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Participants with
Employment Contracts and
Participants in
the Executive Severance Plan
CIT Group Inc.
Long-Term Incentive Plan
Restricted Cash Unit
Retention Award Agreement
“Participant”:
“Date of Award”: January 17, 2008
This
Retention Award Agreement, effective as of the Date of Award set forth above, sets forth
the grant of Restricted Cash Units (“RCUs”) by CIT Group Inc., a Delaware corporation
(the “Company”), to the Participant named above, pursuant to the provisions of the CIT
Group Inc. Long-Term Incentive Plan, as amended (the “Plan”). A purpose of this Retention
Award Agreement is to provide the Participant with an additional incentive to remain in
the service of the Company through the two-year period ending on the second anniversary
of the Date of Award (the “Retention Period”). All capitalized terms shall have the
meanings ascribed to them in the Plan, unless specifically set forth otherwise herein.
The
parties hereto agree as follows:
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(A) |
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Grant
of RCUs. The Company hereby grants to the Participant [NUMBER] RCUs,1 subject
to the terms and conditions of the Plan and this Award
Agreement. Each RCU represents the unsecured right to receive
in the future a cash payment equal to the Fair Market Value of
one Share on the Vesting Date (as defined below) (the “Settlement Amount”).
The Participant shall not be required to pay any additional
consideration for the payment of the Settlement Amount upon
settlement of the RCUs. |
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(1) |
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Subject
to the Participant’s continued employment with the Company and its Subsidiaries (the “Company
Group”) through the applicable Vesting Date (as
defined below), the RCUs shall vest in two
installments, with 50% of the RCUs vesting on the first
anniversary of the Date of the Award and the
remaining 50% of the RCUs vesting on the second
anniversary of the Date of Award. The “Vesting Date,” for
purposes of this Award Agreement, shall mean each
date upon which a portion of the RCUs vests. |
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The
number of RCUs is determined by dividing the dollar amount of the Participant’s award
approved by the Committee on January 15, 2008 by the closing price per share on
January 17, 2008. |
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(2) |
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If,
during the Retention Period, (i) the Participant’s employment with the Company Group
terminates due to the Participant’s death or “Disability,” (ii)
the Participant resigns for “Good Reason,” (iii) the
Participant’s employment with the Company Group is
terminated by the Company Group without “Cause” or
(iv) a Change in Control occurs, the RCUs shall, to
the extent not previously vested, immediately become
100% vested. If the Participant has entered into an employment
agreement with the Company in effect on the Date of
the Award (the “Employment Agreement”), then “Disability,” “Good
Reason” and “Cause” shall have the meanings
attributed to them in the Employment Agreement. If the Participant
does not have an Employment Agreement but is a
participant of the Company’s Executive Severance Plan
(the “Executive Severance Plan”), then “Disability,” “Good
Reason” and “Cause” shall have the meanings attributed to such terms in
the Executive Severance Plan. |
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(3) |
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If
the Participant’s employment with the Company Group terminates due to the Participant’s “Retirement” (as
defined below), the RCUs shall be cancelled immediately and the
Participant shall immediately forfeit any rights to,
and shall not be entitled to receive any payments
with respect to, the RCUs, including, without
limitation, the right to receive the Dividend Bonus
pursuant to Section (D) and the right to receive
payment of any unpaid Settlement Amount for
previously vested RCUs for which the Settlement Date
has not occurred; provided, however, that the
Committee may elect, in its sole discretion, prior
to or in connection with such termination of employment, to provide for
the vesting and payment of some or all of the
Participant’s then outstanding RCUs and the
corresponding portion of the Dividend Bonus. For purposes of
this Award Agreement, “Retirement” is defined as
either (i) a Participant’s election to retire upon
attaining his or her “Normal Retirement Age”; or (ii)
a Participant’s election to retire upon (A)
completing at least a 10-year “Period of Benefit
Service” and (B) having either (1) attained age 55, or (2)
incurred an “Eligible Termination” and, at the time
of such “Eligible Termination,” having attained age
54. The terms “Normal Retirement Age,” “Period of
Benefit Service” and “Eligible Termination” shall have the meaning
as defined in the Company’s Retirement Plan. |
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(4) |
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Subject
to the exercise of the Committee’s election pursuant to Section (B)(3), if the Participant’s
employment with the Company Group terminates for any
reason other than as set forth in Section (B)(2), the
unvested RCUs shall be cancelled immediately and the
Participant shall immediately forfeit any rights to, and shall not be
entitled to receive any payments with respect to, the
RCUs |
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including,
without limitation, the right to receive the Dividend
Bonus pursuant to Section (D) and the right to
receive payment of any unpaid Settlement Amount for
previously vested RCUs for which the Settlement Date
has not occurred. |
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(C) |
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Settlement.
