þ
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the fiscal year ended April 30, 2009 | ||
OR
|
||
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 95-2623879 | |
(State or Other Jurisdiction
of
Incorporation or Organization) |
(I.R.S. Employer
Identification Number) |
|
1900 Avenue of the Stars, Suite 2600,
Los Angeles, California (Address of principal executive offices) |
90067
(Zip code) |
Title of Each Class
|
Name of Each Exchange on Which Registered
|
|
Common Stock, par value $0.01 per share | New York Stock Exchange |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o |
37
38
F-34
Item 1.
Business
1
Table of Contents
Companies are actively in search of preferred providers in order
to create efficiencies and consolidate vendor relationships;
Companies that can offer a full suite of talent management
solutions are becoming increasingly attractive; and
Clients seek trusted advisors who understand their business and
unique organizational culture in order to manage the multiple
needs of their business on a global scale.
2
Table of Contents
Have access to a diverse and highly qualified pool of candidates
on an as-needed basis;
Reduce or eliminate the costs required to maintain and train an
in-house recruiting department in a rapidly changing industry;
Benefit from the most updated industry and geographic market
information;
Access cutting-edge search technology software; and
Maintain management focus on core strategic business issues.
Increasing demand for managers with broader qualifications;
Increasing desire by candidates to more actively manage their
careers;
Increasing demand for senior executives with not just the right
technical skills, but also the right leadership characteristics
to meet the specific requirements of the position and
organizational culture;
Increasing demand for senior executives who can exceed the high
standards of due diligence and public scrutiny as a result of
new securities legislation;
Decreasing executive management tenure and more frequent job
changes; and
Inadequate succession planning.
3
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4
Table of Contents
5
Table of Contents
29
%
18
%
18
%
14
%
11
%
5
%
5
%
63
%
13
%
8
%
8
%
6
%
2
%
6
Table of Contents
7
Table of Contents
8
Table of Contents
Operating
Number of
Number of
Fee
Income
Offices as of
Consultants as of
Revenue
(Loss)
April 30, 2009
April 30, 2009
(Dollars in thousands)
$
309,514
$
37,516
22
230
143,184
2,061
22
124
66,332
5,396
17
84
24,323
2,441
7
22
543,353
47,414
68
460
94,870
(12,003
)
10
155
(31,683
)
$
638,223
$
3,728
78
615
(1)
Futurestep partially occupies 21 of the executive recruitment
offices globally in 15 countries.
Year Ended April 30,
2009
2008
2007
(In thousands)
$
305,472
$
368,039
$
324,349
41,861
48,646
35,559
172,899
223,826
179,974
93,668
124,503
96,114
24,323
25,556
17,426
$
638,223
$
790,570
$
653,422
Item 1A.
Risk
Factors
9
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10
Table of Contents
changes in and compliance with applicable laws and regulatory
requirements;
difficulties in staffing and managing global operations;
social and political instability;
fluctuations in currency exchange rates;
statutory equity requirements;
repatriation controls; and
potential adverse tax consequences.
11
Table of Contents
a classified Board of Directors;
limitations on the removal of directors;
limitation on stockholder actions;
advance notification requirements for director nominations and
actions to be taken at stockholder meetings; and
the ability to issue one or more series of preferred stock by
action of our Board of Directors.
12
Table of Contents
Item 1B.
Unresolved
Staff Comments
Item 2.
Properties
Item 3.
Legal
Proceedings
Item 4.
Submission
of Matters to a Vote of Security Holders
48
Chief Executive Officer
54
Executive Vice President and Chief Financial Officer
45
Executive Vice President and Chief Executive Officer of
Leadership and Talent Consulting
62
Executive Vice President, Korn/Ferry and Chief Executive
Officer, Futurestep
13
Table of Contents
Item 5.
Market
for Registrants Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities
High
Low
$
18.88
$
15.42
$
20.52
$
9.87
$
14.50
$
9.28
$
11.49
$
7.54
$
27.13
$
22.62
$
24.62
$
16.27
$
20.75
$
13.10
$
18.95
$
14.42
14
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AMONG
KORN/FERRY INTERNATIONAL, THE S&P 500 INDEX
AND A PEER GROUP
www.researchdatagroup.com/S&P.htm
15
Table of Contents
Approximate Dollar
Value of Shares
Shares Purchased
that may Yet be
as Part of Publicly-
Purchased Under
Shares
Average Price
Announced Programs
the Programs
Purchased
Paid per Share
(1), (2), (3) and (4)
(1), (2), (3) and (4)
(Dollars in thousands)
$
$
36.4 million
5,749
(5)
$
8.47
$
36.4 million
$
$
36.4 million
5,749
(5)
(1)
On December 7, 2005, the Board of Directors approved the
repurchase of up to $50 million of the Companys
common stock in a common stock repurchase program. The shares
can be repurchased in open market transactions or privately
negotiated transactions at the Companys discretion.
(2)
On June 8, 2006, the Board of Directors approved the
repurchase of an additional $25 million of the
Companys common stock in a common stock repurchase
program. The shares can be repurchased in open market
transactions or privately negotiated transactions at the
Companys discretion.
(3)
On March 6, 2007, the Board of Directors approved the
repurchase of an additional $50 million of the
Companys common stock in a common stock repurchase
program. The shares can be repurchased in open market
transactions or privately negotiated transactions at the
Companys discretion.
(4)
On November 2, 2007, the Board of Directors approved the
repurchase of an additional $50 million of the
Companys common stock in a common stock repurchase
program. The shares can be repurchased in open market
transactions or privately negotiated transactions at the
Companys discretion.
(5)
Represents withholding of a portion of restricted shares to
cover taxes on vested restricted shares.
16
Table of Contents
Item 6.
Selected
Financial Data
Year Ended April 30,
2009
2008
2007
2006
2005
(In thousands, except per share data and other operating
data)
$
638,223
$
790,570
$
653,422
$
522,882
$
452,194
37,905
45,072
35,779
28,887
24,183
676,128
835,642
689,201
551,769
476,377
442,632
540,056
447,692
341,196
292,913
126,882
134,542
105,312
93,462
83,544
49,388
58,750
44,662
31,927
25,702
11,583
10,441
9,280
9,002
8,437
41,915
672,400
743,789
606,946
475,587
410,596
3,728
91,853
82,255
76,182
65,781
(10,391
)
11,949
10,416
11,086
3,360
5,410
4,812
10,172
10,244
10,463
384
36,081
30,164
19,594
20,251
2,365
3,302
3,163
2,000
193
$
(10,092
)
$
66,211
$
55,498
$
59,430
$
38,620
$
(0.23
)
$
1.50
$
1.40
$
1.49
$
1.00
$
(0.23
)
$
1.46
$
1.24
$
1.32
$
0.90
43,522
44,012
39,774
39,890
38,516
43,522
45,528
46,938
47,270
46,229
$
309,514
$
374,891
$
329,065
$
259,089
$
225,850
143,184
183,042
146,155
120,059
110,455
66,332
95,915
74,987
57,922
51,196
24,323
25,556
17,426
15,660
10,828
543,353
679,404
567,633
452,730
398,329
94,870
111,166
85,789
70,152
53,865
$
638,223
$
790,570
$
653,422
$
522,882
$
452,194
78
89
82
72
70
615
684
601
507
474
9,630
11,106
10,415
9,608
8,062
$
255,000
$
305,296
$
226,137
$
211,753
$
178,906
75,255
83,966
98,130
66,444
28,042
198,250
196,259
193,716
197,540
138,179
740,879
880,214
761,491
635,491
534,168
45,147
44,949
10,989
10,795
459,099
496,134
432,955
323,751
252,902
17
Table of Contents
(1)
In response to deteriorating economic conditions encountered in
fiscal 2009, we recognized $41.9 million of restructuring
charges comprised of (a) severance charges of
$26.9 million and (b) facilities charges of
$15.0 million.
