EXHIBIT 10.41
REMEDYTEMP, INC.
SPECIAL DEFERRED COMPENSATION PLAN
PREPARED BY:
REISH & LUFTMAN
A PROFESSIONAL CORPORATION
ATTORNEYS AT LAW
TENTH FLOOR
11755 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90025
(310) 478-5656
REMEDYTEMP, INC.
SPECIAL DEFERRED COMPENSATION PLAN
THIS SPECIAL DEFERRED COMPENSATION PLAN is amended and restated
effective January 1, 2005, with reference to the following:
A. REMEDYTEMP, INC., a California corporation (the "Company"),
originally adopted this Plan effective as of January 5, 1998.
B. The Company and Greg Palmer ("Palmer") entered into an employment
agreement (the "Agreement"), pursuant to a letter from the Company to Palmer
dated December 17, 1997.
C. This Plan is adopted by the Company pursuant to section 13.2 of the
Agreement.
D. This Plan is not intended to be a qualified plan within the meaning
of sections 401(a) and 501(a) of the Internal Revenue Code of 1986, as amended
(the "Code") but is intended to be a nonqualified deferred compensation plan
that complies with the terms of Code section 409A. This Plan is intended to be
an unfunded plan for purposes of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"). Company contributions shall be held in a "Rabbi
Trust," as that term is defined in Revenue Procedure 92-64, 1992-2 C.B. 422.
NOW, THEREFORE, the Company hereby adopts the RemedyTemp, Inc. Special
Deferred Compensation Plan on the following terms and conditions:
1. Definitions. Whenever used in this Plan, the following words and
phrases shall have the meaning set forth below, unless a different meaning is
expressly provided or plainly required by the context in which the words or
phrases are used:
1.1 Beneficiary means a person designated by a Palmer to receive Plan
benefits in the event of Palmer's death.
1.2. Board means the Board of Directors of the Company and its
successors.
1.3. Disability means (i) Palmer's inability to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than twelve (12) months, or (ii)
Palmer's receipt of income replacement benefits for a period of not less than
three (3) months under an accident and health plan covering employees of the
Company, by reason of any medically determinable physical or mental impairment
which can be expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months
1.4. Plan means the RemedyTemp, Inc. Special Deferred Compensation
Plan established by this document and the Trust Agreement established in
connection herewith.
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1.5. Plan Committee means the individuals appointed by the Board from
time to time to administer the Plan as provided herein. Initially, as of the
effective date of the Plan, members of the Plan Committee are Jeffrey A. Elias
and Alan Purdy.
1.6. Shares means four thousand nine hundred eighty-five (4,985)
shares of the Company's Class A Common Stock.
1.7. Trust Agreement means the grantor trust established in connection
with this Plan between the Company as grantor and the Trustee.
1.8. Trustee means Union Bank of California, N.A. or any successor
institutional trustee named to succeed such Trustee under the terms of the Trust
Agreement established in connection with this Plan.
2. Contribution and Allocation.
2.1. Company Contribution and Allocation. On behalf of Palmer, the
Company has contributed to the Plan the sum of one hundred thousand dollars
($100,000) which has been used to purchase the Shares. Such contribution shall
be allocated to Palmer's Company Account and be credited with dividends, if any,
as provided in Section 2.2 below.
2.2. Credited Earnings. Palmer's Company Account shall be credited
with dividends, if any, paid on the Shares held in such Account. Notwithstanding
the foregoing, the Trustee shall, at the direction of the Plan Committee, have
the duty and authority to invest the trust assets and funds in accordance with
the terms of the Trust Agreement, and all rights associated with the trust
assets shall be exercised by the Trustee as designated by the Plan Committee and
shall in no event be exercisable by or be settled upon Palmer or his
Beneficiaries.
2.3. Forfeitures. If any amount of Company Contributions are forfeited
in any year, such forfeited amounts shall be returned to the Company.
2.4. Funding. The assets of the Plan shall be held under the Trust
Agreement (a "grantor trust") designated in Article I above. As such, the Plan
is intended to be an unfunded plan for purposes of the requirements of ERISA and
the Code.
Notwithstanding the provisions under the terms of the Plan that
amounts contributed to this Plan, plus earnings thereon, shall be allocated to a
separate Account of Palmer, all such amounts credited to such individual Account
shall remain the general assets of the Employer, and as such shall remain
subject to the claims of the general creditors of the Company. This Plan and the
related Trust Agreement do not create, nor does Palmer or any Beneficiary have,
any right with respect to any specific assets of the Company or the Plan, until
such time as Palmer's Company Account shall become 100% vested as provided in
Section 3.
