THE J. JILL GROUP, INC.

AMENDED AND RESTATED

2005 INCENTIVE COMPENSATION PLAN

 

Purpose

 

This Amended and Restated 2005 Incentive Compensation Plan (the “ Incentive Compensation Plan ”) is designed to provide financial reward to employees of The J. Jill Group, Inc. ( the “ Company ”) for their contribution toward the attainment of the Company’s financial goals for the fiscal year ending December 31, 2005 (“ FY 2005 ”).

 

Participation

 

                  A “ Participating Employee ” shall mean each of the following employees of the Company:  (i) the President and Chief Executive Officer; (ii) any Executive Vice President; (iii) any Senior Vice President; (iv) any Vice President; (v) any Operating Vice President; and (vi) any employee below the level of Operating Vice President who is selected for participation in this Incentive Compensation Plan by the President and Chief Executive Officer.  No employee below the level of Operating Vice President shall be entitled to participate in this Incentive Compensation Plan unless and until selected to do so by the President and CEO.

 

                  No Participating Employee shall be entitled to receive a bonus under this Incentive Compensation Plan unless the Participating Employee satisfies the eligibility criteria set forth below.

 

Eligibility Criteria

 

                  A Participating Employee who is in performance counseling at any time during a performance period will not be eligible for a bonus for the performance period.

 

                  To be eligible to receive a bonus for a performance period, a Participating Employee must be actively employed by the Company for a minimum of three months in the performance period.  Time on leave does not count as active employment.  Employment by a subsidiary of the Company shall be considered employment by the Company for purposes of this Incentive Compensation Plan.

 

                  To be eligible to receive a bonus for a performance period, a Participating Employee must be employed on the last day of the performance period.

 



 

Performance Period

 

This Incentive Compensation Plan pertains to FY 2005.  For measurement purposes, FY 2005 will be divided into two seasonal performance periods:

 

Spring — December 26, 2004 to June 25, 2005

Fall — June 26, 2005 to December 31, 2005

 

Additional Bonuses

 

Nothing in this Incentive Compensation Plan shall be deemed to limit the authority of the Board of Directors, the Compensation Committee of the Board of Directors or the President and CEO to award additional bonuses outside the Incentive Compensation Plan in their discretion.

 

Payments

 

Bonus payments under this Incentive Compensation Plan will be made promptly following the close of the performance period.

 

Calculation of Bonus Payment

 

                  Definitions:

 

                  The “ Bonus Percentage ” for a Participating Employee shall be the percentage assigned to the Participating Employee for the purpose of calculating the Participating Employee’s bonus, if any, under this Incentive Compensation Plan.  Bonus Percentages for employees at the level of Operating Vice President and above shall be determined by the Board of Directors or the Compensation Committee of the Board of Directors.  Bonus Percentages for Participating Employees below the level of Operating Vice President shall be determined by the President and CEO.

 

                  Earnings Per Share Percentage ” for a performance period means the lesser of (i) 100% or (ii) a fraction, the numerator of which is the Company’s Preliminary Earnings Per Share for the performance period minus the Company’s Earnings Per Share Target for the performance period, and the denominator of which is $0.07, expressed as a percentage. 

 

                  Earnings Per Share Target ” for a performance period means:  (i) for the Spring performance period, the Company’s fully diluted earnings per share target for the

 

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performance period as set forth in the Company’s 2005 Financial Plan; and (ii) for the Fall performance period, the fully diluted earnings per share target for the performance period established by the Compensation Committee for purposes of this Incentive Compensation Plan before the beginning of the performance period.

 

                  Maximum Bonus ” for a performance period with respect to any Participating Employee means the Participating Employee’s Bonus Percentage times the base salary paid to him or her for the performance period.

 

                  Preliminary Earnings Per Share ” for a performance period means the amount the Company’s fully diluted earnings per share for the performance period would be if no bonuses under this Incentive Compensation Plan were paid for the performance period.

 

                  If the Company’s Preliminary Earnings Per Share for a performance period are less than or equal to the Company’s Earnings Per Share Target for the performance period, no bonuses shall be paid under this Incentive Compensation Plan for the performance period.

 

                  If the Company’s Preliminary Earnings Per Share for a performance period are greater than the Company’s Earnings Per Share Target for the performance period, then each eligible Participating Employee shall receive a bonus for the performance period under this Incentive Compensation Plan in an amount equal to the Participating Employee’s Maximum Bonus for the performance period times the Earnings Per Share Percentage for the performance period.

 

Example

 

CASE 1:                  Assume the Participating Employee’s annual base salary is $50,000, his or her Bonus Percentage is 10%, the Company’s Earnings Per Share Percentage for the Spring performance period is 100% and the Company’s Earnings Per Share Percentage for the Fall performance period is 100%:

 

Season

 

Salary for
Performance
Period

 

Bonus %

 

Maximum
Bonus

 

EPS %

 

Bonus
Amount

 

Spring

 

$

25,000

 

10

%

$

2,500

 

100

%

$

2,500

 

Fall

 

$

25,000

 

10

%

$

2,500

 

100

%

$

2,500

 

Total

 

$

50,000

 

 

 

$

5,000

 

 

 

$

5,000

 

 

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CASE 2:                  Assume the Participating Employee’s annual base salary is $50,000, his or her Bonus Percentage is 10%, the Company’s Earnings Per Share Percentage for the Spring performance period is 100% and the Company’s Earnings Per Share Percentage for the Fall performance period is 0:

 

Season

 

Salary for
Performance
Period

 

Bonus %

 

Maximum
Bonus

 

EPS %

 

Bonus
Amount

 

