Moloney Family Funeral Homes

MOLONEY FAMILY FUNERAL HOMES

OPPORTUNITY PLAN

for

Funeral Directors

Effective July 1, 2007

The Opportunity Plan has been created to provide recognition and reward for each of our team members. The plan is designed to give financial incentive and reward to each team member for their impact on family satisfaction and our overall performance as a company. We are excited by this new initiative and believe that it will help individual employees achieve greater financial success, while establishing a firm foundation for the company’s future growth.

It is important to remember that excellentcustomer satisfaction will result in referrals, which, in turn, will increase volume. In our area there are many firms a family could use for their funeral needs. Client satisfaction is a key ingredient in growing our business and serving more families each year. Referrals are generated by client families who are completely satisfied.

We have a strong vision of the future and we believe that our company will continue to grow. In order to maintain and improve upon this growth, enhanced employee performance is fundamental in ensuring both individual and company success. With this in mind we have established a monetary reserve which we intend to use for investment in those individuals who perform – in the estimation of our clients - at high levels of satisfaction.

Customer satisfaction and teamwork are critical indicators of our ability to grow. We are well aware that the staff is responsible for much of our success and we want to recognize and reward those employees who perform exceptionally well. Included in the following pages are the details of the Opportunity Plan.

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OPPORTUNITY PLAN OUTLINE

Bonus A:

Overall Satisfaction

Team Performance

Bonus

Exceptional teamwork and execution company-wide are important for our long-term growth and success. Learning, education and adoption of new and creative service initiatives are also required for us to remain the leading funeral service provider in our market. This means we will all have to individually integrate training and service initiatives into what we do, as well as help each other succeed in this.

As a group of high achieving funeral professionals who help drive the results of the entire company, we are targeting a quarterly performance reward for you should the group reach certain customer satisfaction and value creation milestones.

The Chart Below outlines your Opportunity Plan for the Team Performance Bonus. We believe that our level of customer satisfaction will and should improve throughout the year as our dedication to the customer and strong teamwork will pay dividends. Therefore, in an effort to set levels that are attainable today yet drive us to improve into the future, the qualification levels are as follows:

CFS RANGE / 0%-89% / 90%-91% / 92%-93% / 94%-100%
Qualification Level / Ineligible / Minimum / Excellent / Superior
Annual Bonus / $0 / $600 / $1,200 / $1,600
Quarterly Bonus / $0 / $150 / $300 / $400

The measurement used for the above potential reward shall be Question #7, “Overall Satisfaction”, from the Company’s Customer Survey Instrument.

Bonus B:

Arrangement

Excellence Reward

Your qualification for the Arrangement Excellence portion of the Opportunity Plan shall be determined by your individual results from the Company’s Customer Family Survey responses returned each quarter. The measurement used shall be Question #7, “Overall Satisfaction”. There is no more important factor in our success than delivering exceptional value and service to our client families therefore it will serve as the centerpiece of Bonus B.

The amount that can be earned in any quarter will vary depending on the results from your individual surveys, the number of arrangements you make, the total net revenue from your arrangements and the collections from the client families you meet.

Illustration A at the end of this document illustrates different bonus levels based on the following formula.

Bonus B FormulaYour Arrangement Excellence Reward shall be calculated using the following formula:

Value created

(-) Revenue Threshold

(-) Accounts Receivable Amount Over 45 Days

(-) Discounts & Refunds

(-) Errors and Omissions

ELIGIBLE OPPORTUNITY AMOUNT

Eligible opportunity amount

(X) CFS incentive rate

GROSS QUARTERLY BONUS

Value Created. Value Created shall be equal to all service and funeral merchandise revenue arranged, excluding Cash Advances. Typical items include all service charges, caskets, vaults, cremation products, other memorial merchandise (jewelry, folders, etc.), flowers, markers and monuments, etc.

Revenue Threshold. We have carefully considered the company’s normal and standard operating costs as well as the additional investment to be made for the Opportunity Plan. Based on each individual’s anticipated arrangement volume and value creation levels, we have determined that there is an inherent cost associated with the business operations that must be considered, as well as a need for continued reinvestment to support future growth plans. Therefore, we have designed the Opportunity Plan to take this into account. We have determined that this amount, the Revenue Threshold Cost Factor, is roughly equal to 85% of our revenue. Secondly, we are managing our business against the expectation of achieving certain per call averages. This targeted company-wide revenue per call will be used in determining the revenue threshold as well. We have targeted $9,000 as a company target.