(2)
In the fourth quarter of fiscal 2007, we issued notice for the
redemption of our 7.5% Convertible Series Subordinated
Notes and 7.5% Convertible Series A Preferred Stock.
In response, the holder of the notes and preferred stock
exercised its option to convert the debt and preferred stock
pursuant to the terms of the original agreements. The conversion
resulted in approximately 5.6 million shares of our common
stock being delivered to the debt and preferred stock holder in
April 2007. As of April 30, 2009, we had no outstanding
amounts related to these convertible securities. Conversion of
debt is discussed in Item 7
, Long-Term Debt
.
(3)
Certain amounts in the consolidated balance sheet have been
conformed to current year presentation.
Item 7.
Managements
Discussion and Analysis of Financial Condition and Results of
Operations
18
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19
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Year Ended April 30,
2009
2008
2007
100.0
%
100.0
%
100.0
%
5.9
5.7
5.5
105.9
105.7
105.5
69.3
68.3
68.5
19.9
17.0
16.1
7.7
7.4
6.8
1.8
1.4
1.5
6.6
0.6
11.6
12.6
(1.6
)%
8.4
%
8.5
%
20
Table of Contents
Year Ended April 30,
2009
2008
2007
Dollars
%
Dollars
%
Dollars
%
(Dollars in thousands)
$
309,514
48.5
%
$
374,891
47.4
%
$
329,065
50.4
%
143,184
22.4
183,042
23.2
146,155
22.4
66,332
10.4
95,915
12.1
74,987
11.5
24,323
3.8
25,556
3.2
17,426
2.6
543,353
85.1
679,404
85.9
567,633
86.9
94,870
14.9
111,166
14.1
85,789
13.1
638,223
100.0
%
790,570
100.0
%
653,422
100.0
%
37,905
45,072
35,779
$
676,128
$
835,642
$
689,201
Year Ended April 30,
2009
2008
2007
Dollars
Margin(1)
Dollars
Margin(1)
Dollars
Margin(1)
(Dollars in thousands)
$
37,516
12.1
%
$
70,628
18.8
%
$
69,815
21.2
%
2,061
1.4
29,820
16.3
24,166
16.5
5,396
8.1
19,299
20.1
16,010
21.4
2,441
10.0
2,230
8.7
1,894
10.9
47,414
8.7
121,977
18.0
111,885
19.7
(12,003
)
(12.7
)
8,545
7.7
7,854
9.2
(31,683
)
(38,669
)
(37,484
)
$
3,728
0.6
%
$
91,853
11.6
%
$
82,255
12.6
%
(1)
Margin calculated as a percentage of fee revenue by business
segment.
21
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22
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23
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24
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25
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26
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27
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28
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Payments Due in:
Less Than
More Than
Note
Total
1 Year
1-3 Years
3-5 Years
5 Years
(In thousands)
16
$
90,482
$
26,717
$
29,142
$
17,570
$
17,053
6
13,642
7,439
4,325
1,487
391
$
104,124
$
34,156
$
33,467
$
19,057
$
17,444
(1)
Represents rent payments, net of sublease income on an
undiscounted basis.
29
Table of Contents
30
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31
Table of Contents
Item 7A.
Quantitative
and Qualitative Disclosures About Market Risk
32
Table of Contents
Item 8.
Financial
Statements and Supplementary Data
Item 9.
Changes
in and Disagreements with Accountants on Accounting and
Financial Disclosure
Item 9A.
Controls
and Procedures
33
Table of Contents
Item 9B.
Other
Information
Item 10.
Directors,
Executive Officers and Corporate Governance
34
Table of Contents
Item 11.
Executive
Compensation
Item 12.
Security
Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
Item 13.
Certain
Relationships and Related Transactions, and Director
Independence
Item 14.
Principal
Accountant Fees and Services
35
Item 15.
Exhibits
and Financial Statement Schedules
Page
Index to Financial Statements:
See Consolidated Financial Statements included as part of this
Form 10-K.
Pursuant to
Rule 7-05
of
Regulation S-X,
the schedules have been omitted as the information to be set
forth therein is included in the notes of the audited
consolidated financial statements.
F-1
Exhibit
3
.1+
Certificate of Incorporation of the Company, filed as
Exhibit 3.1 to the Companys Quarterly Report on
Form 10-Q,
filed December 15, 1999.
3
.2+
Certificate of Designations of 7.5% Convertible Preferred
Stock, filed as Exhibit 3.1 to the Companys Current
Report on
Form 8-K,
filed June 18, 2002.
3
.3+
Second Amended and Restated Bylaws of the Company, filed as
Exhibit 3.1 to the Companys Current Report on
Form 8-K,
filed April 29, 2009.
4
.1+
Form of Common Stock Certificate of the Company, filed as
Exhibit 4.1 to the Companys Registration Statement on
Form S-3
(No. 333-49286),
filed November 3, 2000.
4
.2+
Form of 7.5% Convertible Subordinated Note Due 2010, filed
as Exhibit 4.1 to the Companys Current Report on
Form 8-K,
filed June 18, 2002.
4
.3+
Form of Stock Purchase Warrant, filed as Exhibit 4.2 to the
Companys Current Report on
Form 8-K,
filed June 18, 2002.
4
.4+
Subordination Agreement, dated as of June 13, 2002, made by
Korn/Ferry International, a Delaware corporation, Friedman
Fleischer & Lowe Capital Partners, L.P., a Delaware
limited partnership, and FFL Executive Partners, L.P., a
Delaware limited partnership in favor of Bank of America, N.A.,
filed as Exhibit 4.3 to the Companys Current Report
on
Form 8-K,
filed June 18, 2002.
10
.1*+
Form of Indemnification Agreement between the Company and some
of its executive officers and Directors, filed as
Exhibit 10.1 to the Companys Registration Statement
on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.2*+
Form of U.S. and International Worldwide Executive Benefit
Retirement Plan, filed as Exhibit 10.3 to the
Companys Registration Statement of
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.3*+
Form of U.S. and International Worldwide Executive Benefit Life
Insurance Plan, filed as Exhibit 10.4 to the Companys
Registration Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.4*+
Worldwide Executive Benefit Disability Plan (in the form of
Long-Term Disability Insurance Policy), filed as
Exhibit 10.5 to the Companys Registration Statement
on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.5*+
Form of U.S. and International Enhanced Executive Benefit and
Wealth Accumulation Plan, filed as Exhibit 10.6 to the
Companys Registration Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.6*+
Form of U.S. and International Senior Executive Incentive Plan,
filed as Exhibit 10.7 to the Companys Registration
Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.7*+
Executive Salary Continuation Plan, filed as Exhibit 10.8
to the Companys Registration Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.8*+
Form of Amended and Restated Stock Repurchase Agreement, filed
as Exhibit 10.10 to the Companys Registration
Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.9*+
Form of Standard Employment Agreement, filed as
Exhibit 10.11 to the Companys Registration Statement
on
Form S-1
(No. 333-61697),
effective February 10, 1999.
10
.10*+
Form of U.S. and Foreign Executive Participation Program, filed
as Exhibit 10.27 to the Companys Registration
Statement on
Form S-1
(No. 333-61697),
effective February 10, 1999.
36
Table of Contents
Exhibit
10
.11*+
Employment Agreement between the Company and Paul C. Reilly,
dated May 24, 2001, filed as Exhibit 10.14 to the
Companys Annual Report on
Form 10-K,
filed July 30, 2001.
10
.12*+
Amendment to Employment Agreement between the Company and Paul
C. Reilly, dated December 1, 2001, filed as
Exhibit 10.1 to the Companys Quarterly Report on
Form 10-Q,
filed December 17, 2001.
10
.13*+
Second Amendment to Employment Agreement between the Company and
Paul C. Reilly, dated July 1, 2003 filed as
Exhibit 10.13 to the Companys Annual Report on
Form 10-K,
filed July 22, 2003.
