EXHIBIT 10.41

EMPLOYMENT AGREEMENT

BETWEEN

KORN/FERRY INTERNATIONAL

AND

GARY BURNISON

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TABLE OF CONTENTS

 

1.

   Employment    1

2.

  

At-Will Employment

   1

3.

  

Position, Duties and Responsibilities

   1

4.

  

Annual Compensation

   1   

(a)    Base Salary

   1   

(b)    Annual Cash Incentive Award

   1   

(c)    Equity Incentive Program

   1

5.

  

Employee Benefit Programs and Perquisites

   2   

(a)    General

   2   

(b)    Reimbursement of Business Expenses

   2   

(c)    Conditions of Employment

   2

6.

  

Termination of Employment

   2   

(a)    Death

   2   

(b)    Disability

   2   

(c)    Termination by the Company for Cause or Voluntary Termination by
Executive

   3   

(d)    Termination by the Company Without Cause or by Executive for Good Reason
Prior to change in Control or More Than 12 Months After a Change in Control

   3   

(e)    Following a Change in Control, Termination by the Company Without Cause
or by Executive for Good Reason

   4   

(f)     Certain Additional Payments by the Company

   4   

(g)    Other Programs

   6   

(h)    Conditions to Receipt of Benefits Under Section 6

   6   

(i)     Certain Definitions

   6

7.

  

Application of Section 409A

   7

8.

  

No Mitigation; No Offset

   7

9.

  

Confidential Information; Cooperation with Regard to Litigation

   7   

(a)    Nondisclosure of Confidential Information

   7   

(b)    Definition of Confidential Information

   7   

(c)    Cooperation in Litigation

   8

10.

  

Nonsolicitation

   8

11.

  

Remedies

   8

12.

  

Resolution of Disputes

   8

13.

  

Indemnification

   8   

(a)    Company Indemnity

   8   

(b)    No Presumption Regarding Standard of Conduct

   8   

(c)    Liability Insurance

   9

14.

  

Effect of Agreement on Other Benefits

   9

15.

  

Expenses of Counsel for Executive

   9

16.

  

Assignment; Binding Nature

   9

17.

  

Representations

   9

18.

  

Entire Agreement

   9

19.

  

Amendment or Waiver

   9

20.

  

Severability

   9

21.

  

Survivorship

   9

22.

  

Beneficiaries/References

   9

23.

  

Governing Law

   10

24.

  

Counterparts and Facsimile

   10

25.

  

Notices

   10

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EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of
April 24, 2007, by and between KORN/FERRY INTERNATIONAL, a Delaware corporation
with its principal offices in Los Angeles, California (the “Company”), and GARY
BURNISON, an individual (the “Executive), it being the understanding and
agreement of the parties that the terms and conditions of this Employment
Agreement shall not be effective until July 1, 2007 (the “Start Date”) and shall
not be effective unless Executive is continuously employed with the Company
between the date hereof and June 30, 2007.

1. Employment. The Company agrees to employ Executive and Executive agrees to be
employed by the Company upon the terms and conditions set forth in this
Agreement.

2. At-Will Employment. Executive’s employment under this Agreement will begin on
the Start Date, unless otherwise mutually agreed by the Company and Executive.
Subject to compliance with this Agreement, the Company may terminate Executive’s
employment, with or without Cause (as defined in Section 6(i) of this
Agreement), for any reason or no reason and with or without advance notice, upon
a resolution adopted by a majority of the then-serving members of the Board
other than Executive. Executive may terminate his employment at any time, for
any or no reason, with or without Good Reason (as defined in Section 6(i) of
this Agreement) upon thirty (30) days advance written notice to the Company.

3. Position, Duties and Responsibilities. Executive will serve as Chief
Executive Officer with duties and responsibilities customary to such offices and
shall report to the Company’s Board of Directors (the “Board”). At the request
of the Board, Executive will serve as an officer or director of the Company’s
subsidiaries and other affiliates without additional compensation. Executive
will devote substantially all of Executive’s business time and attention to the
performance of Executive’s obligations, duties and responsibilities under this
Agreement. Subject to Company policies applicable to senior executives
generally, Executive may engage in personal, charitable, professional and
investment activities to the extent such activities do not conflict or interfere
with Executive’s obligations to, or Executive’s ability to perform the normal
duties and functions of Executive pursuant to this Agreement. Executive will be
nominated for election to the Board prior to the next annual shareholders’
meeting of the Company.

4. Annual Compensation. In consideration of Executive’s services to the Company
pursuant to this Agreement, Executive’s annual compensation shall be as follows:

(a) Base Salary. Executive shall be entitled to receive a base salary of
$47,916.67 per month (his “Base Salary”) ($575,000 on an annualized basis) (such
annualized amount, his “Annual Base Salary”), paid in accordance with the
Company’s regular payroll practices. The Board will review the level of
Executive’s Base Salary at least annually, beginning in June 2008. The Board,
acting in its discretion, may increase (but may not decrease) Executive’s Base
Salary at any time, unless the Board concludes that an across-the-board
reduction in compensation is required for all executive officers of the Company,
in which case Executive’s compensation shall be ratably reduced.

(b) Annual Cash Incentive Award. Executive will participate in the Company’s
annual cash incentive plan established for senior executives with an annual
target cash award equal to 100% of Executive’s Annual Base Salary, with the
ability to earn additional amounts up to a maximum cash award equal to 200% of
Executive’s Annual Base Salary. Executive’s annual cash incentive award will be
payable at such time as annual cash incentive awards are paid to executive
officers generally, but not later than 120 days after the end of the fiscal year
for which such award is earned. The annual performance targets for the cash
award shall be set by the Board and/or the Compensation Committee of the Board
(the “Compensation Committee”) prior to the commencement of each fiscal year of
the Company.

