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EXHIBIT 10.5
TEAM AMERICA CORPORATION
COMPENSATION CONTINUATION AGREEMENT
This agreement is between TEAM American Corporation, an Ohio Corporation, (the
"Company") and Xxxxxxx X. Xxxxxx, an employee of the Company (the "Employee").
BACKGROUND INFORMATION
a.) It is the desire of the Company to assist the Employee in providing for
his retirement through the use of a nonqualified deferred compensation
arrangement.
b.) In consideration of the performance of future services to the Company by
the Employee, the parties agree as provided below.
ARTICLE I - DEFINITIONS
1.1 Normal Retirement Date. Shall be the first day of the month following the
Employee's retirement, provided the Employee has reached age 65.
1.2 Early Retirement Date. Shall be the first day of January of the year
following the Employee's retirement.
1.3 Retirement. Shall mean the termination of employment with the Company,
other employer or self employment with the stated intention not to resume full
time gainful employment.
1.4 Termination of Service. Shall mean termination of employment with the
Company for a reason other than retirement.
ARTICLE II - BENEFIT
2.1 Amount Allocated. The Company agrees to allocate $540.02 each month to
Employee's account while the Employee continues to be employed by the Company.
The Company may discontinue this payment upon written notice sent to the last
known address of the Employee.
2.2 Benefits Payable at Retirement. Upon reaching Normal Retirement Date or
Early Retirement Date, the Company will pay to Employee for a period of 15
years an annual benefit calculated in accordance with section 2.3. In the event
of Employee's death after such payments have begun but prior to the final
payment, the company shall make such payments to the
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Employee's designated beneficiary in the amount of the projected payments had
the Employee survived.
2.3. Benefit Calculation. Payments shall be calculated to exhaust the
principal and accumulated earnings of any investment selected by the company
for the accumulation of Employee's account over the payment period. If such
investments include life insurance, payments based on such insurance shall be
calculated to be equal to the maximum loan available from the insurance
contract which will not cause such policy to lapse prior to Employee's life
expectancy. The payment will be recalculated each year to reflect fluctuations
in the value of the investments in Employee's account.
2.4 No Secured Interest. Employee shall have no right or claim against any
asset of the Company. "Employee's Account" shall be the sole property of the
company. The sole purpose of the "Employee's Account" shall be to provide the
measure of the benefits under this Article not to provide the funding for such
benefits nor to secure the payment of such benefits. Employee shall have no
interest in it. Employee is an unsecured creditor of the Company for all
aspects of this contract.
2.5 Investment. The Company shall have the sole discretion to determine the
investments which shall be used to determine the benefits under this contract.
Such investments may be life insurance policies owned by the company on the
life of the Employee.
2.6 Preretirement Death Benefit. (a) In the event Employee dies prior to
retirement, no benefits shall be paid under this contract except as provided in
this section 2.6.
(b) Company shall pay the designated beneficiary of Employee $47,520.00 each
year for 15 years.
(c) Notwithstanding (b) above, in the event that the investments chosen
include a life insurance policy and the issuer of the policy does not pay the
death benefit for whatever cause, the Company's obligation shall be limited to a
lump sum payment equal to the cash value of such insurance policy plus the
value of any other investments.
(d) The initial payment shall be made within (90) days of the death of the
Employee.
2.7 Effect of Termination of Service. In the event of Employee's Termination
of Service with the Company prior to Normal Retirement Date, payments under
this Article will begin upon the earliest possible Normal Retirement Date or
Early Retirement Date Employee could have had, if Employee's employment with
the Company had continued, unless benefits are paid under section 2.6.
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ARTICLE III - EMPLOYMENT
3.1 No Employment Contract. Nothing in this contract shall be construed to
confer upon the Employee the right to continue in the employment of the Company
or to require the Company to continue the employment of the Employee.
3.2 Employment At Will. The employment relationship between the Company
and the Employee shall be "at will" unless such employment relationship has
been or is later modified by a written employment agreement between the Company
and the Employee.