10
.14*+
Letter from the Company to Paul C. Reilly, dated June 6,
2001, filed as Exhibit 10.2 to the Companys Quarterly
Report on
Form 10-Q,
filed December 17, 2001.
10
.15*+
Employment Agreement between the Company and
Gary C. Hourihan effective March 6, 2000, filed
as Exhibit 10.22 to the Companys Annual Report on
Form 10-K,
filed July 31, 2000.
10
.16*+
Korn/Ferry International Special Severance Pay Policy, dated
January 1, 2000, filed as Exhibit 10.2 to the
Companys Quarterly Report on
Form 10-Q,
filed March 19, 2001.
10
.17*+
Korn/Ferry International Second Amended and Restated Performance
Award Plan, filed as Appendix A to the Companys
Definitive Proxy Statement, filed August 12, 2004.
10
.18+
Investor Rights Agreement, dated as of June 13, 2002, by
and among Korn/Ferry International, a Delaware corporation,
Friedman Fleischer & Lowe Capital Partners, L.P., a
Delaware limited partnership, and FFL Executive Partners, L.P.,
a Delaware limited partnership, filed as Exhibit 10.1 to
the Companys Current Report on
Form 8-K,
filed June 18, 2002.
10
.19*+
Letter from Korn/Ferry International Futurestep, Inc. to Robert
H. McNabb, dated December 3, 2001, filed as
Exhibit 10.29 to the Companys Amended Annual Report
on
Form 10-K/A,
filed August 12, 2002.
10
.20*+
Letter from the Company to Robert H. McNabb, dated
November 29, 2001, filed as Exhibit 10.30 to the
Companys Amended Annual Report on
Form 10-K/A,
filed August 12, 2002.
10
.21*+
Employment Agreement between the Company and Robert H. McNabb,
dated October 1, 2003, filed as Exhibit 10.2 to the
Companys Quarterly Report on
Form 10-Q,
filed December 12, 2003.
10
.22*+
Employee Stock Purchase Plan filed as Exhibit 10.29 to the
Companys Annual Report on
Form 10-K,
filed July 22, 2003.
10
.23*+
Employment Agreement between the Company and Gary D. Burnison,
dated October 1, 2003, filed as Exhibit 10.2 to the
Companys Quarterly Report on
Form 10-Q,
filed March 12, 2004.
10
.24+
Letter Agreement, dated December 31, 2003, among the
Company, Friedman Fleischer & Lowe Capital Partners,
L.P. and FFL Executive Partners, L.P., filed as
Exhibit 10.1 to the Companys Quarterly Report on
Form 10-Q,
filed March 12, 2004.
10
.25*+
Third Amendment to the Employment Agreement between the Company
and Paul C. Reilly, dated March 10, 2004, filed as
Exhibit 10.3 to the Companys Quarterly Report on
Form 10-Q,
filed March 12, 2004.
10
.26*+
Form of Indemnification Agreement between the Company and some
of its executive officers and directors, filed as
Exhibit 10.4 to the Companys Quarterly Report on
Form 10-Q,
filed March 12, 2004.
10
.27*+
Fourth Amendment to the Employment Agreement between the Company
and Paul C. Reilly, dated March 7, 2005, filed as
Exhibit 10.32 to the Companys Annual Report on
Form 10-K,
filed July 14, 2005.
10
.28+
Summary of Non-Employee Director Compensation, filed as
Exhibit 10.1 to the Companys Current Report on
Form 8-K,
filed January 12, 2006.
10
.29*+
Fifth Amendment to the Employment Agreement between the Company
and Paul C. Reilly, dated April 26, 2006, filed as
Exhibit 10.32 to the Companys Annual Report on
Form 10-K,
filed July 14, 2006.
10
.30*+
Form of Restricted Stock Award Agreement to Employees Under the
Performance Award Plan filed as Exhibit 10.1 to the
Companys Current Report on
Form 8-K,
filed June 29, 2006.
10
.31*+
Form of Restricted Stock Award Agreement to Non-Employee
Directors Under the Performance Award Plan filed as
Exhibit 10.2 to the Companys Current Report on
Form 8-K,
filed June 29, 2006.
10
.32*+
Stock and Asset Purchase Agreement dated as of August 8,
2006 by and among Lominger Limited, Inc., Lominger Consulting,
Inc., Michael M. Lombardo, Robert W. Eichinger, and the Company
filed as Exhibit 10.1 to the Companys Quarterly
Report on
Form 10-Q,
filed September 8, 2006.
10
.33*+
Letter Agreement between the Company and Robert H. McNabb dated
as of September 29, 2006, filed as Exhibit 10.1 to the
Companys Quarterly Report on
Form 10-Q,
filed December 11, 2006.
Table of Contents
Exhibit
10
.34*+
Letter Agreement dated December 14, 2006 by and among the
Company and Gary C. Hourihan, Executive Vice President of
the Company and President of Leadership Development Solutions,
modifying the terms of Mr. Hourihans Employment
Agreement, dated March 6, 2000, filed as Exhibit 10.1
to the Companys Quarterly Report on
Form 10-Q,
filed March 12, 2007.
10
.35*+
Letter from the Company to Gary Burnison, dated March 30,
2007, filed as Exhibit 10.38 to the Companys Annual
Report on
Form 10-K,
filed June 29, 2007.
10
.36*+
Non Renewal of Employment Agreement between the Company and Paul
C. Reilly, dated April 24, 2007, filed as
Exhibit 10.39 to the Companys Annual Report on
Form 10-K,
filed June 29, 2007.
10
.37*+
Employment Agreement between the Company and Paul C. Reilly,
dated April 24, 2007, filed as Exhibit 10.40 to the
Companys Annual Report on
Form 10-K,
filed June 29, 2007.
10
.38*+
Employment Agreement between the Company and Gary Burnison,
dated April 24, 2007, filed as Exhibit 10.41 to the
Companys Annual Report on
Form 10-K,
filed June 29, 2007.
10
.39*+
Employment Agreement between the Company and Stephen J. Giusto,
dated October 10, 2007, filed as Exhibit 10.1 to the
Companys Quarterly Report on
Form 10-Q,
filed December 10, 2007.
10
.40*+
Form of Restricted Stock Unit Award Agreement to Directors Under
the Performance Award Plan, filed as Exhibit 10.2 to the
Companys Quarterly Report on
Form 10-Q,
filed December 10, 2007.
10
.41*+
Letter from the Company to Ana Dutra, dated January 16,
2008, filed as Exhibit 10.1 to the Companys Quarterly
Report on
Form 10-Q,
filed March 11, 2008.
10
.42*+
Offer of Employment Letter between the Company and Paul C.
Reilly, dated June 26, 2008, filed as Exhibit 10.1 to
the Companys Quarterly Report on
Form 10-Q,
filed September 9, 2008.
10
.43*+
Reimbursement Letter Agreement between the Company and Paul C.
Reilly, dated March 1, 2008, filed as Exhibit 10.2 to
the Companys Quarterly Report on
Form 10-Q,
filed September 9, 2008.
10
.44*
Employment Agreement between the Company and Stephen J. Giusto
dated March 17, 2009.
10
.45*
Employment Agreement between the Company and Michael A.
DiGregorio.
10
.46*+
Korn/Ferry 2008 Stock Incentive Plan, filed as Exhibit 99.1
to the Companys Registration Statement on
Form S-8
(No. 333-158632),
filed April 17, 2009.
10
.47*+
Form of Restricted Stock Award Agreement to Employees and
Non-Employee Directors Under the Korn/Ferry International 2008
Stock Incentive Plan, filed as Exhibit 10.2 to the
Companys Current Report on
Form 8-K,
filed June 12, 2009.
10
.48*+
Form of Stock Option Agreement to Employees and Non-Employee
Directors Under the Korn/Ferry International 2008 Stock
Incentive Plan, filed as Exhibit 10.3 to the Companys
Current Report on
Form 8-K,
filed June 12, 2009.
