EXHIBIT 10.2
DIAMOND MANAGEMENT & TECHNOLOGY CONSULTANTS, INC.
AMENDED AND RESTATED
1998 EQUITY INCENTIVE PLAN
     1. Purpose. The Diamond Management & Technology Consultants, Inc. 1998
Equity Incentive Plan (the “Plan”) is intended to promote the long-term success
of Diamond Management & Technology Consultants, Inc. (the “Company”) and its
stockholders by strengthening the Company’s ability to attract and retain highly
competent executives and other selected employees and to provide a means to
encourage stock ownership and proprietary interest in the Company.
     2. Term. The Plan shall become effective upon the date (the “Effective
Date”) it is approved by the Board of Directors of the Company (the “Board”),
subject to its ratification and approval by the affirmative vote of the holders
of a majority of the securities of the Company present or represented, and
entitled to vote at a meeting of stockholders of the Company, and shall
terminate at the close of business on the tenth anniversary of the Effective
Date unless terminated earlier under Section 14. Certain awards made with the
approval of the Company’s Worldwide Operating Committee in March and April 1998
prior to the Effective Date were intended to be pursuant to the Plan and are
therefore included under the Plan. After termination of the Plan, no future
awards may be granted, but previously granted awards shall remain outstanding in
accordance with their applicable terms and conditions and the terms and
conditions of the Plan.
     3. Plan Administration. The Company’s Management Committee, as constituted
from time to time, or any other committee appointed by the Board (the
“Committee”) shall be responsible for administering the Plan. Except as
otherwise provided in the Plan, the Committee shall have full and exclusive
power to interpret the Plan and to adopt such rules, regulations and guidelines
for carrying out the Plan as it may deem necessary or proper, and such power
shall be executed in the best interests of the Company and in keeping with the
objectives of the Plan. The interpretation and construction of any provision of
the Plan or any option or right granted hereunder and all determinations by the
Committee in each case shall be final, binding and conclusive with respect to
all interested parties.
     4. Eligibility. Any employee of the Company shall be eligible to receive
one or more awards under the Plan. Directors of the Company who are not employed
by the Company will be considered “employees” eligible to receive awards under
the Plan. Consultants of the Company qualifying as “employees” within the
meaning of Form S-8 under the Securities Act of 1933, as amended (the
“Securities Act”), shall also be eligible to receive awards under the Plan.
“Company” includes any entity that is directly or indirectly controlled by the
Company or any entity in which the Company has a significant equity interest, as
determined by the Committee.

 

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     5. Shares of Common Stock Subject to the Plan. Subject to the provisions of
Section 6 of the Plan, the aggregate number of shares of Common Stock, $0.001
par value, of the Company (“Stock”) which may be transferred to participants
under the Plan shall be:
     (i) 28,000,000 shares; plus
     (ii) any shares that are represented by awards or portions of awards under
the Diamond Management & Technology Consultants, Inc. 1994 Stock Option Plan, as
amended (the “Prior Plan”) that are forfeited, expired, cancelled or settled
without the issuance of shares; plus
     (iii) any shares that are represented by options or portions of options not
awarded under the Prior Plan but included in clause (i) of Section 3 of the
Prior Plan that are forfeited, expired, cancelled or settled without the
issuance of shares; plus
     (iv) any shares issued and included in clause (i) of Section 3 of the Prior
Plan that are repurchased by the Company.
     The aggregate number of shares of Stock that may be covered by awards
granted to any single individual under the Plan shall not exceed 250,000 shares
per fiscal year of the Company. The aggregate number of shares of Stock that may
be granted in the form of incentive stock options (“ISOs”) intended to comply
with Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”)
shall be 28,000,000 shares.
     Shares subject to awards under the Plan which expire, terminate, or are
canceled prior to exercise or, in the case of awards granted under Section 8.3,
do not vest, shall thereafter be available for the granting of other awards.
Shares which have been exchanged by a participant as full or partial payment to
the Company in connection with any award under the Plan also shall thereafter be
available for the granting of other awards. In instances where a stock
appreciation right (“SAR”) or other award is settled in cash, the shares covered
by such award shall remain available for issuance under the Plan. Likewise, the
payment of cash dividends and dividend equivalents paid in cash in conjunction
with outstanding awards shall not be counted against the shares available for
issuance. Any shares that are issued by the Company, and any awards that are
granted through the assumption of, or in substitution for, outstanding awards
previously granted by an acquired entity shall not be counted against the shares
available for issuance under the Plan.
     Any shares of Stock issued under the Plan may consist in whole or in part
of authorized and unissued shares or of treasury shares, and no fractional
shares shall be issued under the Plan. Cash may be paid in lieu of any
fractional shares in settlements of awards under the Plan.
     6. Adjustments. In the event of any stock dividend, stock split,
combination or exchange of shares, merger, consolidation, spin-off,
recapitalization or other distribution (other than normal cash dividends) of
Company assets to stockholders, or any other change affecting shares of Stock or
share price, such proportionate adjustments, if any, as the Committee in its

