486,630
Deferred income taxes		54,879			62,464
Other assets, net		10,776			11,101
Total assets	$	925,756		$	893,151
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued expenses	$	40,689		$	32,601
Accrued payroll and related taxes		42,026			37,848
Income taxes payable		7,987			16,140
Total current liabilities		90,702			86,589
Other		13,587			13,100
Total liabilities		104,289			99,689
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $.01 par value; 10,000,000 shares authorized; no shares issued		—			—
Common stock, $.01 par value; 400,000,000 shares authorized; 107,217,155 and 104,576,204 shares issued, respectively		1,072			1,046
Additional contributed capital		655,137			634,492
Retained earnings		177,323			162,546
Accumulated other comprehensive income		8,636			6,933
Deferred stock compensation		(7,881	)		(2,495	)
Treasury stock, at cost (1,976,937 shares in 2004 and 1,613,400 shares in 2003)		(12,820	)		(9,060	)
Total stockholders’ equity		821,467			793,462
Total liabilities and stockholders’ equity	$	925,756		$	893,151

See accompanying notes to condensed consolidated financial statements.

3

MPS Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

	Three Months Ended					Six Months Ended
(dollar amounts in thousands except per share amounts)	June 30, 2004		June 30, 2003			June 30, 2004		June 30, 2003
	(unaudited)		(unaudited)			(unaudited)		(unaudited)
Revenue	$	333,245	$	273,167		$	643,726	$	537,430
Cost of revenue		248,089		199,586			480,335		396,844
Gross profit		85,156		73,581			163,391		140,586
Operating expenses:
General and administrative		68,089		58,475			134,383		116,050
Depreciation and intangibles amortization		3,794		4,245			7,716		8,672
Total operating expenses		71,883		62,720			142,099		124,722
Income from operations		13,273		10,861			21,292		15,864
Other income (expense), net		96		(9	)		731		(15	)
Income from continuing operations before provision for income taxes		13,369		10,852			22,023		15,849
Provision for income taxes		4,025		4,389			7,246		6,453
Income from continuing operations		9,344		6,463			14,777		9,396
Loss from discontinued operations (net of an income tax benefit of $347 and $344, respectively)		—		(644	)		—		(638	)
Net income	$	9,344	$	5,819		$	14,777	$	8,758
Basic net income per common share:
Income from continuing operations	$	0.09	$	0.06		$	0.14	$	0.09
Loss from discontinued operations, net of tax		—		(0.01	)		—		(0.01	)
Basic net income per common share	$	0.09	$	0.06		$	0.14	$	0.09
Average common shares outstanding, basic		103,655		101,242			103,158		101,623
Diluted net income per common share:
Income from continuing operations	$	0.09	$	0.06		$	0.14	$	0.09
Loss from discontinued operations, net of tax		—		(0.01	)		—		(0.01	)
Diluted net income per common share	$	0.09	$	0.06		$	0.14	$	0.09
Average common shares outstanding, diluted		107,527		103,002			106,955		102,840

See accompanying notes to condensed consolidated financial statements.

4

MPS Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

	Six months ended June 30,
(dollar amounts in thousands)	2004			2003
	(unaudited)			(unaudited)
Cash flows from operating activities:
Income from continuing operations	$	14,777		$	9,396
Adjustments to income from continuing operations to net cash provided by operating activities:
Deferred income taxes		7,875			8,126
Deferred compensation		1,578			847
Depreciation and intangibles amortization		7,716			8,672
Changes in certain assets and liabilities, net of acquisitions:
Accounts receivable		(26,613	)		25,636
Prepaid expenses and other assets		(1,781	)		(2,080	)
Accounts payable and accrued expenses		7,653			(9,377	)
Accrued payroll and related taxes		4,502			3,072
Other, net		(2,496	)		2,532
Net cash provided by operating activities		13,211			46,824
Cash flows from investing activities:
Sale of assets		2,442			—
Purchase of furniture, equipment and leasehold improvements, net of disposals		(5,658	)		(3,357	)
Purchase of businesses, including additional consideration on acquisitions, net of cash acquired		(15,970	)		(848	)
Net cash used in investing activities		(19,186	)		(4,205	)
Cash flows from financing activities:
Repurchases of common stock		(3,760	)		(7,626	)
Discount realized on employee stock purchase plan		(204	)		(164	)
Proceeds from stock options exercised		10,900			457
Repayments on indebtedness		(400	)		(69	)
Net cash provided by (used in) financing activities		6,536			(7,402	)
Effect of exchange rate changes on cash and cash equivalents		752			77
Net increase in cash and cash equivalents		1,313			35,294
Net cash provided by discontinued operations		1,343			140
Cash and cash equivalents, beginning of period		124,830			66,934
Cash and cash equivalents, end of period	$	127,486		$	102,368

See accompanying notes to condensed consolidated financial statements.

5

MPS Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(unaudited)

(dollar amounts in thousands except per share amounts)

1. Basis of Presentation.

The accompanying condensed consolidated financial statements are unaudited and have been prepared by MPS Group, Inc. (‘MPS’ or the ‘Company’) in accordance with the rules and regulations of the Securities and Exchange Commission (‘SEC’). Accordingly, certain information and footnote disclosures usually found in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. The financial statements should be read in conjunction with the consolidated financial statements and related notes included in the Company’s Form 10-K for the year ended December 31, 2003.

The accompanying condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial position and results of operations for the interim periods presented. The results of operations for an interim period are not necessarily indicative of the results of operations for a full fiscal year.

Stock-Based Compensation

The Company accounts for its employee and director stock option plans in accordance with Accounting Principles Board Opinion No. 25, ‘Accounting for Stock Issued to Employees,’ and related interpretations. The Company measures compensation expense for employee and director stock options as the aggregate difference between the fair value of its common stock and exercise prices of the options on the date that both the number of shares the grantee is entitled to receive and the exercise prices are known. Compensation expense associated with restricted stock grants is equal to the fair value of the shares on the date of grant and is recorded pro rata over the required holding period. If the Company had elected to recognize compensation cost for all outstanding options granted by the Company by applying the fair value recognition provisions of Statement of Financial Accounting Standards (‘SFAS’) No. 148, ‘Accounting for Stock-Based Compensation—Transition and Disclosure,’ to stock-based employee compensation, net income and earnings per share would have been reduced to the pro forma amounts indicated below.

	Three Months Ended						Six Months Ended
(dollar amounts in thousands except per share amounts)	June 30, 2004			June 30, 2003			June 30, 2004			June 30, 2003
Net income
As reported	$	9,344		$	5,819		$	14,777		$	8,758
Total stock-based employee compensation expense determined under fair value based method for all awards, net of related tax effects		(934	)		(1,309	)		(1,617	)		(2,554	)
Pro forma	$	8,410		$	4,510		$	13,160		$	6,204
Basic net income per common share
As reported	$	0.09		$	0.06		$	0.14		$	0.09
Pro forma	$	0.08		$	0.04		$	0.13		$	0.06
Diluted net income per common share
As reported	$	0.09		$	0.06		$	0.14		$	0.09
Pro forma	$	0.08		$	0.04		$	0.12		$	0.06

6

MPS Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

(dollar amounts in thousands except per share amounts)

2. Net Income per Common Share

The calculation of basic net income per common share and diluted net income per common share is presented below:

	Three Months Ended					Six Months Ended
(dollar amounts in thousands except per share amounts)	June 30, 2004		June 30, 2003			June 30, 2004		June 30, 2003
Basic income per common share computation:
Income from continuing operations	$	9,344	$	6,463		$	14,777	$	9,396
Loss from discontinued operations, net of tax		—		(644	)		—		(638	)
Net income	$	9,344	$	5,819		$	14,777	$	8,758
Basic average common shares outstanding		103,655		101,242			103,158		101,623
Basic income per common share:
Income from continuing operations	$	0.09	$	0.06		$	0.14	$	0.09
Loss from discontinued operations, net of tax		—		(0.01	)		—		(0.01	)
Basic net income per common share	$	0.09	$	0.06		$	0.14	$	0.09
Diluted income per common share computation:
Income from continuing operations	$	9,344	$	6,463		$	14,777	$	9,396
Loss from discontinued operations, net of tax		—		(644	)		—		(638	)
Net income	$	9,344	$	5,819		$	14,777	$	8,758
Basic average common shares outstanding		103,655		101,242			103,158		101,623
Incremental shares from assumed exercise of stock options and restricted awards		3,872		1,760			3,797		1,217
Diluted average common shares outstanding		107,527		103,002			106,955		102,840
Diluted income per common share:
Income from continuing operations	$	0.09	$	0.06		$	0.14	$	0.09
Loss from discontinued operations, net of tax		—		(0.01	)		—		(0.01	)
Diluted net income per common share	$	0.09	$	0.06		$	0.14	$	0.09

Options to purchase shares of common stock were not included in the computation of diluted earnings per share if the exercise prices of these options were greater than the average market price of the common shares. For the three months ended June 30, 2004 and 2003, options to purchase 599,000 and 2.1 million shares of common stock, respectively, were not included in the computation of diluted earnings per share. For the six months ended June 30, 2004 and 2003, options to purchase 766,000 and 2.4 million shares of common stock, respectively, were not included in the computation of diluted earnings per share.

3. Commitments and Contingencies

Litigation

The Company is a party to a number of lawsuits and claims arising out of the ordinary conduct of its business. In the opinion of management, based on the advice of in-house and external legal counsel, the lawsuits and claims pending are not likely to have a material adverse effect on the Company, its financial position, its results of operations, or its cash flows.

7

MPS Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

(dollar amounts in thousands except per share amounts)

4. Segment Reporting

The Company discloses segment information in accordance with SFAS No. 131, ‘Disclosure About Segments of an Enterprise and Related Information,’ which requires companies to report selected segment information on a quarterly basis and to report certain entity-wide disclosures about products and services, major customers, and the material countries in which the entity holds assets and reports revenues.

The Company has three reportable segments: professional services, IT services, and IT solutions. The Company’s reportable segments are strategic divisions that offer different services and are managed separately, as each division requires different resources and marketing strategies. The professional services division provides expertise in a wide variety of disciplines including accounting and finance, law, engineering, and health care. The IT services division offers value-added solutions, such as IT project support and staffing, recruitment of full-time positions, project-based solutions, supplier management solutions, and on-site recruiting support. The IT solutions division provides IT strategy consulting, design and branding, application development, and integration. The professional services division’s results for 2004, include the results from the acquisitions of two legal staffing businesses acquired in February and August of 2003, two health care staffing businesses acquired in February and March of 2004, and one accounting staffing business acquired in February of 2004. The Company evaluates segment performance based on revenues, gross profit, and income before provision for income taxes. The Company does not allocate income taxes, interest, or unusual items to the segments.

The following table summarizes segment and geographic information:

	Three Months Ended						Six Months Ended
(dollar amounts in thousands)	June 30, 2004			June 30, 2003			June 30, 2004		June 30, 2003
Revenue
Professional services	$	168,677		$	124,848		$	325,245	$	244,289
IT services		147,442			128,256			284,856		254,876
IT solutions		17,126			20,063			33,625		38,265
Total revenue	$	333,245		$	273,167		$	643,726	$	537,430
Gross profit
Professional services	$	48,199		$	35,836		$	91,680	$	69,028
IT services		31,460			29,345			60,343		56,938
IT solutions		5,497			8,400			11,368		14,620
Total gross profit	$	85,156		$	73,581		$	163,391	$	140,586
Income (loss) from continuing operations before provision for income taxes:
Professional services	$	11,224		$	6,322		$	17,977	$	10,333
IT services		2,227			1,982			2,768		2,558
IT solutions		(178	)		2,557			547		2,973
		13,273			10,861			21,292		15,864
Corporate interest and other income (expense), net		96			(9	)		731		(15	)
Income from continuing operations before provision for income taxes	$	13,369		$	10,852		$	22,023	$	15,849
Geographic Areas
Revenue
United States	$	207,153		$	177,839		$	398,834	$	348,994
U.K.		122,300			92,607			238,191		183,016
Other		3,792			2,721			6,701		5,420
Total revenue	$	333,245		$	273,167		$	643,726	$	537,430

8

MPS Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

(dollar amounts in thousands except per share amounts)

	June 30, 2004		December 31, 2003
Assets
Professional services	$	398,963	$	379,959
IT services		493,559		464,538
IT solutions		33,234		48,654
Total assets	$	925,756	$	893,151
Geographic Areas
Long-Lived Assets
United States	$	381,680	$	371,579
U.K.		142,273		140,302
Other		4,245		4,237
Total assets	$	528,198	$	516,118

5. Comprehensive Income

The Company discloses other comprehensive income in accordance with SFAS No. 130, ‘Reporting Comprehensive Income’. Comprehensive income includes unrealized gains and losses on foreign currency translation adjustments. A summary of comprehensive income for the three and six months ended June 30, 2004 and 2003, is as follows:

	Three Months Ended					Six Months Ended
	June 30, 2004			June 30, 2003		June 30, 2004		June 30, 2003
Net income	$	9,344		$	5,819	$	14,777	$	8,758
Unrealized gain (loss) on foreign currency translation adjustments (a)		(1,205	)		2,508		1,703		1,275
Comprehensive income	$	8,139		$	8,327	$	16,480	$	10,033

(a) The currency translation adjustments are not adjusted for income taxes as they relate to indefinite investments in non-U.S. subsidiaries.

6. Excess Real Estate Obligations

In 2001 and 2002, the Company experienced a material decrease in demand for its domestic operations. To reflect this decreased demand, the Company made attempts to realign its real estate capacity needs by vacating and reorganizing certain office space.

In 2002, management determined that the Company would not be able to utilize this vacated office space and, therefore, notified the respective lessors of its intentions. This determination eliminated the economic benefit associated with the vacated office space. As a result, the Company recorded a charge for contract termination costs, mainly due to costs that will continue to be incurred under the lease contract for its remaining term without economic benefit to the Company. While the Company looks to settle excess lease obligations, the current economic environment has made it difficult for the Company to either settle or find acceptable subleasing opportunities. The average remaining lease term for the lease obligations included herein is approximately 2.0 years.

9

MPS Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements—(Continued)

(unaudited)

(dollar amounts in thousands except per share amounts)

The charge for contract termination costs was recorded in accordance with SFAS No. 146, ‘Accounting for Costs Associated with Exit or Disposal Activities.’ The following table summarizes the activity of the charge for contract termination costs from origination through June 30, 2004 by reportable segment:

(dollar amounts in thousands)	Professional Services			IT Services			IT Solutions			Total
Balance as of December 31, 2002	$	431		$	675		$	7,861		$	8,967
Costs paid or otherwise settled during 2003		(223	)		(431	)		(3,620	)		(4,274	)
Amounts recaptured during 2003		(39	)		(229	)		(16	)		(284	)
Balance as of December 31, 2003		169			15			4,225			4,409
Costs paid or otherwise settled during the three months ended:
March 31, 2004		(106	)		(11	)		(530	)		(647	)
June 30, 2004		(3	)		(4	)		(455	)		(462	)
Balance as of June 30, 2004	$	60		$	—		$	3,240		$	3,300

7. Discontinued Operations

In December 2003, the Company sold certain operating assets and transferred certain operating liabilities of its outplacement unit, Manchester. For the three months ended June 30, 2003, Manchester’s revenue and loss before taxes were $5.7 million and $1.0 million, respectively. For the six months ended June 30, 2003, Manchester’s revenue and loss before taxes were $13.3 million and $1.0 million, respectively. The remaining net liabilities of Manchester as of June 30, 2004 were $1.2 million, of which $830,000 were for contract termination costs associated with abandoned real estate. The remaining net liabilities of Manchester are included in the line item ‘Accounts payable and accrued expenses’ in the Company’s Condensed Consolidated Balance Sheets.

8. Business Combinations

In the six months ended June 30, 2004, the Company acquired three businesses in its professional services division: two health care staffing businesses, Management Search and Sunbelt Staffing, acquired in February and March of 2004; and one accounting staffing business, Lillian Kloock and Associates, acquired in February of 2004. Purchase consideration for the three acquisitions totaled $12.9 million in cash at closing, and deferred cash payments of $1.2 million. These acquisitions were immaterial to the Company’s results of operations on an actual and pro forma basis for the three and six months ended June 30, 2004.

The changes in the carrying amount of goodwill for the six months ended June 30, 2004 are as follows:

(dollar amounts in thousands)	Professional Services		IT Services		IT Solutions		Total
Balance as of December 31, 2003	$	212,317	$	253,588	$	20,725	$	486,630
Acquisitions		13,365		—		—		13,365
Balance as of June 30, 2004	$	225,682	$	253,588	$	20,725	$	499,995

10

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

MPS (the ‘Company’) is a leading global provider of business services with over 170 offices throughout the United States, Canada, the United Kingdom, and continental Europe. MPS delivers a mix of consulting, solutions, and staffing services in disciplines such as IT services, finance and accounting, legal, engineering, IT solutions, health care, and human capital automation.

The following detailed analysis of operations contains certain financial information on a ‘constant currency’ basis. Such constant currency financial data is not a U.S. generally accepted accounting principles (‘GAAP’) financial measure. Constant currency removes from financial data the impact of changes in exchange rates between the U.S. dollar and the functional currencies of the Company’s foreign subsidiaries, by translating the current period financial data into U.S. dollars using the same foreign currency exchange rates that were used to translate the financial data for the previous period. The Company believes presenting certain results on a constant currency basis is useful to investors because it allows a more meaningful comparison of the performance of its foreign operations from period to period. Additionally, certain internal reporting and compensation targets are based on constant currency financial data for the Company’s various foreign subsidiaries. However, constant currency measures should not be considered in isolation or as an alternative to financial measures that reflect current period exchange rates, or to other financial measures calculated and presented in accordance with GAAP.

In 2003 and through the second quarter of 2004, the Company acquired five businesses for its professional services division (together, the ‘Acquisitions’): two legal staffing businesses acquired in February and August of 2003; two health care staffing businesses acquired in February and March of 2004; and one accounting staffing business acquired in February of 2004. The following detailed analysis of operations presents the revenue generated by the Company’s professional services division in the United States excluding the effect of Acquisitions. Such financial data that excludes the effect of businesses we acquire is not a GAAP financial measure. The Company believes presenting some results excluding the effects of businesses we acquire is helpful to investors because it permits a comparison of the performance of its core internal operations from period to period. Additionally, certain internal reporting and compensation targets are based on core internal operations. The effect of businesses we acquire are excluded for the first 12 months following the acquisition date. Subsequent to this, these businesses are considered to be integrated for reporting purposes. Again however, such measures should be considered only in conjunction with the correlative measures that include the results from acquisitions, as calculated and presented in accordance with GAAP.

Additionally, from time to time the Company may use EBITDA to measure results of operations. EBITDA is a non-GAAP financial measure that is defined as earnings before interest, taxes, depreciation and amortization. The Company believes EBITDA is a meaningful measure of operating performance as it gives management a consistent measurement tool for evaluating the operating activities of the business as a whole, as well as, the various operating units, before the effect of investing activities, interest and taxes. In addition, the Company believes EBITDA provides useful information to investors, analysts, lenders, and other interested parties because it excludes transactions that management considers unrelated to core business operations, thereby helping interested parties to more meaningfully evaluate, trend and analyze the operating performance of the business. The Company also uses EBITDA for certain internal reporting purposes, and certain compensation targets may be based on EBITDA. Finally, certain covenants in the Company’s debt facility are based on EBITDA performance measures. EBITDA, as with all non-GAAP financial measures, should be considered only in conjunction with the comparable measures, as calculated and presented in accordance with GAAP, including net income.

In December 2003, the Company sold certain operating assets and transferred certain operating liabilities of its outplacement unit, Manchester. As a result of the sale of Manchester and in accordance with GAAP, the Company’s Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations report the results of operations of Manchester as discontinued operations for all periods presented. For the three months ended June 30, 2003, Manchester’s revenue and loss before taxes were $5.7 million and $1.0 million, respectively. For the six months ended June 30, 2003, Manchester’s revenue and loss before taxes were $13.3 million and $1.0 million, respectively.

11

The following detailed analysis of operations should be read in conjunction with the 2003 Consolidated Financial Statements and related notes included in the Company’s Form 10-K for the year ended December 31, 2003.

Three Months Ended June 30, 2004 Compared To Three Months Ended June 30, 2003

Revenue. Revenue increased $60.0 million, or 22.0%, to $333.2 million in the three months ended June 30, 2004, from $273.2 million in the year earlier period. The increase was due to an increase in revenue in both the Company’s professional Services and IT Services divisions of 35.1% and 15.0%, respectively. This increase was slightly offset by a revenue decrease of 14.6% in the Company’s IT Solutions division.

Approximately 38% of the Company’s revenue for the three months ended June 30, 2004, was generated internationally, primarily in the United Kingdom. The Company’s revenue is therefore subject to changes in foreign currency exchange rates. The weakening of the U.S. dollar since the second quarter of 2003 had an impact on revenue, as changes in foreign currency exchange rates contributed $12.8 million in revenue for the three months ended June 30, 2004. Acquisitions contributed $12.9 million in revenue for the three months ended June 30, 2004.

Gross profit. Gross profit increased $11.6 million, or 15.8%, to $85.2 million in the three months ended June 30, 2004, from $73.6 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $2.8 million and $2.3 million in gross profit, respectively, for the three months ended June 30, 2004. Gross margin decreased to 25.6% in the three months ended June 30, 2004, from 26.9% in the year earlier period. The lower margin is due primarily to a combination of the following: a higher concentration of the Company’s IT Services revenue being generated internationally, which operates at a lower gross margin compared to the Company’s domestic operations; lower utilization in the Company’s IT Solutions division; and lower gross margins in the domestic operations of the Company’s IT Services division.

Operating expenses. Total operating expenses increased $9.2 million, or 14.7%, to $71.9 million in the three months ended June 30, 2004, from $62.7 million in the year earlier period. The Company’s general and administrative (‘G&A’) expenses, which are included in operating expenses, increased $9.6 million, or 16.4%, to $68.1 million in the three months ended June 30, 2004, from $58.5 million in the year earlier period. The change in G&A expenses was due to the following: the increase in compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; the impact of changes in foreign currency exchange rates; the additional G&A expenses from Acquisitions; and a gain on the sale of assets. While the Company’s G&A expenses increased, G&A expenses as a percentage of revenue decreased to 20.4% in the three months ended June 30, 2004, from 23.0% in the year earlier period.

Operating income. Operating income increased $2.4 million, or 22.0%, to $13.3 million in the three months ended June 30, 2004, from $10.9 million in the year earlier period. Operating income as a percentage of revenue remained constant at 4.0% in both the three months ended June 30, 2004 and 2003.

Other income (expense), net. Other income (expense), primarily includes interest income related to the Company’s investments and cash on hand, net of interest expense related to notes issued in connection with acquisitions and fees related to the Company’s credit facility.

Income taxes. The Company’s effective tax rate decreased to 30.1% in the three months ended June 30, 2004, as compared to 40.4% in the year earlier period. The decrease was due primarily to a $1.3 million tax benefit associated with the settlement of a state income tax audit in the second quarter of 2004.

Income from continuing operations. As a result of the foregoing, income from continuing operations increased $2.8 million, or 43.1%, to $9.3 million in the three months ended June 30, 2004, from $6.5 million in the year earlier period. Income from continuing operations as a percentage of revenue increased to 2.8% in the three months ended June 30, 2004, from 2.4% in the year earlier period.

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Segment Results

Professional Services division

Revenue in the professional services division increased $43.9 million, or 35.2%, to $168.7 million in the three months ended June 30, 2004, from $124.8 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $6.9 million and $12.9 million in revenue, respectively, for the three months ended June 30, 2004.

Of the division’s revenue, approximately 61% and 62% was generated in the United States in the three months ended June 30, 2004 and 2003, respectively. The remainder was generated in the United Kingdom. Excluding the contribution from Acquisitions, revenue generated in the United States increased 16.4% in the three months ended June 30, 2004. On a constant currency basis, revenue increased 24.6% for revenue generated in the United Kingdom.

Revenue contribution from the professional services division’s operating units for the three months ended June 30, 2004 and 2003 are as follows:

	Three months ended June 30,
	2004		2003
Accounting and finance	45.3	%	44.2	%
Engineering	30.8		35.7
Legal	15.2		15.0
Health care	7.7		3.5
Executive search	1.0		1.6

Gross profit for the professional services division increased $12.4 million, or 34.6%, to $48.2 million in the three months ended June 30, 2004, from $35.8 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $2.0 million and $2.3 million in gross profit, respectively, for the three months ended June 30, 2004. The gross margin decreased slightly to 28.6% in the three months ended June 30, 2004, compared to 28.7% in the three months ended June 30, 2003.

The professional services division’s G&A expenses increased $7.5 million, or 26.6%, to $35.7 million in the three months ended June 30, 2004, from $28.2 million in the year earlier period. The change in the division’s G&A expenses was due primarily to the following: the increase in compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; the impact of changes in foreign currency exchange rates; the additional G&A expenses from Acquisitions; and a gain on the sale of assets. While the division’s G&A expenses increased, G&A expenses as a percentage of revenue decreased to 21.2% in the three months ended June 30, 2004, from 22.6% in the year earlier period.

