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EXHIBIT 10.17
ABM INDUSTRIES INCORPORATED
SERVICE AWARD BENEFIT PLAN
AS AMENDED AS OF JANUARY 1, 2003
ARTICLE COMMENCING
NUMBER DESCRIPTION ON PAGE
- -----------------------------------------------------------------------------------
1. NAME, EFFECTIVE DATE, PURPOSE AND CONSTRUCTION .................. 1-1
2. DEFINITIONS...................................................... 2-1
3. ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION .......... 3-1
4. BENEFITS ........................................................ 4-1
5. FORFEITURES OF BENEFITS ......................................... 5-1
6. PARTICIPANTS' ACCOUNTS .......................................... 6-1
7. DISTRIBUTION OF BENEFITS ........................................ 7-1
8. FIDUCIARY RESPONSIBILITY ........................................ 8-1
9. ADMINISTRATIVE COMMITTEE ........................................ 9-1
10. AMENDMENT AND TERMINATION ...................................... 10-1
EXHIBIT 10.17
1-1
ABM INDUSTRIES INCORPORATED
SERVICE AWARD BENEFIT PLAN
ARTICLE 1
NAME, EFFECTIVE DATE, PURPOSE AND CONSTRUCTION
1.1 Plan Name
The Plan set forth in this document shall be designated the ABM
Industries Incorporated Service Award Benefit Plan.
1.2 Effective Date
The Effective Date of this Plan was November 1, 1989. This document
reflects amendments and changes made through January 1, 1991.
1.3 Purpose
The Plan is intended to qualify as a severance pay plan described in
Department of Labor Regulations 2510.3-1 (a) (2) and 2510.3-2 (b) and
is intended to be treated as a employee welfare plan under ERISA. The
Plan is intended to provide benefits to terminating employees based
upon their loyal and dedicated service to the Company and its
Affiliates.
1.4 Construction
The following miscellaneous provisions shall apply in the construction
of this Plan document:
(a) State Jurisdiction
All matters respecting the validity, effect, interpretation
and administration of this Plan shall be determined in
accordance with the laws of the State of California except
where preempted by ERISA or other federal statutes.
(b) Gender
Wherever appropriate, words used in the singular may include
the plural or the plural may be read as the singular, the
masculine may include the feminine, and the neuter may include
both the masculine and the feminine.
(c) Application of References to Law
All references to sections of ERISA, or the Internal Revenue
Code, other federal or state statutes, any regulations or
rulings thereunder, shall be deemed to refer to such sections
as they may subsequently be modified, amended, replaced or
amplified by any federal statutes, regulations or rulings of
similar application and import enacted by the Government of
the United States, any duly authorized agency of the United
States Government, any State Government or duly authorized
agency thereunder.
EXHIBIT 10.17
1-2
(d) Enforceable Provisions Remain Effective
If any provision of this Plan shall be held by a court of
competent jurisdiction to be invalid or unenforceable, the
remaining provisions of this Plan shall continue to be fully
effective.
(e) Headings
Headings are inserted for reference only and constitute no
part of the construction of this Plan.
1.5 Employment Relationship Not Affected
Nothing in this Plan document shall be deemed a contract between the
Employer and any Employee, nor shall the rights or obligations of the
Employer or any Employee to continue or terminate employment at any
time be affected hereby.
EXHIBIT 10.17
2-1
ARTICLE 2
DEFINITIONS
2.1 "Account" means the aggregate of all records maintained by the
Committee for purposes of determining a Participant's or Beneficiary's
benefits under the Plan.
2.2 "Affiliated Employer" means any corporation which is so designated by
the Board, which may include any corporation or business determined to
be affiliated under Code Section 414 or any other corporation or
business which is affiliated to some degree with the Employer.
2.3 "Award Date" means October 31, 1990, each succeeding October 31 and any
other date elected by the Board at its discretion. Effective January 1,
1991, "Award Date" shall mean December 31, 1991 and each succeeding
December 31.
2.4 "Beneficiary" means any person designated by a Participant.
2.5 "Board" shall mean the Board of Directors of the Employer.
