Exhibit 10.24


 





 


 


JACKSON HEWITT TAX SERVICE INC. 


 


2005 ANNUAL VOLUNTARY DEFERRED
COMPENSATION PLAN


 


HIGHLIGHTS


 


•                 The Jackson Hewitt Tax Service Inc. 2005 Annual
Voluntary Deferred Compensation Plan (the “Plan”) is
a voluntary non-qualified plan and is independent of other retirement/deferral
programs.  Eligible employees must
execute a Deferred Compensation Agreement to participate in the Plan, a form of
which agreement is attached hereto as Annex I.


 


•                 Certain members
of management are eligible to participate in the Plan.  Such employees may elect to defer a portion
of their pre-tax compensation earned during a fiscal year.  Employees may elect to defer up to 100% from
their annual commission and up to 100% of their bonus.


 


•                 The Company has
the right under the Plan to match the deferred contributions of participating
employees.


 


•                 In exchange for
the employees’ pretax contribution, Jackson Hewitt Tax Service Inc. agrees to
pay the benefit payment in a lump sum or in annual installments with payments
to commence based on the employees’ Participation Elections.  This benefit payment will be based on the
actual rate of return of the investment alternatives the employees have
selected and will depend on the amount and timing of their investment.  Benefits will be paid in accordance with the
Participation Election Form.


 


•                 The Plan is unfunded and any compensation
deferred under the Plan by participating employees represents at all times an
unfunded and unsecured contractual obligation of Jackson Hewitt Tax Service
Inc.  Participating employees and their
beneficiaries will be unsecured creditors of the Jackson Hewitt Tax Service
Inc. with respect to all obligations owed to any of them under the Plan.  Amounts payable under the Plan will be
satisfied solely out of the general assets of Jackson Hewitt Tax Service Inc.
subject to the claims of its creditors.


 


•                 There is no
guaranteed rate of return.  The
appreciation in the employees’ account will be tied to the performance of the
investment alternatives that they select. 
There is no guarantee that the investment objectives of the funds will
be achieved and their account balance may be less than their original deferral
amount.


 


•                 The employee
will be given an opportunity to reallocate among the investment performance
alternatives, view their account, statements and plan documents through the
Company’s administrator for this plan, Brown Bridgman & Company.  They will later be given more information
including a username and password for accessing their account after enrollment.


 


•                 If the employee
dies prior to receiving payments, their beneficiaries will receive their
account balance in a lump sum.


 


•                 If the employee
dies after payments have commenced but before receiving all of the payments
due, the remaining payments will be paid to their designated beneficiary as a
lump sum.


 





















 


INVESTMENT ALTERNATIVES


 


Amounts that the employees defer under the Plan will be credited to an
account established by Jackson Hewitt Tax Service Inc. in their name.  The account will be credited with earnings
based on the performance of various investment alternatives selected by the
employee.


 


The employee will be able to reallocate on the administrators (Brown
Bridgman & Company) website as often as they wish.


 


The
employee may allocate their account balance among one or more of the investment
alternatives that Jackson Hewitt Tax Service Inc. may designate from time to
time, in any combination of whole percentages adding up to 100%.


 


IMPORTANT INFORMATION


 


The
amount the employee contributes is pretax income and will not be part of their
taxable income.  The amount they defer
will be indicated in a separate section of their W-2 form.  Benefits that they or their beneficiary
receives will be taxable as ordinary income in the year received.  However, deferred compensation amounts are
subject to FICA and Medicare tax at time of deferral.


 


RISK FACTORS


 


•                 Under the Plan, participating employees are
unsecured creditors of Jackson Hewitt Tax Service Inc with no rights in any
assets in which Jackson Hewitt Tax Service Inc. may invest.


 


•                 The amount of
their benefit is tied to a variable investment alternative with no guaranteed
rate of return.  Please be aware that if
the vehicles of investment that they elect show negative returns, it is
possible that their account balance may be less than their original deferral
amount.


 


•                 As with all
benefit programs, Jackson Hewitt Tax Service Inc. may alter, amend, modify,
suspend or terminate the Plan at any time in its discretion. If the Plan is
terminated Participant benefit payments will be paid in accordance with the
Participant’s Participation Election Form.


 


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ANNEX I


 


JACKSON
HEWITT TAX SERVICE INC.


 


FORM OF


 


DEFERRED COMPENSATION AGREEMENT


 


This DEFERRED COMPENSATION
AGREEMENT (this “Agreement”)
is made as of the date indicated on the signature page hereof by and between JACKSON HEWITT TAX SERVICE INC., and its subsidiaries and
affiliates (collectively, the “Company”),
and the employee identified on the signature page hereof (the “Participant”).


