Form of Executive Severance Agreement



 Exhibit 10.5 
 EXECUTIVE SEVERANCE AGREEMENT 
 THIS EXECUTIVE
SEVERANCE AGREEMENT (“Agreement”) by and between ModusLink Corporation, a Delaware corporation (the “Company”),
                     (the “Executive”), and, for the purposes of Section 3(b)(ii) only, CMGI, Inc., a Delaware corporation
(“CMGI”), is made this 26th day of July, 2007. 
 WHEREAS, the Executive and the Company have entered into a letter agreement dated
                    , setting forth certain terms and conditions of the Executive’s employment with the Company (“Letter
Agreement”); and 
 WHEREAS, in connection with the Executive’s employment, the parties desire to enter into this Executive
Severance Agreement; 
 NOW, THEREFORE, as an inducement for and in consideration of the Executive remaining in its employ, the Company
agrees that the Executive shall be eligible to receive the severance payments and benefits set forth in this Agreement in the event the Executive’s employment with the Company is terminated under the circumstances described and subject to the
conditions below and shall be entitled to certain other rights and benefits provided herein; and for good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree as follows: 
 1. Term of Agreement. The term of this Agreement shall be from the date hereof through the last day of Executive’s employment with the Company
(the “Termination Date”). 
 2. Not an Employment Contract. The Executive acknowledges that this Agreement does not
constitute a contract of employment or impose on the Company any obligation to retain the Executive as an employee and that this Agreement does not prevent the Executive from terminating his employment. Executive understands and acknowledges that he
is an employee at will and that either he or the Company may terminate the employment relationship between them at any time and for any reason. 
 3. Severance Payment. 
 (a) In the event the employment of the Executive is terminated by the Company for a reason other than
for Cause (as defined below), the Company shall continue to pay to the Executive (as severance pay), his regular bi-weekly base salary as in effect on the Executive’s last day of employment (exclusive of bonus or any other compensation), for
twelve (12) months following the Termination Date (the “Severance Pay”). In the event that the Executive is entitled to severance benefits under Section 3(b) below, this Section 3(a) shall not apply and shall have no further
force or effect. 







 (b) In the event the employment of the Executive is terminated by the Company for a reason other than for
Cause (as defined below) or by the Executive for Good Reason (as defined below), within twelve (12) months following a Change of Control (as defined below) of CMGI, (i) the Company shall continue to pay to the Executive (as severance pay),
his regular bi-weekly base salary as in effect on the Executive’s last day of employment (exclusive of bonus or any other compensation), plus monthly prorated installments of his target bonus for 12 months following the Termination Date, and
(ii) all of the Executive’s stock options and/or restricted stock which is then outstanding shall be immediately vested, such vested awards that were granted as restricted stock shall be free of restrictions and such vested awards that
were granted as options shall remain exercisable for a period of 6 months following the Executive’s last day of employment (but not to exceed the original term of such awards). 
 (c) The Executive agrees that after the Termination Date, but prior to payment of the severance pay called for by Section 3(a) or Section 3(b),
as the case may be, he shall execute a waiver and release (including confidentiality and non-disparagement provisions), based on the Company’s standard form, of any and all claims he may have against the Company and its officers, employees,
directors, parents, subsidiaries and affiliates. Executive understands and agrees that the payment of the severance benefits called for by this Agreement are contingent upon (i) his execution and delivery to the Company within seven
(7) days after the Termination Date of the previously described release of claims (or such longer period as may be prescribed by the Company) and (ii) the expiration of any applicable revocation period. The payment to the Executive of the
amounts payable under this Agreement shall constitute the sole remedy of the Executive in the event of a termination of the Executive’s employment. 
 (d) Payments to the Executive under Sections 3(a) and 3(b) shall be bifurcated into two portions, consisting of the portion, if any, that includes the maximum amount of the payments that does not constitute
“nonqualified deferred compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the portion, if any, that includes the excess of the total payments that does
constitute nonqualified deferred compensation. Payments hereunder shall first be made from the portion that does not consist of nonqualified deferred compensation until such portion is exhausted and then shall be made from the portion that does
constitute nonqualified deferred compensation. Notwithstanding the foregoing, if the Executive is a “specified employee” as defined in Section 409A(a)(3)(B)(i) of the Code, the commencement of the delivery of the portion that
constitutes nonqualified deferred compensation will be delayed to the date that is 6 months and one day after the Executive’s termination of employment (the “Earliest Payment Date”). Any payments that are delayed pursuant to the
preceding sentence shall be paid pro rata during the period beginning on the Earliest Payment Date and ending on the date that is 12 months following termination of the Executive’s employment. The determination of whether, and the extent to
which, any of the payments to be made to the Executive hereunder are nonqualified deferred compensation shall be made after the application of all applicable exclusions under Treasury Reg. § 1.409A-1(b)(9). Any payments that are intended to
qualify for the exclusion for separation pay due to involuntary separation from service set 