10
.49*+
Korn/Ferry International Executive Capital Accumulation Plan,
filed as Exhibit 4.1 to the Companys Registration
Statement on
Form S-8
(No. 333-111038),
filed December 10, 2003.
10
.50*
Letter Agreement dated June 25, 2009, by and among the
Company and Robert McNabb, modifying the terms of
Mr. McNabbs Employment Agreement, dated
October 1, 2003, as renewed and amended on September on
September 29, 2006.
10
.51*
Letter Agreement between the Company and Gary D. Burnison dated
June 25, 2009.
21
.1
Subsidiaries of Korn/Ferry International.
23
.1
Consent of Ernst & Young LLP, Independent Registered
Public Accounting Firm.
24
.1
Power of Attorney (contained on signature page).
31
.1
Chief Executive Officer Certification pursuant to
Rule 13a-14(a)
under the Exchange Act.
31
.2
Chief Financial Officer Certification pursuant to
Rule 13a-14(a)
under the Exchange Act.
32
.1
Chief Executive Officer and Chief Financial Officer
Certification pursuant to 18 U.S.C. Section 1350.
*
Management contract, compensatory plan or arrangement.
+
Incorporated herein by reference.
Table of Contents
By:
Chairman of the Board and Director
June 29, 2009
Chief Executive Officer
(Principal Executive Officer)
and
Director
June 29, 2009
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
June 29, 2009
Vice President, Finance
(Principal Accounting Officer)
June 29, 2009
Director
June 29, 2009
39
Table of Contents
Director
June 29, 2009
Director
June 29, 2009
Director
June 29, 2009
Director
June 29, 2009
Director
June 29, 2009
Director
June 29, 2009
40
Table of Contents
Page
F-2
F-3
F-4
F-5
F-6
F-7
F-8
F-9
F-1
Table of Contents
F-2
Table of Contents
ON INTERNAL CONTROL OVER FINANCIAL REPORTING
F-3
Table of Contents
PUBLIC ACCOUNTING FIRM
F-4
Table of Contents
F-5
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands, except per share data)
$
638,223
$
790,570
$
653,422
37,905
45,072
35,779
676,128
835,642
689,201
442,632
540,056
447,692
126,882
134,542
105,312
49,388
58,750
44,662
11,583
10,441
9,280
41,915
672,400
743,789
606,946
3,728
91,853
82,255
(10,391
)
11,949
10,416
5,410
4,812
10,172
(12,073
)
98,990
82,499
384
36,081
30,164
2,365
3,302
3,163
$
(10,092
)
$
66,211
$
55,498
$
(0.23
)
$
1.50
$
1.40
$
(0.23
)
$
1.46
$
1.24
43,522
44,012
39,774
43,522
45,528
46,938
F-6
Table of Contents
Unearned
Accumulated
Restricted
Other
Common Stock
Retained
Stock
Comprehensive
Shares
Amount
Earnings
Compensation
Income, Net
Total
(In thousands)
41,201
$
344,285
$
(23,154
)
$
(7,731
)
$
10,910
$
324,310
55,498
55,498
844
844
9,186
9,186
65,528
(7,731
)
7,731
(2,722
)
(57,622
)
(57,622
)
1,975
22,986
22,986
1,117
11,257
11,257
4,469
45,043
45,043
(339
)
(339
)
15,669
15,669
7,011
7,011
(335
)
(335
)
46,040
380,559
32,344
20,605
433,508
66,211
66,211
(3,516
)
(3,516
)
24,894
24,894
1,114
1,114
88,703
(3,099
)
(60,950
)
(60,950
)
1,652
18,736
18,736
(76
)
(76
)
15,429
15,429
5,096
5,096
(3,541
)
(3,541
)
(226
)
(226
)
44,593
358,568
95,014
43,097
496,679
(10,092
)
(10,092
)
(3,624
)
(3,624
)
5,514
5,514
(40,685
)
(40,685
)
1,983
1,983
(46,904
)
(709
)
(9,588
)
(9,588
)
845
3,609
3,609
16,495
16,495
(654
)
(654
)
44,729
$
368,430
$
84,922
$
$
6,285
$
459,637
F-7
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands)
$
(10,092
)
$
66,211
$
55,498
11,583
10,441
9,280
16,301
15,949
15,556
915
3,740
561
9,127
10,299
6,583
3,578
(3,780
)
(5,647
)
5,040
(5,555
)
(2,138
)
9,967
(4,354
)
(5,992
)
(12,571
)
(3,085
)
14,359
19,570
44,639
(23,214
)
(25,966
)
(1,340
)
(3,143
)
(2,332
)
(2,365
)
(4,180
)
(3,668
)
(18,909
)
(5,282
)
5,178
(82,236
)
47,802
44,328
21,577
(4,965
)
(2,255
)
3,171
109,511
102,331
(11,947
)
(16,976
)
(14,108
)
(4,104
)
14,038
(28,049
)
(12,900
)
(3,622
)
(24,129
)
(1,781
)
(1,835
)
(1,844
)
2,952
2,923
2,429
(27,780
)
(5,472
)
(65,701
)
(770
)
(1,012
)
1,721
1,736
1,617
(9,588
)
(64,162
)
(57,622
)
3,609
17,436
22,975
(654
)
4,612
7,011
(5,682
)
(41,390
)
(26,019
)
(20,005
)
16,510
3,773
(50,296
)
79,159
14,384
305,296
226,137
211,753
$
255,000
$
305,296
$
226,137
$
5,969
$
4,379
$
10,019
$
24,369
$
47,760
$
27,951
$
$
$
56,300
F-8
Table of Contents
1.
Organization
and Summary of Significant Accounting Policies
F-9
Table of Contents
F-10
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands)
$
210
$
1,806
$
4,974
15,633
13,590
10,086
458
553
496
16,301
15,949
15,556
(5,950
)
(5,821
)
(5,875
)
$
10,351
$
10,128
$
9,681
F-11
Table of Contents
Year Ended April 30
2009
2008
2007
44.11
%
44.42
%
48.05
%
3.27
%
4.60
%
4.95
%
4.25
4.00
4.00
0.00
%
0.00
%
0.00
%
F-12
Table of Contents
Level 1:
Observable inputs such as quoted
prices (unadjusted) in active markets that are accessible at the
measurement date for identical, unrestricted assets or
liabilities.
Level 2:
Inputs other than quoted prices
that are observable for the asset or liability, either directly
or indirectly. These include quoted prices for similar assets or
liabilities in active markets and quoted prices for identical or
similar assets or liabilities in markets that are not active.
Level 3:
Unobservable inputs that reflect
the reporting entitys own assumptions.
F-13
Table of Contents
F-14
Table of Contents
2.
Basic and
Diluted (Loss) Earnings Per Share
F-15
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands, except per share data)
$
(10,092
)
$
66,211
$
55,498
145
2,863
$
(10,092
)
$
66,356
$
58,361
43,522
44,012
39,774
4,083
1,016
109
123
319
274
1,078
1,665
10
3
43,522
45,528
46,938
$
(0.23
)
$
1.50
$
1.40
$
(0.23
)
$
1.46
$
1.24
F-16
Table of Contents
3.
Comprehensive
(Loss) Income
Year Ended April 30,
2009
2008
2007
(In thousands)
$
(10,092
)
$
66,211
$
55,498
(3,624
)
(1,890
)
1,626
5,514
(1,626
)
(782
)
(40,685
)
24,894
9,186
1,983
1,114
$
(46,904
)
$
88,703
$
65,528
April 30,
2009
2008
(In thousands)
$
3,523
$
44,208
(1,890
)
2,762
779
$
6,285
$
43,097
4.
