BEARINGPOINT, INC. PERFORMANCE CASH AWARD AGREEMENT
BEARINGPOINT, INC.
PERFORMANCE CASH AWARD AGREEMENT
PERFORMANCE CASH AWARD AGREEMENT
THIS PERFORMANCE CASH AWARD AGREEMENT (this “Agreement”) evidences a grant of a performance
cash award (the “Cash Award”) made by BearingPoint, Inc., a Delaware corporation (the “Company”) to
the individual (the “Award Recipient”) named in the Award Notice of Performance Cash Award to which
this Agreement relates. The award has been granted pursuant to the BearingPoint, Inc. 2000
Long-Term Incentive Plan (the “Plan”). By signing the Award Notice, the Award Recipient: (a)
acknowledges receipt of and represents that the Award Recipient has read and is familiar with the
Award Notice, this Agreement and the Plan, (b) accepts the award subject to all of the terms and
conditions of the Award Notice, this Agreement and the Plan and (c) agrees to accept as binding,
conclusive and final all decisions or interpretations of the Compensation Committee (the
“Committee”) of the Board of Directors of the Company regarding any questions arising under the
Award Notice, this Agreement or the Plan. Unless otherwise defined herein, capitalized terms shall
have the meanings assigned to such terms in the Plan.
(a) Award. On the Grant Date, the Award Recipient shall receive, subject to the
provisions of this Agreement, a Cash Award in the amount set forth in the Award Notice. Each Cash
Award consists of a bookkeeping entry representing the right to receive cash on a date determined
in accordance with the Award Notice and this Agreement.
(b) Consideration. The Award Recipient is not required to make any monetary payment
as a condition to receiving cash issued upon settlement of the Cash Award, the consideration for
which shall be future services to be rendered to the Company or for its benefit.
(a) General. Except as provided in Section 5 and Section 7 of this Agreement, the
Award Recipient’s Cash Award shall become earned in whole or in part in accordance with the table
in Section 3(b) and shall become vested and nonforfeitable on December 31, 2009 if (i) the Award
Recipient remains continuously employed until the Settlement Date set forth in Section 4(a) (the
period from the date of this Award to December 31, 2009, the “Performance Period”) and (ii) the
performance criteria (the “Performance Measures”) set forth in Section 3(a) hereof are satisfied.
(b) Other Forfeitures. Notwithstanding the general vesting provisions of Section
2(a), the Award Recipient’s Cash Award shall be forfeited completely upon a finding by
a committee consisting of the Chairman of the Board, the chief executive officer of the
Company and the general counsel of the Company (the “Determination Committee”) upon a finding by
the executive vice president of the Company responsible for the Award Recipient’s business unit
that the Award Recipient has violated his duty of loyalty to the Company or otherwise breached the
conditions of his employment. No such forfeiture shall occur, however, until such time as
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Award Recipient’s appeal of the decision of the Determination Committee to the Managing Director
Compensation Committee (the “MDCC”) has been made and decided unfavorably by the MDCC or the Award
Recipient has decided not to pursue such an appeal. The following shall constitute such a
violation or breach, with each such term as hereinafter defined: the Award Recipient’s (i) having
a Conflict of Interest; (ii) disclosure of Proprietary Information; (iii) violation of the
Company’s anti-harassment policy; (iv) violation of the Company’s non-competition requirements and
(v) violation of the Company’s non-solicitation rules.
For purposes of this Agreement the referenced terms are defined as follows:
“Conflict of Interest” means any direct or indirect interest in, connection with, or
benefit from any outside activities, particularly commercial or consulting
activities, which interest might in any way adversely affect the Company.
“Proprietary Information” means all business information or material disclosed to,
developed, or known by the Award Recipient as a consequence of his employment with
the Company and that pertains to the Company or its subsidiaries, affiliates,
predecessors or successors (collectively referred to herein as the “Company”), that
the Company treats as confidential and/or that is embodied in or relates to Works.
Proprietary Information includes the Company’s non-public discoveries, ideas,
inventions, concepts, software and related documentation, designs, drawings,
specifications, techniques, methodologies, models, data, source code, object code,
documentation, diagrams, flow charts, research, development, processes, training
materials, templates, procedures, “know-how,” tools, identities of clients and
prospective clients, client accounts or lists, web design needs, client advertising
needs and history, client reports, client proposals, research regarding prospective
clients, product information and reports, accounts, billing methods, pricing, data,
sources of supply, business methods, production or merchandising systems or plans,
marketing, sales and business strategies and plans, finances, operations, and
information regarding employees.
