|
EXHIBIT 10.3
EXECUTION
COPY
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This
Amended and Restated Employment Agreement, dated as of
February 25, 2008, amends and restates the employment
agreement originally entered into as of August 6, 1996, as
amended, and as restated as of May 10, 1999, and is by and
between MidAmerican Energy Holdings Company (formerly
CalEnergy Company, Inc. (“CalEnergy”), an Iowa
corporation (the “Company”), and Gregory E. Abel
(the “Executive”).
RECITALS
The
Company desires to employ the Executive as its President and
Chief Operating Officer on the terms set forth in this
Agreement, and the Executive desires to accept such
employment.
Accordingly,
the Company and the Executive agree as follows:
AGREEMENT
Section
1. Defined
Terms . Terms used but not defined in this
Agreement will have the meanings ascribed to them in Exhibit A
to this Agreement.
Section
2. Employment.
(a) The
Company will employ the Executive as, and the Executive will
act as, the President and Chief Operating Officer of the
Company, subject to and upon the terms set forth in this
Agreement, for the Term of Employment.
(b) The
Executive’s primary place of employment will be Des
Moines, Iowa.
Section
3. Duties
.
(a) The
Executive (i) will perform and discharge the duties incident
to and consistent with his title of President and Chief
Operating Officer, and (ii) will perform and discharge such
other duties, and will have such other authority, as are
delegated to him by the Chairman of the Board of the Company
(hereinafter referred to as the “Chairman of the
Board”). In performing such duties, the
Executive will report directly to, and be subject to the
direction of, the Chairman of the Board.
(b) The
Executive will act, without any compensation in addition to
the compensation payable pursuant to this Agreement, as an
officer or member of the board of directors of any subsidiary
of the Company, if so appointed or elected.
(c) During the Term of Employment, the
Executive (i) will devote his entire time, attention and
energies during normal business hours to the business of the
Company and its subsidiaries and (ii) will not, without the
written consent of the Chairman of the Board, perform any
services for any other Person or engage in any other business
or professional activity, whether or not performed or engaged
in for profit.
(d) Notwithstanding
subsection 3 (c), the Executive, without the consent of the
Chairman of the Board, may (i) purchase securities issued by,
or otherwise passively invest his personal or family assets
in, any other company or business within the constraints
imposed by the Company’s Code of Business Conduct and
Berkshire Hathaway’s Code of Business Conduct, referred
to below, and (ii) engage in governmental, political,
educational or charitable activities, but only to the extent
that those activities (A) are not inconsistent with any
direction of the Chairman of the Board or any duties under
this Agreement, and (B) do not interfere with the devotion by
the Executive of his entire time, attention and energies
during normal business hours to the business of the
Company.
Section
4. Compensation
.
(a) During
the Term of Employment, the Company will pay the Executive a
base salary at an annual rate of $350,000, in substantially
equal periodic payments in accordance with the Company’s
practices for executive employees, as determined from time to
time by the Compensation Committee.
(b) The
Chairman of the Board will review the salary payable to the
Executive at least annually beginning in the fourth fiscal
quarter of 2008. The Compensation Committee, in its
discretion, may increase the salary of the Executive from time
to time, but may not reduce the salary of the Executive below
the amount set forth in subsection 4 (a) above.
(c) During
the Term of Employment, the Executive shall be eligible for
consideration for an annual incentive merit bonus for the
Executive’s performance during the fiscal year of the
Company in an amount determined by the Compensation Committee,
in its discretion, by reference to the accomplishment by the
Executive of goals established by the Chairman of the Board
for the related fiscal year. The annual bonus paid to the
Executive, however, will not be less than the Minimum Bonus.
The Executive shall also be eligible to be paid other bonuses
for each fiscal year as determined by the Chairman of the
Board. The Executive’s annual incentive merit bonus,
together with all such other bonuses paid or payable for the
fiscal year (including any amounts for which receipt is
otherwise deferred pursuant to a plan or arrangement with the
Company), is referred to herein as “Annual Bonus
Compensation.” However, “Annual Bonus
Compensation” shall not include the Earnings Per Share
bonuses set forth in the letter of March 24, 2003 to
Executive.
(d) The
Company will reimburse the Executive, subject to compliance by
the Executive with the Company’s customary reimbursement
practices, for all reasonable and necessary out-of-pocket
expenses incurred by the Executive on behalf of the Company in
the course of its business.