Each vested RCU shall be settled through a cash payment equal to the
Settlement Amount thirty (30) days following the applicable
Vesting Date (each, a “Settlement Date”). If the Participant’s
home country is outside the United States, such cash payment
will be initially determined in United States Dollars, and then
converted to the Participant’s local currency based on the
prevailing exchange rate in effect on the date immediately
prior to the last business day of the month in which the
applicable Vesting Date occurs, in accordance with the Company’s standard
practice. |
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(D) |
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Dividends.
If, after the Date of Award and prior to the Vesting Date, dividends with
respect to Shares are declared or paid by the Company, the
Participant shall be entitled to receive a cash bonus payment
(the “Dividend Bonus”) in an amount, without interest, equal
to the cumulative dividends declared or paid on a Share, if any,
during such period multiplied by the number of RCUs. Any
portion of the Dividend Bonus payable pursuant to cumulative
dividends declared or paid as either a whole number or
fractional number of Shares (the “Stock Dividend”) shall be converted into a
cash value by multiplying the Stock Dividend by the Fair
Market Value of one Share on the applicable dividend payment
date. The Dividend Bonus shall be paid in cash on the
Settlement Date for the underlying RCUs. No Dividend Bonus
shall be paid with respect to RCUs that are forfeited pursuant
to Section (B). |
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(E) |
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Transferability.
RCUs are not transferable other than by last will and testament, by
the laws of descent and distribution pursuant to a domestic
relations order, or as otherwise permitted under Section 12 of
the Plan. Further, except as set forth in Section 12(b) of
the Plan, a Participant’s rights under the Plan shall be exercisable
during the Participant’s lifetime only by the Participant, or
in the event of the Participant’s legal incapacity, the
Participant’s legal guardian or representative. |
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(F) |
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Incorporation
of Plan. The Plan provides a complete description of the terms and
conditions governing all Awards granted thereunder and is
incorporated into this Award Agreement by reference. The Plan
and this Award Agreement are collectively referred to as the “Plan
Documents.” This Award Agreement and the rights of the Participant
hereunder are subject to the terms and conditions of the Plan,
as amended from time to time, and to such rules and
regulations as the Committee may adopt under the Plan. If
there is any inconsistency between the terms of this Award
Agreement or the terms of the Plan, the Plan’s terms shall
supersede and replace the conflicting terms of this Award
Agreement. |
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(1) |
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The
RCUs are discretionary retention awards. The Plan Documents do not confer on the
Participant any right or entitlement to receive
compensation or bonus in any specific amount for any
future fiscal year (including, without limitation, any grants of
future Awards under the Plan) and do not impact in
any way the Company Group’s determination of the
amount, if any, of the Participant’s compensation or
bonus. The RCUs do not constitute salary, wages,
regular compensation, recurrent compensation or
contractual compensation for the year of grant or any
later year and shall not be included in, nor have any effect on, the
determination of employment-related rights or
benefits under law or any employee benefit plan or
similar arrangement provided by the Company Group
(including, without limitation, severance,
termination of employment and pension benefits),
unless otherwise specifically provided for under the terms
of such plan or arrangement or by the Company Group.
The benefits provided pursuant to the RCUs are in no
way secured, guaranteed or warranted by Company Group. |
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(2) |
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The
RCUs are awarded to the Participant by virtue of the Participant’s employment with, and
services performed for, the Company Group. The Plan
Documents do not constitute an employment agreement.
Nothing in the Plan Documents shall modify the terms of
the Participant’s employment, including, without
limitation, the Participant’s status as an “at will” employee
of the Company Group, if applicable. |
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(3) |
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Subject
to the terms of the Employment Agreement or the Executive Severance Plan, as applicable
to the Participant, the Company reserves the right to
change the terms and conditions of the Participant’s
employment, including the division, subsidiary or
department in which the Participant is employed.