Operating income for the professional services division increased $4.9 million, or 77.8%, to $11.2 million in the three months ended June 30, 2004, from $6.3 million in the year earlier period.

IT Services division

Revenue in the IT services division increased $19.1 million, or 14.9%, to $147.4 million in the three months ended June 30, 2004, from $128.3 million in the year earlier period. Changes in foreign currency exchange rates contributed $5.9 million in revenue for the three months ended June 30, 2004.

Of the division’s revenue, approximately 59% and 63% was generated in the United States in the three months ended June 30, 2004 and 2003, respectively. The remainder was generated internationally, primarily in

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the United Kingdom. Revenue generated in the United States increased 8.7% in the three months ended June 30, 2004, compared to the year earlier period. On a constant currency basis, revenue increased 13.0% for revenue generated internationally, compared to the year earlier period.

Gross profit for the IT services division increased $2.2 million, or 7.5%, to $31.5 million in the three months ended June 30, 2004, from $29.3 million in the year earlier period. However, the gross margin decreased to 21.3% in the three months ended June 30, 2004, from 22.9% in the year earlier period. The gross margin in the division’s domestic operations decreased to 26.3% in the three months ended June 30, 2004, from 27.5% in the year earlier period. The gross margin in the division’s international operations decreased to 14.1% in the three months ended June 30, 2004, from 15.0% in the year earlier period.

The IT services division’s G&A expenses increased $2.2 million, or 8.7%, to $27.4 million in the three months ended June 30, 2004, from $25.2 million in the year earlier period. As a percentage of revenue, the division’s G&A expenses decreased to 18.6% in the three months ended June 30, 2004, from 19.7% in the year earlier period. The increase in the division’s G&A expenses was associated with the following: the increase in compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; and the impact of changes in foreign currency exchange rates.

Operating income for the IT services division increased $0.2 million, or 10.0%, to $2.2 million in the three months ended June 30, 2004, from $2.0 million in the year earlier period.

IT Solutions division

Revenue in the IT solutions division decreased $3.0 million, or 14.9%, to $17.1 million in the three months ended June 30, 2004, from $20.1 million in the year earlier period. The decrease was due to the reduced demand for the Company’s IT consulting solutions.

Gross profit for the IT solutions division decreased $2.9 million, or 34.5%, to $5.5 million in the three months ended June 30, 2004 from $8.4 million in the year earlier period. The gross margin decreased to 32.1% in the three months ended June 30, 2004, from 41.9% in the year earlier period. This decrease was driven by lower utilization of the division’s salaried consultants. This division’s business model, unlike the Company’s other divisions, uses primarily salaried consultants to meet customer demand.

The IT solutions division’s G&A expenses increased $0.1 million, or 2.0%, to $5.1 million in the three months ended June 30, 2004, from $5.0 million in the year earlier period. As a percentage of revenue, the division’s G&A expenses increased to 29.6% in the three months ended June 30, 2004, from 25.1% in the year earlier period.

Operating income for the IT solutions division decreased $2.8 million, to a loss of $0.2 million in the three months ended June 30, 2004, from $2.6 million in the year earlier period.

Six Months Ended June 30, 2004 Compared To Six Months Ended June 30, 2003

Revenue. Revenue increased $106.3 million, or 19.8%, to $643.7 million in the six months ended June 30, 2004, from $537.4 million in the year earlier period. The increase was due to an increase in revenue in both the Company’s professional Services and IT Services divisions of 33.1% and 11.8%, respectively. This increase was offset slightly by a revenue decrease of 12.1% in the Company’s IT Solutions division.

Approximately 38% of the Company’s revenue for the six months ended June 30, 2004, was generated internationally, primarily in the United Kingdom. The Company’s revenue is therefore subject to changes in foreign currency exchange rates. The weakening of the U.S. dollar since the second quarter of 2003 had an impact on revenue, as changes in foreign currency exchange rates contributed $27.8 million in revenue for the six months ended June 30, 2004. Acquisitions contributed $21.7 million in revenue for the six months ended June 30, 2004, and $300,000 in the year earlier period.

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Gross profit. Gross profit increased $22.8 million, or 16.2%, to $163.4 million in the six months ended June 30, 2004, from $140.6 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $6.0 million and $5.2 million in gross profit, respectively, for the six months ended June 30, 2004. Gross margin decreased to 25.4% in the six months ended June 30, 2004, from 26.2% in the year earlier period. The lower margin is due primarily to a combination of the following: a higher concentration of the Company’s IT Services revenue being generated internationally, which operates at a lower gross margin compared to the Company’s domestic operations; lower utilization in the Company’s IT Solutions division; and lower gross margins in the domestic operations of the Company’s IT Services division.

Operating expenses. Total operating expenses increased $17.4 million, or 14.0%, to $142.1 million in the six months ended June 30, 2004, from $124.7 million in the year earlier period. The Company’s general and administrative (‘G&A’) expenses, which are included in operating expenses, increased $18.3 million, or 15.8%, to $134.4 million in the six months ended June 30, 2004, from $116.1 million in the year earlier period. The change in G&A expenses was due to the following: the increase in compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; the impact of changes in foreign currency exchange rates; and the additional G&A expenses from Acquisitions; and a gain on the sale of assets. While the Company’s G&A expenses increased, G&A expenses as a percentage of revenue decreased to 20.9% in the six months ended June 30, 2004, from 21.6% in the year earlier period.

Operating income. Operating income increased $5.4 million, or 34.0%, to $21.3 million in the six months ended June 30, 2004, from $15.9 million in the year earlier period. Operating income as a percentage of revenue increased to 3.3% in the six months ended June 30, 2004, from 3.0% in the year earlier period.

Other income (expense), net. Other income (expense), primarily includes interest income related to the Company’s investments and cash on hand, net of interest expense related to notes issued in connection with acquisitions and fees related to the Company’s credit facility.

Income taxes. The Company’s effective tax rate decreased to 32.9% in the six months ended June 30, 2004, as compared to 40.7% in the year earlier period. The decrease was due primarily to a $1.3 million tax benefit associated with the settlement of a state income tax audit in the second quarter of 2004.

Income from continuing operations. As a result of the foregoing, income from continuing operations increased $5.4 million, or 57.4%, to $14.8 million in the six months ended June 30, 2004, from $9.4 million in the year earlier period. Income from continuing operations as a percentage of revenue increased to 2.3% in the six months ended June 30, 2004, from 1.7% in the year earlier period.

Segment Results

Professional Services division

Revenue in the professional services division increased $80.9 million, or 33.1%, to $325.2 million in the six months ended June 30, 2004, from $244.3 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $15.2 million and $21.7 million in revenue, respectively, for the six months ended June 30, 2004. Acquisitions contributed $300,000 in revenue in the year earlier period.

Of the division’s revenue, approximately 60% and 62% was generated in the United States in the six months ended June 30, 2004 and 2003, respectively. The remainder was generated in the United Kingdom. Excluding the contribution from Acquisitions, revenue generated in the United States increased 14.4% in the six months ended June 30, 2004. On a constant currency basis, revenue increased 24.0% for revenue generated in the United Kingdom.

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Revenue contribution from the professional services division’s operating units for the six months ended June 30, 2004 and 2003 are as follows:

	Six months ended June 30,
	2004		2003
Accounting and finance	45.6	%	44.0	%
Engineering	30.9		36.0
Legal	15.6		14.4
Health care	6.6		3.9
Executive search	1.3		1.7

Gross profit for the professional services division increased $22.7 million, or 32.9%, to $91.7 million in the six months ended June 30, 2004, from $69.0 million in the year earlier period. Changes in foreign currency exchange rates and Acquisitions contributed $4.3 million and $5.2 million in gross profit, respectively, for the six months ended June 30, 2004. The gross margin decreased slightly to 28.2% in the six months ended June 30, 2004, compared to 28.3% in the three months ended June 30, 2003.

The professional services division’s G&A expenses increased $15.0 million, or 26.8%, to $71.0 million in the six months ended June 30, 2004, from $56.0 million in the year earlier period. The change in the division’s G&A expenses was due primarily to the following: the increase in compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; the impact of changes in foreign currency exchange rates; the additional G&A expenses from Acquisitions; and a gain on the sale of assets. While the division’s G&A expenses increased, G&A expenses as a percentage of revenue decreased to 21.8% in the six months ended June 30, 2004, from 22.9% in the year earlier period.

Operating income for the professional services division increased $7.7 million, or 74.8%, to $18.0 million in the six months ended June 30, 2004, from $10.3 million in the year earlier period.

IT Services division

Revenue in the IT services division increased $30.0 million, or 11.8%, to $284.9 million in the six months ended June 30, 2004, from $254.9 million in the year earlier period. Changes in foreign currency exchange rates contributed $12.6 million in revenue for the six months ended June 30, 2004.

Of the division’s revenue, approximately 60% and 62% was generated in the United States in the six months ended June 30, 2004 and 2003, respectively. The remainder was generated internationally, primarily in the United Kingdom. Revenue generated in the United States increased 6.8% in the six months ended June 30, 2004, compared to the year earlier period. On a constant currency basis, revenue increased 6.7% for revenue generated internationally, compared to the year earlier period.

Gross profit for the IT services division increased $3.4 million, or 6.0%, to $60.3 million in the six months ended June 30, 2004, from $56.9 million in the year earlier period. However, the gross margin decreased to 21.2% in the six months ended June 30, 2004, from 22.3% in the year earlier period. The gross margin in the division’s international operations decreased to 13.9% in the six months ended June 30, 2004, from 15.2% in the year earlier period. The gross margin in the division’s domestic operations decreased to 26.1% in the six months ended June 30, 2004, from 26.6% in the year earlier period.

The IT services division’s G&A expenses increased $3.6 million, or 7.2%, to $53.6 million in the six months ended June 30, 2004, from $50.0 million in the year earlier period. As a percentage of revenue, the division’s G&A expenses decreased to 18.8% in the six months ended June 30, 2004, from 19.6% in the year earlier period. The increase in the division’s G&A expenses was associated with the following: the increase in

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compensation expense related to the increase in revenue; the hiring of additional sales and recruiting personnel in the first half of 2004; and the impact of changes in foreign currency exchange rates. Operating income for the IT services division increased $0.2 million, or 7.7%, to $2.8 million in the six months ended June 30, 2004, from $2.6 million in the year earlier period.

IT Solutions division

Revenue in the IT solutions division decreased $4.7 million, or 12.3%, to $33.6 million in the six months ended June 30, 2004, from $38.3 million in the year earlier period. The decrease was due to the reduced demand for the Company’s IT consulting solutions.

Gross profit for the IT solutions division decreased $3.2 million, or 21.9%, to $11.4 million in the six months ended June 30, 2004 from $14.6 million in the year earlier period. The gross margin decreased to 33.8% in the six months ended June 30, 2004, from 38.2% in the year earlier period. This decrease was driven by lower utilization of the division’s salaried consultants. This division’s business model, unlike the Company’s other divisions, uses primarily salaried consultants to meet customer demand.

The IT solutions division’s G&A expenses decreased $0.3 million, or 3.0%, to $9.7 million in the six months ended June 30, 2004, from $10.0 million in the year earlier period. As a percentage of revenue, the division’s G&A expenses increased to 28.9% in the six months ended June 30, 2004, from 26.2% in the year earlier period.

Operating income for the IT solutions division decreased $2.5 million, or 83.3%, to $0.5 million in the six months ended June 30, 2004, from $3.0 million in the year earlier period.

LIQUIDITY AND CAPITAL RESOURCES

The Company’s historical capital requirements have principally been related to the acquisition of businesses, working capital needs and capital expenditures. These requirements have been met through a combination of bank debt and internally generated funds. The Company’s operating cash flows and working capital requirements are affected significantly by the timing of payroll and by the receipt of payment from the customer. Generally, the Company pays its consultants weekly or semi-monthly, and receives payments from customers within 30 to 90 days from the date of invoice.

The Company had working capital of $241.2 million and $216.9 million as of June 30, 2004 and December 31, 2003, respectively. The Company had cash and cash equivalents of $127.5 million and $124.8 million as of June 30, 2004 and December 31, 2003, respectively.

For the six months ended June 30, 2004 and 2003, the Company generated $13.2 million and $46.8 million of cash flow from operations, respectively. The decrease in cash flow from operations, from 2003 to 2004, is primarily due to the Company’s revenue growth. This growth increased the cash needed to fund accounts receivable.

For the six months ended June 30, 2004, the Company used $19.2 million of cash for investing activities, of which $16.0 million, net of cash acquired, was used for the acquisition of two health care staffing businesses and one accounting staffing business, and $5.6 million was used for capital expenditures. This was offset by $2.4 million that the Company generated from the sale of assets.

For the six months ended June 30, 2003, the Company used $4.2 million of cash for investing activities, of which $3.4 million was used for capital expenditures, and $0.8 million for an acquisition of a legal staffing business.

For the six months ended June 30, 2004, the Company generated $6.5 million of cash from financing activities, of which $10.9 million was generated from stock option exercises, offset by $3.8 million used for the

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repurchase of the Company’s common stock. For the six months ended June 30, 2003, the Company used $7.4 million of cash for financing activities, which were primarily used for the repurchase of the Company’s common stock.

The Company’s Board of Directors has authorized the repurchase of up to $65.0 million of the Company’s Common Stock. The Company repurchased 364,000 shares at a cost of $3.8 million in the three months ended June 30, 2004, bringing the total amount repurchased under this plan to 2.0 million shares at a cost of $12.8 million at June 30, 2004. The Company anticipates that it will continue to purchase shares under this authorization in the future.

The Company anticipates that capital expenditures for furniture and equipment, including improvements to its management information and operating systems, during the remainder of 2004 will be approximately $6 million.

While there can be no assurance in this regard, the Company believes that funds provided by operations, available borrowings under the credit facility, and current amounts of cash will be sufficient to meet its presently anticipated needs for working capital, capital expenditures and acquisitions for at least the next 12 months.

Indebtedness of the Company

In the fourth quarter of 2003, the Company closed on a $150 million revolving credit facility syndicated by a group of leading financial institutions. The credit facility contains certain financial and non-financial covenants relating to the Company’s operations, including maintaining certain financial ratios. Repayment, if applicable, of funds borrowed under the credit facility is guaranteed by substantially all of the subsidiaries of the Company. The facility matures in November 2006. As of July 30, 2004, there are no borrowings outstanding under this facility, other than $3.4 million of standby letters of credit for certain operational matters.

SEASONALITY

The Company’s quarterly operating results are affected by the number of billing days in the quarter and the seasonality of its customers’ businesses. Demand for the Company’s services has historically been lower during the calendar year-end, as a result of holidays, through February of the following year, as the Company’s customers approve annual budgets. Extreme weather conditions may also affect demand in the early part of the year, as certain of the Company’s client locations are located in geographic areas subject to inclement weather.

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Item 3. Quantitative And Qualitative Disclosures About Market Risk

The following assessment of the Company’s market risks does not include uncertainties that are either nonfinancial or nonquantifiable, such as political, economic, tax and credit risks.

Interest rates. The Company’s exposure to market risk for changes in interest rates relates primarily to the Company’s debt obligations under its credit facility and to the Company’s investments.

The Company’s investment portfolio consists of cash and cash equivalents including deposits in banks, government securities, money market funds, and short-term investments with maturities, when acquired, of 90 days or less. The Company is adverse to principal loss and seeks to preserve its invested funds by placing these funds with high credit quality issuers. The Company continually evaluates its invested funds to respond appropriately to a reduction in the credit rating of any investment issuer or guarantor.

Foreign currency exchange rates. Foreign currency exchange rate changes impact translations of foreign denominated assets and liabilities into U.S. dollars and future earnings and cash flows from transactions denominated in different currencies. The Company generated approximately 38% of its consolidated revenues for the six months ended June 30, 2004 from international operations, approximately 98% of which were from the United Kingdom. The British pound sterling to U.S. dollar exchange rate has increased approximately 2% in the six months ended June 30, 2004, from 1.78 at December 31, 2003 to 1.81 at June 30, 2004. The Company prepared sensitivity analysis to determine the adverse impact of hypothetical changes in the British pound sterling, relative to the U.S. Dollar, on the Company’s results of operations and cash flows. However, the analysis did not include the potential impact on sales levels resulting from a change in the British pound sterling. An additional 10% adverse movement in the exchange rate would have had an immaterial impact on the Company’s cash flows and financial position at June 30, 2004. While fluctuations in the British pound sterling have not historically had a material impact on the Company’s consolidated results of operations, the lower level of earnings resulting from a decrease in demand for the services provided by the Company’s domestic operations have increased the impact of exchange rate fluctuations. As of June 30, 2004, the Company did not hold and has not previously entered into any foreign currency derivative instruments.

FACTORS WHICH MAY IMPACT FUTURE RESULTS AND FINANCIAL CONDITION

Demand For The Company’s Services Is Impacted By The Economic Climate In The Industries And Markets The Company Serves. This Economic Climate Is Difficult To Predict, With Downturns Weakening Demand.

MPS’s revenues are affected by the level of business activity of its customers, which is driven by the level of economic activity in the industries and markets we serve. While we have experienced a recent uptick in demand related to the current economic environment, a downturn or deterioration in global economic or political conditions could significantly adversely impact our revenues and results of operations.

We cannot predict when the economic climate will significantly improve. Although we have recently seen a slight improvement in the economic climate, we cannot predict to what extent the demand for our services will improve. Even though we have a somewhat variable cost base, material declines in revenue will have an adverse impact on our results.

The current economic climate may also encourage customer downsizings, or consolidations through mergers and otherwise of our major customers or between our major customers with non-customers. These may result in redundant functions or services and a resulting reduction in demand by those customers for our services. Also, spending for outsourced business services may be put on hold until the consolidations are completed.

Economic considerations may also encourage our customers to consolidate their vendor lists in an attempt to achieve cost and expense savings, which increases competitive pressure as described below.

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Our Market Is Highly Competitive, Which Puts Pressure On The Profit Margins Of Our Services.

Our industry is intensely competitive and highly fragmented, with few barriers to entry by potential competitors. MPS faces significant competition in the industries and markets it serves, and will face significant competition in any geographic market that it may enter. In each market in which we operate, we compete for both clients and qualified candidates with other firms offering similar services. Competition creates an aggressive pricing environment, which puts pressure on profit margins.

We have increasingly competed against service providers offering their services from remote locations, particularly from offshore locations such as India. The substantially lower cost of the labor pool in these remote locations puts significant pricing pressure on our service offerings when we compete with competitors offering remote services. While we believe that our service delivery model provides a superior level of service than many of these offshore based competitors, the increased pricing pressure from these providers may have a material adverse impact on our profitability.

The effects of competition may be intensified by our customers’ consolidation of their vendor lists. As customers have consolidated their number of vendors, often in an attempt to secure cost or expense savings in the face of difficult economic conditions, competition to be an approved vendor has greatly intensified. If we fail to remain on these consolidated vendor lists, our results of operations will suffer accordingly. Competing to remain on, or get on, these vendor lists could obligate us to offer our services at prices that offer lower margins, and less profit, than we might otherwise be able to achieve.

Our Business Depends On Key Personnel, Including Executive Officers, Local Managers And Field Personnel; Our Failure To Retain Existing Key Personnel Or Attract New People Will Reduce Business And Revenues.

MPS’s operations depend on the continued efforts of our officers and executive management. The loss of key officers and members of executive management may cause a significant disruption to our business.

We also depend on the performance and productivity of our local managers and field personnel. Our ability to attract and retain new business is significantly affected by local relationships and the quality of service rendered. The loss of key managers and field personnel may also jeopardize existing client relationships with businesses that continue to use our services based upon past relationships with local managers and field personnel. Our revenues could decline in that event.

The Inability To Comply With Existing Government Regulation Along With Increased Regulation Of The Workplace Could Adversely Effect The Company.

The Company’s business is subject to regulation or licensing in many states and in certain foreign countries. While the Company has had no material difficulty complying with regulations in the past, there can be no assurance that the Company will be able to continue to obtain all necessary licenses or approvals, or that the cost of compliance will not prove to be material. Any inability of the Company to comply with government regulation or licensing requirements could materially adversely effect the Company. Additionally, the Company’s temporary services business entails employing individuals on a temporary basis and placing such individuals in clients’ workplaces. Increased government regulation of the workplace or of the employer-employee relationship could materially adversely effect the Company.

The Company Is Exposed To Employment-Related Claims and Costs And Other Litigation That Could Materially Adversely Effect The Company’s Business, Financial Condition, And Results Of Operations.

The Company’s temporary services business entails employing individuals on a temporary basis and placing such individuals in clients’ workplaces. The Company’s ability to control the workplace environment is limited. As

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the employer of record of its temporary employees, the Company incurs a risk of liability to its temporary employees for various workplace events, including claims of physical injury, discrimination, harassment, or retroactive entitlement to the Company’s or clients’ employee benefits. The Company also incurs a risk of liability to its clients resulting from allegations of errors, omissions, misappropriation, or theft of property or information by its temporary employees. The Company maintains insurance with respect to many of such claims. While such claims have not historically had a material adverse effect on the Company, there can be no assurance that the Company will continue to be able to obtain insurance at a cost that does not have a material adverse effect upon the Company or that such claims (whether by reason of the Company not having insurance or by reason of such claims being outside the scope of the Company’s insurance) will not have a material adverse effect upon the Company.

Adjustments During Periodic Tax Audits May Increase Our Tax Liability And Adversely Impact Our Results Of Operations.

MPS is subject to periodic review by federal, state, foreign and local taxing authorities in the ordinary course of business. During 2001, MPS was notified by the Internal Revenue Service that certain prior year income tax returns would be examined. As part of this examination, the net tax benefit associated with an investment in a subsidiary that MPS recognized in 2000 of $86.3 million is also being reviewed. In 2002, the company recorded an $8.7 million charge for an agreed upon adjustment related to its audit of prior years’ tax returns. This Internal Revenue Service examination has been finalized with no additional adjustments. During the second quarter of 2004, MPS was notified that the 2001 tax year will be subject to a federal examination. Currently, no adjustments have been proposed.

The Price Of Our Common Stock May Fluctuate Significantly, Which May Result In Losses For Investors.

The market price for our common stock has been and may continue to be volatile. For example, during the period from January 1, 2004 until June 30, 2004, the closing price of the common stock as reported on the New York Stock Exchange ranged from a high of $12.12 to a low of $9.50. Our stock price can fluctuate as a result of a variety of factors, including factors listed above and others, many of which are beyond our control. These factors include:

• actual or anticipated variations in quarterly operating results;

• announcement of new services by us or our competitors;

• announcements relating to strategic relationships or acquisitions;

• changes in financial estimates or other statements by securities analysts;

• valuation fluctuations which may cause a negative impact to our operating results as it relates to Statement of Financial Accounting Standards No. 142; and

• changes in general economic conditions.

Because of this volatility, we may fail to meet the expectations of our shareholders or of securities analysts, and our stock price could decline as a result.

Item 4. Controls And Procedures

Our management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Chief Executive officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective to provide reasonable assurance that the objectives of disclosure controls and procedures are met.

There have been no changes in the Company’s internal control structure over financial reporting (as defined in Exchange Act Rule 13a-15(f)) that occurred during the Company’s last fiscal quarter that has materially affected or is reasonably likely to materially affect the Company’s internal control over financial reporting.

21

Part II. Other Information

Item 1. Legal Proceedings

No disclosure required.

Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities

Issuer Repurchases of Equity Securities (1)

Period (2)	Total Number of Shares Repurchased	Average Price Paid per Share		Total Number of Shares Purchased Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares That May Yet be Purchased Under the Plans or Programs
April 1, 2004 to April 30, 2004	—	$	—	—	$	55,939,752
May 1, 2004 to May 31, 2004	363,537		10.34	363,537		52,181,437
June 1, 2004 to June 30, 2004	—		—	—		52,181,437
Total	363,537	$	10.34	363,537		52,181,437

(1) In 1999, The Company’s Board of Directors authorized the repurchase of up to $65.0 million of the Company’s common stock. During 2003, the Company repurchased 1.3 million shares of common stock at an average price of $5.77. The following table sets forth information about the Company’s common stock repurchases for the three months ended June 30, 2004. There were no common stock repurchases by the Company during the first quarter of 2004. There is no expiration date for this authorization.

(2) Based on trade date, not settlement date.

Item 3. Defaults Upon Senior Securities

No disclosure required.

