Exhibit 10.3


 


KANBAY
INTERNATIONAL, INC.


 


SEVERANCE
AGREEMENT


 


THIS SEVERANCE AGREEMENT
(this “Agreement”) is made and entered into by and among Kanbay International, Inc.,
a Delaware corporation (the “Company”), Kanbay Incorporated, an Illinois
corporation (“Kanbay”) and Kenneth Coppins (“Executive”) as of November 10,
2005 (the “Effective Date”).


 


WHEREAS, it is in the
best interests of Kanbay, the Company, and the Company’s stockholders to assure
Executive’s continued dedication to Kanbay and the Company; and


 


WHEREAS, any
consideration by Kanbay and the Company of strategic transactions such as
mergers and acquisitions would inevitably create personal uncertainties for
Executive, and therefore distract Executive from the business of Kanbay and the
Company; and


 


WHEREAS, it is in the
best interests of Kanbay, the Company and the Company’s stockholders to retain
Executive’s dedication and reduce distractions by providing Executive with
compensation arrangements in the event of certain terminations of Executive’s
employment, including terminations in connection with a strategic transaction,
as more fully provided herein.


 


NOW, THEREFORE, in
consideration of and reliance upon the foregoing background statement and the
covenants contained in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
Kanbay, the Company and Executive agree as follows:


 


1.                                      DEFINITIONS


 


1.1           “Affiliate” shall mean any
corporation or other business entity that is a parent or subsidiary of the
Company, including ownership of 50% or more of the voting or profits interests
of the corporation or other business entity.


 


1.2           “Base Salary” shall mean the annual
Base Salary payable to Executive so long as the Company or an Affiliate employs
Executive.


 


1.3           “Board” shall mean the Board of
Directors of the Company.


 


1.4           “Cause” shall mean any of the
following: (i) Executive’s 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 by Executive, which is intended to
cause, causes or is reasonably likely to cause material harm to the Company or
an Affiliate, monetarily, reputationally or otherwise; (ii) Executive’s
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 the Company or an
Affiliate, monetarily, reputationally or otherwise; (iii) Executive’s
willful neglect of or continued failure to substantially perform, in any
material respect, his duties (as assigned to Executive from time to time) or
obligations (including a violation of policy) to the Company or an Affiliate
other than any such failure resulting from his incapacity due to physical or
mental illness; or (iv) Executive’s abuse of illegal drugs or other
controlled substances or habitual intoxication. 
For purposes of this Section, an act or omission is “willful” if it was
knowingly done, or knowingly 


 


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omitted to be done, by Executive not in good faith and without
reasonable belief that the act or omission was in the best interest of the
Company.  Any act, or failure to act,
based upon authority given pursuant to a resolution duly adopted by the Board
or based upon the advice of counsel for the Company shall be conclusively
presumed to be done, or omitted to be done, in good faith and in the best
interests of the Company.  The Company
has the discretion, in other circumstances, to determine in good faith, from
all the facts and circumstances reasonably available to it, whether Executive
who is under investigation for, or has been charged with, a crime will be
deemed to have committed it for purposes of this Agreement.


 


1.5           “Change
in Control” shall mean 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) the
Company, (ii) any wholly-owned subsidiary of the Company, or (iii) any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any Affiliate, becomes a “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
having fifty percent (50%) or more of the combined voting power of the
then-outstanding securities of the Company that may be cast for the election of
directors of the Company (other than as a result of an issuance of securities
initiated by the Company in the ordinary course of business) (the “Company
Voting Securities”); provided,
however, that the event described in this Section 1.5(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 the Company, of each new
director of the Company 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 the Company or any successor corporation or entity entitled to vote
generally in the election of the directors of the Company or such other
corporation or entity after such transaction is held in the aggregate by the
holders of the securities of the Company entitled to vote generally in the
election of directors of the Company immediately prior to such transaction; or


 


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


 


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 the Company that reduces the number of Company Voting Securities
outstanding; provided, however, that if after 


 


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such acquisition by the Company 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
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 the Company or an Affiliate.