 

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discretion may deem appropriate to reflect such change shall be made with
respect to (1) the aggregate number of shares of Stock that may be issued under
the Plan; (2) each outstanding award made under the Plan; and (3) the exercise
price per share for any outstanding stock options, SARs or similar awards under
the Plan.
     7. Fair Market Value. “Fair Market Value,” for all purposes of the Plan,
shall mean the average of the closing price of a share of Stock on the NASDAQ
Global Market System for the ten trading days immediately preceding the date of
grant.
     8. Awards. Except as otherwise provided in this Section 8, the Committee
shall determine the type or types of award(s) to be made to each participant and
the number of shares of Stock subject to each such award, and any other terms,
conditions and limitations applicable to such award. Awards may be granted
singly, in combination or in tandem. Awards also may be made in combination or
in tandem with, in replacement of, as alternatives to or as the payment form for
grants or rights under any other compensation plan or individual contract or
agreement of the Company including those of any acquired entity. The types of
awards that may be granted under the Plan are:
     8.1 Stock Options. A stock option is a right to purchase a specified number
of             shares of Stock during a specified period. The purchase price per
share for each stock option shall be not less than 100% of Fair Market Value on
the date of grant, except if a stock option is granted retroactively in tandem
with or as a substitution for a SAR, the exercise price may be no lower than the
Fair Market Value of a share as set forth in award agreements for such tandem or
replaced SAR. A stock option may be in the form of an ISO which complies with
Section 422 of the Code. The price at which shares may be purchased under a
stock option shall be paid in full by the optionee at the time of the exercise
in cash or such other method permitted by the Committee, including (1) tendering
shares; (2) authorizing a third party to sell the shares (or a sufficient
portion thereof) acquired upon exercise of a stock option and assigning the
delivery to the Company of a sufficient amount of the sale proceeds to pay for
all the shares acquired through such exercise; or (3) any combination of the
above.
     8.2 SARs. A SAR is a right to receive a payment, in cash and/or shares,
equal to the excess of the Fair Market Value of a specified number of shares of
Stock on the date the SAR is exercised over the Fair Market Value on the date
the SAR was granted as set forth in the applicable award agreement; except that
if a SAR is granted retroactively in tandem with or in substitution for a stock
option, the designated Fair Market Value set forth in the award agreement shall
be no lower than the Fair Market Value of a share for such tandem or replaced
stock option.
     8.3 Stock Awards. A stock award is a grant made or denominated in shares or
units equivalent in value to shares. All or part of any stock award may be
subject to conditions and restrictions as set forth in the applicable award
agreement, which may be based on continuous service with the Company or the
achievement of performance goals related to profits, profit growth,
profit-related return ratios, cash flow or total stockholder

 

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return, where such goals may be stated in absolute terms or relative to
comparable companies.
     9. Dividends and Dividend Equivalents. Any awards under the Plan may earn
dividends or dividend equivalents as set forth in the applicable award
agreement. Such dividends or dividend equivalents may be paid currently or may
be credited to a participant’s account. Any crediting of dividends or dividend
equivalents may be subject to such restrictions and conditions may be
established in the applicable award agreement, including reinvestment in
additional shares or share equivalents.
     10. Deferrals and Settlements. Payment of awards may be in the form of
cash, stock, other awards or combinations thereof as shall be determined at the
time of grant, and with such restrictions as may be imposed in the award
agreement. The Committee also may require or permit participants to elect to
defer the issuance of shares or the settlement of awards in cash under such
rules and procedures as it may establish under the Plan. It also may provide
that deferred settlements include the payment or crediting of interest on the
deferral amounts, or the payment or crediting of dividend equivalents where the
deferral amounts are denominated in shares.
     11. Transferability and Exercisability. Awards granted under the Plan shall
not be transferable or assignable other than (1) by will or the laws of descent
and distribution; (2) by gift or other transfer of an award to any trust or
estate in which the original award recipient or such recipient’s spouse or other
immediate relative has a substantial beneficial interest, or to a spouse or
other immediate relative, provided that any such transfer is permitted by
Rule 16b-3 under the Securities Exchange Act of 1934, as amended and as in
effect when such transfer occurs and the Board does not rescind this provision
prior to such transfer; or (3) pursuant to a domestic relations order (as
defined by the Code). However, any award so transferred shall continue to be
subject to all the terms and conditions contained in the instrument evidencing
such award.
     12. Award Agreements. Awards under the Plan shall be evidenced by
agreements as approved by the Committee that set forth the terms, conditions and
limitations for each award, which may include the term of an award (except that
in no event shall the term of any ISO exceed a period of ten years from the date
of its grant), the provisions applicable in the event the participant’s
employment terminates, and the Committee’s authority to amend, modify, suspend,
cancel or rescind any award. The Committee need not require the execution of any
such agreement, in which case acceptance of the award by the participant shall
constitute agreement to the terms of the award.
     13. Acceleration and Settlement of Awards. The Committee shall have the
discretion, exercisable at any time before a sale, merger, consolidation,
reorganization, liquidation or change of control of the Company, as defined by
the Committee, to provide for the acceleration of vesting and for settlement,
including cash payment of an award granted under the Plan, upon or immediately
before the effectiveness of such event. However, the granting of awards under
the Plan shall in no way affect the right of the Company to adjust, reclassify,
reorganize or otherwise