Item 4. Submission of Matters to a Vote of Security Holders

The Annual Meeting of the Company’s shareholders was held on May 26, 2004. Proxies were solicited from shareholders of record on the close of business on April 8, 2004. On April 8, 2004, there were 103,593,337 shares outstanding and entitled to vote at the Annual Meeting. At the Annual Meeting, the following proposals were submitted to a shareholder vote as indicated:

1. Approval of a Proposal to the Elect the Following Individuals as Directors of the Company:

Name	For	Withhold Authority
Derek E. Dewan	92,238,299	4,618,499
Timothy D. Payne	95,015,444	1,841,354
Peter J. Tanous	91,823,527	5,033,271
T. Wayne Davis	93,307,486	3,549,312
John R. Kennedy	93,369,996	3,486,802
Michael D. Abney	93,905,490	2,951,308
William M. Isaac	93,336,208	3,520,590
Darla D. Moore	95,020,486	1,836,312
Arthur B. Laffer	90,875,668	5,981,130

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	For	Against	Abstain	Broker Non-Votes
2.      Approval of the Company’s 2004 Equity Incentive Plan	69,206,235	20,323,616	1,564,224	5,762,723
3.      Approval of the Company’s 2004 Non-Employee Director Equity Incentive Plan:	73,460,779	16,072,861	1,560,435	5,762,723
4.      Approval of the Company’s Executive Annual Incentive Plan:	81,701,301	7,830,490	1,562,284	5,762,723

Item 5. Other Information

No disclosure required.

Item 6. Exhibits and Reports on Form 8-K

A. Exhibits Required by Item 601 of Regulation S-K:

See Index of Exhibits.

B. Reports on Form 8-K

On April 21, 2004, we furnished a Report on Form 8-K with respect to Items 7 and 12 pertaining to the issuance of a press release announcing our financial results for the three months ended March 31, 2004. This Form 8-K is not deemed incorporated by reference into any of our filings with the Securities and Exchange Commission.

Exhibit No.	Description
10.1	MPS Group, Inc. 2004 Equity Incentive Plan.
10.2	MPS Group, Inc. 2004 Non-Employee Director Equity Incentive Plan.
10.3	MPS Group, Inc. Executive Annual Incentive Plan.
10.4	MPS Group, Inc. Management Savings Plan.
10.5	Form of Restricted Stock Agreement Under Modis Professional Services, Inc. (now MPS Group, Inc.) amended and restated 1995 Stock Option Plan.
31.1	Certification of Timothy D. Payne pursuant to Rule 13a-14(a).
31.2	Certification of Robert P. Crouch pursuant to Rule 13a-14(a).
32.1	Certification of Timothy D. Payne pursuant to 18 U.S.C. Section 1350.
32.2	Certification of Robert P. Crouch pursuant to 18 U.S.C. Section 1350.

23

SIGNATURES

Pursuant to the requirements of Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

MPS GROUP, INC.
By:	/s/    ROBERT P. CROUCH
	Robert P. Crouch
	Senior Vice President, Treasurer, and Chief Financial Officer
	(Principal Financial Officer and duly authorized signatory)

Date: August 6, 2004

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EX-10.1

Exhibit 10.1

MPS GROUP, INC.

2004 EQUITY INCENTIVE PLAN

Table of Contents

			Page
ARTICLE 1 - GENERAL PROVISIONS			1
	1.1	Establishment and Purposes of Plan	1
	1.2	Types of Awards	1
	1.3	Effective Date	1
ARTICLE 2 - DEFINITIONS			1
ARTICLE 3 - ADMINISTRATION			4
	3.1	General	4
	3.2	Authority of the Committee.	5
	3.3	Delegation of Authority	5
	3.4	Award Agreements	5
	3.5	Indemnification	5
ARTICLE 4 - SHARES SUBJECT TO THE PLAN			5
	4.1	Number of Shares	5
	4.2	Individual Limits	6
	4.3	Adjustment of Shares	7
ARTICLE 5 - STOCK OPTIONS			7
	5.1	Grant of Options	7
	5.2	Agreement	7
	5.3	Option Price	7
	5.4	Duration of Options	7
	5.5	Exercise of Options	7
	5.6	Payment	8
	5.7	Nontransferability of Options.	8
	5.8	Purchased Options	8
	5.9	Special Rules for ISOs	8
ARTICLE 6 - STOCK APPRECIATION RIGHTS			8
	6.1	Grant of SARs	8
	6.2	Tandem SARs	9
	6.3	Payment	9
	6.4	Exercise of SARs	9
ARTICLE 7 - RESTRICTED STOCK AND RESTRICTED STOCK UNITS			9
	7.1	Grant of Restricted Stock	9
	7.2	Restricted Stock Agreement	9
	7.3	Nontransferability	10
	7.4	Certificates	10
	7.5	Dividends and Other Distributions	10
	7.6	Restricted Stock Units (or RSUs)	10
ARTICLE 8 - PERFORMANCE SHARES			11
	8.1	Grant of Performance Shares	11
	8.2	Value of Performance Shares	11
	8.3	Earning of Performance Shares	11
	8.4	Form and Timing of Payment of Performance Shares	11
	8.5	Nontransferability	11

-i-

Table of Contents

(continued)

			Page
ARTICLE 9 - PERFORMANCE MEASURES			11
ARTICLE 10 - BENEFICIARY DESIGNATION			12
ARTICLE 11 - DEFERRALS			12
ARTICLE 12 - WITHHOLDING			12
	12.1	Tax Withholding	12
	12.2	Share Withholding	13
ARTICLE 13 - FOREIGN EMPLOYEES			13
ARTICLE 14 - AMENDMENT AND TERMINATION			13
	14.1	Amendment of Plan	13
	14.2	Amendment of Award Agreement; Repricing	13
	14.3	Termination of Plan	13
	14.4	Detrimental Activity	13
	14.5	Assumption or Cancellation of Awards	14
ARTICLE 15 - MISCELLANEOUS PROVISIONS			14
	15.1	Restrictions on Shares	14
	15.2	No Implied Rights	14
	15.3	Compliance with Laws.	15
	15.4	Successors	15
	15.5	Tax Elections	15
	15.6	Legal Construction.	15

-ii-

MPS GROUP, INC.

2004 EQUITY INCENTIVE PLAN

ARTICLE 1 - GENERAL PROVISIONS

1.1 Establishment and Purposes of Plan. MPS Group, Inc., a Florida corporation (the “Company”), hereby establishes an equity incentive plan to be known as the “MPS Group, Inc. 2004 Equity Incentive Plan” (the “Plan”), as set forth in this document. The objectives of the Plan are (i) to provide incentives to those individuals who contribute significantly to the long-term performance and growth of the Company and its affiliates; and (ii) to attract, motivate and retain employees, directors, consultants, advisors and other persons who perform services for the Company by providing compensation opportunities that are competitive with other companies; and (iii) to align the long-term financial interests of employees and other Eligible Participants with those of the Company’s stockholders.

1.2 Types of Awards. Awards under the Plan may be made to Eligible Participants who are employees in the form of (i) Incentive Stock Options, (ii) Nonqualified Stock Options, (iii) Stock Appreciation Rights, (iv) Restricted Stock, (v) Restricted Stock Units, (vi) Performance Shares, or (vii) any combination of the foregoing. Awards under the Plan may be made to Eligible Participants who are not employees in the form of (i) Nonqualified Stock Options, (ii) Stock Appreciation Rights; (iii) Restricted Stock; and (iv) Restricted Stock Units, or (v) any combination of the foregoing.

1.3 Effective Date. The Plan shall be effective upon approval by the Company’s stockholders (the “Effective Date”).

ARTICLE 2 - DEFINITIONS

Except where the context otherwise indicates, the following definitions apply:

2.1 “Agreement” means the written agreement evidencing an Award granted to the Participant under the Plan.

2.2 “Award” means an award granted to a Participant under the Plan that is an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance Share, or combination of these.

2.3 “Board” means the Board of Directors of the Company.

2.4 “Cause” means, unless provided otherwise in the Agreement, the involuntary termination of a Participant by the Company for any of the following reasons: (a) as a result of an act or acts by the Participant which have been found in an applicable court of law to constitute a felony (other than traffic-related offenses); (b) as a result of one or more acts by a Participant which in the good faith judgment of the Board are believed to be in violation of law or of policies of the Company and which result in demonstrably material injury to the Company; (c) as result of an act or acts of proven dishonesty by the Participant resulting or intended to result directly or indirectly in significant gain or personal enrichment to the Participant at the expense of the Company or public stockholders of the Company; or (d) upon the willful and continued failure by the Participant to perform his duties with the Company (other than any such failure resulting from incapacity due to mental or physical illness not constituting a Disability), after a demand in writing for substantial performance is delivered by the Board, which demand specifically identifies the manner in which the Board believes that the Participant has not substantially performed his duties. For purposes of this Plan, no act or failure to act by the Participant shall be deemed to be “willful” unless done or omitted to be done by the Participant not in good faith and without reasonable belief that the Participant’s action or omission was in the best interests of the Company. “Cause” shall be determined by the Committee. Notwithstanding the foregoing, if the Participant has entered into an employment agreement with the Employer that is binding as of the date of employment termination, and if such employment agreement defines “Cause,” then the definition of “Cause” in such agreement, in lieu of the definition provided above, shall apply to the Participant for purposes of the Plan.

1

2.5 “Change in Control” means any of the following events:

(a) The acquisition by any “person,” as the term person is used for purposes of Sections 13(d) or 14(d) of the Exchange Act, not a stockholder of the Company on the Effective Date, of legal or beneficial ownership of 35% or more of either (i) the then outstanding shares of common stock of the Company or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors;

(b) Individuals who, on the Effective Date, constitute the Board cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Board shall be considered as though such individual were a member of the Board as of the date hereof;

(c) Approval by the stockholders of the Company of a reorganization, merger, or consolidation, in each case unless the stockholders of the Company immediately before such reorganization, merger, or consolidation own, directly or indirectly, immediately following such reorganization, merger, or consolidation at least a majority of the combined voting power of the outstanding voting securities of the corporation resulting from such reorganization, merger, or consolidation in substantially the same proportion as their ownership of the voting securities immediately before such reorganization, merger or consolidation; or

(d) Approval by the stockholders of the Company of (i) a complete liquidation or dissolution of the Company, or (ii) the sale or other disposition of more than 50% of the assets of the Company within a twelve month period.

2.6 “Code” means the Internal Revenue Code of 1986, as now in effect or as hereafter amended. All citations to sections of the Code are to such sections as they may from time to time be amended or renumbered.

2.7 “Committee” means the Compensation Committee of the Board or such other committee consisting of two or more members of the Board as may be appointed by the Board to administer this Plan pursuant to Article 3 of the Plan. If any member of the Committee does not qualify as (i) a “Non-Employee Director” within the meaning of Rule 16b-3 under the Act, and (ii) an “outside director” within the meaning of Code Section 162(m), a subcommittee of the Committee shall be appointed to grant Awards to Named Executive Officers and to officers who are subject to Section 16 of the Act, and each member of such subcommittee shall satisfy the requirements of (i) and (ii) above. References to the Committee in the Plan shall include and, as appropriate, apply to any such subcommittee.

2.8 “Company” means MPS Group, Inc., a Florida corporation, and its successors and assigns.

2.9 “Director” means any individual who is a member of the Board of Directors of the Company; provided, however, that any Director who is employed by the Company or any Employer shall not be considered a Director, but instead shall be considered an employee for purposes of the Plan.

2.10 “Disability” means, (i) with respect to a Participant who is eligible to participate in the Employer’s program of long-term disability insurance, if any, a condition with respect to which the Participant is entitled to commence benefits under such program, and (ii) with respect to any Participant (including a Participant who is eligible to participate in the Employer’s program of long-term disability insurance, if any), the inability of the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of six (6) months or more. For a Director, Disability shall mean the inability of the Director to perform his or her usual duties as a Board member by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of six (6) months or more. The determination of Disability shall be made by the Committee.

2.11 “Effective Date” shall have the meaning ascribed to such term in Section 1.3 hereof.

2

2.12 “Eligible Participant” means an employee of the Employer (including an officer) as well as any other person, including a Director and a consultant or advisor who provides bona fide services to the Employer, as shall be determined by the Committee.

2.13 “Employer” means the Company and any entity during any period that it is a “parent corporation” or a “subsidiary corporation” with respect to the Company within the meaning of Code Sections 424(e) and 424(f). With respect to all purposes of the Plan, including, but not limited to, the establishment, amendment, termination, operation and administration of the Plan, the Company shall be authorized to act on behalf of all other entities included within the definition of “Employer.”

2.14 “Exchange Act” means the Securities Exchange Act of 1934, as now in effect or as hereafter amended. All citations to sections of the Exchange Act or rules thereunder are to such sections or rules as they may from time to time be amended or renumbered.

2.15 “Fair Market Value” means the fair market value of a Share, as determined in good faith by the Committee as follows:

(a) if the Shares are admitted to trading on a national securities exchange, Fair Market Value on any date shall be the last sale price reported for the Shares on such exchange on such date or, if no sale was reported on such date, on the last date preceding such date on which a sale was reported;

(b) if the Shares are admitted to quotation on the National Association of Securities Dealers Automated Quotation System (“NASDAQ”) or other comparable quotation system and have been designated as a National Market System (“NMS”) security, Fair Market Value on any date shall be the last sale price reported for the Shares on such system on such date or on the last day preceding such date on which a sale was reported;

(c) If the Shares are admitted to Quotation on the NASDAQ and have not been designated a NMS Security, Fair Market Value on any date shall be the average of the highest bid and lowest asked prices of the Shares on such system on such date; or

(d) if (a), (b) and (c) do not apply, on the basis of the good faith determination of the Committee.

For purposes of subsection (a) above, if Shares are traded on more than one securities exchange then the following exchange shall be referenced to determine Fair Market Value: (i) the New York Stock Exchange (“NYSE”), or (ii) if shares are not traded on the NYSE, the NASDAQ, or (iii) if shares are not traded on the NYSE or NASDAQ, the largest regional exchange on which Shares are traded.

2.16 “Incentive Stock Option” or “ISO” means an Option granted to an Eligible Participant under Article 5 of the Plan which is intended to meet the requirements of Section 422 of the Code.

2.17 “Insider” shall mean an individual who is, on the relevant date, subject to the reporting requirements of Section 16(a) of the Act.

2.18 “Named Executive Officer” means a Participant who is one of the group of “covered employees” as defined in the regulations promulgated or other guidance issued under Code Section 162(m), as determined by the Committee.

2.19 “Nonqualified Stock Option” or “NQSO” means an Option granted to an Eligible Participant under Article 5 of the Plan which is not intended to meet the requirements of Section 422 of the Code.

2.20 “Option” means an Incentive Stock Option or a Nonqualified Stock Option. An Option shall be designated as either an Incentive Stock Option or a Nonqualified Stock Option, and in the absence of such designation, shall be treated as a Nonqualified Stock Option.

3

2.21 “Option Price” means the price at which a Share may be purchased by a Participant pursuant to an Option.

2.22 “Participant” means an Eligible Participant to whom an Award has been granted.

2.23 “Performance Measures” means the performance measures set forth in Article 9 which are used for performance based Awards to Named Executive Officers.

2.24 “Performance Share” means an Award under Article 8 of the Plan that is valued by reference to a Share, which value may be paid to the Participant by delivery of such property as the Committee shall determine, including without limitation, cash or Shares, or any combination thereof, upon achievement of such performance objectives during the relevant performance period as the Committee shall establish at the time of such Award or thereafter, but not later than the time permitted by Code section 162(m) in the case of a Named Executive Officer, unless the Committee determines not to comply with Code section 162(m).

2.25 “Permitted Transferee” means any members of the immediate family of the Participant (i.e., spouse, children and grandchildren), any trusts for the benefit of such family members or any partnerships whose only partners are such family members. Appropriate evidence of any transfer to the Permitted Transferees shall be delivered to the Company at its principal executive office. If all or part of an Option is transferred to a Permitted Transferee, the Permitted Transferee’s rights thereunder shall be subject to the same restrictions and limitations with respect to the Option as the Participant.

2.26 “Plan” means the MPS Group, Inc. 2004 Equity Incentive Plan, as set forth herein and as it may be amended from time to time.

2.27 “Restricted Stock” means an Award of Shares under Article 7 of the Plan, which Shares are issued with such restriction(s) as the Committee, in its sole discretion, may impose, including without limitation, any restriction on the right to retain such Shares, to sell, transfer, pledge or assign such Shares, to vote such Shares, and/or to receive any dividends or distributions with respect to such Shares, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.

2.28 “Restricted Stock Units” or “RSUs” means a right granted under Article 7 of the Plan to receive a number of Shares or a cash payment for each such Share equal to the Fair Market Value of a Share on a specified date.

2.29 “Restriction Period” means the period commencing on the date an Award of Restricted Stock or Restricted Stock Units is granted and ending on such date as the Committee shall determine.

2.30 “Retirement” means termination of employment other than for Cause after a Participant has (i) attained age 65; or (ii) reached the age of 55 years and has completed at least 10 years of service.

2.31 “Share” means one share of common stock, par value $.01 per share, of the Company, and as such Share may be adjusted pursuant to the provisions of Section 4.3 of the Plan.

2.32 “Stock Appreciation Right” or “SAR” means an Award granted under Article 6 of the Plan which provides for an amount payable in Shares and/or cash, as determined by the Committee, equal to the excess of the Fair Market Value of a Share on the day the Stock Appreciation Right is exercised over the specified purchase price.

ARTICLE 3 - ADMINISTRATION

3.1 General. This Plan shall be administered by the Committee. The Committee, in its discretion, may delegate to one or more of its members, or to officers of the Company, such of its powers as it deems appropriate.

4

3.2 Authority of the Committee.

(a) The Committee shall have the exclusive right to interpret, construe and administer the Plan, to select the Eligible Participants who are eligible to receive an Award, and to act in all matters pertaining to the granting of an Award and the contents of the Agreement evidencing the Award, including, without limitation, the determination of the number of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, or Performance Shares subject to an Award and the form, terms, conditions and duration of each Award, and any amendment thereof consistent with the provisions of the Plan. The Committee may adopt such rules, regulations and procedures of general application for the administration of this Plan, as it deems appropriate.

(b) The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Agreement in the manner and to the extent it shall deem desirable to carry it into effect.

(c) In the event the Company shall assume outstanding employee benefit awards or the right or obligation to make future such awards in connection with the acquisition of another corporation or business entity, the Committee may, in its discretion, make such adjustments in the terms of Awards under the Plan as it shall deem appropriate.

(d) All acts, determinations and decisions of the Committee made or taken pursuant to grants of authority under the Plan or with respect to any questions arising in connection with the administration and interpretation of the Plan, including the severability of any and all of the provisions thereof, shall be conclusive, final and binding upon all parties, including the Company, its stockholders, Participants, Eligible Participants and their estates, beneficiaries and successors.

3.3 Delegation of Authority. Except with respect to Named Executive Officers and Insiders, the Committee may, at any time and from time to time, delegate to one or more persons any or all of its authority under Section 3.2, to the full extent permitted by law.

3.4 Award Agreements. Each Award granted under the Plan shall be evidenced by a written Agreement. Each Agreement shall be subject to and incorporate, by reference or otherwise, the applicable terms and conditions of the Plan, and any other terms and conditions, not inconsistent with the Plan, as may be imposed by the Committee, including without limitation, provisions related to the consequences of termination of employment. A copy of such document shall be provided to the Participant, and the Committee may, but need not, require that the Participant sign a copy of the Agreement.

3.5 Indemnification. In addition to such other rights of indemnification as they may have as directors, officers or as members of the Committee, directors and officers of the Company and the members of the Committee shall be indemnified by the Company against reasonable expenses, including attorney’s fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan or any Award granted hereunder, and against all amounts paid by them in settlement thereof, provided such settlement is approved by independent legal counsel selected by the Company, or paid by them in satisfaction of a judgment or settlement in any such action, suit or proceeding, except as to matters as to which the director, officer or Committee member has been grossly negligent or engaged in willful misconduct in the performance of his duties; provided, that within 60 days after institution of any such action, suit or proceeding, a director, officer or Committee member shall in writing offer the Company the opportunity, at its own expense, to handle and defend the same.

ARTICLE 4 - SHARES SUBJECT TO THE PLAN

4.1 Number of Shares. (a) Subject to adjustment as provided in (b) below and in Section 4.3, the aggregate number of Shares which are available for issuance pursuant to Awards under the Plan is Five Million Seven

5

Hundred Thousand (5,700,000) Shares, plus the number of Shares subject to outstanding grants on the Effective Date under the Company’s Amended and Restated 1995 Stock Option Plan (the “1995 Plan”), which are forfeited or expire on or after the Effective Date in accordance with the terms of such grants. The number of Incentive Stock Options that may be issued under the Plan is 5,700,000. Such Shares shall be made available from Shares currently authorized but unissued or Shares currently held (or subsequently acquired) by the Company as treasury shares, including Shares purchased in the open market or in private transactions. Upon approval of this Plan by the stockholders of the Company, no further grants will be made under the Company’s Amended and Restated 1995 Stock Option Plan (the “1995 Plan”), but awards made under the 1995 Plan shall remain outstanding in accordance with their terms. If Options, Restricted Stock or Restricted Stock Units are issued in respect of options, restricted stock, or restricted stock units of an entity acquired, by merger or otherwise, by the Company (or any subsidiary of the Company or any Employer), to the extent such issuance shall not be inconsistent with the terms, limitations and conditions of Code section 422 or Exchange Act Rule 16b-3, the aggregate number of Shares for which Awards may be made hereunder shall automatically be increased by the number of Shares subject to Awards so issued; provided, however, the aggregate number of shares for which Awards may be granted hereunder shall automatically be decreased by the number of Shares covered by any unexercised portion of an Award so issued that has terminated for any reason, and the Shares subject to any such unexercised portion may not be the subject of an Award to any other person.

(b) The following rules shall apply for purposes of the determination of the number of Shares available for grant under the Plan:

(i) If, for any reason, any Shares awarded or subject to purchase under the Plan are not delivered or purchased, or are reacquired by the Company, for reasons, including, but not limited to, a forfeiture of Restricted Stock or termination, expiration or cancellation of an Option, a Stock Appreciation Right, Restricted Stock Units, or Performance Shares (“Returned Shares”), such shall not be charged against the aggregate number of Shares available for issuance pursuant to Awards under the Plan and shall again be available for issuance pursuant to an Award under the Plan. If the exercise price and/or withholding obligation under an Award is satisfied by tendering Shares to the Company (either by actual delivery or attestation), only the number of Shares issued net of the Shares so tendered shall be deemed delivered for purposes of determining the maximum number of Shares available for issuance under the Plan.

(ii) Each Performance Share awarded that may be settled in Shares shall be counted as one Share subject to an Award. Performance Shares that may not be settled in Shares (or that may be settled in Shares but are not) shall not result in a charge against the aggregate number of Shares available for issuance pursuant to Awards under this Plan.

(iii) Each Stock Appreciation Right or Restricted Stock Unit that may be settled in Shares shall be counted as one Share subject to an Award. Stock Appreciation Rights or Restricted Stock Units that may not be settled in Shares (or that may be settled in Shares but are not) shall not result in a charge against the aggregate number of Shares available for issuance pursuant to Awards under this Plan. In addition, if a Stock Appreciation Right is granted in connection with an Option and the exercise of the Stock Appreciation Right results in the loss of the Option right, the Shares that otherwise would have been issued upon the exercise of such related Option shall not result in a charge against the aggregate number of Shares available for issuance pursuant to Awards under this Plan.

4.2 Individual Limits. Except to the extent the Committee determines that an Award to a Named Executive Officer shall not comply with the performance-based compensation provisions of Code Section 162(m), the following rules shall apply to Awards under the Plan:

(a) Options and SARs. The maximum number of Options and Stock Appreciation Rights that, in the aggregate, may be granted pursuant to Awards in any one calendar year to any one Participant shall be Five Hundred Thousand (500,000).

(b) Restricted Stock, Restricted Stock Units and Performance Shares. The maximum number of Shares of Restricted Stock, number of Restricted Stock Units or Performance Shares that, in the aggregate, may be

6

granted pursuant to Awards in any one calendar year to any one Participant shall be Five Hundred Thousand (500,000) Shares.

4.3 Adjustment of Shares. If any change in corporate capitalization, such as a stock split, reverse stock split, stock dividend, or any corporate transaction such as a reorganization, reclassification, merger or consolidation or separation, including a spin-off, of the Company or sale or other disposition by the Company of all or a portion of its assets, any other change in the Company’s corporate structure, or any distribution to stockholders (other than a cash dividend) results in the outstanding Shares, or any securities exchanged therefor or received in their place, being exchanged for a different number or class of shares or other securities of the Company, or for shares of stock or other securities of any other entity, or new, different or additional shares or other securities of the Company or of any other entity being received by the holders of outstanding Shares, then equitable adjustments shall be made by the Committee in:

(a) the limitations on the aggregate number of Shares that may be awarded as set forth in Section 4.1, including, without limitation, with respect to Incentive Stock Options;

(b) the limitations on the aggregate number of Shares that may be awarded to any one single Participant as set forth in Section 4.2;

(c) the number and class of Shares that may be subject to an Award, and which have not been issued or transferred under an outstanding Award;

(d) the Option Price under outstanding Options and the number of Shares to be transferred in settlement of outstanding Stock Appreciation Rights; and

(e) the terms, conditions or restrictions of any Award and Agreement, including the price payable for the acquisition of Shares; provided, however, that all such adjustments made in respect of each ISO shall be accomplished so that such Option shall continue to be an incentive stock option within the meaning of Code Section 422.

