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Exhibit 10.30
CIT Executive Severance Plan
As Amended and Restated Effective as of January
1, 2008
Section 1.
Establishment, Objectives, and Duration
1.1.
Establishment of the Plan . CIT established the Plan
effective January 1, 1999. On March 7, 2006, the Compensation
Committee of the Board adopted a definition of “change in
control” to be applied uniformly in all CIT benefit plans,
including the Plan. The Plan, as amended and restated herein, is
effective as of the Effective Date.
1.2.
Objective of the Plan . The objective of the Plan is to
enhance the long-term financial security of selected executives of
the Company through the provision of severance benefits, including
enhanced benefits following a Change in Control. The Plan is
further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of
Participants who make significant contributions to the
Company’s success.
1.3.
Duration of the Plan . The Plan shall remain in effect until
such time as the Committee amends or terminates the Plan pursuant
to Section 7 hereof.
Section 2.
Definitions . Whenever used in the Plan, the following terms
shall have the meanings set forth below, and when the meaning is
intended, the initial letter of the word shall be capitalized:
2.1.
“ 409A Affiliate ” means any corporation that is
included in a controlled group of corporations (within the meaning
of Section 414(b) of the Code) that includes CIT and any trade or
business (whether or not incorporated) that is under common control
with CIT (within the meaning of Section 414(c) of the Code);
provided , however , that in applying Section
1563(a)(1), (2), and (3) of the Code for purposes of determining a
controlled group of corporations under Section 414(b) of the Code,
the language “at least 50 percent” shall be used
instead of “at least 80 percent” each place it appears
in Section 1563(a)(1), (2) and (3) of the Code, and in applying
Section 1.414(c) -2 of the Treasury Regulations, for purposes of
determining trades or businesses (whether or not incorporated) that
are under common control for purposes of Section 414(c) of the
Code, “at least 50 percent” shall be used instead of
“at least 80 percent” each place it appears in Section
1.414(c) -2 of the Treasury Regulations.
2.2.
“ Affiliate ” means any Parent or Subsidiary and
any person that directly or indirectly through one or more
intermediaries, controls, is controlled by, or is under common
control with, CIT.
2.3.
“ Annual Base Salary ” means a
Participant’s annual base salary from the Company, including
any compensation reduction contributions made with respect to the
Participant under the CIT Group Inc. Deferred Compensation Plan,
the CIT Group Inc. Savings Incentive Plan and any Code Section 125
plan maintained by the Company, but
excluding all bonuses, incentive compensation,
expense reimbursements and severance pay.
2.4.
“ Annual Bonus ” means the payment paid to a
Participant pursuant to the CIT Group Inc. Corporate Bonus Plan or
an applicable sales incentive plan with respect to a calendar year
period.
2.5.
“ Average Annual Bonus ” means the average of
the two largest bonuses received by a Participant with respect to
the three Annual Bonuses immediately preceding the
Participant’s Separation from Service, which average shall be
determined by including a zero in the average calculation with
respect to any calendar year for which the Participant was eligible
for an Annual Bonus but was not paid an Annual Bonus;
provided , however , that such average amount shall
not exceed the Participant’s Base Compensation.
2.6.
“ Base Compensation ” means a
Participant’s Annual Base Salary at the rate in effect
immediately before the Participant’s Separation from Service
(or, if applicable under Section 2.28(b)(ii), immediately before
such rate was reduced).
2.7.
“ Beneficial Owner ” and “ Beneficially
Owns ” shall have the respective meanings ascribed
thereto or used in Section 13d-3 under the Exchange Act.
2.8.
“ Board ” means the Board of Directors of
CIT.
2.9.
“ Cause ” means a determination by the Committee
that a Participant has:
(a)
unreasonably neglected or refused to perform any executive duty
that has been assigned to such Participant;
(b)
been convicted of, or pleaded guilty or nolo contendere to, any
crime that constitutes a felony under federal or applicable state
or local law;
(c)
knowingly engaged in any activity that is directly or indirectly in
competition with the Company; or
(d)
willfully violated any Company policy that covers standards of
corporate conduct.
2.10.
