Exhibit 10.3
 

 
COMFORCE CORPORATION
 
SECOND RESTATED DEFERRED COMPENSATION PLAN
 
AS CONTINUED IN EFFECT PURSUANT TO THE RESOLUTIONS ADOPTED BY THE COMPANY’S
STOCK OPTION AND COMPENSATION COMMITTEE AND BOARD OF DIRECTORS EFFECTIVE MARCH
31, 2008
 
1.           Purpose
 
 
The purpose of the COMFORCE Corporation Deferred Compensation Plan (the “Plan”)
is to provide deferred compensation to certain officers and key management
employees (“Employees”) who render services to COMFORCE Corporation, a Delaware
corporation (“COMFORCE”), and/or any of its subsidiaries that are 50% or more
owned by it (collectively, together with COMFORCE, the “Company”).

 
2.
Administration

 
 
The Plan shall be administered by the Compensation Committee (the “Committee”)
of the Board of Directors of the Company.  Subject to the provisions of the
Plan, the Committee shall have exclusive power to select the Employees to
participate in the Plan and the time or times when such participation will
commence.  The authority granted to the Committee by the preceding sentence will
be exercised based upon recommendations received from the management of the
Company.

 
 
The Committee shall have authority to interpret the Plan, to adopt and revise
rules and regulations relating to the Plan, to determine the conditions subject
to which any awards may be made or payable, and to make any other determinations
which it believes necessary or advisable for the administration of the
Plan.  Determinations by the Committee shall be made by majority vote and shall
be final and binding on all parties with respect to all matters relating to the
Plan.

 
3.
Definitions

 
 
As used in this Plan, the following terms shall have the following meanings:

 
 
(a)
“Aggregate Sum” shall mean the sum of the Total Deferred Credit and the Total
Interest Credit.

 
 
(b)
“Change of Control” shall mean a change in ownership or effective control of
COMFORCE, or in the ownership of a substantial portion of the assets of
COMFORCE, as provided in regulations promulgated under Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”).

 
 
(c)
“Commencement Date” shall mean the date set forth in the Grant Letter.

 

 

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(d)
“Deferred Credits” shall mean the deferred credits awarded to Employees under
this Plan.

 
 
(e)
“Employment Termination Date” means the date of the Employee’s separation from
service, as defined in regulations promulgated under Section 409A of the Code
and herein, if such separation from service occurs prior to any Change of
Control.  A separation from service will occur when an Employee’s level of
services drops to 49% or less of the average level of services provided by the
Participant over the immediately preceding 36-month period (or if providing
services for less than 36 months, such lesser period).  If an Employee’s status
changes from an employee to an independent contractor, the determination of the
Employment Termination Date will not take into account the services provided as
an independent contractor unless required by regulations promulgated under
Section 409A of the Code.

 
 
(f)
“Grant Letter” shall be as set forth in Exhibit A attached to this Plan (which
may be modified at any time and from time to time by the Compensation
Committee).

 
 
(g)
“Interest Credit” shall mean the sum equivalent to interest compounded quarterly
at the Mid-Term Monthly Applicable Federal Rate (“AFR”) as promulgated from time
to time by the Internal Revenue Service.  Interest Credit shall apply beginning
when the Deferred Credit is credited to the employee pursuant to section 4, and
shall continue until the Termination Date.

 
 
(h)
“Quarterly Period” shall mean each consecutive period of three (3) months
commencing on the first day of the calendar quarter next succeeding the
Commencement Date.

 
 
(i)
“Specified Employee” shall have the meaning ascribed to such term under Section
409A(a)(2)(B)(i) of the Code and regulations promulgated thereunder or as set
forth in any resolution adopted by the Company from time to time in accordance
with such sections of the Code and the regulations promulgated thereunder.

 
 
(j)
“Termination Date” shall mean the earlier of (i) the Employment Termination
Date, or (ii) the date of the occurrence of any Change of Control.

 
 
(k)
“Total Deferred Credit” shall mean the sum of the Deferred Credits earned by the
Employee during the period commencing with the Commencement Date and terminating
with the Termination Date.

 
 
(l)
“Total Interest Credit” shall mean the sum of the Interest Credits on the Total
Deferred Credit earned by the Employee.

 
4.
Earnings of Credits

 
 
The Employee shall earn one (1) Deferred Credit for each Quarterly Period
commencing with the Quarterly Period next following the Commencement Date and
terminating with the Termination Date.  Deferred Credit shall be credited to the
Employee at the beginning

 

 
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of the Quarterly Period following the Quarterly Period during which the Deferred
Credit was earned.  Any initial Deferred Credit provided for in the Grant Letter
shall be credited to the Employee as of the Commencement Date.
 