(c) Equity Incentive Program. Executive shall be awarded, subject to the
approval of the Board, equity incentives with respect to shares of the Company’s
common stock (“Shares”), which shall be granted under the Korn/Ferry
International Performance Award Plan, as the same may be amended from time to
time. Such annual equity incentives shall be awarded at the same time annual
option grants are awarded to the Company’s other executive officers, beginning
with grants attributable to performance for the firm’s 2008 fiscal year. The
terms of any equity incentives granted shall be set by the Board or the
Compensation Committee. Initially:

(1) Executive shall be eligible to receive a grant of restricted stock subject
to the discretion of and approval by the Board and /or Compensation Committee,
with a target grant value of $900,000 (as determined by the Board and/or the
Compensation Committee). Such restricted stock will vest as follows: 25% at the
end of each year after the Start Date, in each case subject to Executive’s
continuous employment with the Company. Other terms of such restricted stock
shall be set by the Board and/or the Compensation Committee.

 

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(2) Executive shall be eligible to receive an award of performance shares
(“Performance Shares”), with a target grant value of 100% of Executive’s Annual
Base Salary (as determined by the Board and/or the Compensation Committee) which
will be earned at the end of, and based on the Company’s performance during, a
performance period of 3 years (the “Performance Period”). Other terms of such
performance shares grant shall be set by the Board or the Compensation
Committee.

(3) Executive shall be eligible to receive an annual grant of restricted stock,
subject to the discretion of and approval of the Board and/or the Compensation
Committee, with a target grant value of 100% of Executive’s Annual Base Salary
(as determined by the Board and/or the Compensation Committee). Such restricted
stock will vest as follows: 25% at the end of each year after the Start Date, in
each case subject to Executive’s continuous employment with the Company. Other
terms of such restricted stock grant shall be set by the Board and/or the
Compensation Committee.

5. Employee Benefit Programs and Perquisites.

(a) General. Executive will be entitled to participate in such retirement or
pension plans, group health, long term disability and group life insurance
plans, and any other welfare and fringe benefit plans, arrangements, programs
and perquisites sponsored or maintained by the Company from time to time for the
benefit of its senior executives generally, including four weeks paid vacation.

(b) Reimbursement of Business Expenses. Executive is authorized to incur
reasonable expenses in accordance with the Company’s written policy in carrying
out Executive’s duties and responsibilities under this Agreement. The Company
will promptly reimburse Executive for all such expenses that are so incurred
upon presentation of appropriate vouchers or receipts, subject to the Company’s
expense reimbursement policies applicable to senior executive officers
generally.

(c) Conditions of Employment. Executive’s place of employment will be at the
Company’s corporate headquarters in Los Angeles, California, subject to the need
for reasonable business travel. The conditions of Executive’s employment,
including, without limitation, office space, office appointments, secretarial,
administrative and other support, will be consistent with Executive’s status as
Chief Executive Officer of the Company.

6. Termination of Employment.

(a) Death. If Executive’s employment with the Company terminates by reason of
Executive’s death, then the Company will pay to Executive’s estate Executive’s
“Accrued Compensation” (as defined in Section 6(i)) within the time period
permitted by applicable law, and all outstanding stock options and other
equity-type incentives held by Executive (but expressly excluding Performance
Shares) and all of Executive’s benefits under the Executive Capital Accumulation
Plan at the time of Executive’s death will become fully vested and shall remain
exercisable until (i) in the case of an option, incentive or benefit granted
prior to the Start Date, until its originally scheduled expiration date; or
(ii) in the case of an option, incentive or benefit granted after the Start
Date, the earlier of (A) the date that is two (2) years after the date of
Executive’s death or (B) its originally scheduled expiration date. Additionally,
Executive’s estate shall be entitled to a pro rata portion of Executive’s target
annual cash incentive award established for the fiscal year in which Executive’s
employment terminates due to death (based on the proportion that the number of
days of Executive’s actual service to the Company during such fiscal year bears
to the number of days in such fiscal year). Executive’s estate shall also be
entitled to receive the number of Performance Shares that would have been earned
if Executive had served the Company for the entire Performance Period and the
Company’s performance during such period had been the target performance for the
Performance Period. To the extent Executive’s covered dependent(s) continue to
participate in the Company’s group health plan(s) after Executive’s death
pursuant to COBRA, the Company will provide reimbursement of COBRA coverage
premiums paid by Executive’s covered dependent(s) so that such covered
dependent(s) enjoy coverage at the same benefit level and to the same extent and
for the same effective contribution, if any, as participation is available to
other executive officers of the Company, for as long as such coverage is
available under COBRA.

(b) Disability. If the Company terminates Executive’s employment by reason of
Executive’s Disability (as defined in Section 6(i)), then the Company will pay
to Executive his Accrued Compensation within the time period permitted by
applicable law and all outstanding stock options and other equity-type
incentives (but expressly excluding Performance Shares) held by Executive and
all of Executive’s benefits under the Executive Capital Accumulation

 

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Plan at Executive’s termination date will become fully vested and shall remain
exercisable until (i) in the case of an option, incentive or benefit granted
prior to the Start Date, until its originally scheduled expiration date; or
(ii) in the case of an option, incentive or benefit granted after the Start
Date, the date that is the earlier of (A) two (2) years after the date
Executive’s employment terminates and (B) its original scheduled expiration
date. Additionally, Executive shall be entitled to a pro rata portion of
Executive’s target annual cash incentive award established for the fiscal year
in which Executive’s employment terminates due to disability (based on the
proportion that the number of days during such fiscal year prior to the date of
termination bears to the number of days in such fiscal year). Executive shall
also be entitled to receive the number of Performance Shares that would have
been earned if Executive had served the Company for the entire Performance
Period and the Company’s performance during such period had been the target
performance for the Performance Period. To the extent Executive and/or
Executive’s covered dependent(s) continue to participate in the Company’s group
health plan(s) pursuant to COBRA after Executive’s termination of employment by
reason of Disability, the Company will provide reimbursement of COBRA coverage
premiums paid by Executive and Executive’s dependent(s) so that Executive and
Executive’s covered dependent(s) enjoy coverage at the same benefit level and to
the same extent and for the same effective contribution, if any, as
participation is available to other executive officers of the Company, for as
long as such coverage is available under COBRA.