 


1.6           “Good Reason” shall mean any one of
the following events, without Executive’s written consent: (i) the
assignment to Executive of duties materially inconsistent with Executive’s
then-current level of authority or responsibilities, or any other action by the
Company or an Affiliate that results in a material diminution in Executive’s
position, compensation, authority, duties or responsibilities; (ii) a
breach by the Company or an Affiliate of any material term or covenant of any
agreement with Executive; (iii) a requirement that Executive be based at
any office or location that
is more than thirty-five (35) miles from the Executive’s principal office
location immediately preceding a Change in Control; or (iv) a
failure by any successor (whether direct or indirect by purchase, merger,
consolidation or otherwise) to all or substantially all of the business or
assets of the Company or the Affiliate employing Executive to assume expressly
and agree to perform this Agreement in the same manner and to the same extent
that the Company or an Affiliate would be required to perform it if no such
succession had taken place.  Executive must provide the Company written
notice of any claim of Good Reason within sixty (60) days after the occurrence
of any action/inaction giving rise to such claim, and the Company or its
Affiliate will have thirty (30) days to cure such claim.


 


2.                                      TERMINATIONS
OF EMPLOYMENT TRIGGERING SEVERANCE BENEFITS


 


2.1           Subject to Section 2.2, and
provided that Executive has executed a full and complete release of the Company
and its Affiliates (and their related parties) from any and all claims, in a
form prepared by the Company, the Company or an Affiliate will provide
Executive with the benefits set forth in Section 3 if Executive’s
employment is terminated for the following reasons (“Qualifying Terminations”):
(i) by the Company or an Affiliate without Cause at any time; or (ii) by
Executive for Good Reason within twelve (12) months after the effective date of
a Change in Control.


 


2.2           In no event will benefits be payable
to Executive under this Agreement in the event of termination due to Executive’s
death, disability, retirement, termination by the Company or an Affiliate for
Cause, or voluntary termination by Executive without Good Reason.


 


2.3           Notwithstanding the foregoing, the
following payments will be made upon Executive’s termination of employment for
any reason or no reason:  (i) earned
but unpaid Base Salary through the date of termination; (ii) any accrued
but unpaid vacation; (iii) any amounts payable under any employee pension
or welfare benefit plans of the Company or an Affiliate in accordance with the
terms of those plans; and (iv) unreimbursed business expenses incurred by
Executive on behalf of the Company or an Affiliate (in accordance with existing
expense reimbursement policies of the Company or an Affiliate).


 


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3.                                      TERMINATION
BENEFITS


 


3.1           Subject to the conditions set forth
in Section 2, and so long as Executive has not violated and does not
violate any of the terms of this Agreement, the following benefits shall be
paid or provided to Executive in the event Executive’s employment is terminated
in a Qualifying Termination:


 


(a)           Salary
Continuation.  The Company or an
Affiliate will pay Executive severance pay consisting of bi-weekly pay checks
in an amount based on Executive’s Base Salary on the date of termination (less
applicable deductions for federal and state taxes and FICA) for a period of six
(6) months following the date of termination.  The severance pay will be paid on regularly
scheduled pay dates.  Notwithstanding the
foregoing, no payments under this Section 3.1(a) shall commence prior
to the effective date of the release of claims being provided to the Company
and its Affiliates by Executive under Section 2.1 (including the
expiration of any revocation period required by law in connection with such
release).


 


(b)           Incentive
Plan Vesting.  All stock option
awards (“Stock Option Awards”) under the Kanbay International, Inc. Stock
Incentive Plan, or any similar or successor plan, held by Executive shall
immediately become exercisable in full, all restrictions applicable to such
Stock Option Awards shall lapse, and all performance measures with respect to
such awards shall be deemed satisfied in full.  Executive will have a period of
time following the date of termination, as stated in Kanbay
International, Inc. Stock Incentive Plan or the applicable Stock Option
Award Agreement issued thereunder, during
which Executive may exercise his Stock Option Awards, if any.  In the case of restricted stock awards (“Restricted
Stock Awards”) under the Kanbay International, Inc. Stock Incentive
Plan, or any similar or successor plan, the Executive’s next scheduled
installment of restricted stock (following the date of termination) shall
immediately vest, but all other subsequently scheduled unvested installments of
restricted stock under such Restricted Stock Award shall immediately be
forfeited and become void.  Except as specifically stated in this Section 3.1(b),
this Agreement
shall not be construed to amend, modify or supersede any of the provisions of the
Kanbay International, Inc. Stock Incentive Plan, or any similar or
successor plan, or any applicable Award Agreement issued thereunder.


 


3.2           Taxation and Withholding.  Neither the Company nor any Affiliate makes
any representations or warranties with respect to, and has no responsibility or
liability for, the personal tax consequences of this Agreement to Executive.  The Company and its Affiliates may make such
provisions and take such steps as they may deem necessary or appropriate for
the withholding of any taxes that the Company or any Affiliate is required by
any law or regulation of any governmental authority, whether federal, state or
local, domestic or foreign, to withhold in connection with this Agreement.