2.6 "Code" means the Internal Revenue code of 1986, as amended (and
regulations issued thereunder).
2.7 "Committee" means the Administrative Committee designated under Article
9.
2.8 "Compensation" for any calendar year means all amounts paid to the
Employee and reported as wages on the Employee's form W-2 for the year
for services rendered for the Employer or Affiliated Employers during
the calendar year, and all amounts which an Employee elected to have
the Employer or Affiliated Employer contribute on his behalf to the ABM
401(k) and Profit Sharing Plan or the ABM Deferred Compensation Plan
for the calendar year. Compensation in excess of $175,000 shall not be
considered in the calculation of benefits; provided, however, the
$175,000 limit shall not replace any limit in place for any year prior
to 1996 under this Plan.
2.9 "Date of Eligibility" shall mean (1) for Eligible Employees hired after
October 31, 1989, the date on which the Employee first performs any
service for the Employer, (2) for Eligible Employees employed on or
before October 31, 1989, November 1, 1989. Effective January 1, 1992,
"Date of Eligibility" shall mean the January 1 following the date on
which the Employee has Compensation in excess of $50,000, or such other
dollar amount as the Committee may from time to time announce.
2.10 "Date of Hire" shall mean the date on which the Employee becomes an
employee of the Employer or an Affiliated Employer within the meaning
of Code Section 3121(d).
EXHIBIT 10.17
2-2
2.11 "Disability" shall mean the permanent incapacity of a Participant, by
reason of physical or mental illness, to perform his usual duties for
the Employer, resulting in termination of his service with the Employer
or any Affiliated Employer. Disability shall be determined by the
Committee in a uniform and nondiscriminatory manner after consideration
of such evidence as it may require, which shall include a report of
such physician or physicians as it may designate.
2.12 "Eligible Employee" shall have the meaning as defined in Article 3.
2.13 "Eligible Participant" shall mean:
(a) An Eligible Employee who was employed continuously throughout
the Fiscal Year, or
(b) an Eligible Employee who terminated employment during the
Fiscal Year due to death, disability or after having reached
his Normal Retirement Date.
2.14 "Employee" means any person considered under the rules of common law or
appropriate statute to be employed by the Employer or an Affiliated
Employer, except:
(a) Employees whose wages are determined by collective bargaining
agreements,
(b) Employee Employees who are receiving pension contributions
under a union retirement plan, and
(c) Contract workers of the Employer or an Affiliated Employer who
are employed to perform principally manual work, including but
not limited to elevator operator, janitor, security worker,
guard, window washer, stationary engineer, painter,
warehouseman, driver, parking attendant, mechanic,
electrician, laundry worker or service technician.
2.15 "Employer" means ABM Industries Incorporated, a Delaware corporation,
and such of its successors or assigns as may expressly adopt this Plan
and agree in writing to continue this Plan.
2.16 "Entry Date" means November 1, 1989, and each succeeding November 1.
Effective January 1, 1991, "Entry Date" means January 1 and each
succeeding January 1.
2.17 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
2.18 "Fiscal Year" means the accounting year of the Plan, which is the
12-month period ending October 31. Effective January 1, 1991, "Fiscal
year" means the 12-month period ending December 31.
2.19 "Normal Retirement Date" means the date of the Participant's 62nd
birthday.
2.20 "Participant" means any Employee who has entered the Plan and been
credited with Service Award Benefits but has not yet had such benefits
distributed.
EXHIBIT 10.17
2-3
2.21 "Plan" means the arrangement created by this document.
2.22 "Plan Administrator" means the Administrative Committee, discussed in
Article 9.
2.23 "Restricted Employee" shall mean all officers, managers and sales
persons of the Employer or an Affiliated Employer.
2.24 "Service Award Benefit" means the benefit calculated under Section 4.2.
EXHIBIT 10.17
3-1
ARTICLE 3
ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION
3.1 Definitions
(a) "Eligible Employee" means any Employee of the Employer or an
Affiliated Employer whose Compensation is $50,000 or greater
in any calendar year. The $50,000 dollar amount may be
adjusted from time to time as the Plan Administrator may deem
necessary. The foregoing notwithstanding, an Employee shall
not be an Eligible Employee during any Fiscal Year the
Employee is also eligible to receive contributions under or
make 401(k) contributions to the ABM 401(k) and Profit Sharing
Plan.
