Exhibit 10.91

 

LOGO [g61937img001.jpg]

 

June 22, 2005

 

PRIVATE & CONFIDENTIAL

 

Ms. Judy Ethell

[Address]

 

Employment Letter and Terms and Conditions of Employment

Full-Time, Salaried Chief Accounting Officer (CAO), Executive Vice President and

Managing Director

 

Dear Judy:

 

On behalf of BearingPoint, Inc. (the “Company”), by this letter (the “Employment
Letter”), I am pleased to offer you the position of Executive Vice President –
Finance and Chief Accounting Officer (and Managing Director) of the Company in
our headquarters office, effective July 1, 2005 (the “Effective Date”). Though
this position will be based in the Washington Metropolitan Area, to which you
will relocate, and officially work at the McLean headquarters of BearingPoint,
you will initially be expected to work principally at the Foxboro, Massachusetts
BearingPoint office location. This temporary arrangement will be required until
I determine that the Company’s financials are current and it is otherwise
appropriate for you to work at an alternate location. Temporary housing
provisions and travel will be arranged for you in accordance with the Company’s
temporary housing and business expense reimbursement policies.

 

Your annualized base salary will be $500,000.00, paid semi-monthly, subject to
standard withholdings and deductions. You will also be eligible to participate
in the Company’s 2000 Long-Term Incentive Plan (the “LTIP”), or any successor or
replacement plan, and

 

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you will be eligible for future compensation adjustments. You will report
directly to the Chief Executive Officer (“CEO”) of the Company and your
performance and compensation will be reviewed at least annually. You will have
such duties and responsibilities as are commensurate with your position. Your
employment shall be “at-will”. The Company may terminate your employment at any
time and for any or no reason. You may terminate your employment with three
months’ prior notice, as provided in your Managing Director Agreement.

 

Equity. Effective on the first business day after you sign and return this
Employment Letter (the “Option Grant Date”), you will be provided an initial
grant of 600,000 stock options (the “Options”) to purchase shares of Company
common stock under the Company’s LTIP, a copy of which is provided to you
herewith as Exhibit A. The Options shall vest 25% each year commencing on the
one-year anniversary of the grant date subject in anniversary years 2 – 4, to
achievement of such performance goals as are specified below as applicable to
vesting of RSUs (substituting anniversary for “Vesting Date”). The options which
vest on the first anniversary shall not be subject to any performance criteria.
The options shall become fully exercisable upon your death or disability. The
exercise price of the Options will be equal to the last available closing price
of the Company’s common stock on the first business day prior to the Option
Grant Date. The attached Award Notice of Stock Option Grant (Exhibit A-1) and
Stock Option Agreement (Exhibit A-2) detail the various terms of your initial
grant, and require your signature of acceptance. These will be provided to you
upon your acceptance of employment.

 

You also shall receive an award of 292,000 restricted stock units (“Restricted
Stock”). The Restricted Stock shall vest on the Vesting Date (as defined in the
Restricted Stock Unit Agreement) subject for all Restricted Stock to (i) all of
the Company’s SEC filings (beginning with the Company’s 2005 Form 10-k) being
filed on a timely basis as of such Vesting Date or your having exerted your
reasonable best efforts to have the Company’s SEC filings materially complete as
of such date, and (ii) your having exerted your reasonable best efforts to move
the Company forward on the path to becoming a “world class financial
organization”. For these purposes, a “world class financial organization” shall
mean an organization that satisfies the criteria mutually established by you and
the CEO. Notwithstanding the preceding, the Restricted Stock which vests on
January 1, 2006 shall not be subject to any performance criteria.

 

Prior to the Effective Date, you will receive a Restricted Stock Unit Agreement
substantially in the form attached hereto as Exhibit B that details the various
terms of your grant, and requires your signature of acceptance. All unvested
Options and Restricted Stock will immediately vest upon the occurrence of a
Change in Control of the Company, as such term is defined in the LTIP or a
termination of employment due to death or “Disability” (as such term is defined
in the LTIP). On a termination of your employment by the Company without Cause
or by you for Good Reason, the portion of the Option and/or Restricted Stock
award scheduled to vest on the anniversary of the grant date following your
termination shall vest on the date of your termination.

 

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You are also eligible to receive additional annual grants of stock options,
and/or other equity awards on at least the same basis as other senior executives
of the Company. To the extent shares are not available under the Company’s
equity plans to provide for the equity grants described herein, the Company
agrees to use its best efforts to satisfy all conditions required to add the
required shares to the applicable plans or to provide equivalent value to you.

 

Annual Bonus. You will be eligible to receive an annual bonus with a target
amount equal to 100% of your base salary (the “Target Bonus”) upon achievement
of reasonable pre-established performance goals. (100 % payout based upon 100%
goals achievement) You will be eligible to receive a Target Bonus for 2005. You
will have meaningful input with respect to the formulation of the performance
goals. Your annual bonus may be paid in cash or any other form in which (and at
such time as) annual bonuses are paid to other senior executives of the Company.
Any such payment shall be subject to standard withholdings and deductions.