(e) The
Company may reduce any payments made to the Executive under
this Agreement by any required federal, state or local
government withholdings or deductions for taxes or similar
charges, or otherwise pursuant to law, regulation or
order.
(f)
Any base salary payable to the Executive for any period of
employment of less than one year during the Term of Employment
will be reduced to reflect the actual number of days of
employment during the period except as provided in Sections
8(b) and 8(c).
Section 5. Other
Benefits .
(a) During
the Term of Employment, the Executive and his dependents may
participate in and receive benefits under any employee benefit
plan which the Company makes generally available to its
employees and their families, including any pension, life
insurance, medical benefits, dental benefits or disability
plan, but only to the extent that the Executive or his
dependents otherwise satisfies the standards established for
participation in the plan. The terms of Executive’s
existing option agreements, as amended, remain unaffected
hereby, except as set forth in Sections 8(b) and 8(c)
hereof.
(b) The
Executive may take up to four weeks of vacation during each
full calendar year during the Term of Employment at a time
mutually convenient to the Executive and the Company, without
loss of compensation or other benefits under this
Agreement.
Section
5 A. Supplemental
Retirement Benefits .
(a) Effective
as of March 12, 1999, the closing date of the merger between
CalEnergy Company, Inc. and MidAmerican Energy Company,
resulting in the creation of MidAmerican Energy Holdings
Company (the “Merger Date”), the Executive became
a participant in the MidAmerican Energy Company Supplemental
Retirement Plan for Designated Officers (the
“SERP”).
(b) The
Executive shall receive fully vested years of participation
credit under the SERP (for all purposes, including vesting and
benefit accrual) for all years of service (or portions
thereof) performed at CalEnergy Company, Inc. prior to the
Merger Date, and for certain additional years of service (or
portions thereof) as provided on Exhibit B attached
hereto.
(c) The
Executive shall be entitled to an Early Retirement Benefit
Payment option under the SERP pursuant to which he shall
commence receiving benefits under the SERP after the
Executive’s separation from service or disability on or
after attaining age 47, which payments shall be calculated
pursuant to the SERP but which shall be no less than as
provided on Exhibit C hereto (including for purposes of the
following sentence). In the event of the
Executive’s death, benefits shall be paid pursuant to
Section 6.4 of the SERP; provided, however, that any payment
due under Section 6.4 (a) of the SERP shall continue for the
remaining lifetime of the Executive’s surviving
“Spouse” (as defined in the SERP) or for 360
months if the Executive dies without a surviving Spouse; and
further provided, however, that any payment due under Section
6.4 (b) of the SERP shall be payable without regard to the
two-thirds and fifty percent limitations contained
therein.
(d) In
addition, the Executive shall be entitled to the following
under the SERP:
(i)
for purposes of determining years of participation credit, the
Executive shall be credited with additional years of
participation (or portions thereof) equal to the difference
between age 65 and the Executive’s age (in years or
portions thereof) on the date of the Triggering Event,
and
(ii)
any benefits under the SERP not fully vested on January 27,
2000 became fully vested as of such date.
(e) Notwithstanding
anything herein or in the SERP to the contrary, for purposes
of determining any benefit payable to Executive under the
SERP, Executive’s annual base salary and annual bonus
shall never be less than the base salary referenced in Section
4(a) hereof and that portion of the Annual Bonus Compensation
earned by Executive for the 1998 calendar year which the SERP
committee has determined shall be included for purposes of
calculating the SERP benefit (i.e., $500,000).
(f) Since
a "rabbi trust" has previously been established in order to
provide security for the payment of benefits to Executive
pursuant to the SERP, the Company shall have a continuing
obligation to deposit into the rabbi trust an amount which,
with the expected earnings thereon from reasonably prudent and
conservative investments (as confirmed by a certificate of a
national accounting firm of recognized standing which is
independent of the Company) shall be sufficient to satisfy the
ultimate benefit obligations to Executive pursuant to the
SERP.
(g) A
general release of claims under the SERP shall not be required
of the Executive in order to receive benefits
thereunder.
(h) The
Executive’s entitlement to benefits under the SERP shall
be nonforfeitable and, Section 6.5 of the SERP
notwithstanding, shall not be adversely affected in any way
upon termination of the Executive’s employment for
Cause.