ARTICLE IV - FORFEITURE
4.1 Fraudulent Acts of Employee. Employee shall forfeit all rights to any
unpaid benefits under this contract in the event that: (i) Employee is
convicted of an offense involving defalcation of the Company or (ii) Employee
is convicted of an offense involving destruction or waste of the assets of
the Company.
4.2 Non-Compete. Employee shall forfeit all rights to any unpaid benefits
under this contract in the event that Employee, directly or indirectly enters
into a business enterprise which competes with the activities of Company or if
Employee accepts payment for inducing any client of Company to terminate its
relationship with Company.
ARTICLE V - MISCELLANEOUS
5.1 Benefits Not Assignable. Neither the Employee nor his designated
beneficiary under this contract shall have the power or right to transfer,
assign, anticipate, hypothecate, mortgage, commute, modify or otherwise
encumber, in advance, any of the benefits payable hereunder; nor shall any of
said benefits be subject to seizure for the payment of any debts, judgments,
alimony or separate maintenance owed by the Employee or his designated
beneficiary; nor be transferable by operation of law in the event of
bankruptcy, insolvency or otherwise. In the event the Employee or any other
beneficiary under this contract attempts assignment, commutation,
hypothecation, transfer or disposal of the benefits hereunder, the Company's
liabilities shall forthwith cease or terminate.
5.2 Amendments. It is agreed by and between the parties hereto that,
during the lifetime of the Employee, this Agreement may be amended or revoked
at any time or times, in whole or in part, by the mutual written assent of the
Employee and the Company.
5.3 Gender. Whenever in the contract words are used in any gender, they
shall be construed to apply to the proper gender of the individual referred to.
5.4 Other Benefits Plans. Nothing contained in this contract shall affect
the right of the Employee to participate in or be covered by any qualified or
nonqualified employee benefit plan of any type constituting a part of the
Company's existing or future compensation structure.
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5.5 Headings. Headings in this contract are inserted for convenience only
and shall not be used in the interpretation of this contract.
5.6 Governing Law. This agreement shall be governed by the laws of the
state of Ohio.
ARTICLE VI - ERISA PROVISIONS
6.1 Named Fiduciary. The Named Fiduciary and Administrator of this plan
shall be the Company until its resignation or removal by the Board of Directors.
6.2 Fiduciary Duties. The duties of the Company as Named Fiduciary and
Administrator shall be the management, control and administration of this
contract. It may delegate to others certain aspects of the management and
operational responsibilities of the plan including the employment of agents
and the delegation of ministerial duties to qualified individuals.
6.4 Requests for Benefits. Requests for benefits shall be made, in
writing, to the Named Fiduciary and Administrator. If upon review of the
written claim, the Named Fiduciary and Administrator determines that the claim
for benefits should be denied, in whole or in part, it shall provide the
claimant with a written notice of the denial containing the specific reasons
for the denial and reference to the provisions of this contract which such
denial is based, and such additional material or information, if any, which
would be required to perfect the claim. Such notice shall be provided within
sixty (60) days of the receipt of the claim. The notice shall contain the
additional steps required of the claimants to make request for further review
of their claim, if they so desire.
6.5 Review of Benefit Denials. In the event that a claim for benefits
under this contract is denied, in whole or in part, and such claimant requests
a further review of such denial, they shall notify the Named Beneficiary and
Administrator, in writing, within sixty (60) days of the first claim denial.
This agreement and any other documents relating to the plan shall be made
available for claimants review upon request. The Plan Fiduciary and
Administrator and the Company shall review their request, together with such
information or comments as they care to submit, and provide a written decision
within sixty (60) days of the receipt of such request. The written decision
shall contain the specific reasons for the decision and shall include reference
to the specific provisions of the contract upon which the decision was based.
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Executed in multiple originals on the 2nd day of July, 1991.
Employee
/s/ Xxxxxxx X. Xxxxxx
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TEAM America Corporation
By: /s/ Will X. Xxxxx
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Title: V.P. Operations
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