 

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change its capital or business structure, or to merge, consolidate, dissolve,
liquidate, sell or transfer all or any portion of its businesses or assets.
     14. Plan Amendment. The Plan may be amended by the Committee as it deems
necessary or appropriate to better achieve the purposes of the Plan, except that
no such amendment shall be made without the approval of the Company’s
stockholders which would increase the number of shares available for issuance in
accordance with Sections 5 and 6 of the Plan. The Board may suspend the Plan or
terminate the Plan at any time; provided, that no such action shall adversely
affect any outstanding benefit. Any shares authorized under Section 5 (or any
amendment thereof) with respect to which no Award is granted prior to
termination of the Plan, or with respect to which an Award is terminated,
forfeited or canceled after termination of the Plan, shall automatically be
transferred to any subsequent stock incentive plan or similar plan for employees
of the Company.
     15. Tax Withholding. The Company shall have the right to deduct from any
settlement of an award made under the Plan, including the delivery or vesting of
shares, a sufficient amount to cover withholding of any federal, state or local
taxes required by law, or to take such other action as may be necessary to
satisfy any such withholding obligations. The Committee may, in its discretion
and subject to such rules as it may adopt, permit participants to use shares to
satisfy required tax withholding and such shares shall be valued at the Fair
Market Value as of the settlement date of the applicable award.
     16. Registration of Shares. Notwithstanding any other provision of the
Plan, the Company shall not be obligated to offer or sell any shares unless such
shares are at that time effectively registered or exempt from registration under
the Securities Act and the offer and sale of such shares are otherwise in
compliance with all applicable federal and state securities laws and the
requirements of any stock exchange or similar agency on which the Company’s
securities may then be listed or quoted. The Company shall have no obligation to
register the shares under the federal securities laws or take any other steps as
may be necessary to enable the shares to be offered and sold under federal or
other securities laws. Prior to receiving shares a Plan participant may be
required to furnish representations or undertakings deemed appropriate by the
Company to enable the offer and sale of the shares or subsequent transfers of
any interest in such shares to comply with the Securities Act and other
applicable securities laws. Certificates evidencing shares shall bear any legend
required by, or useful for the purposes of compliance with, applicable
securities laws, this Plan or award agreements.
     17. Other Benefit and Compensation Programs. Unless otherwise specifically
determined by the Committee, settlements of awards received by participants
under the Plan shall not be deemed a part of a participant’s regular, recurring
compensation for purposes of calculating payments or benefits from any Company
benefit plan or severance program. Further, the Company may adopt other
compensation programs, plans or arrangements as it deems appropriate or
necessary.
     18. Unfunded Plan. Unless otherwise determined by the Committee, the Plan
shall be unfunded and shall not create (or be construed to create) a trust or a
separate fund or funds. The

 

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Plan shall not establish any fiduciary relationship between the Company and any
participant or other person. To the extent any person holds any rights by virtue
of an award granted under the Plan, such rights shall be no greater than the
rights of an unsecured general creditor of the Company.
     19. Use of Proceeds. The cash proceeds received by the Company from the
issuance of shares pursuant to awards under the Plan shall constitute general
funds of the Company.
     20. Regulatory Approvals. The implementation of the Plan, the granting of
any award under the Plan, and the issuance of shares upon the exercise or
settlement of any award shall be subject to the Company’s procurement of all
approvals and permits required by regulatory authorities having jurisdiction
over the Plan, the awards granted under it or the shares issued pursuant to it.
     21. Employment Rights. The Plan does not constitute a contract of
employment and participation in the Plan will not give a participant the right
to continue in the employ of the Company on a full-time, part-time or any other
basis. Participation in the Plan will not give any participant any right or
claim to any benefit under the Plan, unless such right or claim has specifically
accrued under the terms of the Plan.
     22. Governing Law. The validity, construction and effect of the Plan and
any actions taken or relating to the Plan shall be determined in accordance with
the laws of the State of Illinois and applicable federal law.
     23. Successors and Assigns. The Plan shall be binding on all successors and
assigns of a participant, including, without limitation, the estate of such
participant and the executor, administrator or trustee of such estate, or any
receiver or trustee in bankruptcy or representative of the participant’s
creditors.