Spring

 

$

25,000

 

10

%

$

2,500

 

100

%

$

2,500

 

Fall

 

$

25,000

 

10

%

$

2,500

 

0

 

$

0

 

Total

 

$

50,000

 

 

 

$

5,000

 

 

 

$

2,500

 

 

CASE 3:                  Assume the Participating Employee’s annual base salary is $50,000, his or her Bonus Percentage is 10%, the Company’s Earnings Per Share Percentage for the Spring performance period is 50% and the Company’s Earnings Per Share Percentage for the Fall performance period is 10%:

 

Season

 

Salary for
Performance
Period

 

Bonus %

 

Maximum Bonus

 

EPS %

 

Bonus Amount

 

Spring

 

$

25,000

 

10

%

$

2,500

 

50

%

$

1,250

 

Fall

 

$

25,000

 

10

%

$

2,500

 

10

%

$

250

 

Total

 

$

50,000

 

 

 

$

5,000

 

 

 

$

1,500

 

 

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Exhibit 10.2

 

THE J. JILL GROUP, INC.

2005 FALL SEASON SUPPLEMENTAL EXECUTIVE
BONUS PLAN

 

Purpose

 

This 2005 Fall Season Supplemental Executive Bonus Plan (the “ Supplemental Bonus Plan ”) is designed to provide supplemental financial reward to senior executives of The J. Jill Group, Inc. ( the “ Company ”) for their contribution toward the Company’s exceeding its financial goals for the two fiscal quarters ending December 31, 2005 (the “Performance Period”).

 

Participation

 

                  A “ Participating Executive ” shall mean each of the following employees of the Company:  (i) the President and Chief Executive Officer; and (ii) any Executive Vice President.

 

                  No Participating Executive shall be entitled to receive a bonus under this Supplemental Bonus Plan unless the Participating Executive satisfies the eligibility criteria set forth below.

 

Eligibility Criteria

 

                  A Participating Executive who is in performance counseling at any time during the Performance Period will not be eligible for a bonus for the Performance Period.

 

                  To be eligible to receive a bonus for the Performance Period, a Participating Executive must be actively employed by the Company for a minimum of three months in the Performance Period.  Time on leave does not count as active employment.  Employment by a subsidiary of the Company shall be considered employment by the Company for purposes of this Supplemental Bonus Plan.

 

                  To be eligible to receive a bonus for the Performance Period, a Participating Executive must be employed on the last day of the Performance Period.

 



 

Additional Bonuses

 

Nothing in this Supplemental Bonus Plan shall be deemed to limit the authority of the Board of Directors, the Compensation Committee of the Board of Directors or the President and CEO to award additional bonuses outside this Supplemental Bonus Plan in their discretion.

 

Payments

 

Bonus payments under this Supplemental Bonus Plan will be made promptly following the close of the Performance Period.

 

Calculation of Supplemental Bonus Payment

 

                  Definitions:

 

                  Earnings Per Share Target ” for the Performance Period means the Company’s fully diluted earnings per share target for the Performance Period as set forth in the Company’s 2005 Financial Plan.

 

                  Supplemental Bonus Earnings Per Share Percentage ” for the Performance Period means a fraction, the numerator of which is the Company’s Supplemental Bonus Preliminary Earnings Per Share for the Performance Period minus the Company’s Earnings Per Share Target for the Performance Period and the denominator of which is $0.25, expressed as a percentage. 

 

                  The “ Supplemental Bonus Percentage ” for a Participating Executive shall be a percentage assigned to the Participating Executive for the purpose of calculating the Participating Executive’s bonus, if any, under this Supplemental Bonus Plan.  Supplemental Bonus Percentages shall be determined by the Board of Directors or the Compensation Committee of the Board of Directors.

 

                  Supplemental Bonus Preliminary Earnings Per Share ” for the Performance Period means the amount the Company’s fully diluted earnings per share for the Performance Period would be if no bonuses under this Supplemental Bonus Plan were paid for the Performance Period (but taking into account payment of bonuses for the Performance Period, if any, under the Company’s Amended and Restated 2005 Incentive Compensation Plan).

 

                  Each “ Supplemental Bonus Unit ” for a Participating Executive means a Participating Executive’s Supplemental Bonus Percentage times the base salary paid to him or her for the Performance Period.

 

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                  If the Company’s Supplemental Bonus Preliminary Earnings Per Share for the Performance Period are less than or equal to the Company’s Earnings Per Share Target for the Performance Period, no bonuses shall be paid under the Supplemental Bonus Plan.

 

                  If the Company’s Supplemental Bonus Preliminary Earnings Per Share for the Performance Period are greater than the Company’s Earnings Per Share Target for the Performance Period, then each eligible Participating Executive shall receive a bonus under the Supplemental Bonus Plan as follows:

 

Supplemental Bonus Earnings
Per Share Percentage

 

Number of Supplemental Bonus Units

 

Less than 20%

 

0

 

At least 20% but less than 40%

 

1

 

At least 40% but less than 60%

 

2

 

At least 60% but less than 80%

 

3

 

At least 80% but less than 100%

 

4

 

100% or more

 

5

 

 

Example

 

Assume the Participating Executive’s annual base salary is $400,000, his or her Supplemental Bonus Percentage is 10% and the Company’s Supplemental Bonus Earnings Per Share Percentage for the Performance Period is 33%:

 

Salary for
Performance
Period

 

Supplemental
Bonus %

 

Supplemental
Bonus EPS %

 

Supplemental
Bonus Units

 

Supplemental
Bonus Amount

 

$

200,000

 

10

%

33

%

1

 

$

20,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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