(c) Termination by the Company for Cause or Voluntary Termination by Executive.
If (i) the Company terminates Executive’s employment for Cause (as defined in
Section 6(i)), or (ii) Executive voluntarily terminates Executive’s employment
without Good Reason (as defined in Section 6(i)), then the Company shall pay to
Executive Executive’s Accrued Compensation through the date Executive’s
employment terminates within the time period permitted by applicable law.

(d) Termination by the Company Without Cause or by Executive for Good Reason
Prior to Change in Control or More Than 12 Months After a Change in Control. If
Executive’s employment is terminated prior to a “Change in Control” (as defined
in Schedule A), or more than 12 months after the date on which a Change in
Control occurs, (i) by the Company without Cause and for a reason other than
Executive’s Death or Disability, or (ii) by Executive for Good Reason, then the
Company shall pay to Executive within the time period permitted by applicable
law Executive’s Accrued Compensation and a pro rata portion of Executive’s
target annual cash incentive award established for the fiscal year in which
Executive’s employment terminates (based on the number of days of Executive’s
actual service to the Company during such fiscal year), and

(1) the Company shall pay to Executive, in the aggregate, cash payments equal to
the sum of one and one-half times Executive’s then current Annual Base Salary
and one and one-half times Executive’s target bonus, payable in equal monthly
installments over a period of twelve (12) months after the date Executive’s
employment terminates;

(2) for up to eighteen (18) months after such termination, to the extent
Executive and/or Executive’s covered dependent(s) continue to participate in the
Company’s group health plan(s) pursuant to COBRA after Executive’s termination
of employment, the Company will provide reimbursement of COBRA coverage premiums
paid by Executive and Executive’s covered dependent(s) so that Executive and
Executive’s covered dependent(s) enjoy coverage at the same benefit level and to
the same extent and for the same effective contribution, if any, as
participation is available to other executive officers of the Company;

(3) all outstanding stock options and other equity-type incentives held by
Executive and all of Executive’s benefits under the Executive Capital
Accumulation Plan at the time of Executive’s termination (but expressly
excluding Performance Shares) that would have vested in the twelve (12) months
following the date Executive’s employment terminates (in each case, as if such
options, incentives and benefits permitted proportionate vesting in monthly
increments rather than any longer increment) will become fully vested as of the
date Executive’s employment terminates and shall remain exercisable until (A) in
the case of an option, incentive or benefit granted prior to the Start Date,
until its originally scheduled expiration date or (B) in the case of an option,
incentive or benefit granted after the Start Date, the date that is the earlier
of (x) two (2) years after the date Executive’s employment terminates and
(y) its originally scheduled expiration date; and

(4) Executive shall receive a number of Performance Shares equal to the product
of (A) the Performance Shares that would have been earned if Executive had
served the Company for the entire Performance Period and the Company’s
performance during such period had been the target performance for the
Performance Period, and (B) a fraction, (x) the numerator of which fraction
shall be the sum of (i) the number of days of Executive’s employment during the
Performance Period and (ii) 365 (provided that the numerator shall not exceed
the number of days in the Performance Period) and (y) the denominator of which
fraction shall be the number of days in the Performance Period.

 

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(e) Following a Change in Control, Termination by the Company Without Cause or
by Executive for Good Reason. If a Change in Control occurs and, within 12
months after the date on which the Change in Control occurs, Executive’s
employment is terminated (i) by the Company without Cause or (ii) by Executive
for Good Reason, then the Company shall pay to Executive within the time period
permitted by applicable law Executive’s Accrued Compensation and a pro rata
portion of Executive’s target annual cash incentive award established for the
fiscal year in which Executive’s employment terminates (based on the number of
days of Executive’s actual service to the Company during such fiscal year), and

(1) the Company shall pay to Executive, in the aggregate, cash payments equal to
the sum of two (2) times Executive’s then current Annual Base Salary and two
(2) times Executive’s target bonus, payable in equal monthly installments over a
period of twelve (12) months after the date Executive’s employment terminates;

(2) for up to eighteen (18) months after such termination, to the extent
Executive and/or Executive’s covered dependent(s) continue to participate in the
Company’s group health plan(s) pursuant to COBRA after Executive’s termination
of employment, the Company will provide reimbursement of COBRA coverage premiums
paid by Executive and Executive’s dependent(s) so that Executive and Executive’s
covered dependent(s) enjoy coverage at the same benefit level and to the same
extent and for the same effective contribution, if any, as participation is
available to other executive officers of the Company; for the six (6) months
thereafter, if continuing coverage under the Company’s group health plan(s) is
not available under COBRA, upon the written request of Executive at any time
prior to or during such six (6) month period, the Company will seek to secure
continuing coverage for Executive and/or Executive’s covered dependent(s) under
the Company’s group health plan(s), or if such coverage is unavailable,
substantially similar coverage through an alternative health plan provider, and
in either case, if such coverage is obtained, the Company will reimburse
Executive and Executive’s covered dependent(s) for a portion of the cost of such
coverage equal to the amount that the Company would have paid Executive and
Executive’s covered dependents had Executive and Executive’s covered
dependent(s) been eligible for COBRA coverage and the Company was obligated to
provide reimbursement of COBRA coverage premiums paid by Executive and
Executive’s dependent(s) so that Executive and Executive’s covered dependent(s)
could enjoy coverage at the same benefit level and to the same extent and for
the same effective contribution, if any, as participation is available to other
executive officers of the Company;