 

Sign-On Bonus. Within 30 days following the Effective Date of your employment,
you will receive a cash lump sum sign-on bonus in the amount of $750,000 (the
“Sign-On Bonus”), less standard withholdings and deductions; provided, that you
shall repay the Sign-On Bonus within 10 business days following termination of
your employment by the Company for Cause or your voluntary termination without
Good Reason prior to December 31, 2005..

 

Benefits/Long-Term Incentives. You will be entitled to participate in all
employee benefit (including long-term incentives), fringe and perquisite plans,
practices, programs policies and arrangements generally provided to senior
executives of the Company at a level commensurate with your position.

 

Personal Days/Holidays. You will be entitled to 25 annual personal days, accrued
monthly, to use for vacation, illness or other personal absences. These personal
days are in addition to eight Company-designated holidays. As a full-time
employee, you will also be eligible to participate in our Personal Benefits
Program.

 

Relocation. As of the Effective Date, you will provide services full-time at the
Company’s headquarters, subject to the initial and temporary work arrangements
in Massachusetts referenced above. The Company recognizes that it will require a
period of time for you to fully transition your family and your residence. As a
result, for expenses incurred during the period of time commencing on the
Effective Date and ending 90 days after your relocation, the Company will pay
all reasonable, documented relocation and transitional housing and travel
expenses, including a tax gross-up payment to cover all applicable taxes
relating thereto, in connection with your relocation near the Company’s

 

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headquarters, which shall occur no later than June 30, 2006. In addition, the
Company will, at your discretion, either purchase your principal residence based
on the price set by a mutually agreed upon appraisal firm or reimburse you for
your real estate commissions incurred in connection with the sale of your
principal residence. The expenses of moving your personal property will be
reimbursed, in accordance with the Company’s Relocation Policies.

 

Business Expenses. The Company will reimburse you for the reasonable travel,
entertainment and other business expenses incurred by you in the performance of
your duties in accordance with the Company’s policies applicable to senior
executives as in effect from time to time. Travel expenses shall include
expenses incurred to return to St. Louis on weekends and holidays prior to
relocation, in accordance with Company policy.

 

Legal Fees. The Company will reimburse you for legal fees incurred in connection
with negotiating the terms and documentation of your initial employment with the
Company in an amount not-to-exceed $7,500.

 

Severance. Upon termination of your employment, the Company will pay you:
(i) any earned but unpaid base salary through the date of termination, the
Sign-On Bonus if then payable pursuant to the section titled “Sign-On Bonus”
above, and any earned but unpaid annual bonus for any preceding year, provided,
however, that your employment terminates after the payment date for the annual
bonus, (ii) any unpaid accrued personal days or unreimbursed business expenses,
(iii) in the circumstances specified below in the section titled “Termination
without Cause or for Good Reason” the payments specified in that section, and
(iv) any other amounts due under any of the Company’s benefit plans. Payment of
the amounts specified in subsection (iii) above shall be conditioned upon your
execution of a full and binding unilateral Release of all claims arising from or
associated with your employment with the Company, a form of which is attached
hereto as Exhibit D (the “Release Agreement”). Severance shall be paid without
duty to mitigate.

 

Termination without Cause or for Good Reason. Upon your termination of
employment by the Company without Cause, or by you for Good Reason, the Company
will pay you a lump sum cash amount equal to the sum of your (i) annual base
salary and (ii) your then current Target Bonus (if established at such time) or,
if the Target Bonus is not yet established, then the prior year’s actual bonus.
The lump sum cash payment shall be made within 30 days of the date of receipt by
the Company of your fully executed Release Agreement as specified in the
“Severance” section above. The Company will also pay your premiums under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, on your
behalf for 18 months after termination of your employment without Cause or for
Good Reason.

 

Post-Employment Activities. Notwithstanding the covenants contained in your
Managing Director Agreement related to post-employment non-competition
restrictions,

 

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upon your termination of employment with the Company for any reason, you may
return to PricewaterhouseCoopers (PWC) to serve in any tax related capacity
without being in violation of such covenants.

 

Special Termination Agreement. Upon a Change of Control of the Company, you
shall be entitled to receive the payments and other benefits specified in your
Special Termination Agreement, a copy of which is attached as Exhibit E, and
while eligible to receive such payments and other benefits you shall not be
eligible to receive any payment or benefits under the above sections titled
“Severance” and “Termination without Cause or for Good Reason” (no double
payment opportunity exists).

 

Indemnification. The Company will indemnify you (i) to the fullest extent
permitted by law with respect to your activities on behalf of the Company,
(ii) for any excise taxes, interest or penalties which you incur with regard to
Section 4999 of the Internal Revenue Code, as well as for any income or
employment tax liabilities incurred in connection with the Company’s payment of
such amounts, and (iii) for any failure by the Company to comply with
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
including a tax gross-up payment to cover all applicable taxes relating thereto,
unless such failure is a result of your act or omission. You will be covered
under the Company’s D & O liability insurance on the same basis as other senior
level executives of the Company. The Company will also reimburse you for
expenses directly associated with maintenance of your professional license
(CPA), and for your attendance at a minimum of 40 hours of continuing education
per year as required to maintain your CPA license.