“ Change in Control ” means:
(a)
any Person becomes the Beneficial Owner, directly or indirectly, of
securities of CIT representing thirty-five percent (35%) or more of
the combined voting power of CIT’s then outstanding
securities; or
(b)
the following individuals cease for any reason to constitute a
majority of the number of directors of the Board then serving:
individuals who, on the Effective Date, constitute the Board and
any new director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including, but not limited to, a consent solicitation,
relating to the election of directors of CIT) whose appointment or
election by the Board or nomination for election by CIT’s
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stockholders was approved or recommended by a vote
of at least a majority of the directors then still in office who
either were directors on the Effective Date or whose appointment,
election or nomination for election was previously so approved or
recommended; or
(c)
there is consummated a merger or consolidation of CIT or any
Subsidiary with any other corporation, other than (i) a merger or
consolidation which would result in the voting securities of CIT
outstanding immediately prior to such merger or consolidation
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or
any parent thereof), in combination with the ownership of any
trustee or other fiduciary holding securities under an employee
benefit plan of CIT or any Subsidiary of CIT, more than fifty
percent (50%) of the combined voting power of the securities of CIT
or such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation; or (ii) a merger or
consolidation effected to implement a recapitalization of CIT (or
similar transaction) in which no Person is or becomes the
Beneficial Owner, directly or indirectly, of securities of CIT
representing thirty-five percent (35%) or more of the combined
voting power of CIT’s then outstanding securities; or
(d)
the stockholders of CIT approve a plan of complete liquidation or
dissolution of CIT or there is consummated an agreement for the
sale or disposition by CIT of all or substantially all of
CIT’s assets, other than a sale or disposition by CIT of all
or substantially all of CIT’s assets to an entity, more than
fifty percent (50%) of the combined voting power of the voting
securities of which are owned by stockholders of CIT in
substantially the same proportions as their ownership of CIT
immediately prior to such sale
2.11.
“ CIT ” means CIT Group Inc., a Delaware
corporation, and any successor thereto.
2.12.
“ Claims Reviewer ” means the Senior Vice
President of Compensation and Benefits of CIT or such
individual’s delegate; provided , however ,
that neither the Committee nor any member thereof shall serve as
the Claims Reviewer.
2.13.
“ Code ” means the Internal Revenue Code of
1986, as amended from time to time, and the rulings and regulations
issued thereunder.
2.14.
“ Committee ” means the Employee Benefit Plans
Committee of CIT, as it is constituted from time to time, or any
successor committee.
2.15.
“ Company ” means CIT and all 409A Affiliates of
CIT.
2.16.
“ Company New Executive Retirement Plan ” means
the New Executive Retirement Plan of CIT Group Inc. and any
successor plan thereto.
2.17.
“ Company Retirement Plan ” means the CIT Group
Inc. Retirement Plan, as amended and restated effective January 1,
2007, and any successor thereto.
2.18.
“ Company Supplemental Retirement Plan ” means
the CIT Group Inc. Supplemental Retirement Plan and any successor
plan thereto.
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2.19.
“ Comparable Employment ” means employment with
a Purchaser that, if accepted, would provide the Participant with
substantially equivalent Annual Base Salary and a substantially
equivalent Annual Bonus opportunity.
2.20.
“ Director ” means any individual who is a
member of the Board.
2.21.
“ Disability ” means a physical or mental
impairment sufficient to constitute a “disability” (or
similar term) under the Company’s Long-Term Disability Plan;
provided , however , that if the Company ceases to
sponsor a Long-Term Disability Plan, “Disability” shall
have the same meaning as defined in the Company’s Long-Term
Disability Plan last in effect prior to the first date a
Participant suffers from such physical or mental impairment.
2.22.
“ Effective Date ” means January 1, 2008.
2.23.
“ Eligible Termination ” means a Separation from
Service (i) by the Company for any reason other than death,
Disability or Cause; or (ii) by the Participant for Good
Reason.
2.24.
“ Employee ” means any individual who is an
employee of the Company.
2.25.
“ ERISA ” means the Employee Retirement Income
Security Act of 1974, as amended from time to time.
2.26.
“ Exchange Act ” means the Securities Exchange
Act of 1934, as amended from time to time, or any successor
thereto.
2.27.
“ General Release ” shall have the meaning
ascribed to such term in Section 5.5 hereof.
2.28.