3.2 Participation
(a) Initial Participants
Employees who are Eligible Employees as of October 31, 1989
shall become Participants as of November 1, 1989.
(b) Newly Hired Employees
Employees who are hired after October 31, 1989, shall become
Participants as of the first November 1, or such earlier date,
after certification by the Committee that the Employee is an
Eligible Employee. Employees hired after January 1, 1991 shall
become Participants as of the first January 1, or such earlier
date, after certification by the Committee that the Employee
is an Eligible Employee.
(c) Other Employees
Other Employees shall become Participants as of the first
November 1, or such earlier date, after certification by the
Committee that the Employee is an Eligible Employee. Effective
January 1, 1991,the November 1 participation date in this
Article shall be changed to January 1.
(d) Rehired Employees
A rehired Employee shall be treated as an Employee hired after
October 31, 1989, unless the Employee was a Participant in the
Plan. Section 2.16 of the Plan notwithstanding, former Plan
Participants shall renew their participation in the Plan as of
the July 1 or January 1 coinciding with or next following
their date of rehire provided they are otherwise eligible for
the Plan.
3.3 Beneficiary Designation
(a) Designation Procedure
Each Eligible Employee, upon becoming a Participant shall
designate a Beneficiary or Beneficiaries to receive benefits
under the Plan after his death. A Participant may change his
beneficiary designation at any time. Each beneficiary
designation shall be in a form prescribed by the Committee and
will be effective only when filed with the Committee during
the Participant's lifetime. Each beneficiary designation filed
with the Committee will cancel all previously filed
Beneficiary designations.
EXHIBIT 10.17
(b) Lack of Designation
In the absence of a valid designation, the Participant's
benefits under the Plan shall be distributed to the
Participant's surviving spouse, or if there is no surviving
spouse to the Participant's estate.
3.4 Committee Determines Eligibility
Compliance with the eligibility requirements shall be determined by the
Committee, which shall also inform each Eligible Employee of his
becoming a Participant. The Committee shall provide each participant
with a summary plan description in compliance with ERISA and
regulations thereunder.
EXHIBIT 10.17
4-1
ARTICLE 4
BENEFITS
4.1 Credits for Service Award Benefits
(a) On each Award Date, commencing October 31, 1990, the Board
shall Credit the Account of each Eligible Participant with 7
days, to be used in the calculation of Benefits under Article
4.2. For the short Fiscal Year beginning October 1, 1991 and
ending December 31, 1991, the Board shall determine the number
of days to be credited to each Eligible Participant, if any.
(b) In addition to (a) above, on each Award Date, commencing
October 31, 1990, the Board may, in it's sole discretion,
designate an additional number of days to be credited to the
Account of each Eligible Participant.
(c) If an employee reenters the Plan on July 1 of any year, the
Employee/Participant shall be to 1/2 the number of days
awarded under (a) and (b) above to other Employees who
participated for the entire year.
4.2 Calculation of Service Award Benefit
Upon termination of employment, the Committee shall determine the
benefit payable to the Participant. The benefit shall be equal to the
number of days credited to the Account of the eligible Employee
multiplied by the average annual Compensation received in the three
full calendar years of full-time employment preceding the year of
termination converted to a daily rate of pay. For purposes of this
calculation, a year shall consist of 260 days.
4.3 Limitation on Benefits
In no event shall the benefits payable under this Plan combined with
the benefits under the severance pay plan of the Employer, as described
in Chapter 3, III, (b) of the ABMI Personnel Policy and Procedure
Manual, as it may be amended or revised from time to time, exceed two
times the Compensation received by the Participant in the twelve month
period preceding the Participant's termination from employment.
EXHIBIT 10.17
5-1
ARTICLE 5
FORFEITURES OF BENEFITS
5.1 Forfeiture for Short Service
A Participant who terminates employment prior to completing 5 full
years of service, measured from the Employee's Date of Hire, for the
Employer or an Affiliated Employer shall forfeit all benefits under
this Plan. A Participant will be credited with one year of service for
each 12 month period of continuous employment wit the Employer or an
Affiliated Employer.
