FORM OF BONUS AGREEMENT
Exhibit 10
(iii) 48.
THE IT GROUP,
INC.
BONUS
AGREEMENT
This Bonus Agreement (this “Agreement
”) is made and entered into effective as of
by and between The IT
Group, Inc. (the “Company”) and
(the “Key Individual”). Capitalized terms
used but not otherwise defined in this Agreement that are defined in the
Plan (as defined below) shall have the meanings specified in the
Plan.
WITNESSETH:
WHEREAS, the Key Individual is currently
employed by the Company in the capacity of
;
WHEREAS, the Company has adopted the IT Group,
Inc. Executive Bonus Plan (the “Plan”), effective as of
, which provides certain
additional incentives to certain key executives of the Company or its
affiliates;
WHEREAS, the Key Individual has been selected
by the Compensation Committee of the Board of Directors (the
“Compensation Committee” or the “Committee”) to be
eligible to participate in the Plan; and
WHEREAS, the Key Individual desires to become
a participant of the Plan.
NOW, THEREFORE, in consideration of the mutual
covenants contained herein, the Company and Key Individual agree as
follows:
1. TERM OF
AGREEMENT. This Agreement shall continue in
effect until the earlier occurrence of the following events: (i) the Key
Individual’s failure to satisfy any eligibility requirement of the Plan
due to a decrease in the hours of service performed by Key Individual or as
a result of any other circumstance; (ii) the Key Individual’s
termination of employment with the Company or its affiliate whether
voluntarily or involuntarily; or (iii) the termination of the Plan by the
Board of Directors.
2. CONTINUED SERVICE
BONUS
(a) Subject to the
terms of the Plan and the continued existence of the Plan, if Key Individual
is a Full-Time Employee of the Company in good standing for each anniversary
of November 17, 1998 (the “Bonus Date”) during the term of the
Plan, Key Individual shall receive a Continued Service Bonus in an amount as
set forth in Exhibit A.
(b) Notwithstanding the
foregoing, the occurrence of the following events will affect Key Individual
’s eligibility for a Continued Service Bonus as follows:
THE IT GROUP,
INC.
BONUS
AGREEMENT
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(i) Termination
of Employment for Cause; Voluntary Termination.
Key Individual shall not be eligible for any Continued Service
Bonus under this Agreement following a separation from service if such
separation was due to termination by the Company or an affiliate for Cause
or a voluntary termination by Key Individual.
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(ii)
Termination Without Cause.
Subject to Section 2(b)(v), below, in the event that Key
Individual’s employment with the Company or an affiliate is
terminated by either without Cause during the consecutive twelve-month
period prior to an anniversary of the Bonus Date, the Termination Date for
purposes of determining Key Individual’s eligibility for a Continued
Service Bonus shall be deemed to have occurred six (6) months following
Key Individual’s actual Termination Date.
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(iii)
Retirement of Key Individual.
In the event Key Individual’s employment terminates on or
after [his/her] Retirement Date during the consecutive twelve-month period
prior to an anniversary of the Bonus Date, Key Individual shall be
immediately eligible to receive any Continued Service Bonus for any
outstanding anniversary or anniversaries of the Bonus Date as if [he/she]
had remained a Full-Time Employee through the last anniversary date on
which a Continued Service Bonus is to be awarded.
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(iv) Death or
Disability of Key Individual. In the
event Key Individual dies or becomes Permanently Disabled while employed
by the Company or an affiliate during the consecutive twelve-month period
prior to an anniversary of the Bonus Date, Key Individual shall be
immediately eligible to receive any Continued Service Bonus for any
outstanding anniversary or anniversaries of the Bonus Date as if [he/she]
had remained a Full-Time Employee through the last anniversary date on
which a Continued Service Bonus is to be awarded.
3. PERFORMANCE
BONUS.
(a) During the term of
the Plan, if Key Individual is an employee of the Company or its affiliate,
Key Individual shall receive a Performance Bonus upon the occurrence of
certain events (singularly, a “Performance Bonus Event”) as
described in Exhibit A and in an amount as set forth in Exhibit
A.
(b) Notwithstanding the
foregoing, the occurrence of the following events will affect Key Individual
’s eligibility for a Performance Bonus:
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(i) Termination
of Employment for Cause; Voluntary Termination.
Key Individual shall not be eligible for any further Performance
Bonus under this Plan if Key Individual’s separation from service was
due to termination for Cause or voluntary termination.
THE IT GROUP,
INC.
BONUS
AGREEMENT
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(ii)
Termination Without Cause.
In the event that Key Individual’s employment with the
Company or an affiliate is terminated without Cause, the Termination Date
for the purposes of determining Key Individual’s eligibility for a
Performance Bonus shall be deemed to have occurred six (6) months
following the Participant’s actual Termination Date.