ARTICLE 5 - STOCK OPTIONS

5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Eligible Participants at any time and from time to time as shall be determined by the Committee. The Committee shall have sole discretion in determining the number of Shares subject to Options granted to each Participant. The Committee may grant a Participant ISOs, NQSOs or a combination thereof, and may vary such Awards among Participants; provided that only an employee may be granted ISOs.

5.2 Agreement. Each Option grant shall be evidenced by an Agreement that shall specify the Option Price, the duration of the Option, the number of Shares to which the Option pertains and such other provisions as the Committee shall determine. The Option Agreement shall further specify whether the Award is intended to be an ISO or an NQSO. Any portion of an Option that is not designated as an ISO or otherwise fails or is not qualified as an ISO (even if designated as an ISO) shall be an NQSO.

5.3 Option Price. The Option Price for each grant of an ISO or NQSO shall not be less than one hundred percent (100%) of the Fair Market Value of a Share on the date the Option is granted.

5.4 Duration of Options. Each Option shall expire at such time as the Committee shall determine at the time of grant; provided, however, that no Option shall be exercisable later than the tenth (10^th) anniversary of its grant date.

5.5 Exercise of Options. Options granted under the Plan shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall in each instance approve, including conditions related to the employment of or provision of services by the Participant with the Company or any Employer, which need

7

not be the same for each grant or for each Participant. The Committee may provide in the Agreement for automatic accelerated vesting and other rights upon the occurrence of a Change in Control of the Company or upon the occurrence of other events as specified in the Agreement. In addition, the Committee may provide in the Agreement for the right of a Participant to defer option gains related to an exercise.

5.6 Payment. Options shall be exercised by the delivery of a written notice of exercise to the Company, setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares. The Option Price upon exercise of any Option shall be payable to the Company in full either: (a) in cash, (b) cash equivalent approved by the Committee, (c) if approved by the Committee, by tendering previously acquired Shares (or delivering a certification or attestation of ownership of such Shares) having an aggregate Fair Market Value at the time of exercise equal to the total Option Price (provided that the tendered Shares must have been held by the Participant for any period required by the Committee), or (d) by a combination of (a), (b) and (c). The Committee also may allow cashless exercises as permitted under the Federal Reserve Board’s Regulation T, subject to applicable securities law restrictions, or by any other means which the Committee determines to be consistent with the Plan’s purpose and applicable law.

5.7 Nontransferability of Options.

(a) Incentive Stock Options. No ISO granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, all ISOs granted to a Participant under the Plan shall be exercisable during his or her lifetime only by such Participant.

(b) Nonqualified Stock Options. Except as otherwise provided in a Participant’s Award Agreement with respect to transfers to Permitted Transferees (any such transfers being subject to applicable laws, rules and regulations), no NQSO granted under this Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Award Agreement, all NQSOs granted to a Participant under this Article 5 shall be exercisable during his or her lifetime only by such Participant.

5.8 Purchased Options. The Committee shall also have the authority to grant Options to Participants in exchange for a stated purchase price for such Option (which may be payable by the Participant directly or, at the election of the Participant, may be offset from bonus or other amounts owed to the Participant by the Company).

5.9 Special Rules for ISOs. In no event shall any Participant who owns (within the meaning of Section 424(d) of the Code) stock of the Company possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company be eligible to receive an ISO at an Option Price less than one hundred ten percent (110%) of the Fair Market Value of a share on the date the ISO is granted or be eligible to receive an ISO that is exercisable later than the fifth (5th) anniversary date of its grant. No Participant may be granted ISOs (under the Plan and all other incentive stock option plans of the Employer) which are first exercisable in any calendar year for Shares having an aggregate Fair Market Value (determined as of the date an Option is granted) that exceeds One Hundred Thousand Dollars ($100,000).

ARTICLE 6 - STOCK APPRECIATION RIGHTS

6.1 Grant of SARs. A Stock Appreciation Right may be granted to an Eligible Participant in connection with an Option granted under Article 5 of this Plan or may be granted independently of any Option. A Stock Appreciation Right shall entitle the holder, within the specified period (which may not exceed 10 years), to exercise the SAR and receive in exchange therefor a payment having an aggregate value equal to the amount by which the Fair Market Value of a Share exceeds the exercise price, times the number of Shares with respect to which the SAR is exercised. The Committee may provide in the Agreement for automatic accelerated vesting and other rights upon the occurrence of a Change in Control or upon the occurrence of other events specified in the

8

Agreement. A SAR granted in connection with an Option (a “Tandem SAR”) shall entitle the holder of the related Option, within the period specified for the exercise of the Option, to surrender the unexercised Option, or a portion thereof, and to receive in exchange therefore a payment having an aggregate value equal to the amount by which the Fair Market Value of a Share exceeds the Option price per Share, times the number of Shares under the Option, or portion thereof, which is surrendered. SARs shall be subject to the same transferability restrictions as Nonqualified Stock Options.

6.2 Tandem SARs. Each Tandem SAR shall be subject to the same terms and conditions as the related Option, including limitations on transferability, and shall be exercisable only to the extent such Option is exercisable and shall terminate or lapse and cease to be exercisable when the related Option terminates or lapses. The grant of Stock Appreciation Rights related to ISOs must be concurrent with the grant of the ISOs. With respect to NQSOs, the grant either may be concurrent with the grant of the NQSOs, or in connection with NQSOs previously granted under Article 5, which are unexercised and have not terminated or lapsed.

6.3 Payment. The Committee shall have sole discretion to determine in each Agreement whether the payment with respect to the exercise of an SAR will be in the form of all cash, all Shares or any combination thereof. If payment is to be made in Shares, the number of Shares shall be determined based on the Fair Market Value of a Share on the date of exercise. If the Committee elects to make full payment in Shares, no fractional Shares shall be issued and cash payments shall be made in lieu of fractional shares. The Committee shall have sole discretion as to the timing of any payment made in cash or Shares, or a combination thereof, upon exercise of SARs. Payment may be made in a lump sum, in annual installments or may be otherwise deferred (at the election of the Participant) and the Committee shall have sole discretion to determine whether any deferred payments may bear amounts equivalent to interest or cash dividends.

6.4 Exercise of SARs. Upon exercise of a Tandem SAR, the number of Shares subject to exercise under any related Option shall automatically be reduced by the number of Shares represented by the Option or portion thereof which is surrendered.

ARTICLE 7 - RESTRICTED STOCK AND RESTRICTED STOCK UNITS

7.1 Grant of Restricted Stock. Restricted Stock Awards may be made to Eligible Participants as a reward for past service or as an incentive for the performance of future services that will contribute materially to the successful operation of the Employer. Awards of Restricted Stock may be made either alone or in addition to or in tandem with other Awards granted under the Plan and may be current grants of Restricted Stock or deferred grants of Restricted Stock.

7.2 Restricted Stock Agreement. The Restricted Stock Agreement shall set forth the terms of the Award, as determined by the Committee, including, without limitation: the purchase price, if any, to be paid for such Restricted Stock, which may be more than, equal to, or less than Fair Market Value and may be zero, subject to such minimum consideration as may be required by applicable law; any restrictions applicable to the Restricted Stock such as continued service or achievement of Performance Measures, the length of the Restriction Period and whether any circumstances, such as death, Disability, or a Change in Control, will shorten or terminate the Restriction Period; and rights of the Participant to vote or receive dividends or distributions with respect to the Shares during the Restriction Period. Subject to shortening the length of the Restriction Period upon the occurrence of certain circumstances, such as death, Disability, or a Change in Control, all grants of Restricted Stock not subject to Performance Measures shall have a Restriction Period of at least three (3) years but graded vesting may be provided. Restricted Stock Awards subject to Performance Measures shall have a Restriction Period of at least one (1) year. Restricted Stock Awards issued in lieu of all or part of a cash bonus payment otherwise payable to the Participant shall be subject to a Restriction Period of not more than one (1) year.

Notwithstanding Section 3.4 of the Plan, a Restricted Stock Award must be accepted within a period of sixty (60) days, or such other period as the Committee may specify, by executing a Restricted Stock Agreement and

9

paying whatever price, if any, is required. The prospective recipient of a Restricted Stock Award shall not have any rights with respect to such Award, unless and until such recipient has executed a Restricted Stock Agreement and has delivered a fully executed copy thereof to the Committee, and has otherwise complied with the applicable terms and conditions of such Award.

7.3 Nontransferability. Except as otherwise provided in this Article 7, no shares of Restricted Stock nor any Restricted Stock Units received by a Participant shall be sold, exchanged, transferred, pledged, hypothecated or otherwise disposed of during the Restriction Period.

7.4 Certificates. Upon an Award of Restricted Stock to a Participant, Shares of Restricted Stock shall be registered in the Participant’s name (or an appropriate book entry shall be made). Certificates, if issued, may either be held in custody by the Company until the Restriction Period expires or until restrictions thereon otherwise lapse and/or be issued to the Participant and registered in the name of the Participant, bearing an appropriate restrictive legend and remaining subject to appropriate stop-transfer orders. If required by the Committee, the Participant shall deliver to the Company one or more stock powers endorsed in blank relating to the Restricted Stock. If and when the Restriction Period expires without a prior forfeiture of the Restricted Stock subject to such Restriction Period, unrestricted certificates for such shares shall be delivered to the Participant; provided, however, that the Committee may cause such legend or legends to be placed on any such certificates as it may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission and any applicable federal or state law.

7.5 Dividends and Other Distributions. Except as provided in this Article 7 or in the Award Agreement, a Participant receiving a Restricted Stock Award shall have, with respect to such Restricted Stock Award, all of the rights of a stockholder of the Company, including the right to vote the Shares to the extent, if any, such Shares possess voting rights and the right to receive any dividends and distributions; provided, however, the Committee may require that any dividends on such Shares of Restricted Stock shall be automatically deferred and reinvested in additional Restricted Stock subject to the same restrictions as the underlying Award, or may require that dividends and other distributions on Restricted Stock shall be paid to the Company for the account of the Participant. The Committee shall determine whether interest shall be paid on such amounts, the rate of any such interest, and the other terms applicable to such amounts. In addition, with respect to Named Executive Officers, the Committee may apply any restrictions it deems appropriate to the payment of dividends declared with respect to Restricted Stock such that the dividends and/or Restricted Stock maintain eligibility for the performance-based compensation exception under Code Section 162(m).

7.6 Restricted Stock Units (or RSUs). Awards of Restricted Stock Units may be made to Eligible Participants in accordance with the following terms and conditions:

(a) The Committee, in its discretion, shall determine the number of RSUs to grant to a Participant, the Restriction Period and other terms and conditions of the Award, including whether the Award will be paid in cash, Shares or a combination of the two and the time when the Award will be payable (i.e., at vesting, termination of employment or another date).

(b) Unless the Agreement provides otherwise, RSUs shall not be sold, transferred or otherwise disposed of and shall not be pledged or otherwise hypothecated.

(c) Awards of RSUs shall be subject to the same terms as applicable to Awards of Restricted Stock under Section 7.2 of the Plan; provided, however, a Participant to whom RSUs are awarded has no rights as a stockholder with respect to the Shares represented by the RSUs unless and until the Shares are actually delivered to the Participant; provided further, however, RSUs may have dividend equivalent rights if provided for by the Committee which may be subject to the same terms and conditions governing dividends and distributions applicable to Restricted Stock Awards under Section 7.5 of this Plan with the exception that in no event shall RSUs possess voting rights.

(d) The Agreement shall set forth the terms and conditions that shall apply upon the termination of the Participant’s employment with the Employer (including a forfeiture of RSUs for which the restrictions have

10

not lapsed upon Participant’s ceasing to be employed) as the Committee may, in its discretion, determine at the time the Award is granted.

ARTICLE 8 - PERFORMANCE SHARES

8.1 Grant of Performance Shares. Performance Shares may be granted to Participants in such amounts and upon such terms, and at any time and from time to time, as shall be determined by the Committee.

8.2 Value of Performance Shares. Each Performance Share shall have an initial value equal to the Fair Market Value of a Share on the date of grant. The Committee shall set the Performance Measures in its discretion which, depending on the extent to which they are met, will determine the number of Performance Shares that will be paid out to the Participant. For purposes of this Article 8, the time period during which the Performance Measures must be met shall be called a “Performance Period.”

8.3 Earning of Performance Shares. Subject to the terms of this Plan, after the applicable Performance Period has ended, the holder of Performance Shares shall be entitled to receive a payout of the number of Performance Shares earned by the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding Performance Measures have been achieved. The Committee may provide in the Agreement for automatic accelerated vesting and other rights upon a Change in Control or upon the occurrence of other events specified in the Agreement.

8.4 Form and Timing of Payment of Performance Shares. Subject to the terms of this Plan, the Committee, in its sole discretion, may pay earned Performance Shares in the form of cash or in Shares (or in a combination thereof) with an aggregate Fair Market Value equal to the value of the earned Performance Shares at the close of the applicable Performance Period. Such Shares may be granted subject to any restrictions deemed appropriate by the Committee. The determination of the Committee with respect to the form and timing of payout of such Awards shall be set forth in the Award Agreement pertaining to the grant of the Award.

Except as otherwise provided in the Participant’s Award Agreement, a Participant shall be entitled to receive any dividends and distributions declared with respect to Shares that have been earned in connection with grants of Performance Shares but that have not yet been distributed to the Participant (such dividends and distributions shall be subject to the same accrual, forfeiture, and payout restrictions as apply to dividends and distributions earned with respect to Restricted Stock, as set forth in Section 7.5 herein). In addition, unless otherwise provided in the Participant’s Award Agreement, a Participant shall be entitled to exercise full voting rights with respect to Shares that have been earned in connection with grants of Performance Shares but that have not yet been distributed to the Participant.

8.5 Nontransferability. Except as otherwise provided in a Participant’s Award Agreement, Performance Shares may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Award Agreement, a Participant’s rights under the Plan shall be exercisable during the Participant’s lifetime only by the Participant or the Participant’s legal representative.

ARTICLE 9 - PERFORMANCE MEASURES

Until the Committee proposes for stockholder vote and stockholders approve a change in the general Performance Measures set forth in this Article 9, the attainment of which may determine the degree of payout and/or vesting with respect to Named Executive Officers’ Awards that are intended to qualify under the performance-based compensation provisions of Code Section 162(m), the Performance Measure(s) to be used for purposes of such Awards shall be chosen from among the following (which may relate to the Company or a business unit, division or subsidiary): earnings, earnings per share, consolidated pre-tax earnings, net earnings,

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operating income, EBIT (earnings before interest and taxes), EBITDA (earnings before interest, taxes, depreciation and amortization), gross margin, revenues, revenue growth, market value added, economic value added, return on equity, return on investment, return on assets, return on net assets, return on capital employed, return on incremental equity, total stockholder return, profit, economic profit, capitalized economic profit, after-tax profit, pre-tax profit, cash flow measures, cash flow return, sales, sales volume, revenues per employee, stock price, cost goals, budget goals, growth and expansion goals or goals related to acquisitions or divestitures. The Committee can establish other Performance Measures for performance Awards granted to Eligible Participants that are not Named Executive Officers.

The Committee shall be authorized to make adjustments in performance based criteria or in the terms and conditions of other Awards in recognition of unusual or nonrecurring events affecting the Company or its financial statements or changes in applicable laws, regulations or accounting principles. The Committee shall also have the discretion to adjust the determinations of the degree of attainment of the pre-established Performance Measures; provided, however, that Awards which are designed to qualify for the performance-based compensation exception from the deductibility limitations of Code Section 162(m), and which are held by Named Executive Officers, may not be adjusted upward (except as may be permitted by Code Section 162(m)), but the Committee shall retain the discretion to adjust such Awards downward.

If applicable tax and/or securities laws change to permit Committee discretion to alter the governing Performance Measures without obtaining stockholder approval of such changes, the Committee shall have sole discretion to make such changes without obtaining stockholder approval. In addition, in the event that the Committee determines that it is advisable to grant Awards which shall not qualify for the performance-based compensation exception from the deductibility limitations of Code Section 162(m), the Committee may make such grants without satisfying the requirements of Code Section 162(m).

ARTICLE 10 - BENEFICIARY DESIGNATION

Each Participant under the Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in case of his or her death before he or she receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Committee, and will be effective only when filed by the Participant in writing with the Committee during the Participant’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate.

ARTICLE 11 - DEFERRALS

The Committee may permit or require a Participant to defer under this Plan or to a separate deferred compensation arrangement of the Company such Participant’s receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant by virtue of the exercise of an Option or SAR, the lapse or waiver of restrictions with respect to Restricted Stock or Restricted Stock Units, or the satisfaction of any requirements or goals with respect to Performance Shares. If any such deferral election is required or permitted, the Committee shall, in its sole discretion, establish rules and procedures for such payment deferrals.

ARTICLE 12 - WITHHOLDING

12.1 Tax Withholding. The Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy Federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan.

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12.2 Share Withholding. With respect to withholding required upon the exercise of Options or SARs, upon the lapse of restrictions on Restricted Stock, or upon any other taxable event arising as a result of Awards granted hereunder, unless other arrangements are made with the consent of the Committee, Participants shall satisfy the withholding requirement by having the Company withhold Shares having a Fair Market Value on the date the tax is to be determined equal to not more than the minimum amount of tax required to be withheld with respect to the transaction. All such elections shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.

ARTICLE 13 - FOREIGN EMPLOYEES

In order to facilitate the making of any grant of Awards under this Plan, the Committee may provide for such special terms for Awards to Participants who are foreign nationals or who are employed by the Company or any Employer outside of the United States of America as the Committee may consider necessary or appropriate to accommodate differences in local law, tax policy or custom, which special terms may be contained in an Appendix attached hereto. Moreover, the Committee may approve such supplements to or amendments, restatements or alternative versions of this Plan as it may consider necessary or appropriate for such purposes, without thereby affecting the terms of this Plan as in effect for any other purpose, and the Secretary or other appropriate officer of the Company may certify any such document as having been approved and adopted in the same manner as this Plan. No such special terms, supplements, amendments or restatements, however, shall include any provisions that are inconsistent with the terms of this Plan as then in effect unless this Plan could have been amended to eliminate such inconsistency without further approval by the stockholders of the Company.

ARTICLE 14 - AMENDMENT AND TERMINATION

14.1 Amendment of Plan. The Committee may at any time terminate or from time to time amend the Plan in its discretion in whole or in part, but no such action shall adversely affect any rights or obligations with respect to any Awards previously granted under the Plan, unless the affected Participants consent in writing. To the extent required by Code Section 162(m) or 422 and/or the rules of NASDAQ or any exchange upon which the Company lists the Shares for trading or other applicable law, rule or regulation no amendment shall be effective unless approved by the stockholders of the Company at an annual or special meeting.

14.2 Amendment of Award Agreement; Repricing. The Committee may, at any time, in its discretion amend outstanding Agreements in a manner not inconsistent with the terms of the Plan; provided, however, except as provided in Section 14.4, if such amendment is adverse to the Participant, as determined by the Committee, the amendment shall not be effective unless and until the Participant consents, in writing, to such amendment. To the extent not inconsistent with the terms of the Plan, the Committee may, at any time in its discretion amend an outstanding Agreement in a manner that is not unfavorable to the Participant without the consent of such Participant. Notwithstanding the above provision, the Committee shall not have the authority to decrease the Option Price of any outstanding Option, except in accordance with Section 4.3 or unless such an amendment is approved by the stockholders of the Company.

14.3 Termination of Plan. No Awards shall be granted under the Plan after the tenth (10th) anniversary of the date the Board adopts the Plan.

14.4 Detrimental Activity. The Committee may provide in the Award Agreement that if a Participant engages in any “Detrimental Activity” (as defined below), the Committee may, notwithstanding any other provision in this Plan to the contrary, cancel, rescind, suspend, withhold or otherwise restrict or limit any unexpired, unexercised or unpaid Award as of the first date the Participant engages in the Detrimental Activity, unless sooner terminated by operation of another term of this Plan or any other agreement. Without limiting the

13

generality of the foregoing, the Agreement may also provide that if the Participant exercises an Option or SAR, receives a Performance Share or Restricted Stock Unit payout, or receives Shares under an Award at any time during the period beginning six months prior to the date the Participant first engages in Detrimental Activity and ending six months after the date the Participant ceases to engage in any Detrimental Activity, the Participant shall be required to pay to the Company the excess of the then Fair Market Value of the Shares subject to the Award over the total price paid by the Participant for such Shares.

For purposes of this Section, “Detrimental Activity” means any of the following activities as further defined by the Committee in the Award Agreement and as determined by the Committee in good faith: (i) the violation of any agreement between the Company and the Participant relating to the disclosure of confidential information or trade secrets, the solicitation of employees, customers, suppliers, licensees, licensors or contractors, or the performance of competitive services or (ii) conduct that constitutes Cause (as defined in Section 2.4 above), whether or not the Participant’s employment is terminated for Cause.

14.5 Assumption or Cancellation of Awards. In the event of a proposed sale of all or substantially all of the assets or stock of the Company, the merger of the Company with or into another corporation such that stockholders of the Company immediately prior to the merger exchange their shares of stock in the Company for cash and/or shares of another entity or any other corporate transaction to which the Committee deems this provision applicable, each Award shall be assumed or an equivalent Award shall be substituted by the successor corporation or a parent or subsidiary of such successor corporation (and adjusted as appropriate), unless such successor corporation does not agree to assume the Award or to substitute an equivalent award, in which case the Committee may, in its sole discretion and in lieu of such assumption or substitution, provide for the Participant to have the right to exercise the Option or other Award as to all Shares, including Shares as to which the Option or other Award would not otherwise be exercisable (or with respect to RSUs, Performance Shares or Restricted Stock, provide that all restrictions shall lapse or with respect to Performance Shares, provide that the Performance Measures are satisfied) or provide for cancellation and for a cash payment for such Award. If the Committee makes an Option or other Award fully exercisable in lieu of assumption or substitution in the event of a merger or sale of assets or stock or other corporate transaction, the Committee shall notify the Participant that, subject to rescission if the merger, sale of assets or stock or other corporate transaction is not successfully completed within a certain period, the Option or other Award shall be fully exercisable for a period of fifteen (15) days from the date of such notice (or such other period as provided by the Committee), and, to the extent not exercised, the Option or other Award will terminate upon the expiration of such period.

ARTICLE 15 - MISCELLANEOUS PROVISIONS

15.1 Restrictions on Shares. All certificates for Shares delivered under the Plan shall be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Stock is then listed and any applicable federal or state laws, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. In making such determination, the Committee may rely upon an opinion of counsel for the Company or Committee.

Notwithstanding any other provision of the Plan, the Company shall have no liability to deliver any Shares under the Plan or make any other distribution of the benefits under the Plan unless such delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act of 1933), and the applicable requirements of any securities exchange or similar entity.

15.2 No Implied Rights. Nothing in the Plan or any Award granted under the Plan shall confer upon any Participant any right to continue in the service of the Employer, or to serve as a Director thereof, or interfere in any way with the right of the Employer to terminate the Participant’s employment or other service relationship for any reason at any time. Unless agreed by the Board, no Award granted under the Plan shall be deemed salary

14

or compensation for the purpose of computing benefits under any employee benefit plan, severance program, or other arrangement of the Employer for the benefit of its employees. No Participant shall have any claim to an Award until it is actually granted under the Plan. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall, except as otherwise provided by the Committee, be no greater than the right of an unsecured general creditor of the Company.

15.3 Compliance with Laws.

(a) At all times when the Committee determines that compliance with Code Section 162(m) is required or desirable, all Awards granted under this Plan to Named Executive Officers shall comply with the requirements of Code Section 162(m). In addition, in the event that changes are made to Code Section 162(m) to permit greater flexibility with respect to any Awards under the Plan, the Committee may, subject to the requirements of Article 14, make any adjustments it deems appropriate.

(b) The Plan and the grant of Awards shall be subject to all applicable federal and state laws, rules, and regulations and to such approvals by any United States government or regulatory agency as may be required. Any provision herein relating to compliance with Rule 16b-3 under the Exchange Act shall not be applicable with respect to participation in the Plan by Participants who are not Insiders.

15.4 Successors. The terms of the Plan shall be binding upon the Company, and its successors and assigns (whether by purchase, merger, consolidation or otherwise).

15.5 Tax Elections. Each Participant agrees to give the Committee prompt written notice of any election made by such Participant under Code Section 83(b) or any similar provision thereof.

15.6 Legal Construction.

(a) Severability. If any provision of this Plan or an Agreement is or becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any Agreement under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Agreement, it shall be stricken and the remainder of the Plan or the Agreement shall remain in full force and effect.