5.
Payment of Deferred Compensation

 
(a)
Upon the occurrence of the Employment Termination Date, the Aggregate Sum shall
be determined.  This Aggregate Sum shall then be divided by the number of
Quarterly Periods in which this Aggregate Sum was earned (the “Accrual
Period”).  The quotient shall be multiplied by two and the result shall
constitute an amount of each “Deferred Payment” to be made as provided in this
Section 5.  The period (the “Payment Period”) over which the Deferred Payments
shall be made shall be one-half of the duration of the Accrual Period.

 
 
By way of example, assume the Aggregate Sum is $50,000 and the Accrual Period is
20 Quarterly Periods, then the Deferred Payment shall be $5,000 and the Payment
Period shall be 10 Quarterly Periods.

 
 
In the case of any Employee who is not a Specified Employee, the last day of the
Quarterly Period commencing next following the Employment Termination Date
occurs shall be deemed to be the “First Payment Date”   In the case of any
Specified Employee, the last day of the Quarterly Period commencing six (6)
months following the Employment Termination Date occurs shall be deemed to be
the “First Payment Date” The date of the First Payment and the last day of each
Quarterly Period thereafter during the Payment Period shall each be a “Payment
Date.”

 
 
Subject to the provisions of Sections 5(b) and 5(c), on each Payment Date until
all Deferred Payments are made, the Company shall pay to the Employee:

 
 
(i)  One Deferred Payment; and

 
 
(ii) an amount equal to interest compounded monthly at the Interest Credit,
calculated from the First Payment Date and continuing until such Payment Date,
on the Aggregate Sum as of the Employment Termination Date less the aggregate
amount of all Deferred Payments theretofore made.

 
(b)
If a Change of Control shall occur prior to the Employment Termination Date, the
Company shall make a lump sum cash payment to the Employee within 30 days after
the date of the Change of Control in an amount equal to the Aggregate Sum as of
the date of the Change of Control.

 
(c)
If a Change of Control shall occur following the Employment Termination Date but
prior to the final Payment Date,

 
 
(i)
in the case of any Employee who is not a Specified Employee, the Company shall
make a lump sum cash payment to the Employee within 30 days after the date of
the Change of Control in an amount equal to the

 

 
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Aggregate Sum (as of the Employment Termination Date) less any Deferred Payments
made pursuant to Section 5(a); and
 
 
(ii)
in the case of any Specified Employee, the Company shall make a lump sum cash
payment to the Employee on the later of (A) the date that is six (6) months
following the Employment Termination Date or (B) within 30 days after the date
of the Change of Control, in an amount equal to the balance of the Aggregate Sum
(as of the Employment Termination Date) less any Deferred Payments made pursuant
to Section 5(a).

 

 
(d)
If the Employee is not alive at any Payment Date, the amounts payable on such
Payment Date shall be paid instead to the Employee’s estate.

 
6.
Benefits Subject to Company Creditors

 
 
All amounts due Employees under the Plan constitute a liability to the Company.

 
 
The Company may, although it is not required to, segregate any funds for the
purposes of this Plan but, in the event of such segregation, such amounts will
remain part of the Company’s general assets and will be subject to the claims of
the Company’s general creditors.

 
7.
Withholding

 
 
The Company or employer shall deduct from all payments under the Plan federal,
state and local income and employment taxes, as required by applicable
law.  Amounts deferred will be taken into account for purposes of any tax or
withholding obligation under the Federal Insurance Contributions Act and Federal
Unemployment Tax Act, not in the year distributed, but at the later of the year
the services are performed or the year in which the rights to the amounts are no
longer subject to a substantial risk of forfeiture, as required by Sections
3121(v)(2) and 3306(r)(2) of the Code and the regulations thereunder.  Amounts
required to be withheld pursuant to Sections 3121(v)(2) and 3306(r)(2) of the
Code generally shall be withheld out of other current wages paid by the
employer, but, alternatively, may be paid by the Participant’s delivery of cash
or a check satisfactory to the Committee.

 
8.
Vesting

 
 
Subject to the provisions of this agreement, the Employee shall be fully vested
in his Aggregate Sum except that he shall forfeit all such amounts in the event
that his termination of employment was caused by or results from (i) the
Employee having been convicted of a felony, a crime of moral turpitude, or any
crime involving the Company (other than pursuant to actions taken at the
direction of or with approval of the Board of Directors of the Company; or (ii)
a determination by the Board of Directors of the Company that the Employee was
engaged in fraud, misappropriation or embezzlement.