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(iii)
Retirement of Key Individual.
In the event Key Individual’s employment terminates on or
after his or her Retirement Date, the Termination Date for the purposes of
determining Key Individual’s eligibility for a Performance Bonus
shall be deemed to have occurred twelve (12) months following Key
Individual’s actual Termination Date.
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(iv) Death or
Disability of Key Individual. In the
event Key Individual dies or becomes Permanently Disabled, the Termination
Date for the purposes of determining Key Individual’s eligibility for
a Performance Bonus shall be deemed to have occurred twelve (12) months
following Key Individual’s actual Termination Date.
4. CHANGE OF CONTROL
BONUS. In the event an involuntary termination of
employment, other than for Cause, occurs within 18 months following a Change
of Control and during the term of this Plan, Key Individual shall receive a
Change of Control Bonus as set forth in Exhibit A, less any Continued
Service Bonuses and Performance Bonuses actually received or to be received
by Key Individual prior to or as of the Termination Date.
5. GROSS-UP
PAYMENT. If Key Individual receives a Continued
Service Bonus, a Performance Bonus or a Change of Control Bonus (a
“Bonus Payment”), Key Individual shall also receive a gross-up
payment to offset any federal, state, and local income tax and FICA tax
liability. The gross-up payment shall be equal to a Bonus Payment multiplied
by a fraction, x/(1-x), where x equals the highest marginal combined
effective federal, state, and local income tax rates imposed on a Bonus
Payment, and reduced by any tax benefit associated with any interest expense
deduction claimed by Key Individual in the year of the receipt of such Bonus
Payment.
6. EMPLOYMENT NOT
GUARANTEED. This Agreement shall not be deemed to
constitute an employment contract between the Company or any affiliate and
Key Individual, nor shall the existence of this Agreement or any provision
contained in this Agreement be deemed to be a required condition of the
employment of Key Individual. Nothing contained in this Agreement shall be
deemed to give Key Individual the right to continued employment with the
Company or any affiliate, and the Company or an affiliate may terminate Key
Individual at any time, in which case the Key Individual’s rights
arising under this Agreement shall be only those expressly provided under
the terms of this Agreement.
THE IT GROUP,
INC.
BONUS
AGREEMENT
7. GOVERNING LAW.
This Agreement shall be governed by and construed
and enforced in accordance and with the laws of the State of Delaware,
without regard to the application of the conflicts of law provisions
thereof.
8. NOTICES.
All notices and other communications required or permitted
to be given under the Plan shall be in writing and shall be deemed to have
been duly given if delivered personally or by inter-office mail as follows:
(i) if to the Company, The IT Group, Inc., 0000 Xxxxxxx Xxxxxxxxx,
Xxxxxxxxxxx, XX 00000-0000; (ii) if to Key Individual, to the address set
forth below Key Individual’s signature hereto, or at such other address
as Key Individual may hereinafter designate in writing to the Company. Any
such notice shall be deemed duly given when sent by prepaid certified or
registered mail and deposited in a post office or branch post office
regularly maintained by the United States Government.
9. INCORPORATION OF
EXHIBITS AND PLAN. All exhibits referred to in
this Agreement and the terms and provisions of the Plan are incorporated by
reference and made a part of the terms, provisions and covenants of this
Agreement.
10. AMENDMENT.
This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes all
prior agreements, oral and written, between the parties hereto with respect
to the subject matter hereof. This Agreement may be modified or amended only
by an instrument in writing signed by both parties hereto.
11. PROHIBITION
AGAINST ASSIGNMENT. Except as otherwise expressly
provided in this Agreement, the rights, interests and benefits of Key
Individual under this Agreement (a) may not be sold, assigned, transferred,
pledged, hypothecated, gifted, bequeathed or otherwise disposed of to any
other party by Key Individual or any beneficiary, executor, administrator,
heir, distributee or other person claiming under Key Individual, and (b)
shall not be subject to execution, attachment or similar process. Any
attempted sale, assignment, transfer, pledge, hypothecation, gift, bequest
or other disposition of such rights, interests or benefits contrary to the
foregoing provisions of this Section shall be null and void and without
effect.
12. NO TRANSFER OF
INTEREST. No provision of this Agreement shall be
interpreted or construed (a) as transferring to Key Individual or any other
person or entity any direct or indirect ownership or other proprietary
interest whatsoever in the Company or any affiliate or its stock or
securities, or (b) as creating any partnership, joint venture or other joint
business enterprise between any such person and the Company or any
affiliate. The Company and each affiliate shall have and possess all title
to, and beneficial interest in, any and all funds or other property received
by the Company or any affiliate in connection with the sale or other
disposition of all or any portion of the Company’s or any affiliate
’s assets and/or any funds or reserves maintained or held by the
Company or any affiliate on account of any obligation to pay the Bonus
Payments as required under this Agreement, whether or not earmarked by the
Company or any affiliate as a fund or reserve for such purpose; any such
funds, other property or
THE IT GROUP,
INC.
