Exhibit 10.2


 


ADJOINED
CONSULTING LLC INCENTIVE COMPENSATION PLAN


 


Kanbay
International, Inc. (“Kanbay”) has adopted the Adjoined Consulting LLC
Incentive Compensation Plan (the “Plan”) to provide for the payment of
performance bonuses to certain executives and management employees of Adjoined
Consulting LLC (the “Company”) and other Affiliates in consideration of their
efforts during the 2006, 2007 and 2008 fiscal years of Kanbay. The purpose of
the Plan is to align the goals of those Executives participating in the Plan
with the business goals and objectives of Kanbay and the Company, to provide
these Executives with financial incentives to attain those goals and objectives
and to reward these Executives for meeting their Performance Targets.


 


1.                                      DEFINITIONS


 


For purposes of the Plan,
the following terms shall have the following definitions:


 


1.1                                 “Affiliate”
means any corporation or other business entity, or predecessor of such entity,
if any, that is a parent or subsidiary of Kanbay, including ownership of 50% or
more of the voting or profits interests of the corporation or other business
entity.


 


1.2                                 “Board”
means the Board of Directors of Kanbay.


 


1.3                                 “Bonus
Schedule” means the bonus acknowledgement schedule provided to an Executive
that sets forth the Performance Bonus that the Executive is eligible to earn
under the Plan and the Performance Targets applicable to such Performance
Bonus.


 


1.4                                 “Cause” means the Executive’s:


 


(a)                                  willful
neglect of or continued failure to substantially perform, in any material
respect, his or her duties (as assigned to the Executive from time to time) or
obligations (including a violation of policy) to Kanbay, the Company or other
Affiliate other than any such failure resulting from his or her incapacity due
to physical or mental illness;


 


(b)                                 commission
of a willful act (including, without limitation, a dishonest or fraudulent act)
or a grossly negligent act, or the willful or grossly negligent omission to act
that is intended to cause, causes or is reasonably likely to cause material
harm to Kanbay, the Company or other Affiliate, monetarily, reputationally or
otherwise;


 


(c)                                  commission
or conviction of, or plea of nolo contendere
to, any felony or any crime or offense involving dishonesty or fraud or that is
significantly injurious to Kanbay, the Company or other Affiliate, monetarily,
reputationally or otherwise; or


 


(d)                                 abuse
of illegal drugs or other controlled substances or habitual intoxication.


 


An act or omission is “willful”
for this purpose if it was knowingly done, or knowingly omitted to be done, by
the Executive not in good faith and without reasonable belief that the act or
omission was in the best interest of Kanbay or the Company. The Committee has
the discretion, in other circumstances, to determine in good faith, from all
the facts and


 

















 


circumstances reasonably available to it, whether an Executive who is
under investigation for, or has been charged with, a crime will be deemed to
have committed it for purposes of this Plan.


 


1.5                                 “Change
in Control” means the occurrence of any one or more of the following:


 


(a)                                  Any
“person” (as such term is defined in Section 3(a)(9) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”) and as used in Sections 13(d)(3)
and 14(d)(2) of the Exchange Act), including a “group” (as defined in Section
13(d)(3) of the Exchange Act), other than (i) Kanbay, (ii) any wholly-owned
subsidiary of Kanbay, or (iii) any employee benefit plan (or related trust)
sponsored or maintained by Kanbay, the Company or other Affiliate, becomes a “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of Kanbay having fifty percent (50%) or more of the
combined voting power of the then-outstanding securities of Kanbay that may be
cast for the election of directors of Kanbay (other than as a result of an
issuance of securities initiated by Kanbay in the ordinary course of business)
(the “Company Voting Securities”); provided, however, that the event described
in this Section 1.6(a) shall not be deemed to be a Change in Control by virtue
of any underwriter temporarily holding securities pursuant to an offering of
such securities;


 


(b)                                 During
any period of two consecutive years, individuals who at the beginning of any
such period constitute the Board (the “Incumbent Directors”) cease for any
reason to constitute at least a majority of the Board, unless the election, or
the nomination for election by the stockholders of Kanbay, of each new director
of Kanbay during such period was approved by a vote of at least two-thirds of
the Incumbent Directors then still in office;


 


(c)                                  As
the result of, or in connection with, any cash tender or exchange offer, merger
or other business combination, sale of all or substantially all of the assets
or contested election, or any combination of the foregoing transactions, less
than a majority of the combined voting power of the then-outstanding securities
of Kanbay or any successor corporation or entity entitled to vote generally in
the election of the directors of Kanbay or such other corporation or entity
after such transaction is held in the aggregate by the holders of the
securities of Kanbay entitled to vote generally in the election of directors of
Kanbay immediately prior to such transaction; or


 


(d)                                 The
stockholders of Kanbay approve a plan of complete liquidation of Kanbay.