Section
6. Confidentiality and Post-Employment
Restrictions.
(a) The
Executive acknowledges that the Company and its Affiliates
have confidential information and trade secrets, whether
written or unwritten, with respect to carrying on their
business, including sensitive marketing, bidding,
technological and engineering information and data, names of
past, present and prospective customers or partners of and
vendors or suppliers to the company and its Affiliates,
working relationships with governmental agencies and
officials, methods of pricing contracts and income and
expenses associated therewith, the international business
strategy and relative ranking of opportunities in various
countries, negotiated prices and offers outstanding, credit
terms and status of accounts and the terms of circumstances of
any current or prospective business arrangements between the
Company and its Affiliates and any third parties
(“Confidential Information and Trade Secrets”). As
used in this Agreement, the term Confidential Information and
Trade Secrets does not include (i) information which becomes
generally available to the public other than as a result of a
disclosure by the Executive, (ii) information which becomes
available to the Executive on a nonconfidential basis from a
source other than the Company or its Affiliates, or (iii)
information known to the Executive prior to any disclosure to
him by the Company or its Affiliates. The Executive further
acknowledges that the Executive possesses a high degree of
knowledge of the independent energy industry and, in
particular, has committed to a long-standing relationship with
the Company and its Affiliates as an employee and officer,
which has allowed, and will continue to allow, him access to
the Company’s Confidential Information and Trade
Secrets. Accordingly, any employment by the Executive with
another employer in the independent energy industry or
participation by him as a substantial investor in any such
industry may necessarily involve disclosure of the
Company’s Confidential Information and Trade Secrets.
Consequently, the Executive agrees that, if he voluntarily
resigns his employment with the Company for any reason other
than (i) a breach of this Agreement by the Company, or (ii)
for Good Reason, he shall not at any time during the two-year
period after such resignation, directly or indirectly accept
employment by or invest in (except as a passive investor in a
public corporation or in a publicly issued partnership
interest which, in either event, would not exceed an ownership
interest of 2% of the outstanding equity or partnership
interest) any person, firm, corporation, partnership, joint
venture or business which is primarily engaged in the
production or marketing of steam or electrical energy or which
otherwise directly competes with the business of the Company
or its controlled Affiliates and, further, the Executive
agrees that, to avoid the risk of disclosing or improperly
using Confidential Information or Trade Secrets, he shall not
directly or indirectly, provide consulting or advisory
services to any of such independent energy
businesses. The preceding sentence notwithstanding,
Executive shall not be precluded from accepting employment or
providing services to Peter Kiewit Sons’, Inc. or any
Affiliate thereof.
(b) Without
the written consent of the Chairman of the Board, the
Executive will not, during and for three years after the Term
of Employment, (i) disclose any Confidential Information and
Trade Secrets of the Company or any Affiliate of the Company
to any Person (other than the Company, directors, officers or
employees of the company, its Affiliates or duly authorized
agents, attorneys or other representatives thereof), or (ii)
otherwise make use of any Confidential Information and Trade
Secrets other than in connection with authorized dealings with
or by the Company and its Affiliates.
(c) For
a period of three years after the Term of Employment, the
Executive shall neither directly nor indirectly solicit, on
behalf of another employer, the employment of, or hire or
cause another employer to hire, any person who is then
currently employed by the company or an Affiliate thereof, or
otherwise induce, on behalf of another employer, such person
to leave the employment of the Company or an Affiliate thereof
without the prior written approval of the Chairman of the
Board.
(d) The
Executive will hold, on behalf of the Company and its
Affiliates and as the property of the Company and its
Affiliates, all memoranda, manuals, books, papers, letters,
documents, computer discs, data and software and other similar
property obtained during the course of his employment by the
Company or its Affiliates and relating to the Company’s
or its Affiliates business, and will return such property to
the Company or its Affiliates at any time upon demand by the
Chairman of the Board and, in any event, within five calendar
days after the end of the Term of Employment.
(e) During
the Term of Employment, Executive agrees to comply in all
material respects with the Company’s Code of Business
Conduct as in effect on the date hereof. Executive also agrees
to comply in all material respects with Berkshire
Hathaway’s Code of Business Conduct as is then in
effect.
(f) If
any of the prov
|