 
9.
Miscellaneous Provisions

 

 
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(a)
No Employee shall have any claim or right to become a participant under the
Plan.

 
 
(b)
Neither the Plan nor any action taken hereunder shall be construed as giving any
Employee any right to be retained in the employ of the Company.

 
 
(c)
Except when otherwise required by the context, any masculine terminology in this
document shall include the feminine and any singular terminology shall include
the plural.

 
 
(d)
The right of any Employee (or beneficiary of an Employee) to any benefit or to
any payment hereunder shall not be subject to alienation, assignment,
garnishment, attachment, execution or levy of any kind.

 
 
(e)
The provisions of this Plan shall be construed, administered, and enforced in
accordance with the laws of the State of New York, other than its laws
respecting choice of law, to the extent not pre-empted by federal law.

 
 
(f)
If an Employee (or beneficiary of an Employee) entitled to receive any benefits
hereunder is determined by the Committee to be legally incapable of giving valid
receipt and discharge for such benefits, the benefits may be paid to the duly
appointed personal representative of such person.

 
10.
Claims Processes

 
 
In the event that an Employee (or the beneficiary of an Employee) does not
receive any Plan benefit that is claimed, such person shall be entitled to
consideration and review as provided herein.  Such consideration and review
shall be conducted in a manner designed to comply with Section 503 of the
Employee Retirement Income Security Act of 1974.

 
 
Upon receipt of any written claim for benefits, the Committee shall be notified
and shall give due consideration to the claim presented.  If the claim is denied
to any extent by the Committee, the Committee shall furnish the claimant with a
written notice setting forth (in a manner calculated to be understood by the
claimant):

 
 
(a)
the specific reason or reasons for denial of the claim;

 
 
(b)
a specific reference to the Plan provisions 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; and

 
 
(d)
an explanation of the provisions of this section.

 
 
A claimant who has a claim denied may appeal to the Committee for
reconsideration of that claim.  A request for reconsideration under this section
must be filed by written notice within sixty (60) days after receipt by the
claimant of the notice of denial.

 

 
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Upon receipt of an appeal, the Committee shall promptly take action to give due
consideration to the appeal.  Such consideration may include a hearing of the
parties involved, if the Committee feels such a hearing is necessary.  In
preparing for this appeal, the claimant shall be given the right to review
pertinent documents and the right to submit in writing a statement of issues and
comments.  After consideration of the merits of the appeal, the Committee shall
issue a written decision which shall be binding on all parties.  The decision
shall be written in a manner calculated to be understood by the claimant, and
shall specifically state its reasons and pertinent Plan provisions on which it
relies.  The Committee’s decision shall be issued within sixty (60) days after
the appeal is filed, except that if a hearing is held, the decision may be
issued within one hundred twenty (120) days after the appeal is filed.

 
 
The Committee may designate one or more of its members or any other person of
its choosing to make any determination otherwise required under this section.

 
11.
Amendment of the Plan

 
 
The Board of Directors of the Company may alter or amend the Plan from time to
time and at any time, or terminate the Plan at any time.

 
 
No amendment to the Plan or its termination may alter, impair, or reduce the
“Aggregate Sum” accrued for any Employee up to the time of such amendment or
termination, nor will any amendment or plan termination allow payments to be
made in a manner so as to be an impermissible acceleration under section 409A of
the Code.

 

 
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Exhibit A
 
Dear _______________________:
 
You have been hereby chosen to participate in the Comforce Corporation Deferred
Compensation Plan (the “Plan”), a copy of which is attached to this letter.
 
Please note that: Commencement Date shall be______________________________.
 
Deferred Credit shall be an amount equal to one and one half percent (1.5%) of
your total wages as defined in Section 3401(a) of the Internal Revenue Code of
1986, as amended, based upon each Quarterly Period as defined in the Plan
commencing with the next succeeding Quarterly Period. Total wages shall not
include (i) reimbursements or other expense allowances, (ii) fringe benefits,
(iii) moving expenses, (iv) deferred compensation paid or accrued and, (v)
welfare benefits.
 
In addition you shall be awarded an initial Deferred Credit in an amount equal
to $__________.
 
If the above is acceptable to you, please sign one copy of this letter and
return it to us.
 

 

 
Very truly yours,
     
COMFORCE Corporation
       
By
 
The above is acceptable to me:
               

 
 
 
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