 


Notwithstanding the
foregoing, a Change in Control shall not be deemed to occur solely because any
person acquires beneficial ownership of more than fifty percent (50%) of the
Company Voting Securities as a result of the acquisition of Company Voting
Securities by Kanbay which reduces the number of Company Voting Securities
outstanding; provided, however, that if after such acquisition by Kanbay such
person becomes the beneficial owner of additional Company Voting Securities
that increases the percentage of outstanding Company Voting Securities
beneficially owned by such person, a Change in Control transaction shall then
occur.


 


Further notwithstanding the foregoing, unless a majority of the
Incumbent Directors determines otherwise, no Change in Control shall be deemed
to have occurred with respect to a


 


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particular Executive if the Change in Control
results from actions or events in which such Executive is a participant in a
capacity other than solely as an officer, employee or director of Kanbay,
the Company or an Affiliate.


 


1.6                                 “Closing
Date” has the same meaning set forth in Section 2.1 of the Merger Agreement
between Kanbay International, Inc., Kanbay Consulting, LLC, and Adjoined
Consulting, Inc., dated as of February 13, 2006.


 


1.7                                 “Committee”
means the Compensation Committee of the Board that is responsible for setting
Performance Targets, certifying that such targets have been met under the Plan
and the administration of the Plan.


 


1.8                                 “Company”
means Adjoined Consulting LLC (f/k/a Kanbay Consulting, LLC), a Delaware
limited liability company and wholly owned subsidiary of Kanbay, and any
successor thereto.


 


1.9                                 “Disability”
means (a) long-term disability as defined under the long-term disability plan
of Kanbay, the Company or other Affiliate that covers that Executive, (b) if
the Executive is not covered by such a long-term disability plan, disability as
defined for purposes of eligibility for a disability award under the U.S.
Social Security Act, or (c) if the Executive is not covered by a long-term
disability plan or the U.S. Social Security Act, the Committee shall determine
whether the Executive has incurred a Disability, in its sole discretion.


 


1.10                           “Executive” means an executive or
management employee of the Company or other Affiliate selected by the Committee
to participate in this Plan.


 


1.11                           “Kanbay”
means Kanbay International, Inc., a Delaware corporation, and any successor
thereto.


 


1.12                           “Performance
Bonus” means the additional cash remuneration payable to an Executive pursuant
to the Plan.


 


1.13                           “Performance
Period” means the applicable fiscal year of Kanbay, as set forth in the
applicable Bonus Schedule. The Plan will have three Performance Periods during
the term of the Plan, with the first being the 2006 fiscal year of Kanbay, the
second being the 2007 fiscal year of Kanbay and the third being the 2008 fiscal
year of Kanbay.


 


1.14                           “Performance
Target” means any quantitative objective or measurement (including any
individual, organizational or company-wide goal) that is appropriate and
relevant to the Executive for the Performance Period, as determined by the
Committee annually and set forth in the Bonus Schedule. Performance Targets
referring to global objectives will include performance metrics for Kanbay, the
Company and all other Affiliates. Performance Targets referring to regional or
territory objectives will include performance metrics for Kanbay, the Company
or its other Affiliates that operate in that region or territory. Performance
Targets may include, but are not limited to, the following, all as specified in
the Executive’s Bonus Schedule:


 


(a)                                  net
earnings;


 


(b)                                 operating
earnings or income;


 


(c)                                  earnings
growth;


 


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(d)                                 net
income (absolute or competitive growth rates comparative);


 


(e)                                  net
income applicable to common stock;


 


(f)                                    gross
revenue or revenue by pre-defined business segment (absolute or competitive
growth rates comparative);


 


(g)                                 revenue
backlog;


 


(h)                                 margins
realized on delivered services;


 


(i)                                     cash
flow, including operating cash flow, free cash flow, discounted cash flow
return on investment, and cash flow in excess of cost of capital;


 


(j)                                     earnings
per share of common stock;


 


(k)                                  return
on stockholders equity (absolute or peer-group comparative);


 


(l)                                     stock
price (absolute or peer-group comparative);


 


(m)                               absolute
and/or relative return on common stockholders equity;


 


(n)                                 absolute
and/or relative return on capital;


 


(o)                                 absolute
and/or relative return on assets;


 


(p)                                 economic
value added (income in excess of cost of capital);


 


(q)                                 customer
satisfaction;


 


(r)                                    expense
reduction;


 


(s)                                  associate
retention; and


 


(t)                                    ratio
of operating expenses to operating revenues.