(3) all outstanding stock options and other equity-type incentives held by
Executive and all of Executive’s benefits under the Executive Capital
Accumulation Plan at the time of Executive’s termination (but expressly
excluding Performance Shares) will become fully vested and shall remain
exercisable until (A) in the case of an option, incentive or benefit granted
prior to the Start Date, until its originally scheduled expiration date or
(B) in the case of an option, incentive or benefit granted after the Start Date,
the date that is the earlier of (x) two (2) years after the date Executive’s
employment terminates and (y) its originally scheduled expiration date;

(4) Executive shall receive a number of Performance Shares equal to the product
of (A) the Performance Shares that would have been earned if Executive had
served the Company for the entire Performance Period and the Company’s
performance during such period had been the Company’s actual performance for the
entire Performance Period, and (B) a fraction, (x) the numerator of which
fraction shall be the number of days between the start of the Performance Period
and the effective date of the Change in Control and (y) the denominator of which
fraction shall be the number of days in the Performance Period; and

(5) Executive shall receive a number of Performance Shares equal to the product
of (A) the Performance Shares that would have been earned if Executive had
served the Company for the entire Performance Period and the Company’s
performance during such period had been the target performance for the
Performance Period, and (B) a fraction, (x) the numerator of which fraction
shall the number of days between the effective date of the Change in Control and
the end of the Performance Period and (y) the denominator of which fraction
shall be the number of days in the Performance Period.

(f) Certain Additional Payments by the Company.

(1) Anything in this Agreement to the contrary notwithstanding, in the event it
shall be determined that any payment, award, benefit or distribution (or any
acceleration of any payment, award, benefit or distribution) by the Company (or
any of its affiliated entities) or any entity which effectuates a Change in
Control (or any of its affiliated entities) to or for the benefit of Executive
(whether pursuant to the terms of this Agreement or otherwise, but determined
without regard to any additional payments required under this Section 6(f)) (the
“Payments”) would be subject to the excise tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (the “Code”), or any interest or
penalties are incurred by Executive with respect to such excise tax (such excise
tax, together with any such interest and

 

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penalties, are hereinafter collectively referred to as the “Excise Tax”), then
the Company shall pay to Executive an additional payment (a “Gross-Up Payment”)
in an amount such that after payment by Executive of all taxes (including any
Excise Tax) imposed upon the Gross-Up Payment, Executive retains an amount of
the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. For
purposes of determining the amount of the Gross-Up Payment, the Executive shall
be deemed to (i) pay federal income taxes at the highest marginal rates of
federal income taxation for the calendar year in which the Gross-Up Payment is
to be made and (ii) pay applicable state and local income taxes at the highest
marginal rate of taxation for the calendar year in which the Gross-Up Payment is
to be made, net of the maximum reduction in federal income taxes which could be
obtained from deduction of such state and local taxes. In the event that no
Excise Tax is applicable, this Section 6(f) shall not be applicable.

(2) Notwithstanding the foregoing, the Gross-Up Payment described in subsection
(1) shall not be paid to Executive if the aggregate Parachute Value (as defined
below) of all Payments does not exceed one hundred ten percent (110%) of the
Safe Harbor Amount (as defined below). In such an instance, the Payments to
which Executive would otherwise become entitled will instead be reduced (but not
below zero) so that the aggregate present value of the Payments under this
Agreement shall equal the Reduced Amount (as defined below). Unless the Employee
shall have elected another method of reduction by written notice to the Company
prior to the Change in Control, the Company shall reduce the Payments under this
Agreement by first reducing Payments that are payable in cash and then by
reducing Payments that are not payable in cash. Only amounts payable under this
Agreement shall be reduced pursuant to this subsection (2). The “Parachute
Value” of a Payment is the present value as of the date of the Change in Control
of the portion of the Payment that constitutes a “parachute payment” under
Section 280G(b)(2) of the Code, as determined by the Auditor (as defined below)
in accordance with such section of the Code. The “Safe Harbor Amount” is the
maximum dollar amount of payments in the nature of compensation that are
contingent on a Change in Control (as described in Section 280G of the Code) and
that may be paid or distributed to Executive without the imposition of the
Excise Tax. The “Reduced Amount” shall be an amount expressed in present value
which maximizes the aggregate present value of Payments under this Agreement
without causing any such Payment to be subject to the Excise Tax, as determined
in accordance with Section 280G(d)(4) of the Code.

(3) The determinations to be made with respect to this Section 6(f) shall be
made by an accounting firm (the “Auditor”) jointly selected by the Company and
Executive and paid by the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the two years preceding
the date of its selection acted in any way on behalf of the Company or any of
its subsidiaries. If Executive and the Company cannot agree on the firm to serve
as the Auditor, then Executive and the Company shall each select one such
accounting firm and those two firms shall jointly select such an accounting firm
to serve as the Auditor. Any Gross-Up Payment under this Section 6(f) with
respect to any Payments shall be made no later than thirty (30) days following
such Payment. If the Auditor determines that no Excise Tax is payable by
Executive, it shall furnish Executive with a written opinion to such effect, and
to the effect that failure to report the Excise Tax, if any, on Executive’s
applicable federal income tax return will not result in the imposition of a
negligence or similar penalty. If the Auditor determines that the aggregate
Parachute Value of all Payments does not exceed one hundred ten percent
(110%) of the Safe Harbor Amount, it shall furnish Executive with a written
opinion to such effect, and a statement of the reduction in Payments that shall
be made to provide Executive with the Reduced Amount. The determinations by the
Auditor shall be binding upon the Company and Executive. As a result of the
uncertainty in the application of Section 4999 of the Code at the time of the
determination, it is possible that Gross-Up Payments which will not have been
made by the Company should have been made (“Underpayment”) or Gross-Up Payments
are made by the Company which should not have been made (“Overpayment”),
consistent with the calculations required to be made hereunder. In the event
that the Executive thereafter is required to make payment of any Excise Tax or
additional Excise Tax, the Auditor shall determine the amount of the
Underpayment that has occurred and any such Underpayment (together with interest
at the rate provided in Section 1274(b)(2)(B) of the Code) shall be promptly
paid by the Company to or for the benefit of Executive. In the event the amount
of the Gross-Up Payment exceeds the amount necessary to reimburse the Executive
for his or her Excise Tax, the Auditor shall determine the amount of the
Overpayment that has been made and any such Overpayment (together with interest
at the rate provided in Section 1274(b)(2) of the Code) shall be promptly paid
by Executive (to the extent he or she has received a refund if the applicable
Excise Tax has been paid to the Internal Revenue Service) to or for the benefit
of the Company. Executive shall cooperate, to the extent his or her expenses are
reimbursed by the Company, with any reasonable requests by the Company in
connection with any contests or disputes with the Internal Revenue Service in
connection with the Excise Tax. In the event that the Auditor determines that
the value of any accelerated vesting of stock options held by Executive shall be
redetermined within the context of Treasury Regulation §1.280G-1 Q/A 33 (the
“Option Redetermination”), Executive shall (i) file with the Internal Revenue
Service an amended federal income tax return that claims a refund of the
overpayment of the Excise Tax attributable to such Option Redetermination and
(ii) promptly pay the refunded Excise Tax to the Company; provided that the
Company shall pay all reasonable professional fees incurred in the preparation
of Executive’s amended federal income tax return.