BONUS
AGREEMENT
reserves shall be
subject to the claims of the creditors of the Company or any affiliate, and
the provisions of this Agreement are not intended to create, and shall not
be interpreted as vesting, in Key Individual, beneficiary or other person,
any right to or beneficial interest in any such funds, other properly or
reserves.
13. SEVERABILITY.
In the event that any provision of this Agreement is
found to be invalid or otherwise unenforceable by a court or other tribunal
of competent jurisdiction, such invalidity or unenforceability shall not be
construed as rendering any other provision contained herein invalid or
unenforceable, and all such other provisions shall be given full force and
effect to the same extent as though the invalid and unenforceable provision
was not contained herein.
14. VIOLATION OF ANY
COVENANT OR LAW. Notwithstanding any other
provision of this Agreement, the Company or any affiliate shall not be
required to make a Bonus Payment to Key Individual if making such Bonus
Payment would cause the Company or an affiliate to violate any covenant or
other similar provision in any indenture, loan agreement, or other
agreement, or cause the Company or an affiliate to violate any applicable
federal, state or local law.
15. PAYMENTS TO
INCAPACITATED KEY INDIVIDUAL. In the event Key
Individual is under mental or physical incapacity at the time of any payment
to be made to Key Individual pursuant to this Agreement, any such payment
may be made to the conservator or other legally appointed personal
representative having authority over and responsibility for the person or
estate of Key Individual, as the case may be, and for purposes of such
payment references in this Agreement to Key Individual shall mean and refer
to such conservator or other personal representative, whichever is
applicable. In the absence of any lawfully appointed conservator or other
personal representative of the person or estate of Key Individual, any such
payment may be made to any person or institution that has apparent
responsibility for the person and/or estate of Key Individual as determined
by the Board of Directors. Any payment made in accordance with the
provisions of this Section to a person or institution other than Key
Individual shall be deemed for all purposes of this Agreement as the
equivalent of a payment to Key Individual, and the Company and its
affiliates shall have no further obligation or responsibility with respect
to such payment.
16. DESIGNATION OF
BENEFICIARY. Key Individual shall be entitled to
designate one or more persons or entities, in any combination, as his
“Beneficiary” to receive any payments to which Key Individual is
entitled to under this Agreement in the event of Key Individual’s death
during the term of this Agreement. Any such designation shall be made in a
written instrument filed with the Board of Directors. In the event that
either (a) a Beneficiary designation is not on file at the date of Key
Individual’s death, (b) no Beneficiary survives Key Individual, or (c)
the Beneficiary designated by Key Individual is not living at the time any
payment becomes payable under this Agreement, then, for purposes of making
any further payment of any unpaid amounts provided under this Agreement, Key
Individual’s Beneficiary
THE IT GROUP, INC.
BONUS
AGREEMENT
shall be deemed to be
the person or persons surviving him in the first of the following classes in
which there is a survivor, share and share alike:
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(i) Key Individual
’s surviving spouse.
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(ii) Key Individual
’s children, except that if any of the children predecease Key
Individual but leave issue surviving, then such issue shall take by right
of representation the share their parent would have taken if
living.
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(iii) Key Individual
’s estate.
IN WITNESS WHEREOF, the parties have executed
this Bonus Agreement on the day and year first above written.
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| THE IT GROUP,
INC.
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| By:
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| Title: Senior
Vice President, Human Resources
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| KEY
INDIVIDUAL
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THE IT GROUP,
INC.
BONUS
AGREEMENT
EXHIBIT
A
Continued Service
Bonus Payments:
Anniversaries of
Bonus Date
| Continued
Service Bonus Amount
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| 1st
Anniversary
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| 2nd
Anniversary
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| 3rd
Anniversary
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| Performance
Bonus Payments:
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| Performance
Bonus Event
| Performance
Bonus Amount
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| Common Stock price
averages
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| $
for 90 calendar days at any time
within the three year period following the
effective date of this Agreement
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| Common Stock price
averages $
for 90 calendar days at any time within the
three year period following the effective
date of this Agreement
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| Common Stock price
averages $
for 90 calendar days at any time within the
three year period following the effective
date of this Agreement
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| Change of
Control Bonus:
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| Payment of
Interest:
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| Change of Control
and Performance
Bonus payments will accrue
Interest at a rate of
% per annum
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