 

Definitions. Solely for purposes of this Employment Letter and your Managing
Director Agreement (Exhibit F), the following definitions apply:

 

  1. “Good Reason” shall mean the occurrence or failure to cause the occurrence,
as the case may be, without your express written consent, of any of the
following circumstances for more than 30 days after receipt by the General
Counsel of the Company of your written notification and description of the
claimed circumstance: (i) any material adverse change in your then positions,
titles or reporting obligations, or a material diminution of your duties,
responsibilities or authority or the assignment to you of duties or
responsibilities that are materially adversely inconsistent with your position,
(ii) a relocation of the Company’s principal executive office to any location
outside the continental United States, (iii) any material breach by the Company
of any provision of this Employment Letter or the Managing Director Agreement or
Special Termination Agreement you enter into with the Company, or (iv) the
failure of any successor to the Company (whether direct or indirect and whether
by merger, acquisition, consolidation or otherwise) to assume in a writing
delivered to you upon the successor becoming such, the obligations of the
Company under this Employment Letter, provided,

 

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however, that this clause shall not apply if the transaction results in the
successor becoming legally required to fulfill the obligations of the Company
under this Employment Letter, whether by operation of law or otherwise.

 

  2. “Change of Control” shall have the meaning specified in your Special
Termination Agreement with the Company.

 

  3. Notwithstanding the provisions of your Managing Director 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 your receipt of written notification from the
General Counsel which includes a detailed description of the claimed
circumstance: (i) your embezzlement, misappropriation of corporate funds , or
your material acts of dishonesty; (ii) your commission or conviction of any
felony or of any misdemeanor involving moral turpitude, or entry of a plea of
guilty or nolo contendre to any felony or misdemeanor involving moral turpitude;
(iii) your engagement, without a reasonable belief that your 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) your willful failure to
adhere to the Company’s material corporate codes, policies or procedures that
have been communicated to you ; (v) your material breach of any provision of the
Managing Director Agreement or this Employment Letter; or (vi) your 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 you with the
opportunity to cure any Cause event during the 15-day period after your 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.

 

Other Considerations.

 

There are a number of other important items we wish to cover in this Employment
Letter. They are:

 

  •   Contributory benefits (such as medical, dental, supplemental life
insurance, long-term disability and optional accidental death and dismemberment
insurance) are effective the first day of the calendar month following the
Effective Date, unless you are hired on the first day of the month, in which
case they will be effective immediately. All other non-contributory benefits
(such as business travel accident insurance, short-term disability and personal
days) are effective upon the Effective Date.

 

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  •   Please read this Employment Letter and the accompanying Managing Director
Agreement and exhibits thereto carefully. Signing these documents is a condition
of employment. As noted therein, employment with the Company is not for a
specific term and may be terminated (i) by you, upon three months’ notice as
specified in your Managing Director Agreement or (ii) by the Company at any
time, for any or no reason, with or without Cause.

 

  •   In compliance with the Immigration Reform and Control Act, federal law
requires employers to verify work authorization upon hire. We have provided you
with information that describes these requirements and the documents you need to
bring on your first day of work.

 

  •   In compliance with the Fair Credit Reporting Act, employment with the
Company is contingent upon satisfactory completion of the Company’s employment
screening process. This includes a public source background inquiry and receipt
of satisfactory information regarding your employment history. You have signed a
Disclosure and Authorization for Release of Information form authorizing the
Company to compile a background report. If the Company finds that you have made
any misrepresentation or is dissatisfied with the results of any review of your
background, the Company may withdraw any offer of employment or terminate your
employment without obligation whatsoever on the part of the Company except
payment to you for any services rendered.

 

This Employment Letter can be amended only by a writing signed by both you and
the Company. This Employment Letter shall be governed by and construed in
accordance with the internal, domestic laws of the Commonwealth of Virginia.

 

In the event of any conflict between the provisions of this Employment Letter
and the provisions of your Managing Director Agreement, the terms and provisions
in this Employment Letter shall control.

 

The items in this Employment Letter, your Managing Director Agreement and
exhibits thereto, your Special Termination Agreement and the other items
referred to above represent the Company’s entire offer of employment to you.
This Employment Letter supersedes any contrary representations that may have
been made to you at any time. By signing below, you accept this offer of
employment in accordance with the terms and conditions of employment specified
in this Employment Letter. This offer of employment will remain open through
June 24, 2005.

 

Judy, we are excited about having you join us. To inform us of your decision,
please sign and return this Employment Letter, your Special Termination
Agreement (attached as Exhibit E) and your Managing Director Agreement (attached
as Exhibit F).

 

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Should you have any questions, please contact me, or David Black, the Company’s
General Counsel, at (703) 747-5728.

 

Very truly yours,

 

Harry L. You

Chief Executive Officer

BearingPoint, Inc.

 

ACCEPTED:

/s/ Judy Ethell

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Judy Ethell Date: June 22, 2005

 

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