 

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(g) Other Programs. Except as otherwise provided in this Agreement, Executive’s
entitlements under applicable plans and programs of the Company following
termination of Executive’s employment will be determined under the terms of
those plans and programs.

(h) Conditions to Receipt of Benefits Under Section 6. Notwithstanding anything
in this Agreement to the contrary, other than the payment of Executive’s Accrued
Compensation through the date of termination of Executive’s employment,
Executive shall not be entitled to any payments or benefits under this Section 6
shall unless and until Executive (or the representative of Executive’s estate,
in the case of termination due to Executive’s death), executes and delivers to
the Company, within thirty (30) days of the date of termination of Executive’s
employment, a unilateral general release of all known and unknown claims against
the Company and its officers, directors, employees, agents and affiliates in a
form acceptable to the Company, and such release becomes fully effective and
irrevocable under applicable law. Additionally, Executive shall not be entitled
to payments and benefits under this Section 6 on or after the date, if any,
during the twelve (12) months following the date Executive’s employment
terminates (the “Restricted Period”), that Employee (1) breaches or otherwise
fails to comply with any of Executive’s obligations under Section 9(a)
(Nondisclosure of Confidential Information) or Section 10 (Nonsolicitation)
under this Agreement, or (2) Executive elects to, directly or indirectly,
(a) own, manage, operate, sell, control or participate in the ownership,
management, operation, sales or control of any of the following: Heidrick &
Struggles, Manpower, Kelly Services, Spencer Stuart, Russell Reynolds, Egon
Zender and/or Spherion (each a “Listed Entity”) provided that the foregoing
shall not be applicable to the ownership of not more than 1% of the publicly
traded equity securities of any of the foregoing or to the indirect ownership of
any of the foregoing through the ownership of mutual funds; or (b) request or
advise any of the clients, vendors or other business contacts of the Company
with which Executive had contact while employed by the Company to withdraw,
curtail, cancel or not increase their business with the Company. Executive
agrees to notify the Company of each employment or consulting engagement he
accepts during the Restricted Period (including the name and address of the
hiring party) and will, upon request by the Company, describe in reasonable
detail the nature of his duties in each such position.

(i) Certain Definitions. For purposes of this Agreement, the following terms
shall have the meanings set forth herein:

(1) “Accrued Compensation” means, as of any date, the amount of any unpaid Base
Salary and annual cash incentive award earned by Executive through the date of
Executive’s death or the termination of Executive’s employment, plus any
additional amounts and/or benefits payable to or in respect of Executive under
and in accordance with the provisions of any employee plan, program or
arrangement under which Executive is covered immediately prior to Executive’s
death, disability or the termination of Executive’s employment (it being
understood and agreed that no portion of the annual cash incentive award
described in Section 4(b) shall be deemed earned unless Executive was employed
with the Company as of the last day of the fiscal year to which such award
applies).

(2) “Cause” shall mean (a) conviction of any felony or other crime involving
fraud, dishonesty or acts of moral turpitude or pleading guilty or nolo
contendere to such charges, or (b) reckless or intentional behavior or conduct
that causes or is reasonably likely to cause the Company material harm or injury
or exposes or is reasonably likely to expose the Company to any material civil,
criminal or administrative liability, or (c) any material misrepresentation or
false statement made by Executive in any application for employment, employment
history, resume or other document submitted to the Company, either before,
during or after employment. Prior to terminating the Executive for Cause, the
Company shall be required to provide Executive with 90 days advanced written
notice of its intention to terminate Executive for Cause, but Executive shall be
permitted to cure any performance deficiencies during such 90 day period (if the
termination is not due to performance deficiencies, then the Company is
permitted to put Executive on paid leave during such 90 day period).

(3) “Disability” means any medically determinable physical or mental condition
or impairment which prevents Executive from performing the principal functions
of Executive’s duties with the Company that can be expected to result in death
or that has lasted or can be expected to last for a period of 90 consecutive
days or for shorter periods aggregating 180 days in any consecutive 12 month
period, with such determination to be made by an approved medical doctor. For
this purpose, an approved medical doctor shall mean a medical doctor selected by
the Company and Executive. If the parties cannot agree on a medical doctor, each
party shall select a medical doctor and the two doctors shall select a third
medical doctor who shall be the approved medical doctor for this purpose.