“ Good Reason ” means that:
(a)
In all situations, whether or not there has been a Change in
Control, a Participant has been assigned duties and
responsibilities not commensurate with the Participant’s
status as a senior executive of the Company in any material
respect.
(b)
Upon or following a Change in Control, in addition to the
circumstance described in Section 2.28(a), in the event of a Change
in Control, “Good Reason” shall include the following
circumstances:
(i)
a Participant has been required by the Company or any successor
thereto, without the Participant’s consent, to relocate or
perform a significant portion of his or her duties at a location
that is outside a fifty mile radius from his or her present
principal place of employment and not closer to the
Participant’s then current principal residence; or
(ii)
a material reduction in a Participant’s rate of Annual Base
Salary or Annual Bonus opportunity; or
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(iii)
any successor to the Company has failed expressly to assume the
obligations of the Company under the Plan.
2.29.
“ Ineligible Termination ” means a Separation
from Service (i) by the Company for Disability, (ii) by the Company
for Cause; (iii) by the Participant for any reason other than Good
Reason; or (iv) by reason of the Participant’s death.
2.30.
“ Initial Severance Amount ” shall have the
meaning ascribed to such term in Section 5.2(a)(i) or 5.2(b)(i)
hereof, as applicable.
2.31.
“ Parent ” means a corporation which owns or
Beneficially Owns a majority of the outstanding voting stock or
voting power of CIT.
2.32.
“ Participant ” means an Employee selected to
participate in the Plan pursuant to Article 4 hereof.
2.33.
“ Person ” means any person, entity or
“group” within the meaning of Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act, except that such term shall
not include (a) CIT or any of its Subsidiaries, (b) a trustee or
other fiduciary holding securities under an employee benefit plan
of CIT or any of its Affiliates, (c) an underwriter temporarily
holding securities pursuant to an offering of such securities, (d)
a corporation owned, directly or indirectly, by the stockholders of
CIT in substantially the same proportions as their ownership of
stock of CIT, or (e) a person or group as used in Rule 13d-1(b)
under the Exchange Act.
2.34.
“ Plan ” means this CIT Executive Severance
Plan.
2.35.
“ Purchaser ” shall have the meaning ascribed to
such term in Section 5.1(c) hereof.
2.36.
“ Second Severance Amount ” shall have the
meaning ascribed to such term in Section 5.2(a)(ii) or 5.2(b)(ii)
hereof, as applicable.
2.37.
“ Separates from Service ” or “
Separation from Service ” means a “separation
from service” with the Company for purposes of Section 409A
of the Code, determined using the default provisions set forth in
Treasury Regulation Section 1.409A -1(h) or the successor
regulation thereto.
2.38.
“ Severance Benefits ” means the benefits
payable to a Participant under Section 5.2.
2.39.
“ Specified Employee ” means a “specified
employee” within the meaning of Section 409A(a)(2)(B)(i) of
the Code, as determined under the Company’s established
methodology for determining specified employees.
2.40.
“ Subsidiary ” means (a) a corporation or other
entity with respect to which CIT, directly or indirectly, has the
power, whether through the ownership of voting securities, by
contract or otherwise, to elect at least a majority of the members
of such
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corporation’s board of directors or analogous
governing body, or (b) any other corporation or other entity in
which CIT, directly or indirectly, has an equity or similar
interest and which the Committee designates as a Subsidiary for
purposes of the Plan.
Section 3.
Administration
3.1.
The Administrator . The Plan shall be administered by the
Committee.
3.2.
Authority of the Administrator . Except as limited by law
and subject to the provisions of the Plan, the Committee shall have
full power and authority, in its sole discretion, to: (a) determine
a Participant’s eligibility for Severance Benefits and the
amount of such Severance Benefits; (b) construe and interpret the
Plan, determine all questions arising in connection with the Plan,
and to resolve ambiguities, inconsistencies and omissions in the
text of the Plan; (c) adopt, implement, amend, waive or rescind
such rules and regulations as the Committee may deem appropriate
for the proper administration or operation of the Plan; (d) subject
to the provisions of Section 7, amend the terms and conditions of
the Plan; (e) make all factual or other determinations and take all
other actions as may be necessary, appropriate or advisable for the
administration or operation of the Plan; and (f) employ and rely on
legal counsel, actuaries, accountants and other agents as may be
deemed advisable to assist in the administration of the Plan. As
permitted by law, the Committee may delegate to any individual or
committee its authority, or any part thereof, as it deems
necessary, appropriate or advisable for proper administration or
operation of the Plan. If any member of the Committee is a
Participant, such member shall not resolve, or participate in the
resolution of, any matter relating specifically to such
member’s eligibility to participate in the Plan or the
calculation or determination of such member’s Severance
Benefits under the Plan.