 


2.                                      ELIGIBILITY


 


Each Executive who
participates in this Plan will receive a Bonus Schedule that sets forth the
maximum Performance Bonus, expressed as a flat dollar amount, that he or she
will be eligible to earn each Performance Period under the Plan. The Bonus
Schedule also will set forth the Performance Targets that have been established
by the Committee for the Performance Period (which may, in the Committee’s
discretion, differ in subsequent Performance Periods) and that must be satisfied
in order for the Executive to receive his or her Performance Bonus for that
Performance Period. An Executive is not eligible to receive any Performance
Bonus for a Performance Period under the Plan unless it is specifically
mentioned in the Bonus Schedule. Each Executive must return to the Committee or
its delegate an executed copy of the Bonus Schedule to be eligible for
Performance Bonuses under this Plan.


 


3.                                      PERFORMANCE
BONUSES


 


3.1                                 Amount
of Performance Bonus. The actual amount of the Performance Bonus that an
Executive receives will be based upon the attainment of the Performance Targets
set forth in the Bonus Schedule. If a Performance Target is not fully and
completely achieved during the relevant Performance Period, then the applicable
Performance Bonus shall not be earned or paid.


 


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3.2                                 Requirements
for Payment of Performance Bonus. Subject to the requirements of Section
3.1, an Executive will be entitled to receive payment of the Performance Bonus
(if any) for a Performance Period only if the Executive is employed by Kanbay, the Company or other Affiliate
on the date that the Performance Bonus (or such portion thereof) is paid for
that Performance Period, as set forth in Section 3.3 below. If an Executive’s
employment is terminated by the Company or other Affiliate for Cause, or if an
Executive voluntarily terminates his or her employment, prior to the date that
any Performance Bonus (or such portion thereof) for any Performance Period is
paid, he or she will not be entitled to, and will forfeit all rights to
receive, payment of such Performance Bonus.


 


Notwithstanding
the foregoing, and provided that all other terms and conditions of the Plan
have been satisfied, if the Executive’s employment is terminated after
completion of a Performance Period due to death, Disability or involuntary
termination by the Company or other Affiliate without Cause, the Executive will
be paid, to the extent not already paid, any Performance Bonus he or she would
have been paid had he or she been employed on the date that the Performance
Bonus (or such portion thereof) is paid for that completed Performance Period
as set forth in Section 3.3 below. Payment of the Executive’s Performance Bonus
under this Section 3.2 will be made within thirty days after the date of such
termination of Executive’s employment.


 


3.3                                 Time
and Medium of Payment. Subject to the requirements of Sections 3.1 and 3.2,
an Executive’s Performance Bonus will be paid as follows:


 


(a)                                  If
the Executive is designated by the Committee as a “Tier 1” associate on his or
her Bonus Schedule, Performance Bonuses (if any) for each Performance Period
during the term of the Plan will be paid in a lump sum no earlier than the
third anniversary of the Closing Date, but not later than thirty days
thereafter.


 


(b)                                 If
the Executive is designated by the Committee as a “Tier 2” associate on his or
her Bonus Schedule, 50% of the Performance Bonus (if any) for the first
Performance Period during the term of the Plan will be paid in a lump sum no
earlier than the first anniversary of the Closing Date, but not later than
thirty days thereafter, and 50% of the Performance Bonus (if any) for the
second Performance Period during the term of the Plan will be paid in a lump
sum no earlier than the second anniversary of the Closing Date, but not later
than thirty days thereafter. The remainder of any Performance Bonuses for the
first two Performance Periods and the Performance Bonus (if any) for the third
Performance Period will be paid in a lump sum no earlier than the third
anniversary of the Closing Date, but not later than thirty days thereafter.


 


(c)                                  If
the Executive is designated by the Committee as a “Tier 3” associate on his or
her Bonus Schedule, the Performance Bonus (if any) for any Performance Period
during the term of the Plan will be paid in a lump sum no earlier than the next
anniversary of the Closing Date immediately following the applicable
Performance Period, but not later than thirty days thereafter.