(b) Gender and Number. Where the context admits, words in any gender shall include the other gender, words in the singular shall include the plural and words in the plural shall include the singular.

(c) Governing Law. To the extent not preempted by federal law, the Plan and all Agreements hereunder, shall be construed in accordance with and governed by the laws of the State of Florida.

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EX-10.2

Exhibit 10.2

MPS GROUP, INC.

2004 NON-EMPLOYEE DIRECTOR

EQUITY INCENTIVE PLAN

Table of Contents

			Page
ARTICLE 1 - GENERAL PROVISIONS			1
	1.1	Establishment and Purposes of Plan	1
	1.2	Types of Awards	1
	1.3	Effective Date	1
ARTICLE 2 - DEFINITIONS			1
ARTICLE 3 - ADMINISTRATION			3
	3.1	General	3
	3.2	Authority of the Committee.	3
	3.3	Delegation of Authority	4
	3.4	Award Agreements	4
	3.5	Indemnification	4
ARTICLE 4 - SHARES SUBJECT TO THE PLAN			4
	4.1	Number of Shares.	4
	4.2	Adjustment of Shares	5
ARTICLE 5 - STOCK OPTIONS			5
	5.1	Automatic Grant Of Stock Options or Alternate Awards	5
	5.2	Discretionary Grants of Awards	6
	5.3	Grant of Options	6
	5.4	Agreement	6
	5.5	Option Price	6
	5.6	Duration of Options	6
	5.7	Exercise of Options	6
	5.8	Payment	7
	5.9	Nontransferability of Options	7
	5.10	Purchased Options	7
ARTICLE 6 - STOCK APPRECIATION RIGHTS			7
	6.1	Grant of SARs	7
	6.2	Tandem SARs	7
	6.3	Payment	7
ARTICLE 7 - RESTRICTED STOCK AND RESTRICTED STOCK UNITS			8
	7.1	Grant of Restricted Stock	8
	7.2	Restricted Stock Agreement	8
	7.3	Nontransferability	8
	7.4	Certificates	8
	7.5	Dividends and Other Distributions	8
	7.6	Restricted Stock Units (or RSUs)	9
ARTICLE 8 - BENEFICIARY DESIGNATION			9
ARTICLE 9 - DEFERRALS			9
ARTICLE 10 - WITHHOLDING			9
	10.1	Tax Withholding	9
	10.2	Share Withholding	10

-i-

Table of Contents

(continued)

			Page
ARTICLE 11 - AMENDMENT AND TERMINATION			10
	11.1	Amendment of Plan	10
	11.2	Amendment of Award Agreement; Repricing	10
	11.3	Termination of Plan	10
	11.4	Assumption or Cancellation of Awards	10
ARTICLE 12 - MISCELLANEOUS PROVISIONS			10
	12.1	Restrictions on Shares	10
	12.2	Successors	11
	12.3	No Implied Rights	11
	12.4	Compliance with Laws	11
	12.5	Tax Elections	11
	12.6	Legal Construction.	11

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MPS GROUP, INC.

2004 NON-EMPLOYEE DIRECTOR EQUITY INCENTIVE PLAN

ARTICLE 1 - GENERAL PROVISIONS

1.1 Establishment and Purposes of Plan. MPS Group, Inc., a Florida corporation (the “Company”), hereby establishes an equity incentive plan to be known as the “MPS Group, Inc. 2004 Non-Employee Director Equity Incentive Plan” (the “Plan”), as set forth in this document. The objectives of the Plan are (i) to provide incentives to non-employee directors of the Company; (ii) to attract, motivate and retain directors; and (iii) to align the interests of directors with those of the Company’s stockholders.

1.2 Types of Awards. Awards under the Plan may be made in the form of (i) Nonqualified Stock Options, (ii) Stock Appreciation Rights, (iii) Restricted Stock, (iv) Restricted Stock Units, or (v) any combination of the foregoing.

1.3 Effective Date. The Plan shall be effective upon approval by the Company’s stockholders (the “Effective Date”).

ARTICLE 2 - DEFINITIONS

Except where the context otherwise indicates, the following definitions apply:

2.1 “Agreement” means the written agreement evidencing an Award granted to the Participant under the Plan.

2.2 “Award” means an award granted to a Participant under the Plan that is a Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, or combination of these.

2.3 “Board” means the Board of Directors of the Company.

2.4 “Change in Control” means any of the following events:

(a) The acquisition by any “person”, as the term person is used for purposes of Sections 13(d) or 14(d) of the Exchange Act, not a stockholder of the Company on the Effective Date, of legal or beneficial ownership of 35% or more of either (i) the then outstanding shares of common stock of the Company or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors;

(b) Individuals who, on the Effective Date, constitute the Board cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Board shall be considered as though such individual were a member of the Board as of the date hereof;

(c) Approval by the stockholders of the Company of a reorganization, merger, or consolidation, in each case unless the stockholders of the Company immediately before such reorganization, merger, or consolidation own, directly or indirectly, immediately following such reorganization, merger, or consolidation at least a majority of the combined voting power of the outstanding voting securities of the corporation resulting from such reorganization, merger, or consolidation in substantially the same proportion as their ownership of the voting securities immediately before such reorganization, merger or consolidation; or

(d) Approval by the stockholders of the Company of (i) a complete liquidation or dissolution of the Company, or (ii) the sale or other disposition of more than 50% of the assets of the Company within a twelve month period.

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2.5 “Code” means the Internal Revenue Code of 1986, as now in effect or as hereafter amended. All citations to sections of the Code are to such sections as they may from time to time be amended or renumbered.

2.6 “Committee” means the Compensation Committee of the Board or such other committee consisting of two or more members of the Board as may be appointed by the Board to administer this Plan pursuant to Article 3 of the Plan.

2.7 “Company” means MPS Group, Inc., a Florida corporation, and its successors and assigns.

2.8 “Director” means any individual who is a member of the Board of Directors of the Company and is not an employee of the Company.

2.9 “Disability” means the inability of the Participant to perform his or her usual duties as a Board member by reason of any medically determined physical or mental impairment expected to result in death or to be of continuous duration of six (6) months or more. The determination of Disability shall be made by the Committee.

2.10 “Effective Date” shall have the meaning ascribed to such term in Section 1.3 hereof.

2.11 “Eligible Participant” means a Director.

2.12 “Employer” means the Company and any entity during any period that it is a “parent corporation” or a “subsidiary corporation” with respect to the Company within the meaning of Code Sections 424(e) and 424(f). With respect to all purposes of the Plan, including, but not limited to, the establishment, amendment, termination, operation and administration of the Plan, the Company shall be authorized to act on behalf of all other entities included within the definition of “Employer.”

2.13 “Exchange Act” means the Securities Exchange Act of 1934, as now in effect or as hereafter amended. All citations to sections of the Exchange Act or rules thereunder are to such sections or rules as they may from time to time be amended or renumbered.

2.14 “Fair Market Value” means the fair market value of a Share, as determined in good faith by the Committee as follows:

(a) if the Shares are admitted to trading on a national securities exchange, Fair Market Value on any date shall be the last sale price reported for the Shares on such exchange on such date or, if no sale was reported on such date, on the last date preceding such date on which a sale was reported;

(b) if the Shares are admitted to quotation on the National Association of Securities Dealers Automated Quotation System (“NASDAQ”) or other comparable quotation system and have been designated as a National Market System (“NMS”) security, Fair Market Value on any date shall be the last sale price reported for the Shares on such system on such date or on the last day preceding such date on which a sale was reported;

(c) If the Shares are admitted to Quotation on the NASDAQ and have not been designated a NMS Security, Fair Market Value on any date shall be the average of the highest bid and lowest asked prices of the Shares on such system on such date; or

(d) if (a), (b) and (c) do not apply, on the basis of the good faith determination of the Committee.

For purposes of subsection (a) above, if Shares are traded on more than one securities exchange then the following exchange shall be referenced to determine Fair Market Value: (i) the New York Stock Exchange (“NYSE”), or (ii) if shares are not traded on the NYSE, the NASDAQ, or (iii) if shares are not traded on the NYSE or NASDAQ, the largest regional exchange on which Shares are traded.

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2.15 “Insider” shall mean an individual who is, on the relevant date, subject to the reporting requirements of Section 16(a) of the Act.

2.16 “Option” means a stock option which is not intended to meet the requirements of Section 422 of the Code.

2.17 “Option Price” means the price at which a Share may be purchased by a Participant pursuant to an Option.

2.18 “Participant” means an Eligible Participant to whom an Award has been granted.

2.19 “Permitted Transferee” means any members of the immediate family of the Participant (i.e., spouse, children and grandchildren), any trusts for the benefit of such family members or any partnerships whose only partners are such family members. Appropriate evidence of any transfer to the Permitted Transferees shall be delivered to the Company at its principal executive office. If all or part of an Option is transferred to a Permitted Transferee, the Permitted Transferee’s rights thereunder shall be subject to the same restrictions and limitations with respect to the Option as the Participant.

2.20 “Plan” means the MPS Group, Inc. 2004 Non-Employee Director Equity Incentive Plan, as set forth herein and as it may be amended from time to time.

2.21 “Restricted Stock” means an Award of Shares under Article 7 of the Plan, which Shares are issued with such restriction(s) as the Committee, in its sole discretion, may impose, including, without limitation, any restriction on the right to retain such Shares, to sell, transfer, pledge or assign such Shares, to vote such Shares, and/or to receive any dividends or distributions with respect to such Shares, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate.

2.22 “Restricted Stock Units (or RSUs)” means an Award of a right granted under Section 7.6 of the Plan to receive a number of Shares or a cash payment for each such Share equal to the Fair Market Value of a Share on a specified date.

2.23 “Restriction Period” means the period commencing on the date an Award of Restricted Stock or Restricted Stock Units is granted and ending on such date as the Committee shall determine.

2.24 “Share” means one share of common stock, par value $.01 per share, of the Company, and as such Share may be adjusted pursuant to the provisions of Section 4.2 of the Plan.

2.25 “Stock Appreciation Right” or “SAR” means an Award granted under Article 6 of the Plan which provides for an amount payable in Shares and/or cash, as determined by the Committee, equal to the excess of the Fair Market Value of a Share on the day the Stock Appreciation Right is exercised over the specified purchase price.

ARTICLE 3 - ADMINISTRATION

3.1 General. This Plan shall be administered by the Committee. The Committee, in its discretion, may delegate to one or more of its members, or to officers of the Company, such of its powers as it deems appropriate.

3.2 Authority of the Committee.

(a) Subject to the other terms and provisions of the Plan, the Committee shall have the exclusive right to interpret, construe and administer the Plan, to select the Eligible Participants who are eligible to receive

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an Award, and to act in all matters pertaining to the granting of an Award and the contents of the Agreement evidencing the Award, including, without limitation, the determination of the number of Options, Stock Appreciation Rights, Restricted Stock, or Restricted Stock Units subject to an Award and the form, terms, conditions and duration of each Award, and any amendment thereof consistent with the provisions of the Plan. The Committee may adopt such rules, regulations and procedures of general application for the administration of this Plan, as it deems appropriate.

(b) The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Agreement in the manner and to the extent it shall deem desirable to carry it into effect.

(c) In the event the Company shall assume outstanding employee benefit awards or the right or obligation to make future such awards in connection with the acquisition of another corporation or business entity, the Committee may, in its discretion, make such adjustments in the terms of Awards under the Plan as it shall deem appropriate.

(d) All acts, determinations and decisions of the Committee made or taken pursuant to grants of authority under the Plan or with respect to any questions arising in connection with the administration and interpretation of the Plan, including the severability of any and all of the provisions thereof, shall be conclusive, final and binding upon all parties, including the Company, its stockholders, Participants, Eligible Participants and their estates, beneficiaries and successors.

3.3 Delegation of Authority. The Committee may, at any time and from time to time, delegate to one or more persons any or all of its authority under Section 3.2, to the full extent permitted by law.

3.4 Award Agreements. Each Award granted under the Plan shall be evidenced by a written Agreement. Each Agreement shall be subject to and incorporate, by reference or otherwise, the applicable terms and conditions of the Plan, and any other terms and conditions, not inconsistent with the Plan, as may be imposed by the Committee. A copy of such document shall be provided to the Participant, and the Committee may, but need not, require that the Participant sign a copy of the Agreement.

3.5 Indemnification. In addition to such other rights of indemnification as they may have as directors, officers or as members of the Committee, directors and officers of the Company and the members of the Committee shall be indemnified by the Company against reasonable expenses, including attorney’s fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan or any Award granted thereunder, and against all amounts paid by them in settlement thereof, provided such settlement is approved by independent legal counsel selected by the Company, or paid by them in satisfaction of a judgment or settlement in any such action, suit or proceeding, except as to matters as to which the director, officer or Committee member has been grossly negligent or engaged in willful misconduct in the performance of his duties; provided, that within 60 days after institution of any such action, suit or proceeding, a director, officer or Committee member shall in writing offer the Company the opportunity, at its own expense, to handle and defend the same.

ARTICLE 4 - SHARES SUBJECT TO THE PLAN

4.1 Number of Shares.

(a) Subject to adjustment as provided in (b) below and in Section 4.2, the aggregate number of Shares which are available for issuance pursuant to Awards under the Plan is Five Hundred Seventy Thousand (570,000) Shares plus the number of Shares subject to outstanding grants on the Effective Date under the prior Amended and Restated Non-Employee Director Stock Option Plan (the “Prior Director Plan”) which are forfeited or expire on or after the Effective Date in accordance with the terms of such grants. Shares to be issued under the Plan shall be made available from Shares currently authorized but unissued or Shares currently held (or subsequently acquired) by the Company as treasury shares, including Shares purchased in the open market or in private transactions.

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(b) The following rules shall apply for purposes of the determination of the number of Shares available for grant under the Plan:

(i) If, for any reason, any Shares awarded or subject to purchase under the Plan are not delivered or purchased, or are reacquired by the Company, for reasons, including, but not limited to, a forfeiture of Restricted Stock or termination, expiration or cancellation of an Option, Stock Appreciation Right, or Restricted Stock Unit (“Returned Shares”) such shares shall not be charged against the aggregate number of Shares available for issuance pursuant to Awards under the Plan and shall again be available for issuance pursuant to an Award under the Plan. If the exercise price and/or withholding obligation under an Award is satisfied by tendering Shares to the Company (either by actual delivery or attestation), only the number of Shares issued net of the Shares so tendered shall be deemed delivered for purposes of determining the maximum number of Shares available for issuance under the Plan.

(ii) Each Stock Appreciation Right or Restricted Stock Unit that may be settled in Shares shall be counted as one Share subject to an award. Stock Appreciation Rights or Restricted Stock Units that may not be settled in Shares (or that may be settled in Shares but are not) shall not result in a charge against the aggregate number of Shares available for issuance pursuant to an Award under the Plan. In addition, if a Stock Appreciation Right is granted in connection with an Option and the exercise of the Stock Appreciation Right results in the loss of the Option right, the Shares that otherwise would have been issued upon the exercise of such related Option shall not result in a charge against the aggregate number of Shares available for issuance pursuant to an Award under the Plan.

4.2 Adjustment of Shares. If any change in corporate capitalization, such as a stock split, reverse stock split, stock dividend, or any corporate transaction such as a reorganization, reclassification, merger or consolidation or separation, including a spin-off, of the Company or sale or other disposition by the Company of all or a portion of its assets, any other change in the Company’s corporate structure, or any distribution to stockholders (other than a cash dividend) results in the outstanding Shares, or any securities exchanged therefor or received in their place, being exchanged for a different number or class of shares or other securities of the Company, or for shares of stock or other securities of any other entity, or new, different or additional shares or other securities of the Company or of any entity being received by the holders of outstanding Shares, then equitable adjustments shall be made by the Committee in:

(a) the limitations on the aggregate number of Shares that may be awarded as set forth in Section 4.1;

(b) the number and class of Shares that may be subject to an Award, and which have not been issued or transferred under an outstanding Award;

(c) the Option Price under outstanding Options and the number of Shares to be transferred in settlement of outstanding Stock Appreciation Rights; and

(d) the terms, conditions or restrictions of any Award and Agreement, including the price payable for the acquisition of Shares.

ARTICLE 5 - STOCK OPTIONS

5.1 Automatic Grant Of Stock Options or Alternate Awards.

(a) On the date of each Annual Stockholders Meeting (the “Annual Grant Date”), each Director shall be granted an Option to purchase Twenty Thousand (20,000) Shares at an Option Price equal to one hundred percent (100%) of the Fair Market Value of a Share on such grant date, unless such Director has received a grant pursuant to Section 5.1(b) at any time subsequent to the date of the last Annual Grant Date meeting.

(b) Each individual who is first appointed or elected to serve as a Director shall instead be granted an Option to purchase Sixty Thousand (60,000) Shares at an Option Price equal to one hundred percent (100%) of the Fair Market Value of a Share on such date, provided that individual has not previously been in the employ of the Company or an Employer.

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(c) In lieu of each Option to purchase one Share of Common Stock granted pursuant to Sections 5.1(a) and 5.1(b), the Committee in its discretion may substitute therefor an Award of one-half of a Share of Restricted Stock or one-half of a Restricted Stock Unit.

(d) Notwithstanding the automatic grant provisions of this Section 5.1, if a Director has already been granted Options, Restricted Stock and/or Restricted Stock Units in an aggregate amount of 100,000 or more Shares pursuant to the automatic grant provisions of the Plan and/or the Prior Director Plan, no further automatic grants will be made to such Director pursuant to this Section 5.1. For purposes of determining whether Options, Restricted Stock and/or Restricted Stock Units with respect to 100,000 Shares have been granted pursuant to these automatic grant provisions, each Option shall count as one Share and each Share of Restricted Stock and Restricted Stock Unit shall count as two Shares.

Each Option granted under Section 5.1(a) shall vest 33 ¹/3% per year commencing one year after the date of grant, shall expire ten (10) years after the date of grant and may be exercised, in whole or in part, in accordance with Sections 5.7 and 5.8. Each Option granted under Section 5.1(b) shall vest 20% per year commencing one year after the date of grant, shall expire ten (10) years after the date of grant and may be exercised, in whole or in part, in accordance with Sections 5.7 and 5.8. The Committee shall provide in the Award for the treatment of the exercisability of the Options upon the Director’s termination of Board service. Each Share of Restricted Stock and/or Restricted Stock Unit granted in lieu of Options pursuant to Section 5.1(a) shall vest 33 ¹/3% per year commencing one year after the date of grant. Each Share of Restricted Stock and/or Restricted Stock Unit granted in lieu of Options pursuant to Section 5.1(b) shall vest 20% per year commencing one year after the date of grant.

5.2 Discretionary Grants of Awards. The Committee may, in its discretion and upon such terms and conditions as may be established by the Committee, grant Options to Directors under this Plan in addition to those provided for in Section 5.1 above. Such Option grants shall be upon terms and conditions consistent with the provisions of Article 5 hereof.

5.3 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Eligible Participants at any time and from time to time as shall be determined by the Committee. The Committee shall have sole discretion in determining the number of Shares subject to Options granted to each Participant and may vary such Awards among Participants.

5.4 Agreement. Each Option grant shall be evidenced by an Agreement that shall specify the Option Price, the duration of the Option, the number of Shares to which the Option pertains and such other provisions as the Committee shall determine.

5.5 Option Price. The Option Price for an Option shall not be less than the Fair Market Value of a Share on the date the Option is granted.

5.6 Duration of Options. Each Option shall expire at such time as the Committee shall determine at the time of grant; provided, however, that no Option shall be exercisable later than the tenth (10^th) anniversary of its grant date.

5.7 Exercise of Options. Options granted under the Plan shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall in each instance approve, including conditions related to the provision of services by the Participant with the Company or any Employer, which need not be the same for each grant or for each Participant. The Committee may provide in the Agreement for automatic accelerated vesting and other rights upon the occurrence of a Change in Control of the Company or upon the occurrence of other events as specified in the Agreement. In addition, the Committee may provide in the Agreement for the right of a Participant to defer option gains related to an exercise.

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5.8 Payment. Options shall be exercised by the delivery of a written notice of exercise to the Company, setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares. The Option Price upon exercise of any Option shall be payable to the Company in full either: (a) in cash, (b) cash equivalent approved by the Committee, (c) if approved by the Committee, by tendering previously acquired Shares (or delivering a certification or attestation of ownership of such Shares) having an aggregate Fair Market Value at the time of exercise equal to the total Option Price (provided that the tendered Shares must have been held by the Participant for any period required by the Committee), or (d) by a combination of (a), (b) and (c). The Committee also may allow cashless exercises as permitted under the Federal Reserve Board’s Regulation T, subject to applicable securities law restrictions, or by any other means which the Committee determines to be consistent with the Plan’s purpose and applicable law.

5.9 Nontransferability of Options. Except as otherwise provided in a Participant’s Award Agreement with respect to transfers to Permitted Transferees (any such transfers being subject to applicable laws, rules and regulations), no Option granted under this Article 5 may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Further, except as otherwise provided in a Participant’s Award Agreement, all Options granted to a Participant under this Article 5 shall be exercisable during his or her lifetime only by such Participant.

5.10 Purchased Options. The Committee shall also have the authority to grant Options to Participants in exchange for a stated purchase price for such Option (which may be payable by the Participant directly or, at the election of the Participant, may be offset from other amounts owed to the Participant by the Company).

ARTICLE 6 - STOCK APPRECIATION RIGHTS

6.1 Grant of SARs. A Stock Appreciation Right may be granted to an Eligible Participant in connection with an Option granted under Article 5 of this Plan or may be granted independently of any Option. A Stock Appreciation Right shall entitle the holder, within the specified period (which may not exceed 10 years), to exercise the SAR and receive in exchange therefor a payment having an aggregate value equal to the amount by which the Fair Market Value of a Share exceeds the exercise price, times the number of Shares with respect to which the SAR is exercised. The Committee may provide in the Agreement for automatic accelerated vesting and other rights upon the occurrence of a Change in Control or upon the occurrence of other events specified in the Agreement. A SAR granted in connection with an Option (a “Tandem SAR”) shall entitle the holder of the related Option, within the period specified for the exercise of the Option, to surrender the unexercised Option, or a portion thereof, and to receive in exchange therefore a payment having an aggregate value equal to the amount by which the Fair Market Value of a Share exceeds the Option price per Share, times the number of Shares under the Option, or portion thereof, which is surrendered. SARs shall be subject to the same transferability restrictions as Options.

6.2 Tandem SARs. Each Tandem SAR shall be subject to the same terms and conditions as the related Option, including limitations on transferability, and shall be exercisable only to the extent such Option is exercisable and shall terminate or lapse and cease to be exercisable when the related Option terminates or lapses. With respect to Options, the grant either may be concurrent with the grant of the Options, or in connection with Options previously granted under Article 5, which are unexercised and have not terminated or lapsed. Upon exercise of a Tandem SAR, the number of Shares subject to exercise under any related Option shall automatically be reduced by the number of Shares represented by the Option or portion thereof which is surrendered.

6.3 Payment. The Committee shall have sole discretion to determine in each Agreement whether the payment with respect to the exercise of an SAR will be in the form of all cash, all Shares or any combination thereof. If payment is to be made in Shares, the number of Shares shall be determined based on the Fair Market Value of a Share on the date of exercise. If the Committee elects to make full payment in Shares, no fractional Shares shall be issued and cash payments shall be made in lieu of fractional shares. The Committee shall have

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sole discretion as to the timing of any payment made in cash or Shares, or a combination thereof, upon exercise of SARs. Payment may be made in a lump sum, in annual installments or may be otherwise deferred (at the election of the Participant) and the Committee shall have sole discretion to determine whether any deferred payments may bear amounts equivalent to interest or cash dividends.

ARTICLE 7 - RESTRICTED STOCK AND RESTRICTED STOCK UNITS

7.1 Grant of Restricted Stock. Restricted Stock Awards may be made to Eligible Participants as a reward for past service or as an incentive for the performance of future services that will contribute materially to the successful operation of the Company. Awards of Restricted Stock may be made either alone or in addition to or in tandem with other Awards granted under the Plan and may be current grants of Restricted Stock or deferred grants of Restricted Stock.

7.2 Restricted Stock Agreement. The Restricted Stock Agreement shall set forth the terms of the Award, as determined by the Committee, including, without limitation, the purchase price, if any, to be paid for such Restricted Stock, which may be more than, equal to, or less than Fair Market Value and may be zero, subject to such minimum consideration as may be required by applicable law; any restrictions applicable to the Restricted Stock such as continued service or the length of the Restriction Period and whether any circumstances, such as death, Disability, or a Change in Control, will shorten or terminate the Restriction Period; and rights of the Participant to vote or receive dividends or distributions with respect to the Shares during the Restriction Period. Subject to shortening the length of the Restriction Period upon the occurrence of certain circumstances, such as death, Disability, or a Change in Control, or upon the achievement of performance measures, all grants of Restricted Stock and Restricted Stock Units shall have a Restriction Period of not less than three (3) years (but graded vesting may be provided). Restricted Stock Awards issued in lieu of all or part of cash compensation otherwise payable to a Participant shall be subject to a Restriction Period of not more than one year.