None of the Plan Documents, the grant of RCUs, nor
any action taken or omitted to be taken under the Plan
Documents shall be deemed to create or confer on the
Participant any right to be retained in the employ of
the Company Group, or to interfere with or to limit
in any way the right of the Company Group to terminate the Participant’s
employment at any time. Moreover, the termination of
employment provisions set forth in Section (B) only
apply to the treatment of the RCUs in the specified
circumstances and shall not otherwise affect the Participant’s
employment relationship. By accepting this Award
Agreement, the Participant waives any and all rights
to compensation or damages in consequence of the
termination of the Participant’s office or employment
for any reason whatsoever insofar as those rights
arise or may arise from |
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the
Participant’s ceasing to have rights under, or be
entitled to receive payment in respect of, the RCUs
as a result of such termination, or from the loss or diminution in
value of such rights or entitlements. This waiver
applies whether or not such termination amounts to a
wrongful discharge or unfair dismissal. |
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(1) |
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It
is expressly understood that the Committee is authorized to administer, construe, and
make all determinations necessary or appropriate to
the administration of the Plan and this Award
Agreement, all of which shall be binding upon the Participant. |
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(2) |
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The
Board may at any time, or from time to time, terminate, amend, modify or suspend the
Plan, and the Board or the Committee may amend or
modify this Award Agreement at any time; provided,
however, that no termination, amendment, modification or suspension
shall materially and adversely alter or impair the
rights of the Participant under this Award Agreement,
in any material respect without the Participant’s
written consent. |
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(3) |
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If
any provision of the Plan Documents would, in the reasonable good faith judgment of the
Committee, result or likely result in the imposition
on the Participant, a beneficiary or any other person
of a penalty tax under Section 409A of the Code (“Section
409A”), the Committee may modify the terms of the
Plan Documents, without the consent of the
Participant, beneficiary or such other person, in the manner
that the Committee may reasonably and in good faith
determine to be necessary or advisable to avoid the
imposition of such penalty tax. Notwithstanding
anything to the contrary in the Plan Documents, to
the extent that the Participant is a “Specified
Employee” (within the meaning of the Committee’s
established methodology for determining “Specified
Employees” for purposes of Section 409A), no payment
or distribution of any amounts with respect to the
RCUs that are subject to Section 409A may be made
before the first business day following the six (6)
month anniversary from the Participant’s “Separation
from Service” (within the meaning of the Committee’s
established methodology for determining “Specified
Employees” for purposes of Section 409A) from the
Company Group or, if earlier, the date of the
Participant’s death. |
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(4) |
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Payment
of the Settlement Amount and the Dividend Bonus upon settlement of the RCUs is subject to
the Participant satisfying all applicable federal,
state, local and foreign tax obligations (including
the Participant’s FICA obligation). The Company shall
have the power and the right to deduct or withhold
from all |
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amounts
payable to the Participant pursuant to the RCUs or
require the Participant to remit to the Company, an
amount sufficient to satisfy any applicable taxes required by
law. |
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(5) |
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This
Award Agreement shall be subject to all applicable laws, rules, and regulations, and to
such approvals by any governmental agencies or
national securities exchanges as may be required, or
as the Committee determines are advisable. The Participant
agrees to take all steps the Company determines are
necessary to comply with all applicable provisions of
federal and state securities law in exercising his or
her rights under this Award Agreement. |
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(6) |
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Any
notice required by the terms of the Plan or this Award Agreement shall be given in
writing and shall be deemed effective upon personal
delivery or upon deposit in the mail, by registered
or certified mail. Notice to the Company shall be delivered to CIT
Group Inc., Human Resources Department, 0 XXX Xxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000 and to the Participant
at the address that the Participant has most recently
provided to the Company; provided, however, that the Company may
provide notices to the Participant by Company-email,
intranet postings or other electronic means that are
generally used for Company employee communications. |
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(7) |
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Nothing
in the Plan or this Award Agreement should be construed as providing the Participant with
financial, tax, legal or other advice with respect to
the RCUs. The Company recommends that the
Participant consult with his or her financial, tax, legal
and other advisors to provide advice in connection
with the RCUs. |
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(8) |
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All
obligations of the Company under the Plan and this Award Agreement, with respect to the
Awards, shall be binding on any successor to the
Company, whether the existence of such successor is
the result of a direct or indirect purchase, merger,
consolidation, or otherwise, of all or substantially
all of the business and/or assets of the Company. |
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(9) |
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To
the extent not preempted by federal law, this Award Agreement shall be governed by, and
construed in accordance with, the laws of the State
of Delaware. |
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(I) |
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Acceptance
of Award. The Participant acknowledges his or her understanding and
acceptance of the terms and conditions of the Plan Documents.
Acceptance of the RCUs requires no action on the part of the
Participant. If the Participant, however, desires to refuse
the Award, the Participant must notify the Company in writing in
accordance with Section (H)(6) of this Award Agreement no
later than thirty (30) days after receipt |
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of
this Award Agreement. If the Participant refuses the Award he or she
will not be entitled to any additional compensation or
remuneration in replacement of the Award. If the Participant
does not refuse the Award, the Participant will be deemed to
agree to all of the terms of the Award. |
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IN
WITNESS WHEREOF, this Award Agreement has been executed by the Company by one of its duly
authorized officers as of the Date of Award.