 


WHEREAS, the Participant wishes to make an
irrevocable election to defer the receipt of a portion of his or her commission
and/or bonus earned during the 2005 Fiscal Year, as such term is defined
herein;


 


WHEREAS, the Company and the Participant wish to set
forth herein certain terms and conditions applicable to the amounts deferred as
provided herein;


 


WHEREAS, the Participant acknowledges that with
respect to deferred amounts subject to the terms and conditions of this
Agreement, the Participant will be an unsecured creditor of the Company with no
ownership rights in any assets of any kind; and


 


WHEREAS, the Participant further acknowledges that,
while he or she may make elections, subject to the terms and conditions of this
Agreement, pursuant to which the balance of his or her Account (as defined
herein) will be deemed to be allocated among the several Investment
Alternatives (as defined herein) for purposes of measuring the increase or
decrease in the value thereof, nothing contained herein shall require the
Company to make an actual investment of assets corresponding to any amount of
compensation deferred by the Participant;


 


NOW, THEREFORE, in consideration of the provisions
contained in this Agreement and with reference to the foregoing recitals, the
Company and the Participant agree as follows:


 


1.                Defined Terms.  As used in this Agreement, the following
terms shall have the indicated meanings:


 


(a)               “Account”
means the bookkeeping account maintained on the books and records of the
Company to record Deferred Amounts and credits or debits thereto in


 


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accordance with this Agreement and any other terms
of the Program.  An Account is
established only for purposes of measuring a deferred benefit and not to
segregate assets or to identify assets that may be used to make payments
hereunder.


 


(b)              “Account Value”
means the amount reflected on the books and records of the Company as the value
of the Account at any date of determination, as determined in accordance with
this Agreement.


 


(c)               “Beneficiaries”
means the beneficiary or beneficiaries designated by the Participant to receive
any payments in the event of the Participant’s death.  Such designation may be revoked or changed by
the Participant at any time.  If the
Participant does not designate a Beneficiary to which payments are to be made
upon the Participant’s death, or if no Beneficiary survives the Participant,
payments under this Agreement subsequent to the death of the Participant will
be made to the Participant’s estate.  If
a Beneficiary survives the Participant but dies prior to the completion of the
payments contemplated to be made to that Beneficiary under this Agreement, the
unpaid portion of such payments at the death of the Beneficiary shall be paid
to the Beneficiary’s estate.


 


(d)              “Deferral Election”
means an irrevocable election of the Participant to defer payment of a portion
of his or her commission and/or bonus subject to the terms and conditions of the
Program.


 


(e)               “Deferred Amount”
means the amount of commission and/or bonus deferred by the Participant
pursuant to a Deferral Election.


 


(f)               “Distribution
Election” means an irrevocable election of the Participant as to
(i) the year in which distribution of the Account Value will begin and
(ii) the payment method to be used for distribution of the Account Value.


 


(g)              “Fiscal Year”
means the fiscal year of the Company, commencing on May 1st of such year and
ending on April 30th.


 


(h)              “Investment
Performance Alternative” means the Investment Performance
Alternatives made available from time to time for selection by the Participant
to measure the return (positive or negative) to be attributed to Deferred
Amounts.


 


(i)                “Program”
means the 2005 Annual Voluntary Deferred Compensation Plan, the terms and
conditions of the Participant’s participation in which are set forth in the
2005 Annual Voluntary Deferred Compensation Plan document and this Agreement.


 


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(j)                “Subsidiary”
means a corporation or other entity which is consolidated with the Company for
financial statement purposes.


 


(k)               “Total Disability”
means the inability to perform the normal duties of one’s occupation due to
disability or sickness.


 


2.                Deferral Elections.


 


(a)               Acknowledgment of Deferral Election.  The Participant and the Company hereby
acknowledge the Participant’s Deferral Election, made on or prior to the
execution of this Agreement, to defer, in accordance with the terms and
conditions of the Program, payment of specified dollar amounts of commission
and/or bonus as indicated on the signature page hereof with respect to the 2005
Fiscal Year.


 


(b)              Subsequent Deferrals.  The terms of this Agreement shall apply to
any Deferral Election by the Participant with respect to the 2005 Fiscal
Year.  Any such subsequent Deferral
Election shall be made by the Participant’s completion, execution and
submission of a deferral election form prescribed for such purpose by the
Company, in the manner established by the Company for subsequent Deferral
Elections.  The Participant’s
participation in the Program for the 2005 Fiscal Year, however, shall not
confer on the Participant any right to participate in the Program, or in any
similar program that may be established by the Company, with respect to any
subsequent Fiscal Year, and the Participant’s eligibility so to participate
will depend upon the satisfaction of eligibility criteria for such subsequent
Years to be established by the Company in its sole discretion.