5.2 Exceptions
(a) Death
Notwithstanding Article 5.1 above, a Participant's benefits
under this Plan shall not be forfeitable if the termination of
employment is due to the death of the Participant.
(b) Disability
Notwithstanding Article 5.1 above, a Participant's benefits
under this Plan shall not be forfeitable upon a finding by the
Committee that the Participant's termination of employment is
due to Disability defined in Article 2.11.
(c) Normal Retirement
Notwithstanding Article 5.1 above, a Participant's benefits
under this Plan shall not be forfeited if the Participant's
termination occurs after the Participant's Normal Retirement
Date under this Plan.
(d) Notwithstanding Article 5.1 above, if a Participant's
employment is terminated by action of the Employer as part of
the divestiture of Amtech Elevator Services, the Participant's
Account under the Plan shall become fully vested on the
closing of the divestiture transaction.
5.3 Unallocatable Participants
If all or any portion of a Participant's benefits become payable under
this Plan, and the Committee after a reasonable search cannot locate
the Participant or his Beneficiary (if such Beneficiary is entitled to
payment) the Account shall be Forfeited as of the end of the third
Fiscal Year following the Participant's termination from employment.
5.4 Forfeiture for Cause
A Participant who is terminated from employment because of theft,
defalcation, or embezzlement from the Employer, an Affiliated Employer,
or a customer or client of either the Employer or an Affiliated
Employer, shall forfeit all benefits under this Plan.
EXHIBIT 10.17
6-1
ARTICLE 6
PARTICIPANTS ACCOUNTS
6.1 Service Award Account
The Committee shall maintain an accounting of the number of days and
weeks, or portions thereof, awarded to each Participant along with a
record of the Compensation received by the Participant for the current
calendar year and the two preceding calendar years.
6.2 Statement of Accounts
At least annually, the Committee will provide the Participant with a
statement of the status of the Participant's Account and the record of
Compensation in that Account. In the event of any error, the
Participant is entitled to request the Committee to correct either the
number of days or weeks credited, or the Compensation credited.
EXHIBIT 10.17
7-1
ARTICLE 7
DISTRIBUTION OF BENEFITS
7.1 General
Benefits under the Plan are paid solely from the assets of the
Employer. This Plan document grants the Participants no greater right
to the assets of the Employer and Affiliated Employers than that
enjoyed by any unsecured creditor of the Employer and Affiliated
employers.
7.2 Administrative Rules
(a) Authority
Distributions to Participants shall be made only in accordance
with the directions of the Committee, which shall be governed
by the terms of this Plan documents.
(b) Claims
A Participant's Beneficiary has the right to file a claim for
benefits as set forth in Article 9.7.
7.3 Timing and Amount of Distributions
(a) Restricted Employees
A Participant who is a Restricted Employee shall receive his
benefits in two payments from the Plan. The first payment,
equal to 1/2 of the total benefit due, will be made in the
eleventh month following the Participant's termination from
employment. The second payment, equal to 1/2 of the total
benefit due, will be made no later than the last day of the
23rd month following the Participant's termination from
employment. In the event the Employer or Affiliated Employer
sells, closes or otherwise disposes of a subsidiary, division
or other operating unit which is engaged in a type or line of
business in which the Employer or an Affiliated Employer no
longer wishes to engage, the Committee shall direct that the
Accounts of Restricted Employees shall be payable in one lump
sum as soon as administratively possible after the close of
the transaction, provided that such payments will not violate
any provision of the Code.
(b) Other Participants
A participant, who is not a Restricted Employee, shall receive
his benefits in two payments from the Plan. The first payment,
equal to 1/2 of the total benefits, will be paid as soon as
administratively possible following the termination of
employment by the Participant. The second payment, equal to
1/2 of the total benefits, will be paid in the thirteenth
month following the Participant's termination from employment.