(4) Executive shall be deemed to have “Good Reason” to terminate his employment
hereunder if, without Executive’s prior written consent, (A) the Company
materially reduces Executive’s duties or responsibilities as Chief Executive
Officer or assigns Executive duties which are materially inconsistent with his
duties or which materially impair Executive’s ability to function as Chief
Executive Officer, or (B) the Company reduces Executive’s

 

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then current Base Salary or target award opportunity under the Company’s annual
cash incentive bonus plan or annual stock option award program, or terminates or
materially reduces any employee benefit or perquisite enjoyed by Executive (in
each case, other than as part of an across-the-board reduction applicable to all
executive officers of the Company), or (C) the Company fails to perform or
breaches its obligations under any other material provision of this Agreement,
or (D) Executive’s primary location of business is moved by more than 50 miles
(other than a relocation to New York, New York based on management’s decision,
made after Board consultation, provided that Executive receives from the Company
reimbursement of all customary and reasonable expenses of such relocation,
including without limitation temporary living expenses for a period of 6
months), or (E) the Company reduces Executive’s title of Chief Executive Officer
or removes him, or (F) the Company fails to obtain the assumption in writing of
its obligation to perform this Agreement by any successor to all or
substantially all of the assets of the Company within 15 days after a merger,
consolidation, sale or similar transaction. Prior to terminating for Good
Reason, the Executive shall be required to provide the Company with 30 days
advanced written notice of his intention to terminate employment for Good
Reason, but the Company shall be permitted to cure any events giving rise to
such Good Reason during such 30 day period.

7. Application of Section 409A. Notwithstanding any inconsistent provision of
this Agreement, to the extent the Company determines in good faith that (a) one
or more of the payments or benefits received or to be received by Executive
pursuant to this Agreement in connection with Executive’s termination of
employment would constitute deferred compensation subject to the rules of
Internal Revenue Code Section 409A (“Section 409A”), and (b) that Executive is a
“specified employee” under Section 409A, then only to the extent required to
avoid the Executive’s incurrence of any additional tax or interest under
Section 409A, such payment or benefit will be delayed until the date which is
six (6) months after Executive’s “separation from service” within the meaning of
Section 409A. The Company and Executive agree to negotiate in good faith to
reform any provisions of this Agreement to maintain to the maximum extent
practicable the original intent of the applicable provisions without violating
the provisions of Section 409A, if the Company deems such reformation necessary
or advisable pursuant to guidance under Section 409A to avoid the incurrence of
any such interest and penalties. Such reformation shall not result in a
reduction of the aggregate amount of payments or benefits under this Agreement,
nor the obligation of the Company to pay interest on any payments delayed for
the purposes of avoiding a violation of Section 409A.

8. No Mitigation; No Offset. Executive will have no obligation to seek other
employment or to otherwise mitigate the Company’s obligations to Executive
arising from the termination of Executive’s employment, and no amounts paid or
payable to Executive by the Company under this Agreement shall be subject to
offset for any remuneration in which Executive may become entitled from any
other source after Executive’s employment with the Company terminates, whether
attributable to subsequent employment, self-employment or otherwise except that
subsequent employment during the term of this Agreement with an employer
providing benefit plans shall result in an offset against benefits payable by
the Company hereunder to the extent of the benefits paid by the new employer.

9. Confidential Information; Cooperation with Regard to Litigation.

(a) Nondisclosure of Confidential Information. During Executive’s employment and
thereafter, Executive will not, without the prior written consent of the
Company, disclose to anyone (except in good faith in the ordinary course of
business to a person who, to Executive’s knowledge, is obligated to keep such
information confidential) or make use of any Confidential Information (as
defined below) except in the performance of Executive’s duties hereunder or when
required to do so by legal process, by any governmental agency having
supervisory authority over the business of the Company or any of its Affiliates
(as defined below) or by any administrative or legislative body (including a
committee thereof) that requires Executive to divulge, disclose or make
accessible such information. If Executive is so ordered, to divulge Confidential
Information, he will give prompt written notice to the Company in order to allow
the Company the opportunity to object to or otherwise resist such order.

(b) Definition of Confidential Information. For purposes of this Agreement,
“Confidential Information” means information concerning the business of the
Company or any corporation or other entity that, directly or indirectly,
controls, is controlled by or under common control with the Company (an
“Affiliate”) relating to any of its or their products, product development,
trade secrets, customers, suppliers, finances, and business plans and
strategies. Excluded from the definition of Confidential Information is
information (1) that is or becomes part of the public domain, other than through
the breach of this Agreement by Executive or (2) regarding the Company’s
business or industry properly acquired by Executive in the course of Executive’s
career as an executive in the Company’s industry and independent of Executive’s
employment by the Company. For this purpose, information known or available
generally within the trade or industry of the Company or any Affiliate shall be
deemed to be known or available to the public and not to be Confidential
Information.

 

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(c) Cooperation in Litigation. Executive will cooperate with the Company, during
Executive’s employment (and following Executive’s termination of employment for
any reason for a period of two years thereafter), by making Executive reasonably
available to testify on behalf of the Company or any Affiliate in any action,
suit, or proceeding, whether civil, criminal, administrative, or investigative,
and to reasonably assist the Company or any such Affiliate in any such action,
suit, or proceeding by providing information and meeting and consulting with the
Board or its representatives or counsel, or representatives or counsel to the
Company or any such Affiliate, as reasonably requested; provided, however, that
the same does not materially interfere with Executive’s then current
professional activities. The Company will reimburse Executive for all expenses
reasonably incurred by Executive in connection with Executive’s provision of
testimony or assistance (including the fees of any counsel that may be retained
by Executive) and if such assistance is provided after Executive’s termination
of employment, will pay Executive a per diem rate of $2,000.

10. Nonsolicitation. Executive shall not induce or solicit, directly or
indirectly, any employee of or consultant to the Company or any Affiliate to
terminate such person’s employment or consulting engagement with the Company or
any Affiliate during Executive’s employment under this Agreement and for a
period of 12 months following the termination of Executive’s employment under
this Agreement.

11. Remedies. If Executive commits a material breach of any of the provisions
contained in Sections 9 and 10 above, then the Company will have the right to
seek injunctive relief. Executive acknowledges that such a breach of Section 9
or 10 could cause irreparable injury and that money damages may not provide an
adequate remedy for the Company. Nothing contained herein will prevent Executive
from contesting any such action by the Company on the ground that no violation
or threatened violation of either such Section has occurred.