 


3.                The
Account.


 


(a)               Credits and Charges to the Account.  The Deferred Amount for the 2005 Fiscal Year
will be credited to the Account no later than 30 days after the date on which
such amount would otherwise have been paid to the Participant.  The Account will be charged with any amount
distributed to the Participant or any of his or her Beneficiaries.


 


(b)              Election of Investment Performance
Alternatives.  The
Participant agrees that the Account Value will be deemed allocated (for
purposes only of determining the value of the Account), in minimum allocations
of at least 1%, among one or more Investment Performance Alternatives as
indicated on the Initial Investment Allocation Form (or such other form as may
be prescribed for such purposes from time to time by the Company) submitted by
the Participant to the Company and/or their administrator on or prior to the
execution of this Agreement.  The
Participant acknowledges that such deemed allocation is made exclusively for
the purpose of determining the Account Value from time to time in accordance
with this Agreement, and that the Company will have no obligation to invest
amounts corresponding to Deferred Amounts (including, without limitation, in
investment vehicles corresponding to the Investment Alternatives selected by
the Participant). The Participant may change the deemed


 


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allocation
of his or her Account Value among the Investment Alternatives then available
under the Program by utilizing the web based administration program provided by
the administrator.  In the event that the
Participant’s employment with the Company or any Subsidiary or affiliate
thereof terminates for any reason, then following such termination of
employment the Participant will continue to have the right to change the deemed
allocation of his or her Account Value among the Investment Alternatives.


 


(c)               Determination of Account Value.  The Company and/or their administrator will
calculate the Account Value based on the Participant’s Deferred Amounts and his
or her then effective elections with respect to deemed allocation of the
Account among the available Investment Performance Alternatives on a daily
basis during the next business day.  The
Company and/or their administrator will furnish the Participant with access to
a website where current account values can be viewed.  The Account Value reflected will be based on
the best information available to the Company and/or their administrator as of
the end of the period.


 


(d)              Company’s Right to Change Investment
Performance Alternatives. 
The Company may, from time to time and in its sole discretion, change
the Investment Performance Alternatives available under the Program, and
nothing in this Agreement shall be construed to confer on the Participant the
right to continue to have any particular Investment Performance Alternative
available for purposes of measuring the value of his Account.


 


4.                                      Termination of Employment Prior to the Benefit Election Date on your 2005
Benefit Commencement Election Form.


 


(a)               Termination other than retirement.  If the Participant’s employment with the
Company or any Subsidiary or affiliate thereof terminates for any reason other
than retirement, death or total disability prior to the year selected on the
2005 Benefit Commencement Election Form, then during the following year of such
termination of employment the Participant will be entitled to a lump sum
payment of his or her account and such payment shall be an amount equal to the
Account Value, determined on or around May 31st of such year.  Following such payment neither the
Participant nor any Beneficiary of the Participant will have any further rights
under this Agreement.


 


5.                Disability.


 


Anything in this Agreement to the contrary
notwithstanding, in the event of the Participant’s Total Disability (whether or
not his or her employment terminates), the Participant will be entitled to
receive benefits in accordance with the Benefit Commencement Election Form.


 


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6.                Manner
of Payment.


 


(a)               U.S. Dollars.  All payments to the Participant under the
Program will be in U.S. dollars.  The
Participant will have no right to any other form of payment.


 


(b)              Benefit Commencement Election.  The Participant will make a Benefit Commencement
Election specifying (i) a date for commencement of the distribution of the
Account Value and (ii) the payment method, as described in subsection (d)
below, that the Participant elects for such distribution.  The Benefit Commencement Election will be
irrevocable and must be completed at time of deferral.  If at a later date Participant wishes to
amend the Benefit Commencement Election Form, the amendment must take place at
least twelve (12) months from the last amendment or deferral and effect benefits
scheduled for at least twelve (12) months later than the date of the amendment –
and the benefits must be received no sooner than five (5) years later than they
would have otherwise been received prior to the amendment.


 


(c)               Payment Options.  In the Distribution Election the Participant
will elect to have the Account Value distributed pursuant to one of the
following installment payment methods:


 


(i)                                     Lump sum; or


 


(ii)                                  Annual
installments of between two and 20 years.


 


The amount of each annual installment will equal “(1/A)
x B”, where “A” equals the number of annual installments remaining to be made
(including the installment with respect to which the calculation is made) and “B”
equals the Account Value as of the date the amount of such installment is
determined.


 


(d)              No Withdrawals or Loans.  Prior to the commencement of distributions,
the Participant will have no rights under the Program or this Agreement to make
withdrawals from the Account for any reason other than Section 6(f)
below.  In no event will the Participant
be entitled to receive loans from the Company based upon the Account Value.