(c) Exceptions
The Committee, in its sole discretion, may waive the rules in
(a) and (b) in the event of death or Disability of the
Participant, or if the Participant, whether a Restricted
Employee or not, retires after attaining his Normal Retirement
Date. Notwithstanding the foregoing, if the benefit is $5000
or less, the Committee may
EXHIBIT 10.17
7-2
make a single lump sum payment to the Participant as soon as
administratively feasible.
EXHIBIT 10.17
8-1
ARTICLE 8
FIDUCIARY RESPONSIBILITY
8.1 Named Fiduciary
The authority to control and manage the operation and administration of
the Plan shall be allocated between the Employer, the Affiliated
Employer and the Committee, all of whom are named fiduciaries under
ERISA.
8.2 Fiduciary Standards
Each fiduciary shall discharge its duties with respect to the Plan
solely in the interest of the Participants and Beneficiaries as
follows:
(1) For the exclusive purpose of providing benefits to
Participants and their Beneficiaries;
(2) With the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent man
acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of
a like character and with like aims;
(3) In accordance with the Plan document.
8.3 Fiduciaries Liable for Breach of Duty
A fiduciary shall be liable, as provided in ERISA, for any breach of
his fiduciary responsibilities. In addition, a fiduciary under this
Plan shall be liable for a breach of fiduciary responsibility of
another fiduciary under this Plan as provided under ERISA Section 405.
8.4 Fiduciary May Employ Agents
Any person or group of persons may serve in more than one fiduciary
capacity with regard to the Plan. A fiduciary, with the consent of the
Employer, may employ one or more persons to render advice and
assistance with regard to any function such fiduciary has under the
Plan. The expenses of such persons shall be paid by the Employer.
8.5 Authority Outlined
(a) Employer Authority
The Employer has the authority to amend and terminate the
Plan, and to appoint and remove members of the Committee.
(b) Committee Authority
The Committee has the authority to:
(1) Maintain the records of Accounts of the Participants;
(2) Furnish and correct errors in statements of Accounts;
(3) Establish the standards for determining Disability
under the Plan;
(4) Construe the Plan document and questions thereunder;
and
(5) Employ advisors and assistants.
EXHIBIT 10.17
8-2
8.6 Fiduciaries Not to Engage in Prohibited Transactions
A fiduciary shall not cause the Plan to engage in a transaction if he
knows or should know that such transaction constitutes a prohibited
transaction under ERISA Section 406 or code Section 4975, unless such
transaction is exempted under ERISA Section 408 or Code Section 4975.
EXHIBIT 10.17
9-1
ARTICLE 9
ADMINISTRATIVE COMMITTEE
9.1 Appointment of Administrative Committee
The Employer shall appoint an Administrative Committee to manage and
administer this Plan in accordance with the provisions hereof, each
member to serve for such term as the Employer may designate or until a
successor member has been appointed or until removed by the Employer.
Members shall serve without compensation for committee services. All
reasonable expenses of the Committee shall be paid by the Employer.
9.2 Committee Operating Rules
The Committee shall act by agreement of a majority of its members,
either by vote at a meeting or in writing without a meeting. By such
action, the Committee may authorize one or more members to execute
documents on its behalf. In the event of a deadlock or other situation
which prevents agreement of a majority of the Committee members, the
matter shall be decided by the Employer.
9.3 Duties of Plan Administrator
The Committee is the Plan Administrator under ERISA and shall have the
duty and authority to comply with the reporting and disclosure
requirements of ERISA which are specifically required of the Plan
Administrator.
9.4 Duties of the Committee
The Committee shall keep on file a copy of this Plan, including any
subsequent amendments and the latest annual report required under Title
I of ERISA for examination by Participants during the business hours.
9.5 Committee Powers
The Committee has the power and duty to do all things necessary or
convenient to effect the intent and purpose of this Plan, whether or
not such powers and duties are specifically set forth herein. Not in
limitation but in amplification of the foregoing, the Committee shall
have the power to construe the Plan document and to determine all
questions hereunder. Decisions of the Committee made in good faith upon
any matters within the scope or its authority shall be final and
binding on the Employer, the Affiliated Employers, the Participants,
their Beneficiaries and all others. The Committee shall at all times
act in a uniform and nondiscriminatory manner in making and carrying
out its decisions, and may from time to time prescribe and modify
uniform rules of interpretation and administration.