“Works” means (i) any inventions, trade secrets, ideas or original works of
authorship that the Award Recipient conceives, develops, discovers or makes, in
whole or in part, during his employment with the Company and that relate to the
Company’s business or its actual or demonstrably anticipated research or
development; (ii) any inventions, trade secrets, ideas or original works of
authorship that the Award Recipient conceives, develops, discovers or makes in whole
or in part during or for a period of one year after his employment with the Company
and which are made through the use of any of the Company’s equipment, facilities,
supplies, trade secrets or time, or which result from any
work that the Award Recipient performs or performed for the Company; and (iii) any
part or aspect of any of the foregoing.
“Non-Competition” means while employed with the Company and for 24 months after his
termination or resignation, for whatever reason, directly or indirectly, on his own
behalf or on behalf of a Competitive Business (as specified in Exhibit A),
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in any
geographic area or market where he (or a direct report of his business unit)
provided services to the Company during the preceding 12 months: (I) engages in or
is employed by or affiliated with a Competitive Business in which he performs the
same or similar duties or responsibilities or provides comparable services that he
performed or provided while employed with the Company; (II) offers to provide to any
client or prospective client similar services in the same line of business to those
which he conducted, provided or offered to provide while employed by the Company;
(III) renders advice or services to, or otherwise assists, any Competitive Business
in rendering advice or services similar to that advice or services offered or
provided by the Company through him or his business unit to any client or
prospective client; (IV) diverts or attempts to divert any client or prospective
client from the Company to a Competitive Business; (V) transacts any business with
any client or prospective client which, in any manner, would have, or is likely to
have, an adverse effect upon the Company’s existing or prospective business
relationships; and/or (VI) develops, acquires or maintains an ownership interest in
a Competitive Business, provided that an ownership interest of less than 5% of the
outstanding capital stock of a publicly traded Competitive Business shall not be a
violation of this provision.
“Non-Solicitation” means either (I) during his employment with the Company and for a
period of 24 months after his termination or resignation, for whatever reason,
agreeing to take any action to, or do anything reasonably intended to, solicit any
client or prospective client on his own behalf or on behalf of a Competitive
Business or otherwise to influence or attempt to influence any client or prospective
client to cease or refrain from doing business, or reduce the client’s business,
with the Company. The term “solicit” includes any direct or indirect approach,
verbal or written, to a client or prospective client containing an offer,
announcement, request, petition, solicitation or other entreaty that asks, urges,
encourages, invites, moves or otherwise persuades a client or prospective client to
contact or respond to him or a Competitive Business for business purposes or (II)
while employed with the Company and for 24 months after his termination or
resignation, for whatever reason, attempting to hire, employ, solicit for employment
or attempting to hire (or assist a Competitive Business in doing so) any employee of
the Company or any former employee who left the Company within 12 months before or
after his termination or resignation. This prohibition applies to any direct or
indirect, written or verbal, contact for employment purposes and includes, but is
not limited to, notice of alternative job opportunities, responses to employee
inquiries, referrals to hiring managers or providing employee identity, contact,
performance or compensation information to a Competitive Business or its
representative. Impermissible solicitation also includes any direct or indirect
offer to engage or retain a Company employee or
former employee as an employee, agent, consultant, independent contractor or in any
other capacity to perform services for a person or entity other than the Company.
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(a) Growth in Consolidated Business Unit Contribution. No Cash Award shall be earned
unless the “Consolidated Business Unit Contribution” of the Company has grown by a compounded
average of at least 3% annually for the relevant Company fiscal year or years, ending on December
31 in accordance with the table in subsection (b). Growth in Consolidated Business Unit
Contribution (“Growth”) shall be determined beginning with fiscal year 2007 by reference to an
increase in the Consolidated Business Unit Contribution of the Company over the Company’s
Consolidated Business Unit Contribution for fiscal year 2006. “Consolidated Business Unit
Contribution” shall mean consolidated net revenue, less professional compensation, other costs of
service, and sales, general and administrative expense (excluding stock compensation expense, bonus
expense, interest expense and infrastructure expense). The Committee shall review and approve
annually each fiscal year’s Consolidated Business Unit Contribution of the Company.