Employee
Stock Plans
F-17
Table of Contents
April 30,
2009
2008
2007
Weighted-
Weighted-
Weighted-
Average
Average
Average
Exercise
Exercise
Exercise
Options
Price
Options
Price
Options
Price
(In thousands, except per share data)
3,564
$
14.79
4,738
$
14.52
6,742
$
13.42
6
$
14.54
6
$
21.11
113
$
21.09
(127
)
$
8.91
(1,095
)
$
13.29
(1,945
)
$
10.88
(330
)
$
16.61
(85
)
$
19.71
(172
)
$
16.74
3,113
$
14.83
3,564
$
14.79
4,738
$
14.52
3,042
$
14.74
3,257
$
14.41
3,973
$
13.72
April 30, 2009
Options Outstanding
Options Exercisable
Weighted-
Weighted-
Average
Average
Remaining
Weighted-
Remaining
Weighted-
Contractual
Average
Contractual
Average
Life
Exercise
Life
Exercise
(In thousands, except per share data)
538
2.9
$
7.40
538
2.9
$
7.40
866
3.8
$
9.71
863
3.8
$
9.70
815
5.1
$
17.63
766
5.0
$
17.55
894
3.5
$
21.73
875
3.4
$
21.75
3,113
3.9
$
14.83
3,042
3.8
$
14.74
Year Ended April 30,
2009
2008
2007
(In thousands, except per share data)
$
5.77
$
8.54
$
9.12
1,986
4,103
10,245
640
12,552
20,422
319
F-18
Table of Contents
April 30,
2009
2008
2007
Weighted-
Weighted-
Weighted-
Average
Average
Average
Grant Date
Grant Date
Grant Date
Shares
Fair Value
Shares
Fair Value
Shares
Fair Value
(In thousands, except per share data)
1,952
$
22.01
1,356
$
19.26
687
$
16.63
1,288
$
17.57
1,216
$
24.16
1,187
$
19.64
(602
)
$
21.25
(506
)
$
19.88
(444
)
$
16.35
(251
)
$
19.67
(114
)
$
22.49
(74
)
$
18.38
2,387
$
15.50
1,952
$
22.01
1,356
$
19.26
F-19
Table of Contents
5.
Marketable
Securities
April 30, 2009
Available-for-
Trading
Sale(1)
Total
(In thousands)
$
11,329
$
$
11,329
1,096
1,096
23,816
23,816
14,320
14,320
22,692
22,692
2,002
2,002
73,253
2,002
75,255
(2,261
)
(2,002
)
(4,263
)
$
70,992
$
$
70,992
(1)
Due to the short maturities for these instruments fair value
approximates amortized cost.
(2)
These investments are held in trust for settlement of the
Companys obligations under certain of its deferred
compensation plans with $2.3 million classified as current
assets (see Note 8).
April 30, 2008
Gross
Gross
Amortized
Unrealized
Unrealized
Estimated
Cost
Gains
Losses(2)
Fair Value
(In thousands)
$
21,450
$
$
(975
)
$
20,475
39,469
529
(2,459
)
37,539
11,993
337
12,330
13,622
13,622
$
86,534
$
866
$
(3,434
)
$
83,966
(1)
These investments are held in trust for settlement of the
Companys obligations under certain of its deferred
compensation plans with $5.9 million classified as current
assets (see Note 8).
(2)
The Companys gross unrealized losses of $3.4 million
related to its ARS and equity securities as of April 30,
2008 had been in a loss position for less than twelve months.
F-20
Table of Contents
F-21
Table of Contents
April 30, 2009
Total
Level 1
Level 2
Level 3
(In thousands)
$
165,590
$
165,590
$
$
11,329
11,329
1,096
1,096
23,816
23,816
14,320
14,320
22,692
22,692
2,002
2,002
$
240,845
$
228,420
$
$
12,425
Auction Rate
Securities
(In thousands)
$
20,475
1,096
780
(1,096
)
(586
)
(9,025
)
781
$
12,425
6.
Restructuring
Charges
F-22
Table of Contents
Severance
Facilities
Total
(In thousands)
$
60
$
2,963
$
3,023
(60
)
(699
)
(759
)
2,264
2,264
26,857
15,058
41,915
(678
)
(2,921
)
(3,599
)
(15,668
)
(1,692
)
(17,360
)
43
98
141
$
10,554
$
12,807
$
23,361
April 30, 2009
Severance
Facilities
Total
(In thousands)
$
3,052
$
3,187
$
6,239
4,714
2,514
7,228
48
1,243
1,291
787
334
1,121
8,601
7,278
15,879
1,953
5,529
7,482
$
10,554
$
12,807
$
23,361
April 30, 2008
Severance
Facilities
Total
(In thousands)
$
$
768
$
768
489
489
1,257
1,257
1,007
1,007
$
$
2,264
$
2,264
F-23
Table of Contents
7.
Employee
Tax Deferred Savings Plan
8.
Deferred
Compensation and Retirement Plans
Year Ended April 30,
2009
2008
(In thousands)
$
48,367
$
51,465
2,974
2,986
2,854
3,701
45,043
47,567
$
99,238
$
105,719
F-24
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands)
$
54,749
$
54,873
$
50,031
696
1,067
1,210
3,432
3,140
3,030
367
561
798
(3,263
)
(1,560
)
3,199
(3,832
)
(3,332
)
(3,395
)
52,149
54,749
54,873
(3,782
)
(3,284
)
(3,069
)
$
48,367
$
51,465
$
51,804
F-25
Table of Contents
2009
2008
2007
(In thousands)
$
696
$
1,067
$
1,210
3,432
3,140
3,030
212
212
212
$
4,340
$
4,419
$
4,452
2009
2008
2007
6.50
%
5.90
%
6.25
%
7.10
%
6.50
%
5.90
%
0.00
%
0.00
%
0.00
%
Year Ended April 30,
2009
2008
2007
(In thousands)
$
3,119
$
3,300
$
3,098
196
188
188
(4
)
(152
)
136
(186
)
(217
)
(122
)
3,125
3,119
3,300
(151
)
(133
)
(140
)
$
2,974
$
2,986
$
3,160
2009
2008
2007
(In thousands)
$
196
$
188
$
188
(84
)
(71
)
(95
)
$
112
$
117
$
93
2009
2008
2007
6.50
%
5.90
%
6.25
%
7.10
%
6.50
%
5.90
%
0.00
%
0.00
%
0.00
%
F-26
Table of Contents
Deferred
Compensation
Pension
Plans
Benefits
(In thousands)
$
4,026
$
216
4,511
246
4,514
256
4,657
265
4,869
282
23,613
1,310
F-27
Table of Contents
Year Ended April 30,
2009
2008
(In thousands)
$
48,655
$
33,732
5,071
6,985
6,692
8,935
(10,468
)
115
(4,929
)
(1,112
)
81
45,102
48,655
(59
)
(1,088
)
$
45,043
$
47,567
9.
Income
Taxes
F-28
Table of Contents
Year Ended April 30,
2009
2008
2007
(In thousands)
$
3,378
$
14,788
$
18,353
601
5,658
6,543
4,859
21,627
14,869
8,838
42,073
39,765
(4,459
)
(1,699
)
(5,525
)
(1,002
)
(1,805
)
(1,543
)
(2,993
)
(2,488
)
(2,533
)
(8,454
)
(5,992
)
(9,601
)
$
384
$
36,081
$
30,164
Year Ended April 30,
2009
2008
2007
(In thousands)
$
(7,806
)
$
38,865
$
38,008
(4,267
)
60,125
44,491
$
(12,073
)
$
98,990
$
82,499
Year Ended April 30,
2009
2008
2007
35.0
%
35.0
%
35.0
%
1.8
2.1
3.1
(27.8
)
(1.9
)
(3.9
)
47.0
(1.3
)
(1.7
)
(2.6
)
0.3
1.9
2.2
3.9
5.9
0.4
(54.7
)
(1.5
)
(2.5
)
2.0
(0.5
)
(0.5
)
(3.4
)
0.5
0.4
(4.0
)
0.2
(0.6
)
(3.2
)%
36.4
%
36.6
%
F-29
Table of Contents
April 30,
2009
2008
(In thousands)
$
40,861
$
46,240
1,658
1,450
4,130
1,315
1,961
24,513
15,003
8,198
6,116
80,675
70,770
(5,513
)
(4,730
)
(5,703
)
(6,474
)
(11,216
)
(11,204
)
(9,735
)
(2,037
)
$
59,724
$
57,529
April 30,
2009
2008
(In thousands)
$
15,447
$
11,197
(864
)
(796
)
14,583
10,401
65,228
59,594
(10,352
)
(10,444
)
54,876
49,150
(9,735
)
(2,022
)
45,141
47,128
$
59,724
$
57,529
F-30
Table of Contents
April 30,
2009
2008
(In thousands)
$
10,770
$
10,150
2,000
622
620
$
13,392
$
10,770
F-31
Table of Contents
10.