 
forth in Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of the second taxable year of the Executive following
the taxable year of the Executive in which the Executive’s termination of employment occurs. 
 (e) (i) Notwithstanding any other
provision of this Agreement, except as set forth in Section 3(e)(ii), in the event that the Company undergoes a “Change in Ownership or Control” (as defined below), the Company shall not be obligated to provide to the Executive a
portion of any “Contingent Compensation Payments” (as defined below) that the Executive would otherwise be entitled to receive to the extent necessary to eliminate any “excess parachute payments” (as defined in
Section 280G(b)(1) of the Code) for the Executive. For purposes of this Section 3(e), the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Payments” and the aggregate amount (determined in
accordance with Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision) of the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Amount.” 
 (ii) Notwithstanding the provisions of Section 3(e)(i), no such reduction in Contingent Compensation Payments shall be made if (i) the
Eliminated Amount (computed without regard to this sentence) exceeds (ii) the aggregate present value (determined in accordance with Treasury Regulation Section 1.280G-1, Q/A-31 and Q/A-32 or any successor provisions) of the amount of any
additional taxes that would be incurred by the Executive if the Eliminated Payments (determined without regard to this sentence) were paid to him (including, state and federal income taxes on the Eliminated Payments, the excise tax imposed by
Section 4999 of the Code payable with respect to all of the Contingent Compensation Payments in excess of the Executive’s “base amount” (as defined in Section 280G(b)(3) of the Code), and any withholding taxes). The override
of such reduction in Contingent Compensation Payments pursuant to this Section 3(e)(ii) shall be referred to as a “Section 3(e)(ii) Override.” For purposes of this paragraph, if any federal or state income taxes would be
attributable to the receipt of any Eliminated Payment, the amount of such taxes shall be computed by multiplying the amount of the Eliminated Payment by the maximum combined federal and state income tax rate provided by law. 
 (iii) For purposes of this Section 3(e), the following terms shall have the following respective meanings: 
 (A) “Change in Ownership or Control” shall mean a change in the ownership or effective control of CMGI or in the ownership of a substantial
portion of the assets of CMGI determined in accordance with Section 280G(b)(2) of the Code. 
 (B) “Contingent Compensation
Payment” shall mean any payment (or benefit) in the nature of compensation that is made or made available (under this Agreement or otherwise) to a “disqualified individual” (as defined in Section 280G(c) of the Code) and that is
contingent (within the meaning of Section 280G(b)(2)(A)(i) of the Code) on a Change in Ownership or Control of CMGI. 
 (iv) Any
payments or other benefits otherwise due to the Executive following a Change in Ownership or Control that could reasonably be characterized (as determined by the Company) as Contingent Compensation Payments (the “Potential 








 
Payments”) shall not be made until the dates provided for in this Section 3(e)(iv). Within 30 days after each date on which the Executive first
becomes entitled to receive (whether or not then due) a Contingent Compensation Payment relating to such Change in Ownership or Control, the Company shall determine and notify the Executive (with reasonable detail regarding the basis for its
determinations) (i) which Potential Payments constitute Contingent Compensation Payments, (ii) the Eliminated Amount and (iii) whether the Section 3(e)(ii) Override is applicable. Within 30 days after delivery of such notice to
the Executive, the Executive shall deliver a response to the Company (the “Executive Response”) stating either (A) that he agrees with the Company’s determination pursuant to the preceding sentence, in which case he shall
indicate, if applicable, which Contingent Compensation Payments, or portions thereof (the aggregate amount of which, determined in accordance with Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision, shall be equal to the
Eliminated Amount), shall be treated as Eliminated Payments or (B) that he disagrees with such determination, in which case he shall set forth (i) which Potential Payments should be characterized as Contingent Compensation Payments,
(ii) the Eliminated Amount, (iii) whether the Section 3(e)(ii) Override is applicable, and (iv) which (if any) Contingent Compensation Payments, or portions thereof (the aggregate amount of which, determined in accordance with
Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision, shall be equal to the Eliminated Amount, if any), shall be treated as Eliminated Payments. In the event that the Executive fails to deliver an Executive Response on or
before the required date, the Company’s initial determination shall be final and the Contingent Compensation Payments that shall be treated as Eliminated Payments shall be determined by the Company in its absolute discretion. If the Executive
states in the Executive Response that he agrees with the Company’s determination, the Company shall make the Potential Payments to the Executive within three business days following delivery to the Company of the Executive Response (except for
any Potential Payments which are not due to be made until after such date, which Potential Payments shall be made on the date on which they are due). If the Executive states in the Executive Response that he disagrees with the Company’s
determination, then, for a period of 60 days following delivery of the Executive Response, the Executive and the Company shall use good faith efforts to resolve such dispute. If such dispute is not resolved within such 60-day period, such dispute
shall be settled exclusively by arbitration in Boston, Massachusetts, in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator’s award in any court having jurisdiction. The
Company shall, within three business days following delivery to the Company of the Executive Response, make to the Executive those Potential Payments as to which there is no dispute between the Company and the Executive regarding whether they should
be made (except for any such Potential Payments which are not due to be made until after such date, which Potential Payments shall be made on the date on which they are due). The balance of the Potential Payments shall be made within three business
days following the resolution of such dispute. 
 (v) The provisions of this Section 3(e) are intended to apply to any and all payments
or benefits available to the Executive under this Agreement or any other agreement or plan of the Company or CMGI under which the Executive receives Contingent Compensation Payments. 