(b) Table. The following percentages of the Cash Award shall be earned upon
attainment of Growth of at least 3% on a compounded average annual basis, by the end of the
relevant Company fiscal year or years as specified below.
| Fiscal Year(s) | 2007 | 2008 | 2009 | |||||||||
Compounded Average Annual Growth |
³3 | % | ³3 | % | N/A | |||||||
Percentage of Cash Award Earned |
50 | % | 50 | % | N/A | |||||||
| Fiscal Year(s) | 2007 | 2008 | 2008-2009 | |||||||||
Compounded Average Annual Growth |
³3 | % | £3 | % | ³3 | % | ||||||
Percentage of Cash Award Earned |
50 | % | 0 | 50 | % | |||||||
| Fiscal Year(s) | 2007 | 2007-2008 | 2009 | |||||||||
Compounded Average Annual Growth |
£3 | % | ³3 | % | N/A | |||||||
Percentage of Cash Award Earned |
0 | 100 | % | N/A | ||||||||
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| Fiscal Year(s) | 2007 | 2008 | 2008-2009 | |||||||||
Compounded Average Annual Growth |
£3 | % | £3 | % | ³3 | % | ||||||
Percentage of Cash Award Earned |
0 | 0 | 100 | % | ||||||||
| To illustrate, assume (i) at the end of Company fiscal year 2007, annual growth was more than 3%, (ii) at the end of Company fiscal year 2008, annual growth for fiscal years 2007 and 2008 on a compounded average basis was less than 3% and (iii) at the end of Company fiscal year 2009, annual growth for Company fiscal years 2007, 2008 and 2009 on a compounded average basis equaled or exceeded 3%. The Award Recipient would earn, subject to continued employment requirements, (i) 50% of the Award at the end of fiscal year 2007, (ii) no part of the Award for fiscal year 2008 and (iii) an additional 50% of the Award at the end of fiscal 2009. |
(a) Payment of Cash. Following a determination by the Committee that the Performance
Measures were satisfied during one or more fiscal years, the Company shall pay to the Award
Recipient cash equal to the percentage of the Cash Award that has vested not later than March 31,
2010 (the “Settlement Date”); provided, however, except for settlements by reason of Death,
Disability, or Change in Control, that the Committee shall not make a determination that the
Performance Measures are satisfied until the audited financials of the Company are available for a
relevant fiscal year, each of 2007 through 2009. If settlement is delayed because the Committee
has not yet received all such audited financials, the Settlement Date shall occur within 30 days of
the date of the Committee’s determination.
(b) Restrictions on Cash Settlements. The payment of cash upon settlement of a Cash
Award shall be subject to and in compliance with all applicable requirements of federal, state or
foreign law and other law or regulations or any contract or other rule of law to which the Company
is subject. No cash may be paid hereunder if the payment of such cash, in the sole discretion of
the Company’s legal counsel, would constitute a violation of any applicable federal, state or
foreign securities laws or other law or any contract or other rule of law to which the Company is
subject. The inability of the Company to obtain from any regulatory body any authority deemed by
the Company’s legal counsel to be required for the payment of cash subject to the Cash Award shall
relieve the Company of any liability whatsoever in respect of the failure to pay such cash as to
which such requisite authority shall not have been obtained. As a condition to the settlement of a
Cash Award, the Company may require the Award Recipient to
satisfy any qualifications that may be necessary or appropriate, to evidence compliance with
any
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applicable law or regulation or contract to which the Company is subject and to make any
representation or warranty with respect thereto as may be requested by the Company.
(a) Termination for Any Reason Prior to January 1, 2008. Upon the Award Recipient’s
termination for any reason prior to January 1, 2008, the right to earn the Cash Award shall be
automatically forfeited.
(i) Upon the Award Recipient’s termination by the Company other than for Cause after
December 31, 2007 and prior to January 1, 2010, the Award Recipient shall have the right to
vest in a pro rata portion of the Cash Award equal to the ratable portion of the amount to
vest at the end of the Performance Period, if the Performance Measures are achieved. If
less than 100% of the Cash Award had been earned prior to the year of termination, the Award
Recipient shall receive the portion of the Cash Award, if any, earned in the prior year or
years plus a proportion of the Cash Award that would be earned for the remainder of the
Performance Period if the Performance Measures are achieved, in the ratio that his completed
months of service since the later of (I) the beginning of the Performance Period and (II)
the most recent fiscal yearend when an amount was earned (counting the month of termination
as a full month) bears to the number of months between the date in clause (I) or (II),
whichever is applicable, and the next fiscal yearend when an amount is earned. To
illustrate, if an Award Recipient terminates in March 2008, and 50% of the Cash Award had
been earned in 2007, he would receive three-twelfths (25%) of the additional 50%, if the
Performance Measure is met in 2008 and three-twenty-fourths (12.5%) of the additional 50%,
if the Performance Measure is met in 2009. Any such amounts earned shall be paid on the
Settlement Date.
