Exhibit 10.5
EMPLOYEE LEASING
AGREEMENT
This EMPLOYEE LEASING AGREEMENT
(“ Agreement ”) is made as of the 20th day of
November, 2008 and effective as of the Closing Date subject to
consummation of the Closing, between RESIDENTIAL CAPITAL, LLC, a
limited liability company organized under the laws of Delaware
(“ResCap”), and RESMOR TRUST COMPANY, a Canadian
federally incorporated trust company (“ RTC ”).
Capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to such terms in the Purchase Agreement (as
defined below).
WHEREAS, ResCap is the indirect
parent of GMAC Residential Funding of Canada, Limited, a company
organized under the laws of Canada (“ RFOC
”);
WHEREAS, prior to the Closing Date,
RFOC owned all of the issued and outstanding shares (the “
1020491 Shares ”) of 1020491 Alberta Ltd., a
corporation existing under the laws of Alberta (“
1020491 ”);
WHEREAS, prior to the Closing Date,
RFOC and 1020491, together owned all of the shares (the “
RCC Shares ”) of RESMOR CAPITAL CORPORATION, a
corporation existing under the laws of Alberta (“ RCC
”);
WHEREAS, RCC owns all of the issued
and outstanding shares of RTC;
WHEREAS, concurrently herewith,
pursuant to and on the terms and conditions contained in that
certain Share Purchase Agreement (the “ Purchase
Agreement ”), dated as of the date hereof between RFOC
and GMAC LLC, a Delaware limited liability company (“
GMAC ”), RFOC is selling to GMAC, and GMAC is
purchasing from RFOC, all of the 1020491 Shares and all of the RCC
Shares owned by RFOC;
WHEREAS, certain ResCap employees
currently perform duties that relate exclusively to RTC;
and
WHEREAS, ResCap, pursuant to the
terms and subject to the conditions set forth in this Agreement, is
willing to make the services of certain ResCap employees available
to RTC for a limited period of time through a leasing
arrangment.
NOW, THEREFORE, in consideration of
the premises and of the mutual covenants herein contained, ResCap
and RTC agree as follows:
1. Leasing of Employees .
ResCap agrees to lease to RTC, and RTC agrees to accept the
services of, each Employee listed on Schedule 1 (the “
Leased Employees ”), for the period commencing as of
the Closing Date and ending on March 31, 2009, or such earlier
or later date as mutually agreed in writing by ResCap and RTC (the
“ Transition Period ”). Schedule 1 may be
modified after the date hereof to remove the name of a Leased
Employee listed therein (i) by RTC if such Leased Employee,
had he or she been an RTC employee, becomes terminable for
“cause” in accordance with RTC’s normal
employment practices and procedures, (ii) by RTC on two
weeks’ written notice to ResCap that the Leased
Employee’s services are no longer required; or (iii) by
ResCap if such Leased Employee becomes terminable for
“cause” in accordance with
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ResCap’s normal employment practices and
procedures or if such Leased Employee voluntarily terminates
employment with ResCap. Each party agrees that any person removed
from Schedule 1 in accordance with this
Section 1 shall no longer be a Leased Employee under
this Agreement.
2. Transition Period Employment
and Benefits; Post-Closing Obligations .
(a) During the Transition Period:
(i) any Leased Employee who is an ResCap employee on the date
hereof shall, subject to Section 1 , remain a ResCap
employee during the Transition Period; (ii) ResCap shall be
responsible for the payment and provision to the Leased Employees
of all applicable wages, bonuses and commissions earned, and any
severance or other amounts payable on termination of employment
during the Transition Period, regardless of whether they are
payable during or following the Transition Period, and each Leased
Employee shall continue to participate in those Benefit Plans in
which he or she participated immediately prior to the date hereof;
(iii) ResCap shall be responsible for withholding all relevant
employee paid taxes and other employee paid items, and filing all
reports and maintaining all records in connection therewith;
(iv) ResCap shall be responsible for for obtaining and
maintaining appropriate Canadian VISA’s and/or work permits
for Leased Employees; (v) Rescap agrees to repatriate a Leased
Employee to his or her home jurisdiction prior to terminating the
employment of such Leased Employee; and (vi) no Leased
Employee shall be deemed for any purpose to be the agent, servant
or employee of RTC or in the performance of his or her services
hereunder. In this Agreement, “ Benefits Plans
”shall mean means all plans, arrangements, agreements,
programs, policies, practices or undertakings, whether oral or
written, formal or informal, funded or unfunded, insured or
uninsured, registered or unregistered to which ResCap is a party to
or bound by or in which the Leased Employees participate in or
under which ResCap has, or will have, any liability or contingent
liability under or, pursuant to which payments are made, or
benefits are provided to, or an entitlement to payments or benefits
may arise with respect to any of the Leased Employees relating to
retirement savings, pensions, bonuses, profit sharing, deferred
compensation, incentive compensation, life or accident insurance,
hospitalization, health, medical or dental treatment or expenses,
disability, unemployment insurance benefits, employee loans,
vacation pay, severance or termination pay or other benefit
plan.
(b) ResCap shall retain all
liabilities and obligations with respect to all of the Benefit
Plans, and RTC shall not have any liability or obligation relating
to any Benefit Plan.
(c) Prior to the end of the
Transition Period, RTC may, in its discretion, offer employment to
some or all of the Leased Employees, if any, with such offer to be
effective immediately upon the first day following the end of the
Transition Period (the “ Hire Date ”). The
Leased Employees who accept such offers of employment and become
employees of RTC effective on the Hire Date are referred to herein
as “ Hired Employees .” If any Leased Employee
does not become a Hired Employee, either because RTC does not offer
employment to the Leased Employee or because the Leased Employee
does not accept RTC’s offer of employment, then ResCap shall
be responsible for payment of termination and severance benefits,
if any, to which the Leased Employee may become entitled under: any
Benefit Plan; any employment, termination or other related
agreement or arrangement; or applicable Law. ResCap shall in
addition be responsible for the payment of any benefits, severance
or otherwise, during the Transition Period, as provided in
paragraphs (a) and (b) of this
Section 2 . ResCap retains all rights and obligations
under the Benefit Plans with respect to Leased Employees, whether
or not they are Hired Employees.
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3. Services To Be Performed .
During the Transition Period and subject to the terms of the
Purchase Agreement, ResCap shall (a) direct, control and
evaluate the manner and means of each such Leased Employee’s
performance of services for RTC and (b) to the extent
applicable, obtain from RTC periodic reviews of each such Leased
Employee’s performance. RTC may direct ResCap regarding the
services of the Leased Employees to be provided hereunder,
including, without limitation, the work product to be completed,
the result to be derived, the work assignments and the work
locations. RTC may provide professional or technical supervision
and direction to the Leased Employees. The Leased Employees shall
perform services in a manner that is substantially the same as the
manner in which such services were performed by the Leased
Employees for RTC prior to the date hereof. ResCap employment
policies will continue to apply to the Leased Employees. Except as
provided in Section 1 , RTC shall not terminate the
leasing arrangements with respect to any Leased Employee during the
Transition Period.
4. Compensation For Leased
Employees . During the Transition Period, ResCap shall pay
compensation and provide benefits to the Leased Employees. During
the Transition Period, except as otherwise agreed in writing in
advance by RTC, ResCap shall not (a) establish or increase any
bonus, insurance, severance, deferred compensation, pension,
retirement, profit sharing, stock option (including, without
limitation, the granting of stock options, stock appreciation
rights, performance awards or restricted stock awards), stock
purch