Property
and Equipment
April 30,
2009
2008
(In thousands)
$
60,274
$
65,005
21,757
24,397
21,865
24,644
2,414
3,193
106,310
117,239
(78,340
)
(84,777
)
$
27,970
$
32,462
11.
Stockholders
Equity
12.
Long-Term
Debt
F-32
Table of Contents
13.
Business
Segments
Year Ended April 30, 2009
Executive Recruitment
North
Asia
South
America
EMEA
Pacific
America
Subtotal
Futurestep
Corporate
Consolidated
(In thousands)
$
309,514
$
143,184
$
66,332
$
24,323
$
543,353
$
94,870
$
$
638,223
$
330,453
$
149,016
$
67,983
$
24,841
$
572,293
$
103,835
$
$
676,128
$
37,516
$
2,061
$
5,396
$
2,441
$
47,414
$
(12,003
)
$
(31,683
)
$
3,728
$
4,003
$
2,003
$
1,621
$
371
$
7,998
$
1,873
$
1,712
$
11,583
$
254,123
$
113,489
$
70,463
$
20,236
$
458,311
$
65,094
$
217,474
$
740,879
$
8,621
$
3,120
$
1,850
$
1,100
$
14,691
$
3,112
$
10,167
$
27,970
$
71,131
$
31,331
$
972
$
$
103,434
$
29,897
$
$
133,331
Year Ended April 30, 2008
Executive Recruitment
North
Asia
South
America
EMEA
Pacific
America
Subtotal
Futurestep
Corporate
Consolidated
(In thousands)
$
374,891
$
183,042
$
95,915
$
25,556
$
679,404
$
111,166
$
$
790,570
$
395,320
$
189,203
$
98,288
$
25,964
$
708,775
$
126,867
$
$
835,642
$
70,628
$
29,820
$
19,299
$
2,230
$
121,977
$
8,545
$
(38,669
)
$
91,853
$
2,915
$
2,299
$
1,766
$
371
$
7,351
$
1,816
$
1,274
$
10,441
$
269,407
$
162,756
$
97,762
$
19,072
$
548,997
$
87,665
$
243,552
$
880,214
$
9,000
$
5,578
$
3,209
$
1,504
$
19,291
$
4,540
$
8,631
$
32,462
$
69,533
$
37,379
$
972
$
$
107,884
$
34,815
$
$
142,699
F-33
Table of Contents
Year Ended April 30, 2007
Executive Recruitment
North
Asia
South
America
EMEA
Pacific
America
Subtotal
Futurestep
Corporate
Consolidated
(In thousands)
$
329,065
$
146,155
$
74,987
$
17,426
$
567,633
$
85,789
$
$
653,422
$
348,780
$
151,606
$
76,650
$
17,912
$
594,948
$
94,253
$
$
689,201
$
69,815
$
24,166
$
16,010
$
1,894
$
111,885
$
7,854
$
(37,484
)
$
82,255
$
3,032
$
2,344
$
1,317
$
317
$
7,010
$
1,502
$
768
$
9,280
$
287,024
$
123,904
$
75,883
$
12,589
$
499,400
$
68,841
$
193,250
$
761,491
$
7,841
$
6,184
$
2,685
$
1,146
$
17,856
$
4,391
$
3,752
$
25,999
$
63,767
$
31,721
$
972
$
$
96,460
$
27,808
$
$
124,268
(1)
As of the end of the fiscal year.
14.
Acquisitions
Year Ended April 30, (1)
2009(2)
2008(3)
2007(4)
(In thousands)
$
4,676
$
406
$
4,935
2,115
16,000
2,451
307
5,000
4,340
99
15,935
13,189
3,622
28,355
$
8,849
$
3,523
$
12,420
$
8,849
$
493
$
12,420
3,030
$
8,849
$
3,523
$
12,420
$
535
$
323
$
355
(1)
Certain employees who joined the Company through these
acquisitions will be eligible to receive earn-out payments of up
to $10.2 million over the next three years if certain
financial metrics are achieved during that period.
(2)
On November 3, 2008, the Company acquired Lore
International, Inc, a Delaware corporation (Lore).
Actual results of operations of Lore are included in the
Companys consolidated financial statements from
November 3, 2008, the effective date of the acquisition.
(3)
During fiscal 2009, adjustments to the preliminary purchase
price allocation for an acquisition in fiscal 2008 resulted in a
$1.9 million reduction in goodwill.
Table of Contents
(4)
On August 8, 2006, the Company acquired Lominger Limited,
Inc., a Minnesota corporation, and Lominger Consulting, Inc., a
Minnesota corporation (together referred to as the
Lominger Entities), as well as all of the
intellectual property rights of Drs. Robert W. Eichinger
and Michael M. Lombardo (the co-founders of the Lominger
Entities). During fiscal 2008, adjustments to the preliminary
purchase price allocation resulted in a reclassification of
$2.1 million from purchased intangibles to goodwill on the
consolidated balance sheet. Actual results of operations of the
Lominger Entities are included in the Companys
consolidated financial statements from August 8, 2006, the
effective date of this acquisition. The Company also completed
other smaller acquisitions during fiscal 2007. The acquired
consultants in these acquisitions will be eligible to receive
earn-out payments of up to $4.5 million over the next five
years if certain financial metrics are achieved during that
period.
15.
Goodwill
and Intangible Assets
Executive Recruitment
North
Asia
America
EMEA
Pacific
Subtotal
Futurestep
Consolidated
(In thousands)
$
63,767
$
31,721
$
972
$
96,460
$
27,808
$
124,268
493
1,230
1,723
3,030
4,753
2,100
2,100
2,100
3,173
4,428
7,601
3,977
11,578
69,533
37,379
972
107,884
34,815
142,699
8,849
8,849
8,849
(1,834
)
(1,834
)
(1,834
)
(5,417
)
(6,048
)
(11,465
)
(4,918
)
(16,383
)
$
71,131
$
31,331
$
972
$
103,434
$
29,897
$
133,331
Weighted-Average
April 30,
Amortization Period
2009
2008
(In thousands)
5 years
$
400
$
9 years
2,060
800
10 years
450
24 years
11,400
11,400
14,310
12,200
(1,182
)
(481
)
13,128
11,719
3,800
3,800
$
16,928
$
15,519
(1)
During fiscal 2008, customer list was reduced by
$2.1 million as a result of the final purchase price
allocation related to the Companys acquisition of the
Lominger Entities.
F-35
Table of Contents
Estimated
Annual
Amortization
Expense
(In thousands)
$
838
838
838
838
838
8,938
$
13,128
16.
Commitments
and Contingencies
Lease Commitment
(In thousands)
$
26,717
17,000
12,142
8,940
8,630
17,053
$
90,482
F-36
Table of Contents
17.