 


(e)               Unforeseen Emergency.  If you have a severe financial hardship
resulting from illness or accident to you, your spouse, or a dependent, or loss
of property due to casualty or other similar extraordinary unforeseeable
circumstances arising as a result of events beyond your control you may apply
to the Company for a distribution. 
However, the amount of the distribution may not exceed the amount
necessary to satisfy the emergency including taxes on the distribution.


 


7.                Death.


 


If the Participant dies before the commencement of
benefit payments, the Account Value as of the date of death will be paid in a
lump sum to the Participant’s Beneficiaries as soon


 


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as
practicable following the date of death or on or around the next May 31st at
the discretion of the Company.  If the
Participant dies following payment of the first installment payment, the
remaining account balance will be paid to the Participant’s Beneficiary
continued in installments.


 


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8.                Termination
and Amendment.


 


The Company may alter, amend, modify, suspend or
terminate the Program, in whole or in part as to some or all participants in
the Program, at any time in its discretion. 
No further deferrals will be permitted after the effective date of such
termination.  If the Plan were to be
terminated benefits would still be paid in accordance with the 2005 Benefit
Commencement Election Form.


 


9.                Program
Unfunded.


 


The Program is unfunded.  The Account represents at all times an
unfunded and unsecured contractual obligation of the Company.  The Participant and each of his Beneficiaries
will be unsecured creditors of the Company with respect to all obligations owed
to any of them under this Agreement or otherwise under the Program.  Amounts payable under the Program and this
Agreement will be satisfied solely out of the general assets of the Company
subject to the claims of its creditors.


 


10.              No
Investment Obligation.


 


The Participant acknowledges and agrees that the
Company has no obligation to invest amounts corresponding to Deferred Amounts
in investment vehicles corresponding to the Investment Alternatives selected by
the Participant for purposes of determining the Account Value of his or her
Account.  The Participant further
acknowledges and agrees that if the Company, in its sole discretion, elects to
invest amounts corresponding to Deferred Amounts in any such investment
vehicles, the Participant will have no right or interest in any such investment
vehicle by virtue of this Agreement.


 


11.              General
Terms.


 


(a)               Administration.  The Program is administered by the Company or
such other individual or firm as the Company may from time to time appoint to
administer the Program.  Neither the
Company nor such other individual the Company may appoint to administer the
Program shall be liable to the Participant for any action or determination.


 


(b)              No Right to Continued Employment or
Participation.  Neither
this Agreement nor any action taken or omitted to be taken hereunder shall be
deemed to create or confer on the Participant any right to be retained in the
employ of the Company or any subsidiary or other affiliate or to create or
confer on the Participant any right to participate in the Program, or in any
similar program that may be established by the Company, in respect of any
future Deferral.


 


(c)               Tax Advice.  The Participant acknowledges that he or she
has been advised by the Company to consult with his or her tax and other
financial advisors prior to


 


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making
the Deferral Election.  The Company makes
no representations or warranties concerning the tax or other financial
consequences of the Participant’s Deferral Election or any payments provided
for under this Agreement.


 


(d)              Taxes and Withholding.  As a condition to any payment or distribution
pursuant to this Agreement, the Company may require the Participant to pay such
sum to the Company as may be necessary to discharge the Company’s obligations
with respect to any taxes, assessments or other governmental charges imposed on
property or income received by the Participant hereunder.  In the discretion of the Company, the Company
may deduct or withhold such sum from any payment or distribution to the
Participant.


 


(e)               Governing Law.  This Agreement and the legal relations
between the parties shall be construed in accordance with and governed by the
laws of the State of New Jersey.


 


(f)               Construction.  The headings in this Agreement have been
inserted for convenience of reference only and are to be ignored in any
construction of any provision hereof.  If
a provision of this Agreement is not valid or enforceable, that fact shall in
no way affect the validity or enforceability of any other provision.  Use of one gender includes the other, and the
singular and plural include each other.


 


(g)              Successors.  The provisions of this Agreement shall be
binding on the Participant and his or her heirs and legal representatives and
upon the Company and its successors and assigns.  The Participant’s rights hereunder (including
without limitation the right to receive payments as provided herein) may not be
assigned.


 


(h)              Signature in Counterparts.  This Agreement may be signed in counterparts,
each of which shall be an original, with the same effect as if signatures
thereto and hereto were upon the same instrument.


 


[Signature
page follows]


 


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IN WITNESS WHEREOF, the Company
and the Participant have duly executed and delivered this Agreement as of this
      day of
                  ,
2005.


 


 


	
   

  	
  JACKSON HEWITT TAX SERVICE INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PARTICPANT

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  SS #:

  	
   

  	
   

  
							



 


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