 


3.3           Executive’s Death.  If Executive dies before the completion of
any payments or benefits required under this Section 3, the Company or an
Affiliate will make or continue payments and benefits to Executive’s surviving
spouse, if any, or Executive’s estate in accordance with this Section.


 


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4.                                      RESTRICTIVE
COVENANTS


 


4.1           Trade Secrets.  Executive acknowledges that he has had and/or
will have access to confidential information of the Company and its Affiliates
(including, but not limited to, current and prospective confidential know-how,
specialized training, customer lists, marketing plans, business plans,
financial and pricing information, and information regarding acquisitions,
mergers and/or joint ventures) concerning the business, customers, clients,
contacts, prospects, and assets of the Company and its Affiliates that is
unique, valuable and not generally known outside the Company and its
Affiliates, and that was obtained from the Company or an Affiliate or which was
learned as a result of the performance of services by Executive on behalf of
the Company or an Affiliate (“Trade Secrets”). 
Trade Secrets shall not include any information that: (i) is now,
or hereafter becomes, through no act or failure to act on the part of Executive
that constitutes a breach of this Section 4, generally known or available
to the public; (ii) is known to Executive at the time such information was
obtained from the Company or an Affiliate; (iii) is hereafter furnished
without restriction on disclosure to Executive by a third party, other than an
employee or agent of the Company or an Affiliate, who is not under any
obligation of confidentiality to the Company or an Affiliate; (iv) is
disclosed with the written approval of the Company or an Affiliate; or (v) is
required to be disclosed or provided by law, court order, or similar
compulsion, including pursuant to or in connection with any legal proceeding
involving the parties hereto; provided however, that such disclosure shall be
limited to the extent so required or compelled; and provided further, however,
that if Executive is required to disclose such confidential information, he
shall give the Company notice of such disclosure and cooperate in seeking
suitable protections.  Other than in the
course of performing services for the Company and its Affiliates, Executive
will not, at any time, directly or indirectly use, divulge, furnish or make
accessible to any person any Trade Secrets, but instead will keep all Trade
Secrets strictly and absolutely confidential. 
Executive will deliver promptly to the Company or the Affiliate that
employed Executive, at the termination of his employment or at any other time
at the request of the Company or an Affiliate, without retaining any copies,
all documents and other materials in his possession relating, directly or
indirectly, to any Trade Secrets.


 


4.2           Non-competition.  Beginning on the Effective Date and for a
period continuing through the later of (i) six (6) months following
termination of Executive’s employment with the Company and all Affiliates and (ii) the
period the Company or an Affiliate is making severance payments to Executive
under Section 3.1(a) (the “Restricted Period”), Executive shall not
directly or indirectly own any interest in, operate, control or participate as
a partner, director, principal, officer, or agent of, enter into the employment
of, act as a consultant to, or perform any services for, any company, person,
or entity engaged in a “Competitive Business” (as defined herein).  A Competitive Business shall include any
company, person or entity that is involved in or seeks to become involved in
providing information technology services and solutions to the financial
services industry, including business process and technology advice, software
package selection and integration, application development, maintenance and
support, network and system security and specialized services, in any country
in which the Company or an Affiliate is doing business at the time of
termination of Executive’s employment.


 


4.3.          Employee Agreements.  As a condition of this Agreement and as a
condition of Executive’s employment with the Company or an Affiliate, Executive
is required to sign a separate Employee Non-Disclosure, Development and Non-Solicitation Agreement
and/or other similar agreement(s) (collectively, “Employee Agreements”).  Executive hereby reaffirms his commitment to
abide by all obligations set forth in all such Employee Agreements.  Executive further agrees that


 


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any breach by Executive of any Employee Agreement shall be considered a
breach by Executive of this Agreement. 
This Agreement shall not be construed to amend, modify or terminate any
of Executive’s obligations under any Employee Agreement to the extent this
Agreement and the Employee Agreement are not inconsistent.  However, in the event of any direct conflict
between the terms of any Employee Agreement and the terms of this Agreement,
the terms of this Agreement shall govern and supersede any Employee Agreement.


 


4.4           Irreparable Harm.  Executive acknowledges that: (i) Executive’s
compliance with this Agreement is necessary to preserve and protect the
proprietary rights, Trade Secrets, and the goodwill of the Company or an
Affiliate as going concerns, and (ii) any failure by Executive to comply
with the provisions of this Agreement will result in irreparable and continuing
injury for which there will be no adequate remedy at law.  In the event that Executive fails to comply
with the terms and conditions of this Agreement, the obligations of the Company
and its Affiliates to pay the severance benefits set forth in Section 3
shall cease, and the Company or an Affiliate will be entitled, in addition to
other relief that may be proper, to all types of equitable relief (including,
but not limited to, the issuance of an injunction and/or temporary restraining
order) that may be necessary to cause Executive to comply with this Agreement,
to restore to the Company and its Affiliates their property, and to make the
Company and its Affiliates whole.


