Promissory Note - KPMG Consulting Inc. and Michael J. Donahue
PROMISSORY NOTE
$202,158 McLean, Virginia
October 1, 2001
FOR VALUE RECEIVED the undersigned, Michael J. Donahue (the
"Executive"), promises to pay to the order of KPMG Consulting, Inc. (the
"Company") the sum of Two Hundred Two Thousand, One Hundred Fifty Eight Dollars
($202,158), or such lesser amount as shall be outstanding from time to time, at
the offices of the Company in McLean, Virginia, with interest on the balance
outstanding from time to time at the rate of 4.5% per annum.
Interest on the balance outstanding from time to time shall be paid on
October 1, 2002, and thereafter on October 1 in each succeeding year until the
principal and interest on this Promissory Note are paid in full.
Principal shall be paid as follows:
(i) if the Executive sells any or all of the Common Stock of the
Company relating to the restricted stock award (the "Award") that was
granted to the Executive on July 24, 2001, then within 30 days of the date
of the sale of such Common Stock, the Executive will pay a proportionate
amount of the then outstanding principal balance equal to the percentage of
the shares of Common Stock received under the Award that were sold.
(ii) if the Executive's employment is terminated for Cause, the then
outstanding principal balance and all accrued interest shall become due and
payable immediately. "Cause" shall mean that the Executive has:
(a) committed an intentional material act of fraud or
embezzlement in connection with his duties or in the
course of his employment with the Company;
(b) committed an intentional wrongful material damage to
property of the Company;
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(c) committed an intentional wrongful disclosure of
material secret processes or material confidential
information of the Company; or
(d) been convicted of a felony criminal offense.
(iii) if the Executive voluntarily terminates his employment, then the
outstanding principal balance and all accrued interest shall become due and
payable immediately.
(iv) on October 1, 2006, the remaining principal balance that has not
been repaid prior thereto by the Executive pursuant to clauses (i) - (iii)
above, or extinguished and forgiven as provided below, shall become due and
payable.
If (i) the Executive's employment terminates prior to October 1, 2006 for
any reason other than a reason set forth in clause (ii) or clause (iii) above,
or (ii) the Executive becomes entitled to severance compensation under any
special termination agreement between the Executive and the Company relating to
a change of control of the Company, then the outstanding principal balance and
all accrued interest shall be immediately forgiven.
Prepayments of principal may be made in the sole discretion of the
Executive, in whole or in part, at any time or from time to time, without
penalty.
The obligation represented by this Promissory Note shall constitute
the unsecured general obligation of the Executive. To the extent permitted by
law, the Executive waives all exemptions, diligence in collection, demand, and
presentment for payment, protest and notice of protest of nonpayment.
All advances under this Promissory Note shall be recorded on the
Schedule of Advances (Attachment 1), and all payments of principal or interest
under this Promissory Note shall be recorded on the Schedule of Payments
(Attachment 2). The Company agrees to make an appropriate notation on the
Schedule of Payments
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(Attachment 2) to reflect all payments of principal or interest or the
extinguishment and forgiveness of principal and interest pursuant to the terms
of this Promissory Note, and upon the Executive's request, the Company will
submit this Promissory Note to the Executive for a review of such notation.
This Promissory Note shall be governed by the laws of the State of New
York without regard to its conflicts of laws principles and shall be binding
upon and inure to the benefit of the Company and its successors and assigns and
to the Executive and the Executive's heirs, personal representatives and
assigns.
_______________________
Michael J. Donahue
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Attachment 1
Schedule of Advances
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Date of Advance Amount of Advance
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October 1, 2001 $147,796
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Attachment 2
Schedule of Payments
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Date of Payment Amount of Payment
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