Quarterly
Results (Unaudited)
Quarters Ended
Fiscal 2009
Fiscal 2008
April 30
January 31
October 31
July 31
April 30
January 31
October 31
July 31
(In thousands, except per share data)
$
106,980
$
136,210
$
189,300
$
205,733
$
208,204
$
201,156
$
195,857
$
185,353
(30,256
)
(11,258
)
21,488
23,754
20,178
21,180
25,382
25,113
(17,200
)
(22,356
)
13,560
15,904
15,746
16,256
17,109
17,100
(0.40
)
(0.52
)
0.31
0.37
0.36
0.38
0.38
0.38
(0.40
)
(0.52
)
0.30
0.36
0.36
0.37
0.37
0.36
F-37
Page | ||||
1. Employment
|
1 | |||
|
||||
2. At-Will Employment
|
1 | |||
|
||||
3. Position, Duties and Responsibilities
|
1 | |||
|
||||
4. Annual Compensation
|
2 | |||
(a) Base Salary
|
2 | |||
(b) Bonus Award
|
2 | |||
|
||||
5. Employee Benefit Programs and Perquisites
|
2 | |||
(a) General
|
2 | |||
(b) Reimbursement of Business Expenses
|
2 | |||
(c) Conditions of Employment
|
2 | |||
|
||||
6. Termination of Employment
|
2 | |||
(a) Death
|
2 | |||
(b) Disability
|
3 | |||
(c) Termination by the Company for Cause
|
3 | |||
(d) Voluntary Termination by Executive
|
3 | |||
(e) Termination by the Company Without Cause
|
4 | |||
(f) Automatic Termination Upon Executives Commencement of Other
Full-Time Employment
|
4 | |||
(g) Other Programs
|
5 | |||
(h) Conditions to Receipt of Benefits Under Section 6
|
5 | |||
(i) Certain Definitions
|
6 | |||
|
||||
7. Application of Section 409A
|
6 | |||
|
||||
8. No Mitigation; No Offset
|
7 | |||
|
||||
9. Confidential Information; Cooperation with Regard to Litigation
|
7 | |||
(a) Nondisclosure of Confidential Information
|
7 | |||
(b) Definition of Confidential Information
|
7 | |||
(c) Cooperation in Litigation
|
7 | |||
|
||||
10. Nonsolicitation
|
8 | |||
|
||||
11. Remedies
|
8 | |||
|
||||
12. Resolution of Disputes
|
8 |
i
Page | ||||
13. Indemnification
|
8 | |||
(a) Company Indemnity
|
8 | |||
(b) No Presumption Regarding Standard of Conduct
|
9 | |||
(c) Liability Insurance
|
9 | |||
|
||||
14. Effect of Agreement on Other Benefits
|
9 | |||
|
||||
15. Expenses of Counsel for Executive
|
9 | |||
|
||||
16. Assignment; Binding Nature
|
9 | |||
|
||||
17. Representations
|
10 | |||
|
||||
18 Entire Agreement
|
10 | |||
|
||||
19. Amendment or Waiver
|
10 | |||
|
||||
20. Severability
|
10 | |||
|
||||
21. Non-Disparagement
|
10 | |||
|
||||
22. Survivorship
|
10 | |||
|
||||
23. Beneficiaries/References
|
10 | |||
|
||||
24. Governing Law
|
11 | |||
|
||||
25. Counterparts and Facsimile
|
11 | |||
|
||||
26. Notices
|
11 |
ii
1
2
3
4
5
6
7
8
9
10
If to the Company:
|
KORN/FERRY INTERNATIONAL | |
|
Its: Chief Executive Officer | |
|
1900 Avenue of the Stars, Suite 2600 | |
|
Los Angeles, CA 90067 | |
|
Attention: Corporate Secretary | |
|
||
If to Executive:
|
Stephen Giusto | |
|
360 Pinecrest Drive | |
|
Laguna Beach, CA 92651 | |
|
||
|
with a copy to: | |
|
||
|
Larry A. Walraven | |
|
Walraven & Lehman LLP | |
|
120 Vantis, Suite 535 | |
|
Aliso Viejo, CA 92656 |
11
The Company:
|
KORN/FERRY INTERNATIONAL | |||
|
||||
|
/s/ Gary D. Burnison
|
|||
|
Its: Chief Executive Officer | |||
|
||||
Executive:
|
STEPHEN J. GIUSTO | |||
|
||||
|
/s/ Stephen J. Giusto
|
12
Page | ||||
1. Employment
|
1 | |||
2. At-Will Employment
|
1 | |||
3. Position, Duties and Responsibilities
|
1 | |||
4. Annual Compensation
|
1 | |||
(a) Base Salary
|
1 | |||
(b) Annual Cash Incentive Award
|
2 | |||
(c) Equity Incentive Program
|
2 | |||
5. Employee Benefit Programs and Perquisites
|
3 | |||
(a) General
|
3 | |||
(b) Reimbursement of Business Expenses
|
3 | |||
(c) Conditions of Employment
|
3 | |||
6. Termination of Employment
|
3 | |||
(a) Death
|
3 | |||
(b) Disability
|
4 | |||
(c) Termination by the Company for Cause or Voluntary Termination by Executive
|
4 | |||
(d) Termination by the Company Without Cause or by Executive for Good Reason Prior to Change in Control or More Than 12 Months After a Change in Control
|
4 | |||
(e) Following a Change in Control, Termination by the Company Without Cause or by Executive for Good Reason
|
5 | |||
(f) Certain Additional Payments by the Company
|
||||
(g) Other Programs
|
7 | |||
(h) Conditions to Receipt of Benefits Under Section 6
|
7 | |||
(i) Certain Definitions
|
7 | |||
7. Application of Section 409A
|
8 | |||
8. No Mitigation; No Offset
|
9 | |||
9. Confidential Information; Cooperation with Regard to Litigation
|
9 | |||
(a) Nondisclosure of Confidential Information
|
9 | |||
(b) Definition of Confidential Information
|
9 | |||
(c) Cooperation in Litigation
|
10 | |||
10. Nonsolicitation
|
10 | |||
11. Remedies
|
10 |
i
Page | ||||
12. Resolution of Disputes
|
10 | |||
13. Indemnification
|
10 | |||
(a) Company Indemnity
|
10 | |||
(b) No Presumption Regarding Standard of Conduct
|
11 | |||
(c) Liability Insurance
|
11 | |||
14. Effect of Agreement on Other Benefits
|
11 | |||
15. Expenses of Counsel for Executive
|
11 | |||
16. Assignment; Binding Nature
|
12 | |||
17. Representations
|
12 | |||
18. Entire Agreement
|
12 | |||
19. Amendment or Waiver
|
12 | |||
20. Severability
|
12 | |||
21. Survivorship
|
12 | |||
22. Beneficiaries/References
|
12 | |||
23. Governing Law
|
13 | |||
24. Counterparts and Facsimile
|
13 | |||
25. Notices
|
13 |
ii
1
2
3
4
5
6
7
8
9
10
11
12
If to the Company:
|
KORN/FERRY INTERNATIONAL | |
|
||
|
1900 Avenue of the Stars, Suite 2600 | |
|
||
|
Los Angeles, CA 90067 | |
|
||
|
Attention: Corporate Secretary | |
|
||
If to Executive:
|
The Company: |
KORN/FERRY INTERNATIONAL
|
|||
/s/ Gary D. Burnison | ||||
By: Gary D. Burnison | ||||
Its: Chief Executive Officer | ||||
Executive: |
MICHAEL DiGREGORIO
|
|||
/s/ Michael DiGregorio | ||||
13
14
15
Re | Employment Agreement dated as of October 1, 2003 between Korn/Ferry International (Company or Korn/Ferry) and Robert McNabb, as renewed and amended on September 29, 2006 (the Employment Agreement) |
1
2
Sincerely,
|
||||
/s/ Gary Burnison | ||||
Gary Burnison, Chief Executive Officer |
/s/ Robert McNabb
|
June 25 2009 | |||
|
||||
Robert McNabb
|
Date of Signature |
3
Re: | Employment Agreement dated as of April 24, 2007 between Korn/Ferry International (Company or Korn/Ferry) and Gary Burnison (Employment Agreement) |
Sincerely,
|
||||
/s/ Kenneth Whipple | ||||
Kenneth Whipple |
/s/ Gary D. Burnison
|
June 25, 2009 | |||
|
||||
Gary D. Burnison
|
Date of Signature |
Subsidiaries | Jurisdiction | |||
1.