Each quarter, your Revenue Threshold will be deducted from the Value Created. The Revenue Threshold is determined by multiplying the actual number of arrangements made multiplied by the targeted revenue per call multiplied by the revenue threshold cost factor:

Number of Actual Arrangements

X Targeted Revenue per Call

X Cost Factor

Quarterly Revenue Threshold

Accounts Receivable. Commencing with funerals arranged on or after July 1, 2007, any accounts receivable over 45 days old will be deducted from the Value Created amount. In the cases where the funeral home accepts an insurance assignment this amount will not be deducted unless the outstanding balance reaches 90 days or more. For the purposes of the opportunity plan, any accounts receivable that ages beyond the allowed timeframe will be deducted for up to a period of 4 quarters. After 4 quarters the account will be excluded from further bonus calculations.

Discounts & Refunds. Any services or goods provided to client families at no charge, or at a reduced rate from our standard fees, will be deducted from the Value Created. Goods or services provided in such a manner will not count towards Value Created as the funeral home does not receive payment for such items and in turn can not pay a bonus on such amounts. Discounts given will be deducted from the Value Created. Any amount refunded to a client family, for whatever reason and at the discretion of management, shall also be deducted from the Value Created total.

Errors and Omissions. An error or omission is any item that causes the company to incur financial loss in the processing of a case. One such example is the rerunning of a death certificate or obituary due to misspelled names or incorrect information. For example, if the replacement cost on an obituary were $400 then the $400 replacement cost would be deducted from the Value Created. If it is determined that you could not have done anything to prevent the error, it will not be deducted from the value generation total.

Combined

OpportunityIt is possible that based on the results from the surveys returned from our client families each quarter that none of the bonuses might be earned, any of the bonuses might be earned or all of the bonuses might be earned.

Minimum

Quarterly

Call VolumeThe Funeral Services Profession has extremely high fixed costs in order to operate at our level. Therefore, we must take this into consideration as we are deciding to set aside new and addition money for the Opportunity Plan. After careful review, we feel that it is prudent to set a quarterly minimum call volume target of 235 calls as the volume we must reach in any particular quarter in order to achieve financial balance for the funeral home. Should the company not conduct 235 calls during any quarter, the Opportunity Plan shall be considered null and void for that quarter and no rewards will be earned. Thank you for understanding the company’s need to achieve certain call volume thresholds in order for us to have the necessary funds to successfully operate the business.

Minimum Survey

Return RateIn order to be eligible for bonus payout in any particular quarter you must receive a minimum of 35% of your surveys back for the prior 4 months to the end of the quarter. For example, for a quarter ending in September, it would mean that 35% of the surveys mailed out under your name from May thru August must have been returned.

Calculation

& PaymentsThe Opportunity Plan will be calculated every 3 months, or quarterly. Payments will be made within 45 days of a quarter’s closing. To be eligible for payout for the Opportunity Plan you must be employed both for the entire eligible quarter and at the time of payout.

Inappropriate

Family Arrangement

SelectionIt is imperative for the long-term success of our business that every family we served is treated equally and fairly in all aspects. We have not historically placed greater importance on serving those families that spend more money with our firm than those who can’t or chose not to. Therefore, we expect moving forward that there will not be any attempt by our arranging professionals to intentionally make arrangements with those customers who it is anticipated will spend larger amounts of money for their services nor an attempt to avoid meeting with customers seeking minimal services or limited financial expenditure. If such favoritism and behavior is notice by Ownership or brought to Ownership’s attention then such behavior will result in suspension from the Opportunity Plan and any bonus earned during that quarter will be null and void. Future restatement to participate in the Opportunity Plan shall be at the sole discretion of Ownership.

EligibilityThe Opportunity Plan is a bonus plan that is designed to reward employees who are proactively contributing to our firm’s growth and ability to deliver excellent customer service. Therefore, in order to qualify for a bonus pay-out in any plan quarter you may not be under any form of disciplinary notice, probation, suspension or any other counseling action written or verbal. If you happen to be under disciplinary action your return to normal employment status will automatically qualify you for the opportunity plan for the next full quarter in which you are under standard employment.

Exclusive Bonus

PlanThe Opportunity Plan replaces all other incentives and/or bonus plans now in force.

Appeal ProcessAny disagreement with the results, including disputes regarding a returned client family survey response, must be made in writing within 7 days after the quarterly Opportunity Plan report is distributed. A final decision by Ownership will be made within 15 days after the receipt of the written appeal.

Your personal success in the Opportunity Plan will be considered as a factor in the annual performance review process, since excellent customer satisfaction is the leading indicator of our ability to serve the community and remain in business.

THIS IS THE FIRST PHASE OF THE IMPLEMENTATION OF THE OPPORTUNITY PLAN. IT WILL BE REVIEWED AND ADJUSTED PERIODICALLY BASED UPON THE DECISION OF OWNERSHIP.

I hereby agree to and acknowledge receipt of the Moloney Family Funeral Homes’ Opportunity Plan dated July 1, 2007.

Ann CiancioloMoloney Family Funeral Homes

Date Date

ILLUSTRATION A – INDIVIDUAL ARRANGEMENT CONFERENCE EXCELLENCE

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