 


3.4                                 Committee
Certification. The Committee shall certify in writing, prior to payment of
any Performance Bonus hereunder to an Executive, that the Performance Targets
and any other material terms of the Plan were satisfied.


 


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3.5                                 Change
in Control. If a Change in Control occurs and thereafter the Executive’s
employment is involuntarily terminated without Cause by Kanbay, the Company or
other Affiliate, the Executive will be paid, to the extent not already paid,
any Performance Bonus he or she would have been paid for all Performance
Periods ending on or prior to the date his or her employment is terminated, as
if the Executive had been employed on the date that such Performance Bonus was
to be paid. Payment of the Executive’s Performance Bonus under this Section 3.5
will be made within thirty days after the date of such termination of the
Executive’s employment.


 


4.                                      GENERAL
TERMS AND CONDITIONS


 


4.1                                 Administration
by the Committee. The Committee will administer the Plan in accordance with
its terms, and will have all powers necessary to carry out the Plan’s
provisions. The Committee has full discretion to, and will, interpret the Plan
and determine all questions arising in its administration, interpretation and
application, including but not limited to questions of eligibility and the
status and rights of Executives and other persons. Any determination by the
Committee will be conclusive and binding on all persons. The Committee may
delegate to Kanbay’s Chief Executive Officer some or all of its authority under
the Plan, including the responsibility for setting Performance Targets (other
than with respect to himself), certifying whether such Performance Targets have
been met under the Plan, selecting eligible executives, and administering the
Plan.


 


4.2                                 No
Assurance of Employment or Payment. Participation in the Plan does not
guarantee or imply continued employment. Except as required by applicable law,
nothing in this Plan or any Executive’s Bonus Schedule is intended to create an
employment agreement with an Executive. By participating in this Plan, the
Executive agrees that his or her employment is “at-will”, and the Executive,
Kanbay or the Company (or any other Affiliate that employs the Executive) may
terminate the employment relationship at any time for any reason or no reason. Furthermore,
participation in the Plan does not guarantee payment of any Performance Bonus
amount.


 


4.3                                 Non-Payment
or Recovery. Kanbay, the Company or other Affiliate may refuse to pay a
Performance Bonus or may recover a Performance Bonus previously paid if an
error in the calculation of a Performance Bonus has resulted in an overpayment
to an Executive. If an erroneous Performance Bonus payment is to be recovered,
the Executive agrees to remit payment to Kanbay,
the Company or other Affiliate the full amount of the monies being recovered
within thirty (30) calendar days after the date of notice from Kanbay. Recovery may be made by Kanbay, the Company or other Affiliate
at any time during and after the Executive’s employment until the outstanding
balance is satisfied in full. This Section 4.3 shall continue to be in effect
after the expiration of this Plan and/or the expiration or termination of the
Executive’s employment with Kanbay,
the Company or any other Affiliate.


 


4.4                                 Amendment;
Term of Plan. The Company reserves the right to amend the Plan or any Bonus
Schedule at any time. Any amendment to the Plan will be made pursuant to a
resolution of the Board, and any amendment to a Bonus Schedule will be by
action of the Committee. The Plan will expire on December 31, 2008; provided,
however, that payment of


 


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any Performance Bonuses otherwise payable pursuant to Section 3 and not
paid by such date will occur in accordance with the terms of the Plan.


 


4.5                                 Complete
Agreement. The
terms and conditions this Plan, together with the applicable Executive’s Bonus
Schedule, constitute the complete and exclusive statement of the understanding
between Kanbay, the Company or any other
Affiliate, and each Executive, which supersedes and excludes all prior or
contemporaneous proposals, understandings, agreements or representations, oral
or written, between, Kanbay, the Company or any other
Affiliate, and each Executive, with respect to the subject matter hereof. If
there is any conflict between the terms of the applicable Bonus Schedule and
this Plan document, the terms of this Plan document will control. During the
term of this Plan, Executives will not be eligible to participate in any other
bonus or similar plan of Kanbay or other Affiliate.


 


4.6                                 Applicable
Law. Except to the extent preempted by federal law, the Plan will be
construed and administered under the laws of the State of Illinois, without
giving effect to its conflict of laws principles.


 


4.7                                 Withholding.
Kanbay, the Company or other Affiliate may withhold from any payment that it is
required to make under the Plan amounts sufficient to satisfy applicable
withholding requirements under any federal, state or local law.


 


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