Exhibit 10.2
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the
“Agreement”) is entered into on December 11, 2007,
between BUILDERS FIRSTSOURCE, INC. (“Company”), and
KEVIN P. O’MEARA (“Consultant”).
It is hereby agreed between Company
and Consultant as follows:
1. Term . This Agreement
is effective on the date stated above and shall remain in effect
for two (2) years from the date hereof (the
“Term”).
2. Materiality of
Obligations. Company and Consultant consider Section 5,
among other terms of this Agreement, to be a vitally important
element of their bargain. Without excluding any other terms from
being material, Company and Consultant expressly acknowledge that
the terms of Section 5 are material terms of this Agreement,
without which (in whole or in part), Company would not have agreed
to its obligations in this Agreement.
3. Services and
Compensation.
3.1
Services. During the term of this Agreement, Consultant
shall provide such advice, support and information pertaining to
the operations, planning, strategies, growth, and management of
Company as are reasonably requested by the Company; provided that
Consultant shall not be required to provide more than
(a) twenty (20) hours per month of consulting services
(excluding reasonable travel time) during the first six months of
the Term and (b) ten (10) hours per month of consulting
services thereafter.
3.2
Compensation. In return for the services described above,
and in return for Consultant’s compliance with the covenants
to which Consultant agrees in Section 5 of this Agreement,
Company agrees to grant Consultant, subject to the provisions of
Section 6.1 of this Agreement, 89,334 restricted shares (the
“Restricted Shares”) of the Company’s common
stock, par value $0.01 per share, pursuant to the Company’s
2007 Incentive Plan. All of the Restricted Shares will vest two
years from the date hereof. Additionally, starting six
(6) months after the date hereof, Consultant shall be entitled
to participate in Company’s benefit plans that are, by their
terms, available to consultants; provided that this will include
health insurance coverage under the Company’s standard
medical and dental insurance plans. If Company is unable to include
consultant on the Company’s medical insurance plan, then
Company will pay Consultant $579.81 per month for each month from
the sixth month of this Agreement to the end of this Agreement in
which the Company is unable to include Consultant on such medical
insurance plan (or such greater amount that is then required to
obtain benefits under COBRA with respect to Company’s then
effective standard medical insurance plan). If the Company is
unable to include Consultant on the Company’s standard dental
insurance plan, then Company will pay Consultant $18.38 per month
for each month from the sixth month of this Agreement to the end of
this Agreement in which the Company is unable to include Consultant
on such dental insurance plan (or such greater amount that is then
required to obtain benefits under COBRA with respect to
Company’s then effective standard dental insurance plan).
Consultant will not be entitled to any cash compensation hereunder
except as set forth in Section 3.3. The Company’s
obligation to allow Consultant to participate in the medical and
dental plans referenced above, including without limitation the
Company’s obligation to make the payments in lieu of such
participation as described above, shall expire and terminate
immediately upon Consultant’s becoming eligible for coverage
under another employer’s benefits plan or policy.
3.3
Expenses. Company shall reimburse Consultant for all travel,
lodging, meals and other reasonable expenses that are:
(a) legitimate business expenses that are reimbursable in
accordance with Company’s expense reimbursement policy;
(b) incurred by Consultant in providing services to Company
under this Agreement; and (c) pre-approved by Company. In
order for reimbursement for an expense to become due to Consultant,
(a) Consultant must submit to Company an expense reimbursement
request form itemizing such expenses, along with supporting
documentation; and (b) the expense reimbursement form must be
approved by the Chief Executive Officer of Company or his designee.
Additionally, starting the first month after the date hereof,
Consultant will be entitled to twelve monthly payments of $1,000 to
help cover Consultant’s general expenses incurred in the
connection with the performance of his obligations under this
Agreement.
3.4
Termination. Company may terminate this Agreement at any
time during the Term for Cause. For the purposes of this Agreement,
“Cause” shall mean (a) Consultant’s
violation of any provision of Section 5 hereof to the extent
not cured as provided in section 6.2 if the Company elects to
provide such opportunity for cure, (b) Consultant’s
engaging in any fraudulent or other willful act taken in bad faith
designed, or that could be reasonably anticipated, to cause
material harm to the Company, or (c) Consultant’s
material failure to perform his other obligations under this
Agreement that is not cured within 30 days after written
notice thereof from the Company. Consultant’s obligations
under Section 5 hereof shall survive a termination of this
Agreement by the Company for Cause. If the Company terminates this
Agreement without Cause, its obligations under this Agreement and
the Restricted Stock Award Agreement shall continue as if no
termination had occurred.
4. Independent
Contractor.
4.1
Relationship. Consultant is an independent contractor. This
Agreement shall not create the relationship of employer and
employee, a partnership or a joint venture between the parties.
Company shall not control or direct the details and/or means by
which Consultant performs his services. Consultant shall determine
the number of days and hours of his work, as well as the number of
his assistants, partners or employees. Consultant shall be solely
responsible for the conduct and performance, and for the wages,
payroll taxes, social security taxes, fringe benefits,
workers’ compensation insurance, work and performance
schedules and work conditions, of his assistants, partners, and
employees. Consultant acknowledges and agrees that he has no
authority to enter into contracts on behalf of Company or to
otherwise obligate Company in any respect during the term of this
Agreement.
4.2
Taxes. Consultant shall be responsible for and pay all costs
of conducting his business, including but not limited to, the
expense and responsibility for any and all applicable insurance,
city, county, state and Federal licenses, permits, taxes, and
assessments of any and all regulatory agencies, boards, or
municipalities. Consultant is responsible for payment of his
self-employment taxes, including without limitation, income taxes,
unemployment taxes, workers’
-2-
compensation taxes, social security taxes, and business and
occupation taxes, and shall indemnify and hold Company harmless
from paying such taxes.
5. Noncompetition;
Nonsolicitation .
5.1
Non-Competition. Consultant agrees, for two (2) years
from the date hereof, not to engage in competition (or assist any
other Person in engaging in competition) with the Company or any
Related Party, directly or indirectly (either individually, by any
form of ownership, or as a director, manager, member, officer,
principal, agent, employee, employer, advisor, consultant, lender,
member, shareholder, partner, or other representative in a
Competing Business), in the Business of the Company in a Prohibited
Location by performing services that are the same as or
substantially similar to those services Consultant performed for
the Company at any time during either the Term or the last three
(3) years of Consultant’s employment with the Company.
“Person” means any individual, corporation, limited
liability company, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or other
entity. “Related Parties” means any of the directly or
indirectly held subsidiaries of the Company or any of their related
divisions, predecessors, successors or assigns. “Competing
Business” means any business, regardless of form, that is
directly engaged, in whole or in relevant part, in any business or
enterprise that is the same as, or substantially the same as or
similar to, the Business of the Company; provided that employment
by an entity or enterprise that derives less than ten percent (10%)
of its revenue or income from activities constituting the Business
of the Company shall not be deemed to be a Competing Business
unless the Employee is actively involved in such competing
activities. The “Business of the Company” means, to the
extent the Company or a Related Entity is engaged in such activity,
the business of (a) manufacturing roof and floor trusses, wall
panels, stairs, vinyl and aluminum windows, and synthetic millwork
and (b) supplying and installing structural and related
building products including without limitation, the items
enumerated in clause (a) and doors, engineered wood products,
lumber and lumber sheet goods, millwork, kitchen cabinets,
insulation and other building products. A “Prohibited
Location” means any location within fifty (50) miles
of
|