 4. Definitions. For purposes of this Agreement, the following terms shall have the following
meanings: 
 (a) “Cause” shall mean a good faith finding by a majority of the members of the Board of Directors of the Company,
after giving the Executive an opportunity to be heard, of: (i) gross negligent or willful misconduct by the Executive in connection with his employment duties, (ii) failure by the Executive (other than due to disability) to perform his
duties or responsibilities required pursuant to his employment, after written notice and an opportunity to cure, (iii) misappropriation by the Executive of the assets or business opportunities of the Company, or its affiliates,
(iv) embezzlement or other financial or other fraud committed by the Executive, (v) the Executive knowingly allowing any third party to commit any of the acts described in any of the preceding clauses (iii) or (iv), or (vi) the
Executive’s indictment for, conviction of, or entry of a plea of no contest with respect to, any felony or any crime involving moral turpitude. 
 (b) “Good Reason” shall mean: (i) the unilateral relocation by the Company of the Executive’s principal work place for the Company to a site more than 60 miles from the Executive’s principal
office, (ii) a material reduction in the Executive’s then-current salary without the Executive’s consent or (iii) material diminution of the Executive’s duties, authority or responsibilities, without the Executive’s
consent. In order to establish “Good Reason” for a termination, the Executive must provide notice to the Company of the existence of the condition giving rise to the “Good Reason” within 90 days following the initial existence of
the condition, and the Company has 30 days following receipt of such notice to remedy such condition. 
 (c) “Change of Control”
shall mean the first to occur of any of the following: 
 (A) the acquisition by an individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the “Exchange Act”)) (a “Person”) of beneficial ownership of any capital stock of CMGI if, after such acquisition, such Person beneficially owns (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) 50% or more of either (x) the then-outstanding shares of common stock of CMGI (the “Outstanding CMGI Common Stock”) or (y) the combined voting power of the
then-outstanding securities of CMGI entitled to vote generally in the election of directors (the “Outstanding CMGI Voting Securities”); provided, however, that for purposes of this subsection (A), any acquisition directly from CMGI shall
not constitute a Change in Control; or 
 (B) such time as the Continuing Directors (as defined below) do not constitute a majority of the
Board of Directors of CMGI (the “Board”) (or, if applicable, the Board of Directors of a successor corporation to CMGI), where the term “Continuing Director” means at any date a member of the Board (x) who was a member of
the Board on the date of this Agreement or (y) who was nominated or elected subsequent to such date by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or whose election to the Board
was recommended or endorsed by at least a majority of the directors who were Continuing Directors at the time of such nomination or election; provided, however, that there shall be excluded from this 