Notwithstanding Section 3.4 of the Plan, a Restricted Stock Award must be accepted within a period of sixty (60) days, or such other period as the Committee may specify, by executing a Restricted Stock Agreement and paying whatever price, if any, is required. The prospective recipient of a Restricted Stock Award shall not have any rights with respect to such Award, unless and until such recipient has executed a Restricted Stock Agreement and has delivered a fully executed copy thereof to the Committee, and has otherwise complied with the applicable terms and conditions of such Award.

7.3 Nontransferability. Except as otherwise provided in this Article 7, no Shares of Restricted Stock nor any Restricted Stock Units received by a Participant shall be sold, exchanged, transferred, pledged, hypothecated or otherwise disposed of during the Restriction Period.

7.4 Certificates. Upon an Award of Restricted Stock to a Participant, Shares of Restricted Stock shall be registered in the Participant’s name (or an appropriate book entry shall be made). Certificates, if issued, may either be held in custody by the Company until the Restriction Period expires or until restrictions thereon otherwise lapse and/or be issued to the Participant and registered in the name of the Participant, bearing an appropriate restrictive legend and remaining subject to appropriate stop-transfer orders. If required by the Committee, the Participant shall deliver to the Company one or more stock powers endorsed in blank relating to the Restricted Stock. If and when the Restriction Period expires without a prior forfeiture of the Restricted Stock subject to such Restriction Period, unrestricted certificates for such Shares shall be delivered to the Participant; provided, however, that the Committee may cause such legend or legends to be placed on any such certificates as it may deem advisable under the rules, regulations and other requirements of the Securities and Exchange Commission and any applicable federal or state law.

7.5 Dividends and Other Distributions. Except as provided in this Article 7 or in the Award Agreement, a Participant receiving a Restricted Stock Award shall have, with respect to such Restricted Stock Award, all of the rights of a stockholder of the Company, including the right to vote the Shares to the extent, if any, such Shares

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possess voting rights and the right to receive any dividends or distributions; provided, however, the Committee may require that any dividends on such Shares of Restricted Stock shall be automatically deferred and reinvested in additional Restricted Stock subject to the same restrictions as the underlying Award, or may require that dividends and other distributions on Restricted Stock shall be paid to the Company for the account of the Participant. The Committee shall determine whether interest shall be paid on such amounts, the rate of any such interest, and the other terms applicable to such amounts.

7.6 Restricted Stock Units (or RSUs). Awards of Restricted Stock Units may be made to Eligible Participants in accordance with the following terms and conditions:

(a) The Committee, in its discretion, shall determine the number of RSUs to grant to a Participant, the Restriction Period and other terms and conditions of the Award, including whether the Award will be paid in cash, Shares or a combination of the two and the time when the Award will be payable (i.e., at vesting, termination of Board service or another date).

(b) Unless the Agreement provides otherwise, RSUs shall not be sold, transferred or otherwise disposed of and shall not be pledged or otherwise hypothecated.

(c) Awards of RSUs shall be subject to the same terms as applicable to Awards of Restricted Stock under Section 7.2 of this Plan; provided, however, a Participant to whom RSUs are awarded has no rights as a stockholder with respect to the shares represented by the RSUs unless and until the Shares are actually delivered to the Participant; provided further, however, RSUs may have dividend equivalent rights if provided for by the Committee which may be subject to the same terms and conditions governing dividends and distributions applicable to Restricted Stock Awards under Section 7.5 of this Plan with the exception that in no event shall RSUs possess voting rights.

(d) The Agreement shall set forth the terms and conditions that shall apply upon the Participant’s termination of Board service (including a forfeiture of RSUs for which the restrictions have not lapsed upon Participant’s ceasing to serve on the Board) as the Committee may, in its discretion, determine at the time the Award is granted.

ARTICLE 8 - BENEFICIARY DESIGNATION

Each Participant under the Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in case of his or her death before he or she receives any or all of such benefit. Each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Committee, and will be effective only when filed by the Participant in writing with the Committee during the Participant’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate.

ARTICLE 9 - DEFERRALS

The Committee may permit or require a Participant to defer under this Plan or to a separate deferred compensation arrangement of the Company such Participant’s receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant by virtue of the exercise of an Option or SAR, or the lapse or waiver of restrictions with respect to Restricted Stock or Restricted Stock Units. If any such deferral election is required or permitted, the Committee shall, in its sole discretion, establish rules and procedures for such payment deferrals.

ARTICLE 10 - WITHHOLDING

10.1 Tax Withholding. The Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy any Federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan.

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10.2 Share Withholding. With respect to withholding required upon the exercise of Options or SARs, upon the lapse of restrictions on Restricted Stock or RSUs or upon any other taxable event arising as a result of Awards granted hereunder, Participants shall, if requested by the Committee, satisfy the withholding requirement by having the Company withhold Shares having a Fair Market Value on the date the tax is to be determined equal to not more than the minimum amount of tax required to be withheld with respect to the transaction. All such elections shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.

ARTICLE 11 - AMENDMENT AND TERMINATION

11.1 Amendment of Plan. The Committee may at any time terminate or from time to time amend the Plan in its discretion in whole or in part, but no such action shall adversely affect any rights or obligations with respect to any Awards previously granted under the Plan, unless the affected Participants consent in writing. To the extent required by the rules of NASDAQ or any exchange upon which the Company lists the Shares for trading or other applicable law, rule or regulation, no amendment shall be effective unless approved by the stockholders of the Company at an annual or special meeting.

11.2 Amendment of Award Agreement; Repricing. The Committee may, at any time in its discretion amend outstanding Agreements in a manner not inconsistent with the terms of the Plan; provided, however, if such amendment is adverse to the Participant, as determined by the Committee, the amendment shall not be effective unless and until the Participant consents, in writing, to such amendment. To the extent not inconsistent with the terms of the Plan, the Committee may, at any time in its discretion amend an outstanding Agreement in a manner that is not unfavorable to the Participant without the consent of such Participant. Notwithstanding the above provision, the Committee shall not have the authority to decrease the Option Price of any outstanding Option, except in accordance with Section 4.2 or unless such an amendment is approved by the stockholders of the Company.

11.3 Termination of Plan. No Awards shall be granted under the Plan after the tenth (10th) anniversary of the date the Board adopts the Plan.

11.4 Assumption or Cancellation of Awards. In the event of a proposed sale of all or substantially all of the assets or stock of the Company, the merger of the Company with or into another corporation such that stockholders of the Company immediately prior to the merger exchange their shares of stock in the Company for cash and/or shares of another entity or any other corporate transaction to which the Committee deems this provision applicable, each Award shall be assumed or an equivalent Award shall be substituted by the successor corporation or a parent or subsidiary of such successor corporation (and adjusted as appropriate), unless such successor corporation does not agree to assume the Award or to substitute an equivalent award, in which case the Committee may, in its sole discretion and in lieu of such assumption or substitution, provide for the Participant to have the right to exercise the Option or other Award as to all Shares, including Shares as to which the Option or other Award would not otherwise be exercisable (or with respect to Restricted Stock or Restricted Stock Units, provide that all restrictions shall lapse) or provide for cancellation and for a cash payment for such Award. If the Committee makes an Option or other Award fully exercisable in lieu of assumption or substitution in the event of a merger or sale of assets or stock or other corporate transaction, the Committee shall notify the Participant that, subject to rescission if the merger, sale of assets or stock or other corporate transaction is not successfully completed within a certain period, the Option or other Award shall be fully exercisable for a period of fifteen (15) days from the date of such notice (or such other period as provided by the Committee), and, to the extent not exercised, the Option or other Award will terminate upon the expiration of such period.

ARTICLE 12 - MISCELLANEOUS PROVISIONS

12.1 Restrictions on Shares. All certificates for Shares delivered under the Plan shall be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Stock is

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then listed and any applicable federal or state laws, and the Committee may cause a legend or legends to be placed on any such certificates to make appropriate reference to such restrictions. In making such determination, the Committee may rely upon an opinion of counsel for the Company or Committee.

Notwithstanding any other provision of the Plan, the Company shall have no liability to deliver any Shares under the Plan or make any other distribution of the benefits under the Plan unless such delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act of 1933), and the applicable requirements of any securities exchange or similar entity.

12.2 Successors. The terms of the Plan shall be binding on the Company, and its successors and assigns (whether by purchase, merger, consolidation or otherwise).

12.3 No Implied Rights. Nothing in the Plan or any Award granted under the Plan shall confer upon any Participant any right to continue in the service of the Company, or to serve as a Director thereof, or interfere in any way with the right of the Company to terminate the Participant’s services for any reason at any time. No Participant shall have any claim to an Award until it is actually granted under the Plan. To the extent that any person acquires a right to receive payments from the Company under the Plan, such right shall, except as otherwise provided by the Committee, be no greater than the right of an unsecured general creditor of the Company.

12.4 Compliance with Laws. The Plan and the grant of Awards shall be subject to all applicable federal and state laws, rules, and regulations and to such approvals by any United States government or regulatory agency as may be required. Any provision herein relating to compliance with Rule 16b-3 under the Act shall not be applicable with respect to participation in the Plan by Participants who are not Insiders.

12.5 Tax Elections. Each Participant agrees to give the Committee prompt written notice of any election made by such Participant under Code Section 83(b) or any similar provision thereof.

12.6  Legal Construction.

(a) Severability. If any provision of this Plan or an Agreement is or becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or would disqualify the Plan or any Agreement under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to applicable laws or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Agreement, it shall be stricken and the remainder of the Plan or the Agreement shall remain in full force and effect.

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(b) Gender and Number. Where the context admits, words in any gender shall include the other gender, words in the singular shall include the plural and words in the plural shall include the singular.

(c) Governing Law. To the extent not preempted by federal law, the Plan and all Agreements hereunder, shall be construed in accordance with and governed by the laws of the State of Florida.

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EX-10.3

Exhibit 10.3

MPS GROUP, INC.

EXECUTIVE ANNUAL INCENTIVE PLAN

SECTION 1

Establishment and Purpose. MPS Group, Inc., a Florida corporation (the “Company”), hereby establishes an incentive compensation plan, which shall be known as the MPS Group, Inc. Executive Annual Incentive Plan (the “Plan”). The purposes of the Plan are to further the growth and financial success of the Company by offering performance incentives to designated executives who have significant responsibility for such success, to encourage management to focus on key corporate, business unit and individual performance objectives, and to assist in the attraction and retention of qualified management talent through a competitive compensation package. All Awards granted under the Plan shall be governed solely by the terms of the Plan, the Award Notification, the Plan Rules and applicable law.

SECTION 2

Definitions.

“Affiliate” means a company or organization that directly, or indirectly through one or more intermediaries, is controlled by the Company, whether through the ownership of voting securities, by contract or otherwise, and may be an unincorporated entity, division or operating unit of the Company or any its Affiliates.

“Award” means the cash incentive bonus granted to a Participant in accordance with the provisions of the Plan.

“Award Notification” means the written terms and conditions applicable to an Award granted to a Participant, substantially in the form attached as Appendix B.

“Award Opportunity” means the percentages, as set forth in the Award Notification, that are to determine the amount of the Participant’s Award. Award Opportunity levels shall generally be dependent upon an individual’s position in the Company or an Affiliate and level of responsibility.

“Base Annual Salary” means the actual regular annual base salary paid to a Participant during the applicable Plan Year, excluding bonus, automobile allowance, dues or other special awards (but as increased by the amount of any pre-tax deferrals or other pre-tax payments made by the Participant to the Company’s deferred compensation or welfare plans (whether qualified or non-qualified)). Base Annual Salary shall not include income from stock options, restricted stock awards, fringe benefits, tax gross-ups or similar items.

“Board of Directors” or “Board” means the Board of Directors of the Company.

“Change in Control” means any of the following events:

(a) The acquisition by any “person,” as the term person is used for purposes of Sections 13(d) or 14(d) of the Exchange Act, of legal or beneficial ownership of 35% or more of either (i) the then outstanding shares of common stock of the Company or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors;

(b) Individuals who, as of the Effective Date constitute the Board of Directors cease for any reason to constitute at least a majority of the Board of Directors; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Board of Directors shall be considered as though such individual were a member of the Board of Directors as of the date hereof;

(c) Approval by the shareholders of the Company of a reorganization, merger or consolidation, in each case unless the shareholders of the Company immediately before such reorganization, merger or consolidation own, directly or indirectly, immediately following such reorganization, merger or consolidation at least a majority of the combined voting power of the outstanding voting securities of the corporation resulting from such reorganization, merger or consolidation in substantially the same proportion as their ownership of the voting securities immediately before such reorganization, merger or consolidation; or

(d) Approval by the shareholders of the Company of (i) a complete liquidation or dissolution of the Company, or (ii) the sale or other disposition of more than 50% of the assets of the Company within a twelve month period.

“Chief Executive Officer” means the chief executive officer of the Company, unless otherwise specified.

“Chief Financial Officer” means the chief financial officer of the Company, unless otherwise specified.

“Code” means the Internal Revenue Code of 1986, as amended.

“Committee” means the Compensation Committee of the Board of Directors, or any subcommittee thereof, comprised of not less than the minimum number of persons from time to time required by Section 16(b) of the Exchange Act or Code Section 162(m), or any other committee designated by the Board of Directors which is responsible for administering the Plan.

“Company” means MPS Group, Inc., a Florida corporation, and its successors.

“Effective Date” shall have the meaning ascribed to it in Section 7(a).

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

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“Financial Performance Criteria” means one or more criteria selected by the Committee to measure performance for the year and which are listed on Appendix A attached hereto.

“Financial Performance Objective” means one or more Financial Performance Criteria that are applied to a Participant in determining the component of the Plan that relates to financial performance.

“Key Performance Objective” means an established individual goal applied to a Participant in determining a component of the Plan that relates to other than financial performance.

“Maximum Award” means the maximum percentage of Base Annual Salary which may be paid to a Participant as an Award based upon the performance during the Plan Year.

“Named Executive Officer” means a Participant who for a particular Plan Year is one of the group of “covered employees” under Code Section 162(m) and the regulations thereunder.

“Participant” means an employee of the Company or an Affiliate who is designated by the Committee in its sole discretion to participate in the Plan.

“Performance Level” means one or more related levels of Financial Performance Objectives and Key Performance Objectives as established by the Committee. Each Performance Level may be expressed on an absolute and/or relative basis; or may be based on or otherwise employ comparisons based on internal targets, the past performance of the Company and/or the past or current performance of other companies; and in the case of earnings-based measures, may consist of or utilize comparisons related to capital, shareholders’ equity and/or shares outstanding, or to assets or net assets.

“Plan Rules” has the meaning ascribed to it by Section 3(a).

“Plan Year” means the twelve month period which is the same as the Company’s fiscal year. The initial Plan Year shall be January 1, 2004 through December 31, 2004.

“Target Award” means the percentage of Base Annual Salary which will be paid to a Participant as an Award if the Performance Level applicable to the Participant for the Plan Year is achieved, as reflected in the Plan Rules for such Plan Year.

“Threshold Award” means the percentage of Base Annual Salary which may be paid to a Participant as an Award based on the minimum acceptable performance during the Plan Year.

SECTION 3

Administration.

(a) The Plan will be administered by the Committee, subject to its right to delegate responsibility for administration of the Plan as set forth herein. Subject to the terms of the Plan and applicable law, the Committee will have authority to establish: (i) the employees who are to become Participants in the Plan; (ii) the

3

Target Award, Maximum Award and Threshold Award that can be granted to each Participant and the method for determining such award which the Committee may amend from time to time; (iii) the applicable Financial Performance Objectives and Key Performance Objectives for each Participant, which Financial Performance Objectives will include one or more of the Financial Performance Criteria listed on Appendix A attached hereto, as determined by the Committee each year; (iv) the time or times and the conditions subject to which any Award may become payable; and (v) the form of payment of an Award (collectively, the matters referred to in (i) – (v) above are “Plan Rules”) .

(b) The Plan Rules will be adopted by the Committee prior to, or as soon as practical after, the commencement of each Plan Year, provided that with respect to Named Executive Officers such Plan Rules will be adopted within the time provided in the regulations under Code Section 162(m) if compliance therewith is necessary or desirable in the Committee’s determination. Subject to the provisions of the Plan and the Committee’s right to delegate its responsibilities, the Committee will also have the discretionary authority to interpret the Plan, to prescribe, amend and rescind rules and regulations relating to it, and to make all other determinations deemed necessary or advisable in administering the Plan. The determinations of the Committee on the matters referred to in paragraphs (a)(i) through (iv) of this Section 3 with respect to Named Executive Officers (and such other Participants as the Committee may determine) may be submitted at least annually to the Board of Directors for its consideration and ratification, provided that with respect to the Chief Executive Officer the Committee shall establish the Award level and performance targets. For Participants who are not Named Executive Officers, or for Named Executive Officers for which the Committee may determine that compliance with Code Section 162(m) is not necessary or warranted in any Plan Year, the Committee may in its discretion establish Financial Performance Criteria or other performance measures not listed on Appendix A without obtaining shareholder approval.

SECTION 4

Eligibility. The Committee will designate by name or position the Participants for each Plan Year, which designation may be based upon the recommendations of the Chief Executive Officer and other designees. Any employee who is a Participant in one Plan Year may be excluded from participation in any other Plan Year. If, during the Plan Year, a Participant, other than a Named Executive Officer for which compliance with Code Section 162(m) is warranted or desirable in the Committee’s determination, changes employment positions to a new position that corresponds to a different Award level, the Committee may, in its discretion, adjust the Participant’s Award level for such Plan Year. The Committee may, in its discretion, designate employees who are hired after the beginning of the Plan Year as Participants for such Plan Year and as eligible to receive a full or partial Award for such year.

SECTION 5

Awards.

(a) Each Participant shall receive an annual Award Notification that shall address the terms and conditions of his/her annual Award Opportunity. The Award Notification shall address the weighting between the Financial Performance Objectives and any Key Performance

4

Objectives; the Performance Levels for each objective; and such other terms and conditions applicable to the Award, as determined by the Committee, not inconsistent with the terms of the Plan.

(b) At the end of each Plan Year, the finance department of the Company will determine the actual financial performance for the Plan Year. The Chief Executive Officer will review any individual Key Performance Objectives for other Participants to determine the achievement of those Performance Levels. Once the Performance Levels have been determined, the Chief Financial Officer or its designee will calculate the actual Award payment.

(c) At the end of each Plan Year, the Committee shall certify the extent to which the Financial Performance Objectives and Key Performance Objectives have been achieved for such Plan Year based upon information provided by the Company and such other information related to the Participant as the Committee deems necessary. Subject to the right to decrease an Award as described in the next paragraph, the Participant’s Award shall be computed by the Committee based upon the achievement of the established Financial Performance Objectives and/or Key Performance Objectives, the Plan Rules, measurement criteria and the requirements of the Plan. In addition to any adjustments which the Committee may provide for in the Award or the Plan Rules, the Committee may, in determining whether Financial Performance Objectives and Key Performance Objectives have been met, adjust the Company’s or Affiliate’s financial results to exclude the effect of unusual charges or income items, changes in accounting rules or other events (such as acquisitions, divestitures and equity and similar restructurings, force reductions or similar corporate restructurings, asset impairments), ((including impairments of goodwill and other intangible assets)), which in the Committee’s judgment distort the comparison of results from one year to another (either on a segment or consolidated basis). The Committee may also make adjustments to eliminate the effects of changes in tax law, rules and regulations. With respect to Named Executive Officers, the Committee shall consider the provisions of Section 162(m) of the Code in making adjustments for awards intended to comply with Section 162(m) of the Code.

(d) The Committee may, in its discretion, decrease the amount of a Participant’s Award for a Plan Year based upon such factors as it may determine, including the failure of the Company or Affiliate to meet certain performance goals or of a Participant to meet his or her Key Performance Objectives. The factors to be used in reducing an Award shall be established at the beginning of a Plan Year and may vary among Participants.

(e) In the event that the Company’s or Affiliate’s performance is below the performance standards for the Plan Year and the Awards are reduced or cancelled, the Committee may in its discretion grant Awards (or increase the otherwise earned Awards) under the Plan to deserving Participants, except that any adjustments for Participants who are Named Executive Officers shall be made in a manner consistent with the next paragraph.

(f) The Plan Rules and Awards under the Plan shall be administered in a manner to qualify payments under the Plan to Named Executive Officers for the performance-based exception under Code Section 162(m) and the regulations thereunder, except where the Committee or the Board of Directors determines such compliance is not desirable or required. The maximum Award that may be paid to an individual Participant for a Plan Year shall be $3 million.

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(g) No Participant will have any vested right to receive payment of any Award until such date as the Committee has made its determination with respect to the payment of such Participant’s Award; provided, that where the Committee determines that Board ratification of its determination is necessary or desirable, then no right to payment of any Award to such Participant is vested until the Board has so ratified the Committee’s determination. Except as provided herein or stated otherwise in a Participant’s employment agreement, severance agreement or other arrangement, no Award will be paid to any Participant who is not an active employee of the Company or an Affiliate at the end of the Plan Year to which the Award relates; provided, that, at the discretion of the Committee or its designee, partial Awards may be authorized by the Committee to be paid to Participants (or their beneficiaries) who are terminated without cause (as determined by the Committee or its designee) or who retire, die or become permanently and totally disabled during the Plan Year. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Affiliate and a Participant or any other person. To the extent that any Participant or person acquires a right to receive payments from the Company or an Affiliate pursuant to an Award, such right shall entail no interest in any specific asset of the Company or Affiliate and shall be no greater than the right of any employee of the Company or Affiliate generally.

(h) Payment of the Awards will be made as soon as practicable after their determination (but in no event later than March 15th of the year following the Plan Year for which the Award is earned), subject to a Participant’s right to defer payment pursuant to any applicable deferred compensation plans or arrangements of the Company. Payment will generally be made in a lump sum in cash, unless the Committee otherwise determines at the beginning of the Plan Year.

SECTION 6

General.

(a) Notwithstanding the responsibilities of the Committee set forth herein, the Committee may delegate to the Chief Executive Officer or others all or any portion of its responsibility for administration of the Plan. Such delegation may include, without limitation, the authority to designate employees who can participate in the Plan, to establish Plan Rules, to interpret the Plan, to determine the extent to which performance criteria have been achieved, and to adjust any Awards that are payable. In the case of each such delegation, the administrative actions of the delegate shall be subject to the approval of the person within the Company to whom the delegate reports (or, in the case of a delegation to the Chief Executive Officer, to the approval of the Committee to the extent a Named Executive Officer is involved).

(b) Upon the occurrence of a Change in Control, unless the Participant otherwise elects in writing, the Participant’s Award for the Plan Year shall be awarded at the greater of the Target Award level, or the actual level of achievement of the Financial Performance Objective(s), Key Performance Objectives or Performance Levels for such Plan Year to the date of the Change in

6

Control (determined by projecting the achievement level to the date of the Change in Control as performance for the full Plan Year), without any reductions under this Plan, and shall be deemed to have been fully earned for the Plan Year, provided that the Participant shall only be entitled to payment of a pro rata portion of the Award based upon the number of days within the Plan Year that had elapsed as of the effective date of the Change in Control. Notwithstanding the foregoing sentence or anything stated herein elsewhere, nothing in this Plan is intended or should be construed to alter, limit or diverge from the terms of any employment agreement or severance agreement between a Participant and the Company or any Affiliate where such employment agreement or severance agreement provides for a greater payment on account of an Award in the event of a change in control (as defined in such employment or severance agreement), and the terms of any employment agreement or severance agreement between a Participant and the Company or any Affiliate that provide for a greater payment of an Award to a Participant in the event of a change in control (as defined in such employment or severance agreement) shall prevail and/or control over the terms in this Plan, and the Participant shall be due the benefit of the greater payment of an Award provided for pursuant to the terms of such employment agreement or severance agreement with the Company or an Affiliate, provided that nothing stated herein is intended to duplicate payment to a Participant on account of any Award. The Award amount shall be paid in cash within thirty (30) days after the effective date of the Change in Control.

(c) Except as provided below, no Award shall be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant, except by will or the laws of descent and distribution.

(d) The Committee may provide for each Participant to designate a person or persons to receive, in the event of death, any Award to which the Participant would then be entitled under this Plan. Such designation will be made in the manner determined by the Committee and may be revoked by the Participant in writing. If the Committee does not provide for such designation, or if a Participant fails effectively to designate a beneficiary, then the estate of the Participant will be deemed to be the beneficiary.

(e) The Company shall deduct from each Award the amount of any taxes required to be withheld by any governmental authority, or the Participant may make other arrangements that the Committee may accept at the Committee’s discretion to satisfy such tax obligations.