3.3.
Decisions Binding . All determinations, interpretations,
decisions or other actions made or taken by the Committee pursuant
to the provisions of the Plan and all related orders and
resolutions of the Committee shall be final, conclusive and binding
for all purposes and upon all Persons, including without limitation
CIT, CIT’s shareholders, Directors, Employees, Participants,
and Participants’ estates and beneficiaries.
Section 4.
Eligibility and Participation
4.1.
Eligibility . All executive Employees of the Company who do
not have a written employment contract with the Company that
provides for severance benefits, including executive Employees who
are also Directors, are eligible to participate in this Plan.
4.2.
Actual Participation . The Chief Executive Officer of CIT,
in his or her sole discretion may, from time to time, select one or
more eligible Employees to be Participants. CIT shall promptly
notify an eligible Employee of his or her selection as a
Participant.
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4.3.
Termination of Participation . A Participant shall cease to
be a Participant upon the earliest to occur of:
(a)
the Participant’s receipt of all Severance Benefits to which
he or she is entitled under the Plan;
(b)
the Participant’s Ineligible Termination;
(c)
the effective date of a written agreement that provides for
severance benefits between the Participant and the Company; or
(d)
subject to Section 7, termination of the Plan.
Section 5.
Severance Benefits
5.1.
Eligibility for Severance Benefits .
(a)
If a Participant Separates from Service with the Company in an
Eligible Termination, the Participant shall receive Severance
Benefits in the amount determined under Section 5.2.
(b)
If a Participant Separates from Service with the Company in an
Ineligible Termination, the Participant shall not be entitled to
receive Severance Benefits.
(c)
Notwithstanding anything herein to the contrary, a
Participant’s Separation from Service shall constitute an
Ineligible Termination rather than an Eligible Termination if the
Participant, prior to his or her Separation from Service, (i) is
employed by or otherwise provides services for compensation to a
409A Affiliate or a division or business unit of the Company that
is sold in whole or in part to an entity that is not a 409A
Affiliate of CIT or otherwise affiliated with CIT (such as a joint
venture of which CIT or a 409A Affiliate is a member, owner or
partner) (the “ Purchaser ”), whether by sale of
stock or assets, and (ii) is offered Comparable Employment with
such Purchaser, whether or not the Participant actually accepts
such Comparable Employment with the Purchaser.
(d)
Participants who are offered and accept a position with a Purchaser
shall be deemed to have separated in an Ineligible Termination,
even if such position does not constitute Comparable Employment.
Upon initial employment with a Purchaser, whether or not in
Comparable Employment, all rights of the Participant under this
Plan shall terminate, and no Severance Benefits shall be payable
hereunder.
5.2.
Amount of Severance Benefits .
(a)
If the date of a Participant’s Eligible Termination is (x)
before the occurrence of a Change in Control or (y) more than two
years after the occurrence of such a Change in Control, the Company
shall provide to such Participant the following Severance
Benefits:
(i)
An Initial Severance Amount equal to the sum of (A) two times the
Participant’s Base Compensation, plus (B) a pro rata
Average Annual
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Bonus for the year of such Eligible Termination,
prorated based on the number of months (rounded to the next whole
month) that the Participant was actively employed during the
calendar year in which such termination occurred; provided ,
however , that such cash payment shall in no event exceed
two times the lesser of (x) the sum of the Participant’s
Annual Base Salary for the calendar year preceding the calendar
year in which the Eligible Termination occurs, or (y) the
applicable limit under Section 401(a)(17) of the Code in effect for
the year in which the Eligible Termination occurs;
(ii)
A Second Severance Amount, if any, equal to (A) the sum of (x) two
times the Participant’s Base Compensation, plus (y) a pro
rata Average Annual Bonus for the year of such Eligible
Termination, prorated based on the number of months (rounded to the
next whole month) that the Participant was actively employed during
the calendar year in which such termination occurred,
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