12. Resolution of Disputes. Any controversy or claim arising out of or relating
to this Agreement or any breach or asserted breach hereof or questioning the
validity and binding effect hereof arising under or in connection with this
Agreement, other than seeking injunctive relief under Section 11, shall be
resolved by binding arbitration, to be held in Los Angeles, California in
accordance with the rules and procedures of the American Arbitration
Association. Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof. All costs and expenses of any
arbitration or court proceeding (including fees and disbursements of counsel)
shall be borne by the respective party incurring such costs and expenses, but
the Company shall reimburse Executive for all reasonable costs and expenses by
Executive if Executive substantially prevails in such arbitration or court
proceeding. Notwithstanding the foregoing, if any applicable law requires
different or additional rules or procedures to be applied in order for this
Agreement to arbitrate to be enforceable, or prohibits any expense allocation
provided herein, such rules or procedures shall take precedence and such
prohibitions shall be a part of this Agreement to the to the extent necessary to
render this Agreement enforceable.

13. Indemnification.

(a) Company Indemnity. If Executive is made a party, or is threatened to be made
a party, to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”), by reason of the fact that he
is or was a director, officer or employee of the Company or any Affiliate or was
serving at the request of the Company or any Affiliate as a director, officer,
member, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, including service with respect to employee benefit
plans, whether or not the basis of such Proceeding is Executive’s alleged action
in an official capacity while serving as a director, officer, member, employee
or agent, then the Company will indemnify Executive and hold Executive harmless
to the fullest extent legally permitted or authorized by the Company’s articles
of incorporation, certificate of incorporation or bylaws or resolutions of the
Company’s Board to the extent not inconsistent with state laws, against all
costs, expense, liability and loss (including, without limitation, attorney’s
fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to
be paid in settlement) reasonably incurred or suffered by Executive in
connection therewith, except to the extent attributable to Executive’s gross
negligence or fraud, and such indemnification shall continue as to Executive
even if he has ceased to be a director, member, officer, employee or agent of
the Company or Affiliate and shall inure to the benefit of Executive’s heirs,
executors and administrators. The Company will advance to Executive all
reasonable costs and expenses to be incurred by Executive in connection with a
Proceeding within 20 days after receipt by the Company of a written request for
such advance. Such request shall include an undertaking by Executive to repay
the amount of such advance if it shall ultimately be determined that he is not
entitled to be indemnified against such costs and expenses. The provisions of
this section shall not be deemed exclusive of any other rights of
indemnification to which Executive may be entitled or which may be granted to
Executive and shall be in addition to any rights of indemnification to which he
may be entitled under any policy of insurance.

(b) No Presumption Regarding Standard of Conduct. Neither the failure of the
Company (including its Board, independent legal counsel or shareholders) to have
made a determination prior to the commencement of any proceeding concerning
payment of amounts claimed by Executive under the preceding subsection (a) of
this section that

 

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indemnification of Executive is proper because Executive has met the applicable
standard of conduct, nor a determination by the Company (including its Board,
independent legal counsel or shareholders) that Executive has not met such
applicable standard of conduct, shall create a presumption that Executive has
not met the applicable standard of conduct.

(c) Liability Insurance. The Company will continue and maintain a directors and
officers liability insurance policy covering Executive to the extent the Company
provides such coverage for its other senior executive officers.

14. Effect of Agreement on Other Benefits. Except as specifically provided in
this Agreement, the existence of this Agreement shall not be interpreted to
preclude, prohibit or restrict Executive’s participation in any other employee
benefit or other plans or programs in which he currently participates.

15. Expenses of Counsel for Executive. The Company and Executive will each bear
their own respective legal and other expenses incurred in connection with the
negotiation, execution and delivery of this Agreement; provided, however, that
the Company shall reimburse the reasonable legal fees and expenses then incurred
by Mitchell Silberberg & Knupp LLP, acting as counsel to Executive, up to a
maximum of $20,000 in the aggregate for all such expenses.

16. Assignment; Binding Nature. This Agreement shall be binding upon and inure
to the benefit of the parties and their respective successors, heirs (in the
case of Executive) and permitted assigns. No rights or obligations of the
Company under this Agreement may be assigned or transferred by the Company
except that such rights or obligations may be assigned or transferred to the
successor of the Company or its business if the assignee or transferee assumes
the liabilities, obligations and duties of the Company, as contained in this
Agreement, either contractually or as a matter of law. No rights or obligations
of Executive under this Agreement may be assigned or transferred by Executive
other than Executive’s rights to compensation and benefits, which may be
transferred only by will or operation of law, except as otherwise specifically
provided or permitted hereunder.

17. Representations. The Company represents and warrants that it is fully
authorized and empowered to enter into this Agreement and that the performance
of its obligations under this Agreement will not violate any Agreement between
it and any other person, firm or organization. Executive represents and warrants
that there is no legal or other impediment which would prohibit Executive from
entering into this Agreement or which would prevent Executive from fulfilling
Executive’s obligations under this Agreement.

18. Entire Agreement. This Agreement contains the entire understanding and
agreement between the parties concerning the subject matter hereof and
supersedes all prior agreements, understandings, discussions, negotiations and
undertakings, whether written or oral, between the parties with respect thereto.
If this Agreement becomes effective as provided in the first paragraph of this
Agreement, this Agreement will have amended, restated and superseded in its
entirety the Employment Agreement between Executive and the Company dated
October 1, 2003, as extended by written notice delivered on March 30, 2007 (the
“Prior Agreement”) and the Prior Agreement shall then be of no further force and
effect. Executive and the Company acknowledge and agree that the Prior Agreement
shall govern the terms of Executive’s employment from the date hereof until the
Start Date.