(f) Subject to employment agreement or applicable law, no person shall have any claim to be named as a Participant, and there is no obligation for uniformity of treatment of employees, Participants or holders or beneficiaries of Awards. The terms and conditions of Awards need not be the same with respect to each Participant.

(g) Nothing in the Plan or in any Award shall confer (or be deemed to confer) upon any Participant any rights to continued employment, or interfere with or restrict in any way the rights of the Company or an Affiliate to suspend, alter or terminate the employment of any Participant at any time for any reason whatsoever, with or without cause.

(h) Unless otherwise expressly provided in the Plan or binding employment or severance agreements, all designations, determinations, interpretations and other decisions, under or with

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respect to the Plan or any Award, shall be within the discretion of the Committee, may be made at any time, and shall be final, conclusive and binding upon all persons, including the Company and any Affiliate, any Participant and any holder or beneficiary of any Award. The Committee shall have full power and authority to determine whether, and to what extent, any Award shall be canceled or suspended if the Participant (a) without the consent of the Committee, while employed by the Company or an Affiliate, or after termination of such employment but while payment of an Award otherwise still remains due, becomes associated with, employed by, renders services to, or owns any interest in, other than any non-substantial interest, as determined by the Committee, any business that is in competition with the Company or such Affiliate, or (b) is terminated for cause as determined by the Committee.

(i) No member of the Board or Committee, or designee, shall be personally liable for any action taken or determination made with respect to the Plan or any Award or payment granted or not granted hereunder.

(j) All obligations of the Company under the Plan with respect to Plan Rules issued and Awards granted hereunder shall be binding upon any assignee or successor to the Company, whether such assignee or successor is the result of an acquisition of stock or assets of the Company, a merger, consolidation or otherwise.

(k) The Plan shall be interpreted and construed under the laws of the State of Florida without giving effect to conflict of law principles.

SECTION 7

Term of the Plan.

(a) The Plan shall be effective as of January 1, 2004 (the “Effective Date”).

(b) The Committee (subject to the ratification rights of the Board of Directors) or the Board may suspend or terminate the Plan at any time, or amend the Plan in any respect, provided that no such action will, without the consent of an affected Participant, adversely affect the Participant’s rights under an existing Award.

[Remainder of Page Intentionally Left Blank]

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APPENDIX A

to

MPS GROUP, INC.

EXECUTIVE ANNUAL INCENTIVE PLAN

For purposes of the Plan, Financial Performance Criteria shall be one or more of the following Company, Affiliate, operating unit or division financial performance measures:

(i) “EBITDA” which means earnings before interest, taxes, depreciation and/or amortization

(ii) “EBIT” which means earnings before interest and taxes

(iii) Earnings, consolidated pre-tax earnings, net earnings, earnings per share

(iv) Operating income

(v) Gross margin, gross margin growth

(vi) Revenues, revenue growth, revenue per employee

(vii) Market value added, economic value added

(viii) Budget goals

(ix) Cost goals

(x) Return on equity, assets, net assets, capital employed, incremental equity or investment

(xi) Total shareholder return

(xii) Profit, economic profit, capitalized economic profit, after tax profit, pre-tax profit

(xiii) Cash flow measures, cash flow return

(xiv) Sales, sales volume

(xv) Stock price

(xvi) Business expansion goals

(xvii) Goals relating to acquisitions or divestitures.

Notwithstanding the foregoing: (a) the Committee may provide in an Award Notification that, for purposes of measuring attainment of the foregoing Financial Performance Criteria, results may exclude or discount amounts attributable to earnings of Affiliates acquired after the Effective Date and during the Plan Year; and (b) in the event any newly established branch operation commences business after the Effective Date, the financial performance of such branch operation shall not be included in the calculation of any earnings measure during the first nine months of such operations, unless such branch operation has positive earnings within the nine month period and then only for the period in which such is positive.

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APPENDIX B

to

MPS GROUP, INC.

EXECUTIVE ANNUAL INCENTIVE PLAN

FORM OF AWARD NOTIFICATION

AWARD NOTIFICATION

EXECUTIVE ANNUAL INCENTIVE PLAN

[200X]

Name:  [Name]

Position:  [Title]

This document serves as notification of your base salary and performance goals effective January 1, 200X.

Base Annual Salary: $[            .00]

Annual Incentive Award Opportunity:

Threshold Award – XX%

Target Award – XX%

Maximum Award – XXX%

Performance Objectives; Weightings

Performance Level

Threshold Performance – XX%

Target Performance – XX%

Maximum Performance – XXX%

EX-10.4

Exhibit 10.4

MPS GROUP, INC.

MANAGEMENT SAVINGS PLAN

(Effective as of January 1, 2004)

MPS GROUP, INC.

MANAGEMENT SAVINGS PLAN

TABLE OF CONTENTS

ARTICLE I INTRODUCTION AND ESTABLISHMENT		1
ARTICLE II DEFINITIONS		1
ARTICLE III PARTICIPATION		5
3.1	Eligibility to Participate.	5
3.2	Beneficiary Election.	5
ARTICLE IV PARTICIPANTS’ ACCOUNTS; EMPLOYER CONTRIBUTION CREDITS		6
4.1	Accounting for Participants’ Interests.	6
4.2	Vesting of a Participant’s Account.	7
4.3	Distribution of a Participant’s Periodic Contribution Subaccount Other Than for Death.	7
4.4	Distribution Upon Death.	8
4.5	Hardship.	8
4.6	Gross-up.	8
ARTICLE V PLAN ADMINISTRATOR		8
5.1	Committee.	8
5.2	Right and Duties.	8
5.3	Compensation, Indemnity and Liability.	9
5.4	Taxes.	9
ARTICLE VI CLAIM REVIEW PROCEDURE		10
6.1	Notice of Denial.	10
6.2	Contents of Notice of Denial.	10
6.3	Right to Review.	11
6.4	Application for Review.	11
6.5	Hearing.	12
6.6	Notice of Hearing.	12
6.7	Counsel.	12
6.8	Decision on Review.	12
6.9	Appeals Arbitrator.	13
ARTICLE VII AMENDMENT AND TERMINATION; CHANGE IN CONTROL		13
7.1	Amendments.	13
7.2	Termination of Plan.	14
7.3	Change In Control Provisions.	14

-i-

ARTICLE VIII MISCELLANEOUS		14
8.1	Limitation on Participant’s Rights.	14
8.2	Benefits Unfunded.	14
8.3	Other Plans.	15
8.4	Cooperation and Receipt or Release.	15
8.5	Governing Law.	15
8.6	Gender, Tense and Headings.	15
8.7	Successors and Assigns; Nonalienation of Benefits.	15
8.8	Combination With Other Plan.	16

APPENDIX A

APPENDIX B

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ARTICLE I

INTRODUCTION AND ESTABLISHMENT

MPS Group, Inc. (“Company”) hereby establishes the MPS Group, Inc. Management Savings Plan (“Plan”) for the benefit of eligible management and highly compensated employees of the Company and its Subsidiaries. The Plan is designed to provide eligible employees savings benefits. In general, the Plan provides for the Company to make annual credits to an account for eligible employees, which account is credited with earnings in accordance with the Plan.

The effective date of the Plan is January 1, 2004 (“Effective Date”).

ARTICLE II

DEFINITIONS

When used in this Plan, the following terms shall have the meanings set forth below unless a different meaning is plainly required by the context:

“Account” means the records maintained by the Plan Administrator to determine each Participant’s interest under this Plan. Such Account may be reflected as an entry in the Company’s (or Employer’s) records, or as a separate account under a trust arrangement, or as a combination of both. The Plan Administrator may establish such subaccounts as it deems necessary for the proper administration of the Plan.

“Appeals Arbitrator” has the meaning ascribed to such term in Section 6.9.

“Beneficiary” means the person(s), trust(s), partnership(s), foundation(s) or other legal entity(ies), including his estate, last designated by the Participant in a proper writing received by the Plan Administrator to receive the vested amount in his Account in the event of such Participant’s death; or if no designation shall be in effect at the time of a Participant’s death or if all designated Beneficiaries shall have predeceased the Participant, then the Beneficiary shall be the Participant’s estate or his personal representative.

“Board” means the Board of Directors of the Company.

“Change in Control” means any of the following events:

(a) The acquisition by any “person,” as the term person is used for purposes of Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended, of legal or beneficial ownership of 35% percent or more of either (i) the then outstanding shares of common stock of the Company, or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors;

(b) Individuals who, on the Effective Date, constitute the Board cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by

the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Board shall be considered as though such individual were a member of the Board as of the date hereof;

(c) Approval by the shareholders of the Company of a reorganization, merger or consolidation, in each case unless the shareholders of the Company immediately before such reorganization, merger or consolidation own, directly or indirectly, immediately following such reorganization, merger or consolidation at least a majority of the combined voting power of the outstanding voting securities of the corporation resulting from such reorganization, merger or consolidation in substantially the same proportion as their ownership of the voting securities immediately before such reorganization, merger or consolidation; or

(d) Approval by the shareholders of the Company of (i) a complete liquidation or dissolution of the Company, or (ii) the sale or other disposition of more than 50% of the assets of the Company within a twelve month period.

“Change in Control Credit” shall have the meaning ascribed to that term in Section 4.1(b).

“Change in Control Subaccount” shall have the meaning ascribed to that term in Section 4.1(b).

“Code” means the Internal Revenue Code of 1986, as amended.

“Company” means MPS Group, Inc., a Florida corporation, or its successor or successors.

“Compensation” means the annual cash compensation (salary plus annual bonus) paid by the Employer to the Participant on account of services for the Plan Year. The Participant’s Compensation shall include amounts deferred by the Participant to any deferred compensation plan of the Employer (whether or not qualified), and any salary reduction amounts contributed to a welfare plan. The term “Compensation” shall not include long-term incentive payments, signing bonuses, income from stock options, restricted stock, or other stock-related awards, car allowances and non-cash remuneration, such as health benefits, life insurance and other fringe benefits.

“Compensation Committee” shall mean the duly authorized compensation committee of the Board of Directors of the Company.

“Disability” shall have the meaning set forth in the Executive’s employment agreement, if any. If the Executive does not have an employment agreement that defines Disability, Disability shall have the meaning set forth in the Employer’s long term disability plan or policy covering the Executive and shall not be considered to have occurred until after the waiting period as required by such plan or policy. If there is no employment agreement defining Disability and there is no long term disability plan or policy covering the Executive, Disability shall mean a physical or mental incapacity which impairs the Participant’s ability to substantially perform his usual duties and services for the Employer for a period of one hundred eighty (180) consecutive days. The determination as to whether Disability exists shall be made by the Plan Administrator based upon the information provided to it.

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“Effective Date” means the effective date of this Plan, January 1, 2004.

“Election Form” means the form prescribed by the Plan Administrator on which a Participant may specify his Beneficiary(ies) and the manner of payment of his benefits, subject to the approval of the Plan Administrator.

“Eligible Executive” means a key employee designated as eligible pursuant to Section 3.1. Any dispute regarding any individual’s classification shall be determined by the Plan Administrator in its sole discretion.

“Employer” means the Company and any Subsidiary or related employer designated by the Company to participate in the Plan.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Notice of Participation” shall have the meaning ascribed to that term in Section 3.1.

“Participant” means an Eligible Executive who has received Employer contribution credits or has been designated as entitled to receive a Change in Control Credit and whose interest in the Plan has not been wholly distributed.

“Periodic Contribution” means a contribution credit made by the Company pursuant to Section 4.1(a).

“Periodic Contribution Subaccount” shall have the meaning ascribed to that term in Section 4.1(a).

“Plan” means the MPS Group, Inc. Management Savings Plan, as set forth herein and as it may be amended from time to time.

“Plan Administrator” means the Compensation Committee of the Board or, if applicable, another committee appointed pursuant to Article V to administer the Plan.

“Plan Year” means January 1 through the next following December 31.

“Protected Termination of Employment” means the involuntary termination other than a Termination for Cause of the employment of a Participant (designated as entitled to receive a Change in Control Credit) from the Employer:

(a) within the six (6) month period prior to the consummation of any transaction that results in a Change in Control; or

(b) that the Participant can reasonably show (i) was at the direction or request of a third party that had taken steps reasonably calculated to effect a Change in Control provided that such Change in Control is actually consummated within twelve (12) months following such termination, or (ii) occurred in anticipation of a Change in Control provided that such Change in Control is actually consummated within twelve (12) months following such termination.

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“Replacement Income Amount” means the amount calculated in accordance with Section 4.1(b).

“Retirement” means termination of the Participant’s employment from the Employer on or after attaining age 56, other than a Termination for Cause.

“Subsidiary” means any corporation in an unbroken chain of corporations, beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns shares possessing 50% or more of the total combined voting power of all classes of shares in one of the other corporations in such chain. The term “Subsidiary” shall also include a partnership or limited liability company in which the Company or a Subsidiary owns 50% or more of the profits interest or capital interest.

“Termination for Cause” means the involuntary termination of the employment of a Participant from the Employer for any of the following reasons:

(a) as a result of an act or acts by the Participant which have been found in an applicable court of law to constitute a felony (other than traffic-related offenses);

(b) as a result of one or more willful acts by Participant which in the good faith judgment of the Board constitute one or more willful violation(s) of law or of policies of the Employer and which result in demonstrably material injury to the Employer;

(c) as a result of an act or acts of proven dishonesty by the Participant resulting or intended to result directly or indirectly in significant gain or personal enrichment to the Participant at the expense of the Employer or shareholders of the Company; or

(d) upon the willful and continued failure by the Participant to perform his duties with the Employer (other than any such failure resulting from incapacity due to mental or physical illness not constituting a Disability), after the expiration of the cure period (such cure period to be determined in the good faith judgment of the Plan Administrator) stated in a written demand for substantial performance delivered by the Plan Administrator to the Participant, which demand specifically identifies the manner in which the Plan Administrator believes that the Participant has not substantially performed his duties and the applicable cure period to remedy such failure; provided, however, if in the Plan Administrator’s good faith judgment the failure is not curable, then no such cure period shall be required.

For purposes of this Plan no act or failure to act by the Participant shall be deemed to be “willful” unless done or omitted to be done by the Participant not in good faith and without reasonable belief that the Participant’s action or omission was in the best interests of the Employer. The determination of whether a termination of employment is a “Termination for Cause” shall be made by the Plan Administrator. Notwithstanding the foregoing, if the Participant has entered into an employment agreement with the Employer that is binding as of the date of

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employment termination, and if such employment agreement defines “Cause” or “Good Reason” then the definition of “Cause” or “Good Reason” in such agreement, in lieu of the definition of “Cause” provided above, shall apply to the Participant for purposes of the Plan.

“Valuation Date” means December 31^st of each year or the date of an earlier occurring Change in Control and any other date(s) selected by the Plan Administrator as of which the Accounts of Participants are valued while the Plan is in effect.

“Year of Service” means, subject to such break in service rules as the Plan Administrator may establish, each Plan Year in which the Eligible Executive is credited with 1,000 or more Hours of Service with the Employer. Hours of Service shall be determined hereunder in accordance with the Company’s general rules for determining such hours under its tax-qualified plans. Service for credit with predecessor companies shall be granted in the discretion of the Committee as reflected on the Notice of Participation given to an Eligible Executive.

ARTICLE III

PARTICIPATION

3.1 Eligibility to Participate. Prior to, or at the beginning of, each Plan Year, the Compensation Committee of the Board (or its designee) shall specify the Eligible Executives who may receive Periodic Contributions for that Plan Year. For the initial Plan Year, the Compensation Committee of the Board (or its designee) shall specify Eligible Executives within three (3) months after the adoption of the Plan. Such eligibility designation may be made by establishing a minimum compensation level for participation or by the use of such other criteria as the Compensation Committee (or its designee) deems appropriate from time to time (including designating individuals by name). Each Eligible Executive will be notified of his or her eligibility by delivery of a Notice of Participation substantially in the form of Appendix B hereto.

3.2 Beneficiary Election. The Eligible Executive shall designate on the Election Form provided by the Plan Administrator one or more Beneficiary(ies) to receive payment of amounts in his Account in the event of death. If the Plan Administrator has received more than one Election Form for any Eligible Executive or Participant, the Plan Administrator shall be obligated to observe only the latest of such Election Forms on file as determined by the Plan Administrator’s own records for any or all payment of amounts in an Account under the Plan. In the case of receipt by the Plan Administrator of formal written notice of a disputed claim of entitlement to any amounts in an Account before payment is made in accordance with this provision, the Plan Administrator shall be entitled to hold all amounts in such Account pending instructions by a court of competent jurisdiction or to deposit all amounts in such Account with such a court and notify the disputing parties of such act and that the Plan Administrator has discharged its duties under the Plan.

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ARTICLE IV

PARTICIPANTS’ ACCOUNTS; EMPLOYER CONTRIBUTION CREDITS

4.1 Accounting for Participants’ Interests.

(a) Periodic Contribution Subaccount. The Company shall establish a “Periodic Contribution Subaccount” for each Participant under the Plan. Thereafter, unless the Compensation Committee otherwise determines, as of the end of each Plan Year (or as of such other date as the Compensation Committee may determine), there shall be credited to the Periodic Contribution Subaccount of each Eligible Executive who is employed on the last day of the Plan Year and who has a Year of Service for such Plan Year an amount equal to a percentage of the Eligible Executive’s Compensation for such Plan Year. The annual percentage contribution credit received by each Eligible Executive shall be five percent (5%) of Compensation; provided, that each year the Compensation Committee may, in its sole discretion, increase or decrease such percentage amount for the year for an Eligible Executive, but in no event shall the percentage contribution credit be less than five percent (5%) of Compensation.

(b) Change in Control Subaccount. The Compensation Committee of the Board may at any time designate any Participant as entitled to receive a credit upon a Change in Control (a “Change in Control Credit”). Once a Participant is so designated, such designation may not be rescinded. With respect to any Participant who has been designated as entitled to receive a Change in Control Credit, the Company shall establish a “Change in Control Subaccount” and there shall be credited to such Participant’s Change in Control Subaccount as of the date of a Change in Control (if such Participant is employed by the Employer on the date of the Change in Control or experienced a Protected Termination of Employment) a Change in Control Credit in an amount equal to the Replacement Income Amount, minus the value of the Participant’s Periodic Contribution Subaccount on the date of the Change in Control. The Replacement Income Amount is calculated pursuant to this Section 4.1(b), as follows:

(i) First, calculate the annual amount of replacement income determined by multiplying 50% by the annual average of the Compensation earned by the Participant during the three (3) full calendar years of employment immediately preceding the calendar year in which the Change in Control occurs. If a Participant was not employed for all twelve (12) months of a calendar year, the Compensation earned for that calendar year shall be adjusted to reflect the amount that would have been earned had the Participant been employed for twelve (12) months.

(ii) Second, determine the lump sum present value, as of the date of the Change in Control, of a single life annuity that will provide the annual amount of replacement income calculated in Section 4.1(b)(i) beginning when the Participant would attain age 56 and continuing for his or her life, or if the Participant has already attained the age of 56, then from his or her age on the date of the Change in Control and continuing for his or her life. This calculated lump sum amount is the Replacement Income Amount.

(iii) For purposes of determining the Replacement Income Amount, the following actuarial assumptions shall be used:

(A) 1994 Group Annuity Reserve table using blended 50% male and female rates; and

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(B) The “applicable interest rate” specified in Code Section 417(e)(3) or subsequent legislation.

(c) Investment Performance. The Plan Administrator shall permit each Participant to direct the investment of his Account and may establish any number or type of investment alternatives from time to time in the Plan Administrator’s reasonable discretion from which a Participant may elect on his Election Form to invest all or any part of his Accounts. A crediting rate contributed by the Company could be established in the Compensation Committee’s discretion as among the alternatives to be selected by the Participants. Each Account will be credited each Valuation Date with the earnings and losses of the investments designated by the Participant since the preceding Valuation Date in such manner as may be determined by the Plan Administrator.

4.2 Vesting of a Participant’s Account. A Participant’s Change in Control Subaccount shall always be 100% vested and nonforfeitable. A Participant’s interest in the amount credited to his Periodic Contribution Subaccount shall become 100% vested and nonforfeitable upon the earliest of his death, Disability, Retirement or a Change in Control. The Participant’s interest in the amount credited to his Periodic Contribution Subaccount shall also become vested upon the completion of five (5) or more Years of Service provided, however, if the Participant incurs a Termination for Cause (whether before or after the completion of such five (5) Years of Service), or if the Participant’s employment is otherwise terminated prior to vesting as provided in this or the preceding sentence, his entire Periodic Contribution Subaccount shall be forfeited.

4.3 Distribution of a Participant’s Periodic Contribution Subaccount Other Than for Death. Subject to modification upon a Change in Control, as specified in Section 7.3, a Participant’s Periodic Contribution Subaccount shall be distributed as follows: The vested amounts (determined in accordance with Section 4.2) credited to a Participant’s Periodic Contribution Subaccount shall be payable in a lump sum as soon as practical after the Participant’s Disability or termination from employment, unless, in the case of a termination other than for Disability, the Participant has elected a delayed payment date and/or payment in installments and such installment payment election has been approved by the Plan Administrator on the Election Form; provided that the lump sum payment shall be made not later than the year in which the Participant attains age 65 and the last installment payment shall be made not later than the year in which the Participant attains age 75. The Plan Administrator may establish rules to permit Participants to change the form and timing of their payment election; provided that no such change shall be effective unless it is made at least two (2) years prior to the Participant’s termination from employment. All amounts shall be paid in cash.

4.4 Distribution Upon Death. In the event of the Participant’s death, the Participant’s Beneficiary shall be paid the greater of (i) the Participant’s Account as of the date of death, or (ii) the amount specified in Appendix A of this Plan. All such amounts shall be paid to the Participant’s Beneficiary as soon as reasonably practicable after the Participant’s death and shall be paid in a single lump sum in cash.

4.5 Hardship. A Participant who is suffering an unforeseen and severe financial hardship as a result of (i) an illness or accident of the Participant or his immediately family, (ii)

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loss of Participant’s property due to casualty, or (iii) for such other reasons as the Plan Administrator may establish, may file a written request with the Plan Administrator for distribution of all or a portion of the amount credited to his Account. The Plan Administrator shall have the sole discretion to determine whether to grant a Participant’s hardship request and the amount to distribute to the Participant.

4.6 Gross-up. To the extent designated by the Compensation Committee and reflected on a Notice of Participation, if any amounts credited under this Plan result in the imposition, under Code Sections 280G/4999, of an excise tax on a Participant, the Company will pay the Participant an additional amount to make the Participant “whole” for certain excise or penalty taxes the Participant must pay as a result of the imposition of the excise tax. The amount of gross-up specified on the Notice of Participation will specify for which taxes the Participant is being grossed-up. In addition, to the extent that a Participant has an employment agreement with the Company specifying that the Participant will receive a gross-up payment to offset excise taxes on the Participant under Code Sections 280G/4999 for payments received from the Employer, then such Participant shall be entitled to application of such employment agreement provisions to amounts credited under this Plan (but such Participant shall be entitled to only a single instance of gross-up benefits from any source for amounts credited under the Plan, it not being the intention to duplicate gross-up benefits for amounts credited hereunder to any one Participant).

ARTICLE V

PLAN ADMINISTRATOR

5.1 Committee. The Plan Administrator shall be the Compensation Committee or such committee as may be designated by the Compensation Committee to administer and manage the Plan. Members of any committee shall not be required to be employees of the Company or Participants. Action of the Plan Administrator may be taken with or without a meeting of committee members. If a member of the committee is a Participant in the Plan, he shall not participate in any decision which solely affects his own Account. Upon the occurrence of a Change in Control, the individual or individuals serving in the capacity of Plan Administrator on the date of the Change in Control may not be changed by the Compensation Committee or Board without the approval of a majority of the Participants or until such time as all benefits due to Participants have been paid to the applicable Participant or Beneficiary or a trust formed pursuant to Section 8.2 has been fully funded.

5.2 Right and Duties. The Plan Administrator shall have the discretionary authority to administer and manage the Plan and shall have all powers necessary to accomplish that purpose, including (but not limited to) the following:

(a) to construe, interpret and administer this Plan;

(b) to make allocations and determinations required by this Plan, and to maintain records relating to Participants’ Accounts;

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(c) to compute and certify to the Company the amount and kinds of benefits payable to Participants or their beneficiaries, and to determine the time and manner in which such benefits are to be paid;

(d) to authorize all disbursements by the Company pursuant to this Plan;

(e) to maintain (or cause to be maintained) all the necessary records of the administration of this Plan;

(f) to make and publish such rules for the regulation of this Plan as are not inconsistent with the terms hereof;

(g) to delegate to other individuals or entities from time to time the performance of any of its duties or responsibilities hereunder; and

(h) to hire agents, accountants, actuaries, consultants and legal counsel to assist in operating and administering the Plan.

The Plan Administrator shall have the exclusive discretionary authority to construe and to interpret the Plan, to decide all questions of eligibility for benefits and to determine the amount and manner of payment of such benefits, and its decisions on such matters shall be final and conclusive on all parties.