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3. Vesting. Palmer's Company Account shall become 100% vested upon the
earlier of: (A) his completion of five years of employment (including any period
of disability in which the Company continues to pay Palmer's salary, as provided
in section 7 of the Agreement) from Palmer's effective start date; or (B)
termination of his employment for any reason, including with and without cause,
and death.
4. Distributions.
4.1 Planned Distribution. Once Palmer's Company Account becomes 100%
vested, the Shares (or their equivalent in the event of a conversion of such
Shares) held and all earnings credited thereon shall be distributed to him as
soon as practicable thereafter. However, as provided in section 13.2 of the
Agreement, Palmer may defer the Shares and earnings thereon during the term of
his Amended and Restated Employment Agreement. If Palmer continues to defer the
Shares and earnings under the Special Deferred Compensation Plan, such amounts
shall not be paid earlier than six (6) months after the date of termination of
employment with the Company (or, if earlier, the date of death of the
Participant).
5. Amendment. The Company reserves the right to amend the Plan at any
time by resolution of the Plan Committee. The Plan Committee will determine the
effective date of any such amendment. The amendment may not deprive Palmer or
Beneficiary of any portion of a benefit under the terms of this Plan at the time
of the amendment.
6. Benefits Not Funded. Palmer and his Beneficiary have the status of
unsecured creditors of the Company, and the Plan constitutes a mere promise by
the Company to make benefit payments in the future. Palmer's or his
Beneficiary's interest in the Plan is an unsecured claim against the general
assets of the Company, and neither Palmer nor his Beneficiary has any right
against the account until the Plan has distributed the benefit. All amounts
credited to an account are the general assets of the Company and may be disposed
of or used by the Company in such manner as it determines.
Notwithstanding the first paragraph of this Section 6, the Company
will transfer the Shares to a trust pursuant to a Trust Agreement, a copy of
which is attached. Such Trust Agreement created by the Company is intended to be
a grantor trust, and any assets held by such trust to assist the Company in
meeting its obligations under the Plan will conform to the terms of the model
trust, as described in Revenue Procedure 92-64, 1992-2 C.B. 422, promulgated by
the Internal Revenue Service.
It is the intention of the parties that this Plan and the accompanying
Trust Agreement shall constitute an unfunded arrangement maintained for the
purpose of providing deferred compensation for Palmer, who is a member of a
select group of management or highly compensated employees for purposes of Title
I of the Employee Retirement Income Security Act of 1974.
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7. Miscellaneous.
7.1. Designation of Beneficiary. Palmer shall designate, in writing,
one or more beneficiaries to receive his benefit under the provisions of Section
2 in the event he dies before the Company has paid his vested benefit. Palmer
shall file the written designation with the Plan Committee. Palmer may revoke a
previous beneficiary designation by filing a new written beneficiary designation
with the Plan Committee.
In any event, if Palmer or his Beneficiary who has designated another
Beneficiary is divorced, all beneficiary designations executed prior to the
effective date of the dissolution of marriage (or other decree or order entered
under applicable state law) are automatically revoked under the terms of this
Section 7.1. In such event, Palmer or his Beneficiary may designate one or more
Beneficiaries in accordance with the terms of this Section 7.1. If none is made
following the effective date of the dissolution of the marriage, the
individual's benefit shall pass under the laws of intestate succession and the
terms of the next following paragraph.
If Palmer fails to file a valid designation of beneficiary with the
Plan Committee under the provisions of this Section 7.1, or if a designated
Beneficiary fails to survive to receive any or all payments due hereunder, then
the death benefit payable under this Plan shall be payable to Palmer's (or his
Beneficiary's) spouse; if no spouse survives, then to the Palmer's (or his
Beneficiary's) children, with equal shares among living children and with the
living descendants of a deceased child receiving equal portions of the deceased
child's share; in the absence of spouse or descendants, to Palmer's (or his
Beneficiary's) parents; and in the absence of spouse, descendants or parents, to
Palmer's (or his Beneficiary's) brothers and sisters, with the living
descendants of a deceased brother and those of a deceased sister receiving equal
portions of the deceased brother's or sister's share; in the absence of any of
the persons name herein, to Palmer's (or his Beneficiary's) estate.
For purposes of this Section 7.1, the term "descendant" means all
persons who are descended from the person referred to either by birth to or
legal adoption by such person, and "child" or "children" includes adopted
children.
7.2. Benefits Not Assignable. The rights of Palmer are not subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment, or garnishment by creditors of Palmer nor any
Beneficiary. Neither Palmer nor his Beneficiary may assign, transfer or pledge
the benefits under this Plan. Any attempt to assign, transfer or pledge Palmer's
benefits under this Plan is void.