 
clause (y) any individual whose initial assumption of office occurred as a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of proxies or consents, by or on behalf of a person other than the Board; or 
 (C) the consummation of a merger, consolidation, reorganization, recapitalization or share exchange involving CMGI or a sale or other disposition of all or substantially all of the assets of CMGI (a “Business
Combination”), unless, immediately following such Business Combination, each of the following two conditions is satisfied: (x) all or substantially all of the individuals and entities who were the beneficial owners of the Outstanding CMGI
Common Stock and Outstanding CMGI Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the
then-outstanding securities entitled to vote generally in the election of directors, respectively, of the resulting or acquiring corporation in such Business Combination (which shall include, without limitation, a corporation which as a result of
such transaction owns CMGI or substantially all of CMGI’s assets either directly or through one or more subsidiaries) (such resulting or acquiring corporation is referred to herein as the “Acquiring Corporation”) in substantially the
same proportions as their ownership of the Outstanding CMGI Common Stock and Outstanding CMGI Voting Securities, respectively, immediately prior to such Business Combination and (y) no Person (excluding any employee benefit plan (or related
trust) maintained or sponsored by CMGI or by the Acquiring Corporation) beneficially owns, directly or indirectly, 40% or more of the then-outstanding shares of common stock of the Acquiring Corporation, or of the combined voting power of the
then-outstanding securities of such corporation entitled to vote generally in the election of directors (except to the extent that such ownership existed prior to the Business Combination); or 
 (D) the liquidation or dissolution of CMGI. 
 5. Termination of Employment. Upon termination of Executive’s employment with the Company for any reason, in addition to any severance payments which may be payable under this Agreement, Executive shall be entitled to receive
all salary and benefits through the Termination Date. 
 6. Miscellaneous. 
 (a) Notices. Any notices delivered under this Agreement shall be deemed duly delivered four business days after it is sent by registered or
certified mail, return receipt requested, postage prepaid, or one business day after it is sent for next-business day delivery via a reputable nationwide overnight courier service, in each case to the address of the recipient set forth in the
introductory paragraph hereto. Either party may change the address to which notices are to be delivered by giving notice of such change to the other party. All notices to the Company shall also be addressed to the Company’s General Counsel.








 (b) Pronouns. Whenever the context may require, any pronouns used in this Agreement shall include
the corresponding masculine, feminine or neuter forms, and the singular forms of nouns and pronouns shall include the plural, and vice versa. 
 (c) Entire Agreement. This Agreement shall constitute the entire agreement between the parties regarding the matters addressed herein and supersede all prior agreements and understandings, whether written or oral, relating to the
subject matter of such agreements. If there shall be any inconsistency (including, without limitation, identical capitalized terms with less than identical meanings) between the Agreement, and any other agreement (including the Letter Agreement),
plan, award, program or practice of the Company whether now existing or hereafter adopted or amended, then this Agreement shall control, unless the Executive and the Company hereafter have agreed otherwise in writing and such other agreement, plan,
program or practice specifically refers to the provision of the Agreements affected thereby. 
 (d) Section 409A. This Agreement
is intended to comply with the provisions of Section 409A and the Agreement shall, to the extent practicable, be construed in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A
if and to the extent required in order to comply with Section 409A. No payments to be made under this Agreement may be accelerated or deferred except as specifically permitted under Section 409A. In the event that the Agreement
shall be deemed not to comply with Section 409A, then neither the Company, the Board nor its or their designees or agents shall be liable to the Executive or other person for actions, decisions or determinations made in good faith. 

(e) Amendment. This Agreement may be amended or modified only by a written instrument executed by both the Company and the Executive, and, with
respect to Section 3(b)(ii) only, by CMGI. 
 (f) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts. Any action, suit or other legal arising under or relating to any provision of this Agreement shall be commenced only in a court of the Commonwealth of Massachusetts (or, if appropriate, a federal
court located within Massachusetts), and the Company and the Executive each consents to the jurisdiction of such a court. The Company and the Executive each hereby irrevocably waive any right to a trial by jury in any action, suit or other legal
proceeding arising under or relating to any provision of this Agreement. 
 (g) Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of both parties and their respective successors and assigns, including any corporation with which or into which the Company may be merged or which may succeed to its assets or business, provided, however, that
the obligations of the Executive are personal and shall not be assigned by him. 
 (h) Waivers. No delay or omission by the Company in
exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of
any right on any other occasion. 







 (i) Captions. The captions of the sections of this Agreement are for convenience of reference only
and in no way define, limit or affect the scope or substance of any section of this Agreement. 
 (j) Severability. In case any
provision of this Agreement shall be invalid, illegal or otherwise unenforceable, the validity, legality and enforceability of the remaining provisions shall in no way be affected or impaired thereby. 
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 THE EXECUTIVE ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT AND UNDERSTANDS AND AGREES TO ALL OF
THE PROVISIONS IN THIS AGREEMENT. 
 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year set forth
above. 
  

			
	ModusLink Corporation
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	Executive
		
		 	  

	Name:	 	
	
	For the purposes of Section 3(b)(ii) only:
	
	CMGI, Inc.
		
	By:	 	  

	Name:	 	
	Title: