EXHIBIT 10.2
CONSULTING
AGREEMENT
This CONSULTING AGREEMENT, dated as
of September 28, 2009 (this “Agreement”), is
hereby made by and between Blount International, Inc., a
Delaware corporation (the “Corporation”), and James S.
Osterman (the “Executive”).
WHEREAS, the Executive is serving as
Chairman and Chief Executive Officer of the Corporation pursuant to
the terms of an Amended And Restated Employment Agreement, dated as
of October 17, 2007, as amended (the “Employment
Agreement”); and
WHEREAS, the Term of the Employment
Agreement ends on January 3, 2010 and after the end of the
Term, the Employment Agreement provides that Executive will
continue to provide certain consulting services to the Corporation;
and
WHEREAS, the Corporation desires
that the Executive provide certain consulting services to the
Corporation in order to permit the Corporation to avail itself of
the extensive expertise, knowledge, and experience of the Executive
with respect to the Corporation’s business and customers and
the Executive desires to provide such services to the Corporation,
all upon the terms and subject to the conditions set forth
herein.
NOW, THEREFORE, in consideration of
the foregoing and the mutual covenants and agreements set forth
herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree
as follows.
1.
Term . Executive shall perform the
services hereunder for a period commencing on January 4, 2010
(“Effective Date”) and ending on December 31, 2011
(such period is referred to hereinafter as the “Consulting
Period”). The Consulting Agreement may only be
terminated during the Consulting Period by the Corporation in the
event of Executive’s death, Disability, termination for cause
(as defined in Section 6.2 of the Employment Agreement) or
Executive’s voluntary termination of service.
2.
Services to be
Provided . The Corporation hereby
agrees to engage the Executive, and the Executive hereby agrees to
serve the Corporation, on the terms and subject to the conditions
set forth in this Agreement. Commencing on the Effective Date
and during the Consulting Period, the Executive shall perform the
following services: (i) attend as a “goodwill
ambassador” of the Corporation the trade shows scheduled for
September, 2010 in Cologne, Germany, April, 2010 in Canton,
China, April, 2011 in Canton, China, and October, 2011 in Canton,
China, such attendance to be coordinated with the attendance by
Corporation executives who may attend such trade shows and
following such trade shows, provide a report to the Chief Executive
Officer of the Corporation (“CEO”) and/or the
Board of Directors (the “Board”); and (ii) at the
request of, and in consultation with, the CEO (and in conjunction
with senior Corporation executives), maintain and assist in
managing relationships with major customers, entertain such
customers through customer outings (hunting, fishing, golf, etc.),
consult and advise on products, services and manufacturing
facilities, visit the Corporation’s largest customers and the
Corporation’s international operations, and provide the
Board, the CEO and senior corporate executives with consultation
and advice on business matters affecting the Corporation.
Executive will be reimbursed for the reasonable out-of-pocket
expenses (including
business travel and
entertainment) which he incurs in performing his consulting
services.
Executive’s
title during the Consulting Period will be mutually agreed upon
between Executive and the Corporation. Executive will
continue to serve as a member of the Board and as Chairman of the
Board (as non-executive Chairman commencing January 4, 2010)
until the Corporation’s annual meeting of stockholders in
2010. Executive’s service on the Board thereafter will
be subject to his nomination to such position in the discretion of
the Board and election to such position.
Executive will be
available to perform services up to ten (10) days per
month. The CEO and Executive will agree on the days Executive
will be performing services under the Consulting Agreement.
In addition to the consulting fee provided for in
Section 3(a), the Corporation may request Executive to perform
services for additional days per month at the rate of $1,600 per
day. The Corporation and the Executive reasonably anticipate
that following the Effective Date, Executive’s level of
services provided to the Corporation will be reduced permanently to
a level less than or equal to twenty (20%) percent of the level of
services provided prior to the Effective Date.
3.
Consulting
Fees; Benefits; Office Space And Assistant .
(a)
Executive will be
paid a consulting fee for his services of $200,000 per year.
Executive will be paid his consulting fees monthly. Executive
will be entitled to a bonus of $50,000 per year for each
Corporation fiscal year which ends coincident with, or prior to,
the termination of the Consulting Agreement, if the Corporation
meets its financial targets and pays bonuses to executive officers
for such fiscal year (such determination will be made by the
Board).
(b)
Executive will be
provided during the Consulting Period with health and life
insurance coverages (including executive medical) under the
Corporation’s existing benefit programs, but if such
coverages cannot be continued under the existing benefit programs
or if the healthcare coverage cannot be provided in a manner such
that benefit payments will continue to be tax-free to Executive and
his dependents, the Corporation will arrange for other, comparable
coverages at its expense. Executive will continue to be
responsible for paying the costs of any dependent coverage in the
same manner as if he were an active employee.
(c)
To assist in
performing the consulting services, Executive will be provided
during the Consulting Period, at the Corporation’s expense,
with an equipped office and his current secretary/administrative
assistant (or a substitute acceptable to Executive). The
secretary/administrative assistant shall receive a level of
compensation and benefits comparable to that being received by such
assistant at the end of the Term of the Employment Agreement.
Executive’s office will be at a location acceptable to
Executive, but will not be in the Portland headquarters
building.
(d)
Executive will
also be provided with an automobile (and related costs) under terms
similar to those the Corporation uses for senior executives,
with
2
reimbursement for
membership dues and assessments at a country club, and payment for
a financial/tax consultant for personal financial and tax
planning. A
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