E
XHIBIT
10.3
E MPLOYMENT A GREEMENT
OF
T ERRY L. C OOK
This EMPLOYMENT AGREEMENT (“
Agreement ”) is made and entered into effective as of
January 1, 2007, by and between TERRY L. COOK (“
Employee ”) and BUSINESS STAFFING, INC. (the “
Company ”).
R ECITALS
A. Employee is currently employed by the Company
pursuant to that certain Employment Agreement by and between the
Company and Employee dated effective January 1, 2002, as
amended by that certain Amendment to Employment Agreement dated
December 15, 2004 (the “ 2002 Amended Employment
Agreement ”). The Company leases Employee to Kaiser
Ventures LLC (“ Kaiser ”) and he works as
Kaiser’s Executive Vice President – Administration, and
General Counsel and Corporate Secretary.
B. The intent of this Agreement is to set forth the
terms and conditions of Employee’s employment by the Company
and his serving as a leased employee to Kaiser. This Agreement
shall supersede the 2002 Amended Employment Agreement.
NOW THEREFORE
, for good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. E MPLOYMENT , P OSITIONS AND D UTIES .
The Company hereby employs Employee upon the terms and conditions
set forth in this Agreement. Employee acknowledges and agrees that
he will be a leased employee only to Kaiser. Employee’s
positions with Kaiser as a leased Employee shall be Executive Vice
President – Administration, and General Counsel and Corporate
Secretary. In such capacity, Employee shall have the
responsibilities and duties normally incident to such positions,
including, but not limited to, those duties and responsibilities
set forth in Schedule “A” attached hereto
and incorporated herein by this reference and such other duties and
responsibilities as may be reasonably assigned to him from
time-to-time by Kaiser’s President or Chief Executive
Officer. Employee agrees to devote his full business time and
attention to the discharge of his duties and responsibilities under
this Agreement.
2. T ERM AND C REDIT FOR P AST E MPLOYMENT . Employee’s employment under the terms of
this Agreement shall commence as of January 1, 2007, and shall
continue for a minimum of five (5) years from the effective
date of this Agreement (“ Initial Term ”) unless
sooner terminated as provided herein; provided, however, the term
of this Agreement shall be automatically extended on a month to
month basis after the Initial Term until such time as Kaiser has
disposed of all of its material assets unless otherwise earlier
terminated as provided in this Agreement. Notwithstanding the date
of the commencement of this Agreement, for purposes of the
calculation of benefits or for any other similar purpose, the
Company shall credit Employee with the time he was employed by the
Company, Kaiser or any predecessor of Kaiser.
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3. B ASE S ALARY .
As of January 1, 2007, Employee’s annual base salary
shall be $275,450. Prior to the first meeting of the Board of
Managers in any calendar year, the Human Relations Committee of the
Board will review Employee’s salary and report its
recommendations for any revision to the full Board at such meeting
and will communicate its review to the Company. Employee’s
annual base salary shall be adjusted effective as of January 1
of each year, commencing January 1, 2008, by the increase in
the consumer price index over the prior applicable year utilizing
the Consumer Price Index for Urban Wage Earners and Clerical
Workers, U.S. City Average, All Items, published by the Bureau of
Labor Statistics of the United Stated Department of Labor. The
entire Board of Managers of Kaiser together with the Company have
final responsibility for the review, approval or disapproval of any
revisions to Employee’s annual base salary.
4. I NCENTIVE P ERFORMANCE B ASED B ONUS P ROGRAM . Employee acknowledges that in 2001 Kaiser
discontinued it historical annual performance bonus program and
that the Company is also terminating its discretionary cash bonus
program simultaneously with the effective date of this Agreement.
In lieu of these previous cash bonus programs, Employee shall be
eligible for and be paid an incentive performance bonus in
accordance with the terms of the Company’s Executive Officer
New Revenue Incentive Participation Plan dated effective
January 1, 2007, the terms of which are incorporated herein by
this reference.
5. A NNUAL G RANT OF C LASS A U NITS AND V ESTING AND C ONVERSION OF P REVIOUSLY G RANTED O PTIONS . During the term of this Agreement, the Company
shall cause to be issued to Employee 25,000 Kaiser Class A
Units as of January 15 of each year beginning as of
January 15, 2007, if Employee is employed by the Company as of
the immediately preceding December 31; provided, however, the
amount of this annual grant of Class A Units shall be reviewed
may be modified by the Company prior to the January 15, 2010
grant of Class A Units. Notwithstanding the foregoing, the
annual grant of Class A Units may be delayed until the
Employee complies with the provisions of Paragraph 6.b.
below.
It is acknowledged and agreed that
all options granted to Employee by Kaiser or its predecessor prior
to the date of this Agreement are fully vested in Employee and all
outstanding options to acquire Kaiser Ventures Inc. common stock
have been converted to options to acquire Class A Units in
Kaiser.