7.3. Benefit. This Plan constitutes an agreement between the Company
and Palmer which is binding upon and inures to the Company, its successors and
assigns and upon Palmer and his heirs and legal representatives.
7.4. Headings. The headings of the Articles and Sections of this Plan
are included for purposes of convenience only, and shall not affect the
construction or interpretation of any of it provisions.
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7.5. Notices. All notices, requests, demands, and other communications
under this Plan shall be in writing and shall be deemed to have been duly given
on the date of service if served personally on the party to whom notice is to be
given, or on the third day after mailing if mailed to the party to whom notice
is to be given, by first class mail, registered or certified (return receipt
requested), postage prepaid, and properly addressed to the last known address to
each party as set forth on the first page thereof. Any party may change its
address for purposes of this Section by giving the other parties written notice
of the new address in the manner set forth above.
7.6. Gender Usage. The use of the masculine gender includes the
feminine gender for all purposes of this Plan.
7.7. Expenses. Costs of administration of the Plan shall be paid by
the Company.
7.8. Claims Review Procedure.
(A) A claim for benefits may be filed, in writing, with the Plan
Committee. A written disposition of a claim shall be furnished to the claimant
with a reasonable time after the claim for benefits is filed. In the event a
claim for benefits is denied, the Plan Committee shall provide the claimant with
the reasons for denial.
(B) A claimant whose claim for benefits was denied may file for a
review of such denial, with the Plan Committee, no later than 60 days after he
has received written notification of the denial.
(C) The Plan Committee shall give a request for review a full and fair
review. If the claim for benefits is denied upon completion of a full and fair
review, notice of such denial shall be provided to the claimant within 60 days
after the Plan Committee's receipt of such written claim for review. This 60-day
period may be extended in the event of special circumstances. Such special
circumstances shall be communicated to the claimant in writing within the 60-day
period. If there is an extension, a decision shall be made as soon as possible,
but not later than 120 days after receipt by the Plan Committee of such claim
for review.
(D) If benefits are provided or administered by an insurance company,
insurance service, or other similar organization which is subject to regulation
under the insurance laws, the claims procedure relating to these benefits may
provide for review. If so, that company, service, or organization will be the
entity to which claims are addressed.
7.9. No Other Agreements or Understandings. This Plan represents the
sole agreement between the Company and Palmer concerning its subject matter and
it supersedes all prior agreements, arrangements, understandings, warranties,
representations, and statements between the parties concerning its subject
matter, except to the extent the Agreement is specifically referred to herein.
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8. Administration.
8.1. Plan Committee. The Plan shall be administered by the Plan
Committee. The Plan Committee shall have full authority and power to administer
and construe the Plan, subject to applicable requirements of law. Without
limiting the generality of the foregoing, the Plan Committee shall have the
powers indicated in the foregoing Sections of this Plan and the following
additional powers and duties:
(A) To make and enforce such rules and regulations as it deems
necessary or proper for the administration of the Plan;
(B) To interpret the Plan and to decide all questions concerning the
Plan;
(C) To determine the amount and the recipient of any payments to be
made under the Plan;
(D) To value the Shares deemed held in Palmer's Company Account; and
(E) To make all other determinations and to take all other steps
necessary or advisable for the administration of the Plan.
All decisions made by the Plan Committee pursuant to the provisions of
the Plan shall be made in its sole discretion and shall be final, conclusive,
and binding upon all parties.
8.2. Delegation of Duties. The Plan Committee may delegate such of its
duties and may engage such experts and other persons as it deems appropriate in
connection with administering the Plan. The Plan Committee shall be entitled to
rely conclusively upon, and shall be fully protected in any action taken by the
Plan Committee, in good faith in reliance upon any opinions or reports furnished
them by any such experts or other persons.
8.3. Indemnification of Committee. The Company agrees to indemnify and
to defend to the fullest extent permitted by law any person serving as a member
of the Plan Committee, and each employee of the Company or any of its affiliates
appointed by the Plan Committee to carry out duties under this Plan, against all
liabilities, damages, costs and expenses (including attorneys' fees and amounts
paid in settlement of any claims approved by the Company) occasioned by any act
or omission to act in connection with the Plan, if such act or omission is in
good faith.
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8.4. Liability. To the extent permitted by law, neither the Plan
Committee nor any other person shall incur any liability for any acts or for any
failure to act except for liability arising out of such person's own willful
misconduct or willful breach of the Plan.
IN WITNESS WHEREOF, the Company has adopted the amended and restated
version of the Plan on November 29, 2005, effective January 1, 2005.
REMEDYTEMP, INC.
By: /s/ Gunnar B. Gooding
------------------------------------
Gunnar B. Gooding
Senior Vice President, Human
Resources and Legal Affairs
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