 


4.5           Survival.  The provisions set forth in this Section 4
shall survive termination of this Agreement.


 


4.6           Scope Limitations.  If the scope, period of time or area of
restriction specified in this Section 4 are or would be judged to be
unreasonable in any court proceeding, then the period of time, scope or area of
restriction will be reduced or limited in the manner and to the extent
necessary to make the restriction reasonable, so that the restriction may be
enforced in those areas, during the period of time and in the scope that are or
would be judged to be reasonable.


 


5.             MISCELLANEOUS


 


5.1           Employment Status.  Nothing herein shall be deemed to create any
term of employment, it being expressly understood and agreed between the
parties that Executive’s employment is at will and that either party may
terminate such employment at any time.


 


5.2           Governing Law.  All provisions of this Agreement will be
construed and governed by Illinois law without regard to its choice of law
principles or the laws of any other jurisdiction.  Any suit, claim or other legal proceeding
arising out of or relating to Executive’s employment, his termination from
employment, or this Agreement shall be brought exclusively in the federal or
state courts located in Cook County, Illinois, and Executive and the Company
and its Affiliates hereby submit to personal jurisdiction in the State of
Illinois and to venue in such courts. 
Notwithstanding the foregoing, the Company or an Affiliate may seek and
obtain injunctive relief against Executive in any court having jurisdiction
over Executive.


 


5.3           Severability.  Every provision of this Agreement is intended
to be severable. If any provision or portion of a provision is illegal or
invalid, then the remainder of this Agreement shall not be affected. Moreover,
any provision of this Agreement which is determined to be unreasonable,
arbitrary or against public policy shall be modified as necessary so that it is
not unreasonable, arbitrary or against public policy while maximizing the
intent of the parties.


 


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5.4           Entire Agreement.  Except as provided in any non-disclosure,
non-solicitation, intellectual property or similar agreement signed by
Executive, with respect to its subject matter, this Agreement constitutes the
entire understanding of the parties superseding all prior agreements,
understandings, negotiations and discussions between them, whether written or
oral, and there are no other understandings, representations, warranties or
commitments with respect thereto. 
Notwithstanding any terms contained herein to the contrary, the Company
or its Affiliates, in addition to any rights set forth herein, shall have the
right to seek enforcement of any other penalties or restrictions that may apply
under any other non-disclosure, non-solicitation, intellectual property or
similar agreement between Executive and the Company or its Affiliates.


 


5.5           Successors and Assigns.  This Agreement may not be assigned by
Executive.  This Agreement shall be
binding upon and inure to the benefit of all successors and assigns (whether by
operation of law or otherwise) of the Company and its Affiliates.


 


5.6           Amendment. This Agreement may
only be amended or terminated by mutual written agreement between the Company
and Executive.


 


5.7.          No
Waiver.  No failure or delay by the
Company or an Affiliate or Executive in enforcing or exercising any right or
remedy hereunder shall operate as a waiver thereof.  No modification, amendment or waiver of this
Agreement nor consent to any departure by Executive from any of the terms or
conditions thereof, shall be effective unless in writing and signed by the
Chairman of the Board.  Any such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.


 


5.8.          Counterparts.  The parties may execute this Agreement in one
or more counterparts, all of which together shall constitute but one Agreement.


 


IN WITNESS WHEREOF, each
party has executed this Severance Agreement or caused this Severance Agreement
to be duly executed as of the Effective Date.


 


	
  KANBAY
  INTERNATIONAL, INC.

  	
  KENNETH
  COPPINS

  
	
   

  	
   

  
	
  By:

  	
  /s/ William F.
  Weissman

  	
   

  	
  /s/ Kenneth
  Coppins

  	
   

  
	
  Its:

  	
  Executive Vice
  President, Chief Financial

  Officer and Secretary

  	
   

  	
   

  



 


	
  KANBAY
  INCORPORATED

  
	
   

  
	
  By:

  	
  /s/ William F.
  Weissman

  	
   

  	
   

  	
   

  
	
  Its:

  	
  Executive Vice
  President, Chief Financial

  Officer and Secretary

  	
   

  	
   

  



 


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