(ii) Upon the Award Recipient’s termination by reason of Disability, Retirement or
Death, the Award Recipient shall vest in a pro rata portion of the Cash Award. The pro rata
portion of the Cash Award shall be determined in the same manner as provided in Section
5(b)(i) above. Amounts vested as a result of Retirement shall be paid on the Settlement
Date. Amounts vested due to Death or Disability shall be paid within 30 days of the
Committee’s determination that the Performance Measures were achieved for the year of the
Award Recipient’s Death or Disability. “Retirement” shall mean retirement under the
Company’s Rule of 70 Retirement Policy, or, if required by law, under local law. An Award
Recipient currently is eligible to retire under the Company’s Rule of 70 Retirement Policy,
if the Award Recipient’s age plus “years of service” (as determined under the Company’s
401(k) Plan or any successor to such plan) equals or exceeds 70 as of the date of
retirement.
(i) Upon the Award Recipient’s termination for Cause, as hereinafter defined, any Cash
Award that has not been earned, vested and settled in accordance with
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Section 4, shall be
forfeited automatically on the date of termination and any amounts already paid hereunder to
the Award Recipient shall be repaid to and subject to recovery by the Company.
(ii) For all purposes of this Agreement, “Cause” shall mean the occurrence, failure to
cause the occurrence or failure to cure after the occurrence (when a cure is permitted), as
the case may be, of any of the following circumstances after the Award Recipient’s receipt
of written notification from the General Counsel which includes a detailed description of
the claimed circumstance: (i) the Award Recipient’s embezzlement, misappropriation of
corporate funds, or the Award Recipient’s material acts of dishonesty; (ii) the Award
Recipient’s commission or conviction of any felony or of any misdemeanor involving moral
turpitude, or entry of a plea of guilty or nolo contendere to any felony or misdemeanor
involving moral turpitude; (iii) the Award Recipient’s engagement, without a reasonable
belief that his action was in the best interests of the Company, in any activity that could
harm the business or reputation of the Company in a material manner; (iv) the Award
Recipient’s willful failure to adhere to the Company’s material corporate codes, policies or
procedures that have been communicated to him; (v) the Award Recipient’s material breach of
any provision of the Managing Director Agreement entered into by the Award Recipient and the
Company to the extent applicable or (vi) the Award Recipient’s violation of any statutory or
common law duty or obligation to the Company, including, without limitation, the duty of
loyalty; provided, however, that in the case of subsections (iii), (iv), (v) and (vi), the
Company shall provide the Award Recipient with the opportunity to cure any Cause event
during the 15-day period after his receipt of written notice describing the Cause event;
provided, however, that a Cause event shall be considered to be cured only if all adverse
consequences of the Cause event have been fully remedied.
(d) Voluntary Termination for Reasons Other Than Disability or Retirement Prior to January
1, 2010. Upon the Award Recipient’s voluntary termination of employment for reasons other than
Disability or Retirement prior to January 1, 2010, any portion of the Cash Award previously earned
as well as the right to earn any portion of the Cash Award shall be automatically forfeited.
(e) Non-Competition and Non-Solicitation. If the Award Recipient should violate the
Non-Competition or Non-Solicitation provisions of Section 2(b) hereof within a period of two years
following the Award Recipient’s termination of employment for any reason, any amounts remaining
payable to the Award Recipient under the Award Notice and this Agreement shall be forfeited. In
addition, any amounts already paid hereunder to the Award Recipient shall be repaid to and subject
to recovery by the Company.
(a) In General. The Company shall withhold from any payment under Section 4 the
amount of any federal, state, local or foreign taxes required by law to be withheld with respect to
the settlement of the Cash Award.
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(a) Plan Provisions. The provisions of Section 7.8(a)(i) and (ii) of the Plan shall
not apply to this Award.
(b) General. In the event of a Change in Control, any Cash Award that has been
previously earned, but not settled, shall be assumed by the successor or acquiring company and
settled in accordance with Section 4 and Section 5. Upon a Change in Control, the Performance
Measures shall be deemed fully satisfied and the successor or acquiring company shall assume and
settle in accordance with Section 4 and Section 5, the portion of the amount of the Cash
Retention Award that could be earned at the next scheduled date (December 31, 2007 or 2008, as the
case may be) but not more than 50% of the Cash Retention Award.
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15. Governing Law. This Agreement shall be governed by and construed in accordance with the laws
of the Commonwealth of Virginia, other than the conflict of laws principles thereof.
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