9.6 Committee May Retain Advisors
With the approval of the Employer, the Committee may from time to time
or on a continuing basis, retain such agents and advisors including,
specifically, attorneys, accountants, actuaries, consultants and
administrative assistants, as it considers necessary
EXHIBIT 10.17
9-2
to assist it in the proper performance of its duties. The expenses of
such agents or advisors shall be paid by the Employer.
9.7 Claims Procedure
(a) Claims Must Be Submitted Within 60 Days
The Committee shall determine Participants' and Beneficiaries'
rights and benefits under the Plan. In the event of a dispute
over benefits, a Participant or Beneficiary may file a written
claim for benefits with the Committee, provided that such
claim is filed within 60 days of the date the Participant or
Beneficiary receives notification of the Committee's
determination.
(b) Requirements for Notice of Denial
If a claim is wholly or partially denied, the Committee shall
provide the claimant, setting forth:
(i) The specific reason for the denial;
(ii) Specific references to the pertinent provisions on
which the denial is based;
(iii) A description of any additional material or
information necessary for the claimant to perfect the
claim with an explanation of why such material or
information is necessary; and
(iv) Appropriate information as to the steps to be taken
if the claimant wishes to submit his or her claim for
review.
The notice of denial shall be given within a reasonable time
period but not later than 90 days of the date the claim is
filed, unless special circumstances require an extension of
time for processing the claim. If such extension is required,
written notice shall be furnished to the claimant within 90
days of the date the claim was filed stating the special
circumstances requiring an extension of time and the date by
which a decision on the claim can be expected, which shall be
no more than 180 days from the date the claim was filed. If no
notice of denial is provided as herein described, the claimant
may appeal the claim as though the claim had been denied.
(c) Claimant's Rights if Claim Denied
The claimant and/or his representative may appeal the denied
claim and may;
(i) Request a review upon written request to the
Committee;
(ii) Review pertinent documents; and
(iii) Submit issues and comments in writing; provided that
such appeal is made within 60 days of the date the
claimant received notification of the denied claim.
(d) Time Limit on Review of Denied Claim
Upon receipt of a request for review, the committee shall
provide written notification of its decision to the claimant
stating the specific reasons and referencing specific Plan
provisions on which its decision is based, within a reasonable
time period but not later than 60 days after receiving the
request, unless special circumstances require an extension for
processing the review. If such an extension is required, the
Committee shall notify the claimant of such special
circumstances and of the date, no later than 120 days after
the original
EXHIBIT 10.17
9-2
date the review was requested, on which the Committee will
notify the claimant of its decision.
(e) No Legal Recourse Until Claims Procedure Exhausted.
In the event of any dispute over benefits under this Plan, all
remedies available to the disputing individual under this
Article 9.7 must be exhausted before legal recourse of any
type is sought.
9.8 Committee Indemnification
To the fullest extent permitted by law, the Employer agrees to
indemnify, to defend, and hold harmless the members of the Committee,
individually and collectively, against any liability whatsoever for any
(1) action taken or omitted by them in good faith in connection with
this Plan or their duties hereunder, and (2) expenses or losses for
which they may become liable as a result of any such actions or
non-actions, unless resultant from their own willful misconduct. The
Employer may purchase insurance for the Committee to cover any of their
potential liabilities with regard to the Plan.
EXHIBIT 10.17
10-1
ARTICLE 10
AMENDMENT AND TERMINATION
10.1 Employer May Amend Plan
The Employer reserves the right to amend the Plan in any manner that it
may deem advisable by action of the Employer. The Employer, Affiliated
Employers, Participants and Beneficiaries and all other persons having
any interest hereunder shall be bound by any such amendment.
10.2 Employer May Terminate Plan
The Employer has established the Plan with the bona fide intention and
expectation that the Plan will continue indefinitely, but the Employer
shall be under no obligation to maintain the Plan for any given length
of time and may, in its sole discretion, terminate the Plan at any time
without any liability, except as to the payment of benefits earned
under this Plan prior to the date this Plan is terminated.