6. O THER B ENEFITS .
a. I
NSURANCE
AND
O
THER
B
ENEFITS
. Employee will be entitled to
participate in all benefits provided by the Company to its
employees and to senior executives in accordance with and subject
to the Company’s policies and procedures as they may exist
from time-to-time, including, but not limited to, medical and
dental insurance, life insurance, disability insurance, 401(k)
savings plan, any pension or retirement plan, deferred compensation
plan, education and seminar reimbursement,
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car allowance, and reimbursement of reasonable
expenses for company business. These benefits shall be at least at
the same level as provided to Employee as of the day prior to the
effective date of this Agreement except that contributions to the
Company’s 401(k) savings plan, money purchase plan and
supplemental executive retirement plan of the Company shall be
appropriately modified to reflect the current compensation of
Employee. Benefits shall also include life insurance for the
benefit of Employee with a face amount of not less than that in
effect as of December 31, 2002, with premium paid in
accordance with the Company’s policies in effect on
December 31, 2002, except that the Company may self-insure if
insurance is not available on a commercially reasonably basis. In
addition, the Company shall only be responsible for the payment of
the premium for the first level (first one-third) of
Employee’s life insurance benefit and the third level (the
last one-third) of such coverage. Employee shall be responsible for
the payment of the premium for the second level (second 1/3) of
coverage. Employee shall be entitled to four (4) weeks of paid
vacation per year.
b. A
DDITIONAL
W
ELLNESS
B
ENEFITS
. In addition to the benefits
described above, the Company shall reimburse Employee for all costs
associated with an annual physical not otherwise covered by
insurance and the costs not otherwise covered by insurance for a
more comprehensive physical exam and medical tests and evaluation
every two years, including the costs that may be associated with a
full body scan. Employee’s first comprehensive medical exam
shall be completed by December 31, 2007, with the next
comprehensive exam to be completed by December 31, 2009, and
shall continue thereafter every two years during the term of this
Agreement. If as a result of any annual physical Employee is
diagnosed with a medical condition that may reasonably be
considered to materially impact Employee’s performance of his
duties under this Agreement, Employee shall promptly advise the
Chairman of Kaiser’s Human Relations Committee of such
diagnosis. In the event Employee does not complete the
comprehensive medical exam every two years as provided herein,
Employee’s annual grant of Class A Units shall be
delayed until such time as Employee complies with this
comprehensive medical exam requirement. For example, if Employee
fails to have a comprehensive medical exam completed by
December 31, 2007, the annual grant of Class A Units to
Employee which Employee would have received on January 15,
2008 will be delayed until such time as Employee completes the
required comprehensive medical exam. The Company may also pay or
reimburse Employee for certain other reasonable health and wellness
benefits as may be pre-approved by the Company. Employee shall
provide to the General Counsel of the Company written notice that
he has completed the comprehensive medical exam as provided herein
together with reasonable documentation that such exam was
performed.
7. C OMPENSATION P AYABLE U PON T ERMINATION B Y THE C OMPANY W ITHOUT C AUSE . In
the event Employee is terminated by the Company for any reason
except for “cause”, as “cause” is defined
in Paragraph 11 below, the Company shall pay to Employee the
following compensation and Employee shall receive the following
benefits as severance benefits:
a. if the termination occurs during the Initial
Term, Employee shall be paid two (2) years of annual base
salary;
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b. the Company shall continue to provide and pay
its portion of all of Employee’s health insurance, dental
insurance, vision insurance, life insurance, wellness, welfare and
other benefits for a period of twenty four (24) months
following the date of termination, including the Company’s
portion of any retirement and deferred compensation plans such as
the Company’s 401(k) plan and SERP, as applicable. After such
termination, Employee shall be entitled, for a period of three
years to exercise his Equity Incentives as to any then vested,
including any options vesting within one year of termination as
provided in the next sentence, notwithstanding any other applicable
provision contained in any option agreement. In addition to the
foregoing, with respect to any restricted Equity Incentives,
Employee shall continue to vest in such securities for a period of
one-year following termination.
All amounts due Employee shall be
payable in one lump sum or as may be mutually agreed upon between
Employee and the Company as may be permitted under applicable law.
Employee shall have no duty to seek other employment during this
period of time and there shall be no offset for any compensation
paid to Employee from any other source. If the Company or an
Affiliate of the Company desires to retain Employee as a consultant
after termination of Employee’s employment, the parties shall
negotiate the terms of such consulting agreement which shall be
documented in an agreement executed by the parties.
8. C OMPENSATION P AYABLE U PON C ONSTRUCTIVE T ERMINATION . In the event that Employee is constructively
terminated by the Company as defined in Paragraph 9 below, Employee
shall be paid and receive the same compensation and benefits as
provided in Paragraph 7 above for termination by the Company
without cause.
9. C ONSTRUCTIVE T ERMINATION D EFINED . Employee shall be deemed to have been
constructively terminated by the Company upon the occurrence of any
of the following events:
a. The assignment to Employee of duties materially
and adversely inconsistent with Employee’s positions at
Kaiser as a leased employee as of the effective date of this
Agreement. This includes a change in reporting responsibilities,
authority including title, or responsibilities; provided, however,
a lateral transfer within Kaiser or to an Affiliate shall not be
deemed a constructive termination;
b. Any requirement that Employee permanently
relocate to an office more than 50 miles from the then location to
which he is assigned as of the effective date of this Agreement;
and/or
c. Any failure to provide Employee with
compensation and benefits in the aggregate on terms that are not
materially less favorable than those enjoyed by Employee under this
Agreement as of the effective date of this Agreement, or the
subsequent taking of any action that would materially reduce any of
Employee’s compensation and benefits in effect as of the date
of this Agreement unless such compensation and benefits are
substantially equally reduced for executive officers of the Company
as a group (as measured by a percentage) or there is less than a
ten percent (10%) reduction in compensation or
benefits.
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then, at Employee’s option,
exercisable within ninety (90) days of the date Employee knew,
or should have known exercising reasonable care, of the occurrence
of any of the foregoing events and the expiration of any applicable
cure period, Employee shall have the right to terminate his
employment by written notice to the Company, and on the date of
such termination the Company will pay Employee the compensation and
benefits described in Paragraph 11 below.
10. T ERMINATION FOR C AUSE . If
the Company elects to terminate Employee’s employment for
“cause” (as defined Paragraph 11 below),
Employee’s employment will terminate on the date fixed for
termination by the Company and thereafter the Company will not be
obligated