|
Korn Ferry International S.A. | Argentina | ||
2.
|
Korn/Ferry International Pty Limited | Australia | ||
3.
|
Futurestep (Australia) Pty Ltd | Australia | ||
4.
|
Korn/Ferry International Limited GmbH | Austria | ||
5.
|
Korn/Ferry International Futurestep (Belgium) BVBA | Belgium | ||
6.
|
Korn/Ferry International SNC (Belgium branch) | Belgium | ||
7.
|
Korn/Ferry International S/C Ltda. | Brazil | ||
8.
|
Korn/Ferry Canada, Inc. | Canada | ||
9.
|
Korn/Ferry International Futurestep (Canada) Inc. | Canada | ||
10.
|
Korn/Ferry International, S.A. | Chile | ||
11.
|
Korn/Ferry International s.r.o | Czech Republic | ||
12.
|
Korn/Ferry International (China) Limited | Hong Kong | ||
13.
|
Korn/Ferry International Consulting (Beijing) Limited | Beijing, China | ||
14.
|
Shanghai Korn/Ferry Human Capital Consulting Co., Ltd | Shanghai, China | ||
15.
|
Futurestep China | China | ||
16.
|
Korn/Ferry International A/S | Denmark | ||
17.
|
Korn/Ferry International Futurestep (Denmark) ApS | Denmark | ||
18.
|
Korn/Ferry International Oy | Finland | ||
19.
|
Korn/Ferry International & Cie, S.N.C. | France | ||
20.
|
Korn/Ferry International Futurestep (France) SARL | France | ||
21.
|
Hofmann, Herbold & Partners Beteiligungs GmbH | Germany | ||
22.
|
Korn/Ferry International GmbH | Germany | ||
23.
|
Futurestep Germany GmbH | Germany | ||
24.
|
Korn/Ferry International SA | Greece | ||
25.
|
Korn/Ferry International (Asia Pacific) Limited | Hong Kong | ||
26.
|
Korn/Ferry International (H.K.) Limited | Hong Kong | ||
27.
|
Futurestep (Hong Kong) Ltd | Hong Kong | ||
28.
|
Korn/Ferry International Budapest Personnel Consulting and Service Ltd. | Hungary | ||
29.
|
Korn/Ferry International Private Limited | India | ||
30.
|
Futurestep Recruitment Services Private Ltd. | India | ||
31.
|
PT. Korn/Ferry International | Indonesia | ||
32.
|
Korn/Ferry International S.R.L. | Italy | ||
33.
|
Futurestep (Italy) S.r.l. | Italy | ||
34.
|
Nihon Korn/Ferry International K.K. | Japan | ||
35.
|
Futurestep (Japan) K.K. | Japan | ||
36.
|
Korn/Ferry International (Korea) Limited | Korea | ||
37.
|
KF International (Korea) Ltd. | Korea | ||
38.
|
Agensi Pekerjaan Futurestep Worldwide (M) Sdn. Bhd. | Malaysia | ||
39.
|
Korn/Ferry International (M) Sdn. Bhd. | Malaysia | ||
40.
|
Korn/Ferry Investment India Limited (Mauritius OCB) | Mauritius | ||
41.
|
Korn/Ferry Internacional del Norte, S.A. de C.V. | Mexico | ||
42.
|
Korn/Ferry International S.A. de C.V. | Mexico | ||
43.
|
Postgraduados y Especialistas S.A. de C.V. | Mexico | ||
44.
|
Servicios Romac S.A. de C.V. | Mexico | ||
45.
|
Korn/Ferry International B.V. | Netherlands | ||
46.
|
Korn/Ferry International, Futurestep (The Netherlands) B.V. | Netherlands | ||
47.
|
Korn/Ferry International Futurestep (Holdings) B.V. | Netherlands | ||
48.
|
John Stork BV | Netherlands | ||
49.
|
Korn Ferry International New Zeland Limited | New Zealand | ||
50.
|
Futurestep (New Zealand) Ltd | New Zealand |
1
Subsidiaries | Jurisdiction | |||
51.
|
Korn/Ferry International A/S | Norway | ||
52.
|
Futurestep (Norge) AS | Norway | ||
53.
|
Korn/Ferry International Peru S.A. | Peru | ||
54.
|
Korn/Ferry International Sp.z.o.o. | Poland | ||
55.
|
Korn/Ferry International Pte. Ltd. | Singapore | ||
56.
|
Futurestep (Singapore) Pte Ltd | Singapore | ||
57.
|
Korn/Ferry International, spol.s.r.o. LLC | Slovakia | ||
58.
|
Korn/Ferry International S.A. | Spain | ||
59.
|
Korn/Ferry International Futurestep (Espana), S.L. | Spain | ||
60.
|
Korn/Ferry International AB | Sweden | ||
61.
|
Korn/Ferry (Schweiz) AG | Switzerland | ||
62.
|
Lore International Institute (Europe) AG | Switzerland | ||
63.
|
Korn/Ferry (Thailand) Limited | Thailand | ||
64.
|
Korn/Ferry International Executive Recruitment (Thailand) Limited | Thailand | ||
65.
|
Korn/Ferry International Musavirlik Limited Sirketi | Turkey | ||
66.
|
Futurestep (UK) Limited | United Kingdom | ||
67.
|
Korn/Ferry International, Limited | United Kingdom | ||
68.
|
K/FI (UK) Limited | United Kingdom | ||
69.
|
Carre, Orban & Partners Ltd. | United Kingdom | ||
70.
|
Carre, Orban & Partners Two Ltd. | United Kingdom | ||
71.
|
Continental American Management Corp. | United States, California | ||
72.
|
Korn/Ferry International Holding India | United States, California | ||
73.
|
Korn/Ferry S.A. | United States, California | ||
74.
|
Pearson, Caldwell & Farnsworth, Inc. | United States, California | ||
75.
|
Strategic Compensation Associates | United States, California | ||
76.
|
Avery & Associates, Inc. | United States, California | ||
77.
|
Executive Compensations Advisors, Inc. | United States, Delaware | ||
78.
|
KFI-LK, Inc. | United States, Delaware | ||
79.
|
Korn/Ferry International Futurestep, Inc. | United States, Delaware | ||
80.
|
Korn/Ferry International Futurestep (Holdings) Inc. | United States, Delaware | ||
81.
|
Korn/Ferry International Worldwide, Inc. | United States, Delaware | ||
82.
|
JobDirect.com, Inc. | United States, Delaware | ||
83.
|
Lore International Institute, LLC | United States, Delaware | ||
84.
|
LeaderSource Limited, Inc | United States, Minnesota | ||
85.
|
Lominger Limited, Inc | United States, Minnesota | ||
86.
|
Lominger Consulting, Inc | United States, Minnesota | ||
87.
|
Korn/Ferry International Consultores Asociados, C.A. | Venezuela | ||
88.
|
K/F Konexion, C.A. | Venezuela | ||
89.
|
Korn/Ferry International de Venezuela, C.A. | Venezuela |
2
1
1. | I have reviewed this annual report on Form 10-K of Korn/Ferry International; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
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By:
Name: |
/s/ GARY D. BURNISON
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Title: | Chief Executive Officer |
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1. | I have reviewed this annual report on Form 10-K of Korn/Ferry International; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; | |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
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By: | /s/ MICHAEL A. DIGREGORIO | ||
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Name: | Michael A. DiGregorio | ||
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Title: | Chief Financial Officer |
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By: | /s/ GARY D. BURNISON | ||
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Name: | Gary D. Burnison | ||
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Title: | Chief Executive Officer | ||
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By: | /s/ MICHAEL A. DIGREGORIO | ||
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Name: | Michael A. DiGregorio | ||
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Title: | Chief Financial Officer |
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