19. Amendment or Waiver. No provision in this Agreement may be amended unless
such amendment is agreed to in writing and signed by Executive and an authorized
officer of the Company. Except as set forth herein, no delay or omission to
exercise any right, power or remedy accruing to any party shall impair any such
right, power or remedy or shall be construed to be a waiver of or an
acquiescence to any breach hereof. No waiver by either party of any breach by
the other party of any condition or provision contained in this Agreement to be
performed by such other party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same or any prior or subsequent time.
Any waiver must be in writing and signed by Executive or an authorized officer
of the Company, as the case may be.

20. Severability. In the event that any provision or portion of this Agreement
shall be determined to be invalid or unenforceable for any reason, in whole or
in part, the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by
law.

21. Survivorship. The respective rights and obligations of the parties hereunder
shall survive any termination of Executive’s employment to the extent necessary
to the intended preservation of such rights and obligations.

22. Beneficiaries/References. Executive shall be entitled, to the extent
permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit payable hereunder following
Executive’s death by giving the Company written notice thereof. In the event of
Executive’s death or a judicial determination of Executive’s incompetence,
reference in this Agreement to Executive shall be deemed, where appropriate, to
refer to Executive’s beneficiary, estate or other legal representative.

 

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23. Governing Law. This Agreement shall be governed by and construed and
interpreted in accordance with the laws of California without reference to
principles of conflict of laws.

24. Counterparts and Facsimile. This Agreement may be executed in any number of
counterparts, each such counterpart shall be deemed to be an original
instrument, and all such counterparts together shall constitute but one
agreement. Any such counterpart may contain one or more signature pages. A copy
of this Agreement executed by any party and transmitted by facsimile shall be
binding upon the parties as if executed and delivered in person.

25. Notices. Any notice given to a party shall be in writing and shall be deemed
to have been given when delivered personally or sent by certified or registered
mail, postage prepaid, return receipt requested, duly addressed to the party
concerned at the address of the party indicated below or to such changed address
as such party may subsequently give such notice of:

 

If to the Company:   KORN/FERRY INTERNATIONAL  
1900 Avenue of the Stars, Suite 2600   Los Angeles, CA 90067   Attention:
Corporate Secretary If to Executive:  

 

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IN WITNESS WHEREOF, the undersigned have executed this Employment Agreement on
the date first above written.

 

The Company:   KORN/FERRY INTERNATIONAL    

/s/ Ken Whipple

  By:   Ken Whipple   Its:   Director    

/s/ Peter Dunn

  By:   Peter Dunn   Its:   General Counsel Executive:  

/s/ Gary Burnison

 

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SCHEDULE A

DEFINITION OF CHANGE IN CONTROL

For purposes of the foregoing Agreement, a “Change in Control” shall mean any of
the following:

(a) an acquisition by any Person (excluding one or more Excluded Persons) of
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act)
or a pecuniary interest (as defined in Section 16a-1(a)(2) of the Exchange Act)
in (either comprising “ownership of”) more than 30% of the Common Stock of the
Company or voting securities entitled to then vote generally in the election of
directors (“Voting Stock”) of the Company, after giving effect to any new issue
in the case of an acquisition from the Company; or

(b) approval by the shareholders of the Company of a plan, or the consummation,
of merger, consolidation, or reorganization of the Company or of a sale or other
disposition of all or substantially all of the Company’s consolidated assets as
an entirety (collectively, a “Business Combination”), other than a Business
Combination (1) in which all or substantially all of the holders of Voting Stock
of the Company hold or receive directly or indirectly 70% or more of the Voting
Stock of the entity resulting from the Business Combination (or a parent
company), and (2) after which no Person (other than any one or more of the
Excluded Persons) owns more than 30% of the Voting Stock of the resulting entity
(or a parent company) who did not own directly or indirectly at least that
percentage of the Voting Stock of the Company immediately before the Business
Combination, and (3) after which one or more Excluded Persons own an aggregate
amount of Voting Stock of the resulting entity owned by any Persons who (i) own
more than 5% of the Voting Stock of the resulting entity, (ii) are not Excluded
Persons, (iii) did not own directly or indirectly at least the same percentage
of the Voting Stock of the Company immediately before the Business Combination,
and (iv) in the aggregate own more than 30% of the Voting Stock of the resulting
entity; or

(c) approval by the Board of Directors of the Company and (if required by law)
by shareholders of the Company of a plan to consummate the dissolution or
complete liquidation of Korn/Ferry International; or

(d) during any period of two consecutive years, individuals who at the beginning
of such period constituted the Board and any new directors (excluding any new
director designated by a person who has entered into an agreement or arrangement
with Korn/Ferry International to effect a transaction described in clause (a) or
(b) of this definition) whose appointment, election, or nomination for election
was approved by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose
appointment, election or nomination for election was previously so approved (all
such directors, “Incumbent Directors”), cease for any reason to constitute a
majority of the Board; provided that for purposes of this clause (d), any
directors elected at any time during 1999 shall be deemed to be Incumbent
Directors.

Notwithstanding the above provisions in this Schedule A, no Change in Control
shall be deemed to have occurred if a Business Combination, as described in
paragraph (b) above, is effected and a majority of the Incumbent Directors,
through the adoption of a Board resolution, determines that, in substance, no
Change in Control has occurred.

The “Company” means Korn/Ferry International, a Delaware corporation, its
successors, and/or its Subsidiaries, as the context requires.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time.

“Excluded Person” means

(i) the Company; or

(ii) any person described in and satisfying the conditions of Rule 13d-1(b)(1)
under the Exchange Act; or

(iii) any employee benefit plan of the Company; or

(iv) any affiliates (within the meaning of the Exchange Act), successors, or
heirs, descendants or members of the immediate families of the individuals
identified in party (b) of this definition.

“Person” means an organization, a corporation, an individual, a partnership, a
trust or any other entity or organization, including a governmental entity and a
“person” as that term is used under Section 13(d) or 14(d) of the Exchange Act.

 

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