5.3 Compensation, Indemnity and Liability. The Plan Administrator shall serve as such without bond and without compensation for services hereunder. All expenses of the Plan and the Plan Administrator shall be paid by the Company. If the Plan Administrator is a committee, no member of the committee shall be liable for any act or omission of any other member of the committee, nor for any act or omission on his own part, excepting his own willful misconduct. The Company shall indemnify and hold harmless the Plan Administrator and each member of the committee against any and all expenses and liabilities, including reasonable legal fees and expenses, arising out of his membership on the committee, excepting only expenses and liabilities arising out of his own willful misconduct.

5.4 Taxes. Subject to Section 4.6, if the whole or any part of any Participant’s Account shall become liable for the payment of any estate, inheritance, income or other tax which the Company shall be required to pay or withhold, the Company shall have the full power and authority to withhold and pay such tax out of any monies or other property in its hand for the account of the Participant whose interests hereunder are so liable. The Company shall provide notice of any such withholding. Prior to making any payment, the Company may require such releases or other documents from any lawful taxing authority as it shall deem necessary.

ARTICLE VI

CLAIM REVIEW PROCEDURE

6.1 Notice of Denial. If a Participant or a Beneficiary is denied a claim for benefits under the Plan, the Plan Administrator shall provide to the claimant written notice of the denial within ninety (90) days (forty-five (45) days with respect to a denial of any claim for benefits due

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to the Participant’s Disability) after the Plan Administrator receives the claim, unless special circumstances require an extension of time for processing the claim. If such an extension of time is required, written notice of the extension shall be furnished to the claimant prior to the termination of the initial ninety-day period. In no event shall the extension exceed a period of ninety (90) days (thirty (30) days with respect to a claim for benefits due to the Participant’s Disability) from the end of such initial period. With respect to a claim for benefits due to the Participant’s Disability, an additional extension of up to thirty (30) days beyond the initial thirty-day extension period may be required for processing the claim. In such event, written notice of the extension shall be furnished to the claimant within the initial thirty-day extension period. Any extension notice shall indicate the special circumstances requiring the extension of time, the date by which the Plan Administrator expects to render the final decision, the standards on which entitlement to benefits are based, the unresolved issues that prevent a decision on the claim and the additional information needed to resolve those issues.

6.2 Contents of Notice of Denial. If a Participant or Beneficiary is denied a claim for benefits under a Plan, the Plan Administrator shall provide to such claimant written notice of the denial which shall set forth:

(a) the specific reasons for the denial;

(b) specific references to the pertinent provisions of the Plan on which the denial is based;

(c) a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary;

(d) an explanation of the Plan’s claim review procedures, and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA after exhausting any administrative or contractual remedies, following an adverse benefit determination on review;

(e) in the case of a claim for benefits due to a Participant’s Disability, if an internal rule, guideline, protocol or other similar criterion is relied upon in making the adverse determination, either the specific rule, guideline, protocol or other similar criterion, or a statement that such rule, guideline, protocol or other similar criterion was relied upon in making the decision and that a copy of such rule, guideline, protocol or other similar criterion will be provided free of charge upon request; and

(f) in the case of a claim for benefits due to a Participant’s Disability, if a denial of the claim is based on a medical necessity or experimental treatment or similar exclusion or limit, an explanation of the scientific or clinical judgment for the denial, an explanation applying the terms of the Plan to the claimant’s medical circumstances or a statement that such explanation will be provided free of charge upon request.

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6.3 Right to Review. After receiving written notice of the denial of a claim, a claimant or the claimant’s representative shall be entitled to:

(a) request a full and fair review of the denial of the claim, by written application to the Plan Administrator (or Appeals Arbitrator in the case of a claim for benefits payable due to a Participant’s Disability);

(b) request, free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claim;

(c) submit written comments, documents, records and other information relating to the denied claim to the Plan Administrator or Appeals Arbitrator, as applicable; and

(d) a review that takes into account all comments, documents, records and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

6.4 Application for Review.

(a) If a claimant wishes a review of the decision denying the claim to benefits under the Plan, other than a claim described in Section 6.4 (b), the claimant must submit the written application to the Plan Administrator within sixty (60) days after receiving written notice of the denial.

(b) If the claimant wishes a review of the decision denying the claimant’s claim to benefits under the Plan due to the claimant’s Disability, the claimant must submit the written application to the Appeals Arbitrator within one hundred eighty (180) days after receiving written notice of the denial. With respect to any such claim, in deciding an appeal of any denial based in whole or in part on a medical judgment (including determinations with regard to whether a particular treatment, drug or other item is experimental, investigational or not medically necessary or appropriate), the Appeals Arbitrator shall:

(i) consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment; and

(ii) identify the medical and vocational experts whose advice was obtained on behalf of the Plan in connection with the denial without regard to whether the advice was relied upon in making the determination to deny the claim.

Notwithstanding the foregoing, the health care professional consulted pursuant to this Section 6.4 (b) shall be an individual who was not consulted with respect to the initial denial of the claim that is the subject of the appeal or a subordinate of such individual.

6.5 Hearing. Upon receiving such written application for review, the Plan Administrator or Appeals Arbitrator, as applicable, may schedule a hearing for purposes of reviewing the claimant’s claim, which hearing shall take place not more than thirty (30) days from the date on which the Plan Administrator or Appeals Arbitrator received such written application for review.

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6.6 Notice of Hearing. At least ten (10) days prior to the scheduled hearing, the claimant and the claimant’s representative designated in writing by him, if any, shall receive written notice of the date, time and place of such scheduled hearing. The claimant or the claimant’s representative, if any, may request that the hearing be rescheduled, for the claimant’s convenience, on another reasonable date or at another reasonable time or place.

6.7 Counsel. All claimants requesting a review of the decision denying their claim for benefits may employ counsel for purposes of the hearing.

6.8 Decision on Review. No later than sixty (60) days (forty-five (45) days with respect to a claim for benefits due to the Participant’s Disability) following the receipt of the written application for review, the Plan Administrator or the Appeals Arbitrator, as applicable, shall submit its decision on the review in writing to the claimant involved and to the claimant’s representative, if any, unless the Plan Administrator or Appeals Arbitrator determines that special circumstances (such as the need to hold a hearing) require an extension of time, to a day no later than one hundred twenty (120) days (ninety (90) days with respect to a claim for benefits due to the Participant’s Disability) after the date of receipt of the written application for review. If the Plan Administrator or Appeals Arbitrator determines that the extension of time is required, the Plan Administrator or Appeals Arbitrator shall furnish to the claimant written notice of the extension before the expiration of the initial sixty-day (forty-five-day with respect to a claim for benefits due to the Participant’s Disability) period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan Administrator or Appeals Arbitrator expects to render its decision on review. In the case of a decision adverse to the claimant, the Plan Administrator or Appeals Arbitrator shall provide to the claimant written notice of the denial which shall include:

(a) the specific reasons for the decision;

(b) specific references to the pertinent provisions of the Plan on which the decision is based;

(c) a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claimant’s claim for benefits;

(d) an explanation of the Plan’s claim review procedures, and the time limits applicable to such procedures, including a statement of the claimant’s right to bring an action under Section 502(a) of ERISA after exhausting any administrative or contractual remedies, following the denial of the claim upon review;

(e) in the case of a claim for benefits due to the Participant’s Disability, if an internal rule, guideline, protocol or other similar criterion is relied upon in making the adverse determination, either the specific rule, guideline, protocol or other similar criterion, or a statement that such rule, guideline, protocol or other similar criterion was relied upon in making the decision and that a copy of such rule, guideline, protocol or other similar criterion will be provided free of charge upon request;

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(f) in the case of a claim for benefits due to a Participant’s Disability, if a denial of the claim is based on a medical necessity or experimental treatment or similar exclusion or limit, an explanation of the scientific or clinical judgment for the denial, an explanation applying the terms of the Plan to the claimant’s medical circumstances or a statement that such explanation will be provided free of charge upon request; and

(g) in the case of a claim for benefits due to a Participant’s Disability, a statement regarding the availability of other voluntary alternative dispute resolution options.

6.9 Appeals Arbitrator. The Company shall appoint an individual or entity to determine appeals due to disability (the “Appeals Arbitrator”). The Appeals Arbitrator shall be required to review claims for benefits payable due to a Participant’s Disability that are initially denied by the Plan Administrator and for which the claimant requests a full and fair review pursuant to Section 6.3. The Appeals Arbitrator may not be the individual who made the initial adverse determination with respect to any claim the Appeals Arbitrator reviews and may not be a subordinate of any individual who made the initial adverse determination. The Appeals Arbitrator may be removed in the same manner in which appointed or may resign at any time by written notice of resignation to the Company. Upon such removal or resignation, the Company shall appoint a successor.

ARTICLE VII

AMENDMENT AND TERMINATION; CHANGE IN CONTROL

7.1 Amendments. The Company (or its designee) shall have the right in its sole discretion to amend this Plan in any manner at any time; provided, however, that no such amendment shall:

(a) reduce the Participant’s vested interest in his Account at that time;

(b) modify the definition of Change in Control or modify Section 4.1(b) in a manner that would result in a decrease in a Participant’s anticipated benefit or modify Section 7.3 in a manner adverse to applicable Participants;

(c) reduce the number of distribution alternatives

(d) accelerate payouts from the Plan.

Any amendment shall be in writing and executed by a duly authorized officer of the Company. All Participants shall be bound by such amendment.

7.2 Termination of Plan. The Company expects to continue this Plan, but does not obligate itself to do so. Subject to Section 7.3, the Company reserves the right to discontinue and terminate the Plan at any time, in whole or in part, for any reason (including a change, or an impending change, in the tax laws of the United States or any State). If the Plan is terminated, the Plan Administrator shall be notified of such action in a writing executed by a duly authorized officer of the Company, and the Plan shall be terminated at the time therein set forth. Termination of the Plan shall be binding on all Participants, but in no event may such termination reduce the amounts credited at that time to any Participant’s Account. If this Plan is terminated, amounts

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theretofore credited to Participant’s Periodic Contribution Subaccount, including interest and earnings from the last Valuation Date to the termination date, shall be paid in a lump sum immediately.

7.3 Change In Control Provisions. Notwithstanding anything contained in this Plan to the contrary, the Participant’s Account shall become fully vested on the date of a Change in Control and the Company (or, if a trust has been established in accordance with Section 8.2 hereof, the trust) shall, within thirty (30) days of the Change in Control, pay to the Participant a lump sum cash payment of the full amount credited to his Periodic Contribution Subaccount and Change in Control Subaccount, with earnings determined under Sections 4.1 (a), (b) and (c) credited thereto to the date of payment. The Plan may not be terminated in anticipation of a Change in Control or within six (6) months prior to the beginning of any transaction that results in a Change in Control.

ARTICLE VIII

MISCELLANEOUS

8.1 Limitation on Participant’s Rights. Participation in this Plan shall not give any Participant the right to be retained in the Company’s employ or the employ of any Employer, or any right or interest in this Plan or any assets of the Company other than as herein provided. The Company reserves the right to terminate the employment of any Participant without any liability for any claim against the Employer under this Plan, except to pay any benefits provided for herein.

8.2 Benefits Unfunded.

(a) The benefits provided by this Plan shall be unfunded. All amounts payable under this Plan to Participants shall be paid from the general assets of the Company, and nothing contained in this Plan shall require the Company to set aside or hold in trust any amounts or assets for the purpose of paying benefits to Participants. This Plan shall create only a contractual obligation on the part of the Company, and Participants shall have the status of general unsecured creditors of the Company under the Plan with respect to any obligation of the Company to pay benefits pursuant hereto. Any funds of the Company available to pay benefits pursuant to the Plan shall be subject to the claims of general creditors of the Company, and may be used for any purpose by the Company.

(b) Notwithstanding the preceding paragraph, the Company may at any time transfer assets to a trust for purposes of paying all or any part of its obligations under this Plan. However, only to the extent provided in the trust, such transferred amounts shall remain subject to the claims of general creditors of the Company. To the extent that assets are held in a trust when a Participant’s benefits under the Plan become payable, the Plan Administrator shall direct the trustee to pay such benefits to the Participant from the assets of the trust.

(c) At the time a Change in Control occurs, if the Company has established a trust in accordance with Section 8.2(b) hereof, the Company shall transfer cash and/or other assets to said trust in an amount equal to the total amount of all the benefits payable hereunder to the Participants or Beneficiaries as

set forth in Section 7.3.

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8.3 Other Plans. This Plan shall not affect the right of any Eligible Executive or Participant to participate in and receive benefits under and in accordance with the provisions of any other employee benefit plans which are now or hereafter maintained by the Company, unless the terms of such other employee benefit plan or plans specifically provide otherwise.

8.4 Cooperation and Receipt or Release. If the Company chooses to use insurance on the life of the Participant as a means of assisting the Company in meeting its obligation under the Plan, the Participant must cooperate with the Company or forfeit any right to benefits. Any payment to a Participant in accordance with the provisions of this Plan shall, to the extent thereof, be in full satisfaction of all claims against the Plan Administrator, the Company and any Employer, and the Plan Administrator may require such Participant, as a condition precedent to such payment, to execute a receipt and release to such effect.

8.5 Governing Law. This Plan shall be construed, administered and governed in all respects in accordance with applicable federal law and, to the extent not preempted by federal law, in accordance with the laws of the State of Florida without regard to conflicts of law principles. If any provisions of this instrument shall be held by a court of competent jurisdiction to be invalid or unenforceable, the remaining provisions hereof shall continue to be fully effective.

8.6 Gender, Tense and Headings. In this Plan, whenever the context so indicates, the singular or plural number and the masculine, feminine or neuter gender shall be deemed to include the other. Headings and subheadings in this Plan are inserted for convenience of reference only and are not considered in the construction of the provisions hereof.

8.7 Successors and Assigns; Nonalienation of Benefits. This Plan shall inure to the benefit of and be binding upon the parties hereto and their successors and assigns; provided, however, that the amounts credited to the Account of a Participant shall not (except as provided in Section 5.4) be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to any benefits payable hereunder, including, without limitation, any assignment or alienation in connection with a separation, divorce, child support or similar arrangement, shall be null and void and not binding on the Plan or the Company. In addition to any obligations imposed by law upon any successor to the Company, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to, or purchaser of, substantially all of the business or assets of the Company to expressly agree to assume and perform this Agreement in the same manner that the Company would be required to perform it.

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8.8 Combination With Other Plan. The Plan may be combined or merged with other plans of the Company to the extent such merger or combination does not result in terms contrary to the terms of the Plan, and the Plan Administrator shall establish the terms and conditions relating to any such merger.

[Remainder of Page Intentionally Left Blank]

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APPENDIX A

AMOUNT OF DEATH BENEFIT UNDER SECTION 4.4(ii)

APPENDIX B

FORM OF NOTICE OF PARTICIPATION

NOTICE OF PARTICIPATION

MPS GROUP, INC. MANAGEMENT SAVINGS PLAN

(200X)

Name:	[Name]
Position:	[Title]

This document serves as notification of the terms of your participation in the MPS Group, Inc. Management Savings Plan.

Eligible Executive: [Name] is an Eligible Executive for Periodic Contributions for the 200X Plan Year.

Change in Control: [Name] is designated as entitled to receive a credit upon a Change in Control.

Gross-Up: [Name] is entitled to a gross-up payment in the amount of all taxes, excise taxes, imposed on Participant due to amounts paid or credited under the Plan.

EX-10.5

Exhibit 10.5

RESTRICTED STOCK AGREEMENT

This Restricted Stock Award Agreement (the “Agreement”) is made effective as of [Date] (the “Effective Date”) between [Name] (the “Employee”) and MPS Group, Inc., a Florida corporation (the “Company”).

W I T N E S S E T H    T H A T:

WHEREAS, the Company has awarded to Employee [Number] shares (the “Shares”) of the Company’s common stock (the “Stock”) effective as of the Effective Date, pursuant to the MPS Group, Inc. Amended and Restated 1995 Stock Option Plan (the “Plan”), as a reward for prior service and as an incentive to remain with the Company or its subsidiaries or affiliates and to work to increase the value of the Stock; and

WHEREAS, the Shares are subject to the terms and conditions hereinafter provided;

NOW, THEREFORE, the Company and the Employee agree as follows:

1. AWARD. The Employee hereby is granted [Number] Shares as of the Effective Date subject to all the terms and conditions of this Agreement.

2. STOCK CERTIFICATE; UNCERTIFICATED STOCK.

(a) The Company may in its discretion issue one or more stock certificates (the “Certificate(s)”) in the name of the Employee for the Shares which Employee hereby acknowledges and agrees would be subject to and bear the following legend:

“The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of a Restricted Stock Agreement entered into between the registered owner and MPS Group, Inc., effective as of [Date]. Copies of such Agreement are on file in the offices of the Secretary, MPS Group, Inc., 1 Independent Drive, Jacksonville, Florida 32202.”

The Employee shall forfeit and/or return the Certificate(s) to the Company upon the forfeiture of any Shares, pursuant to this Agreement. Thereafter, the Company shall reissue Stock pursuant to Section 2(c) of this Agreement for the number of Shares, if any, which were not forfeited. The new Stock, if any, and the Shares represented thereby, shall remain subject to this Agreement.

(b) The Company may in its discretion issue in the name of the Employee the Shares in an uncertificated form as properly recorded in the books and records of the Company, including its stock transfer book, which Shares Employee hereby acknowledges and agrees would be subject to the same restrictions and limitations on transferability (including forfeiture) as are set forth for the Certificate(s) in Section 2(a) of this Agreement.

(c) In the event that Shares are forfeited pursuant this Agreement, (i) if a Certificate has been issued pursuant to Section 2(a) hereof, the Company shall reissue a Certificate pursuant to Section 2(a) of this Agreement for the number of Shares, if any, which were not forfeited and (ii) if no Certificate has been issued and the Shares are uncertificated in accordance with Section 2(b) hereof, then the forfeiture of the Shares shall be recorded in the books and records of the Company, including its stock transfer book. Notwithstanding the forgoing, all unforfeited Shares held by Employee pursuant to this Agreement shall remain subject to the terms of this Agreement and the Plan.

3. VESTING OF SHARES. The Employee agrees the Shares shall vest on the date and in the amount as follows:

Vesting Date	Number of Shares Vested
[Date]	[Number]

(a) If the Employee shall cease to be employed by the Company, or any affiliate or subsidiary thereof such that Employee is no longer employed in any capacity with the group of companies affiliated with the Company, and such termination of employment is both (i) for Good Cause on the part of the Company or without Good Reason on the part of Employee (as the terms Good Cause and Good Reason are defined in the executive employment agreement between Employee and Company in effect as of the Effective Date) and (ii) for other than a Change in Control of the Company (as defined in Section 4 of this Agreement) at any time prior to the Vesting Date set forth above, then the Employee shall forfeit and return to the Company any Shares which remain unvested as of such date for no payment.

(b) Employee shall become vested in the Shares then remaining unvested upon the occurrence of (i) a Change in Control of the Company (as defined in Section 4 of this Agreement) or (ii) termination of Employee’s employment without Good Cause by the Company or for Good Reason by the Employee (as the terms Good Cause and Good Reason are defined in the executive employment agreement between Employee and Company).

(c) No Shares hereunder shall be sold, exchanged, transferred, pledged, hypothecated or otherwise disposed of by Employee unless and until vested pursuant to this Section 3 above.

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4. CHANGE IN CONTROL. For purposes of this Agreement, “Change in Control” shall mean:

(a) the acquisition by any person or persons (as such term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended) of legal or beneficial ownership of 35% or more of either (i) the then outstanding shares of common stock of the Company, or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors;

(b) individuals who, as of the Effective Date, constitute the Board cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Board shall be considered as though such individual were a member of the Board as of the date hereof;

(c) approval by the shareholders of the Company of a reorganization, merger or consolidation, in each case unless the shareholders of the Company immediately before such reorganization, merger or consolidation own, directly or indirectly, immediately following such reorganization, merger, or consolidation at least a majority of the combined voting power of the outstanding voting securities of the corporation resulting from such reorganization, merger or consolidation in substantially the same proportion as their ownership of the voting securities immediately before such reorganization, merger or consolidation; or

(d) approval by the shareholders of the Company of (i) a complete liquidation or dissolution of the Company, or (ii) the sale or other disposition of more than 50% of the assets of the Company within a twelve month period.

5. VOTING RIGHTS; DIVIDENDS; CAPITAL CHANGES.

(a) Except as otherwise limited or provided in this Agreement, with respect to any Shares subject to the restrictions of this Agreement, the Employee shall be a shareholder of the Company and (i) shall have all of the rights of a shareholder with respect to the Shares, including full power to vote all of the Shares from time to time, and (ii) shall be entitled to receive dividends and/or distributions declared on such Shares.

(b) Any new, additional or different shares of capital stock or other securities issued with respect to any of the Shares described herein or in substitution or replacement thereof shall be subject to all of the terms and conditions of this Agreement and shall be delivered to the Employee (or the Employee’s beneficiary) or revert to the Company under the same circumstances as the original Shares with respect to, or in substitution for which, they were issued.

6. DELIVERY OF SHARES.

(a) If Employee refuses to deliver to Company a properly endorsed stock certificate for any Shares forfeited, the Employee hereby authorizes and directs the

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Company to cancel on its books and records (including but not limited to its stock transfer book) the Employee’s ownership of the Shares and to take whatever action the Company deems necessary or appropriate to have such Shares registered in the name of the Company without any further action, or direction, by the Employee. The Company shall have similar rights to cancel on its books and records (including but not limited to its stock transfer book) the Employee’s ownership of any Shares in an uncertificated form and to take whatever action the Company deems necessary or appropriate to have such Shares registered in the name of the Company without any further action, or direction, by the Employee.

(b) The Company may in its discretion require the execution and delivery by the Employee of blank stock powers, an escrow agreement, and related schedules and exhibits, as a condition of issuance or delivery of, or removal of restrictions from, the Shares or Certificate(s).

(c) The Company may in its discretion require that Employee pay, or evidence to the Company’s satisfaction arrangement for the payment of, Federal, state or local taxes associated with the award or vesting of the Shares, as a condition of issuance or delivery of, or removal of restrictions from, the Shares or Certificate(s).

7. COMPLIANCE WITH LAW AND REGULATIONS; INCORPORATION OF PLAN. The obligations of the Company hereunder are subject to all applicable Federal and state laws and to the rules, regulations and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares are then listed and any other government or regulatory agency. This Agreement is expressly made subject to the terms of the Plan, the terms and conditions of which are expressly incorporated herein by reference. The Employee hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms and provisions thereof.

8. ATTORNEYS’ FEES. The prevailing party in any litigation hereunder shall be entitled to attorneys’ fees and costs of litigation.

9. NO RIGHTS TO EMPLOYMENT. Nothing in this Agreement shall confer upon the Employee any right to continue in the employ of the Company or interfere in any way with the right of the Company to terminate Employee’s employment at any time.

10. GOVERNING LAW. The terms of this Agreement shall be governed by and interpreted in accordance with the laws of the State of Florida, without regard to any issues of conflicts of laws.

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IN WITNESS WHEREOF, the Employee and Company have executed the Agreement effective as of the day and year first above written.

MPS GROUP, INC.:
By:	/s/
Its:
EMPLOYEE:
	/s/
[Name]

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EX-31.1

Exhibit 31.1

MPS GROUP, INC. AND SUBSIDIARIES

CERTIFICATION PURSUANT TO RULE 13a-14(a)/15d-14(a)

I, Timothy D. Payne, certify that:

1. I have reviewed this report on Form 10-Q of MPS Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2004

/s/ Timothy D. Payne

Timothy D. Payne

President and Chief Executive Officer

Page 1

EX-31.2

Exhibit 31.2

MPS GROUP, INC. AND SUBSIDIARIES

CERTIFICATION PURSUANT TO RULE 13a-14(a)/15d-14(a)

I, Robert P. Crouch, certify that:

1. I have reviewed this report on Form 10-Q of MPS Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2004

/s/    Robert P. Crouch

Robert P. Crouch

Senior Vice President and Chief

Financial Officer

EX-32.1

Exhibit 32.1

MPS GROUP, INC. AND SUBSIDIARIES

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the fiscal quarter ending June 30, 2004 of MPS Group, Inc. (the “Form 10-Q”), I, Timothy D. Payne, President, Chief Executive Officer and Director of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Timothy D. Payne

———————————————

Timothy D. Payne

President and Chief Executive Officer

August 6, 2004

EX-32.2

Exhibit 32.2

MPS GROUP, INC. AND SUBSIDIARIES

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q for the fiscal quarter ending June 30, 2004 of MPS Group, Inc. (the “Form 10-Q”), I, Robert P. Crouch, Senior Vice President, Treasurer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Robert P. Crouch

Robert P. Crouch

Senior Vice President, Treasurer

and Chief Financial Officer

August 6, 2004