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Michael
Baker Corporation
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Airside
Business Park
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100 Airside
Drive
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Moon Township,
PA 15108
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(412)
269-6300
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Craig O.
Stuver
Senior Vice President, Acting Chief Financial Officer and
Treasurer
Michael Baker Corporation
Airside Business Park
100 Airside Drive
Moon Township, PA 15108
Since the
arrangement we entered into on September 18, 2008 for you to
continue to work with us through December 31, 2008 has now
expired, we have agreed to a new arrangement for you to continue to
work with us through March 31, 2009. In acknowledgement of
your willingness to continue to assist us during this period with
an orderly transition, Baker is prepared to offer you the following
arrangement:
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1.
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For
each month (or part of a month exceeding two weeks) you stay with
the Corporation beginning January 1, 2009, the Corporation
will pay you an additional two and one-half months’
compensation and the Cobra cost of your medical insurance for two
and one-half months. The payments for Cobra cost will be grossed up
to cover your Federal and state tax liability on such payments. For
example, if you stay with the Corporation through February 28,
2009, you will receive an additional five months’
compensation plus five months’ Cobra cost. This benefit will
be capped based upon three months of additional service or service
through March 31, 2009, so while you may elect to stay with the
Corporation thereafter, you will only be eligible for up to seven
and one-half months of such supplementary compensation and Cobra
payments under this arrangement, whether you are leaving at that
time or have decided to stay on longer. Subject to paragraph 8 of
this letter, if and as applicable, the supplementary compensation
and the Cobra costs of your medical insurance will be paid in a
single lump-sum on the first regularly scheduled payroll date
following March 15, 2009. Any gross-up payments will be made
on the same date as the underlying taxable payment, provided
however in all events, all such amounts payable by the Corporation
shall be paid by the end of the taxable year next following the
taxable year in which you remit the related taxes or, in the case
of a tax audit or litigation addressing the existence or amount of
a tax liability, by the end of the taxable year following the
taxable year in which the taxes that are the subject of audit or
litigation are remitted to the taxing authority (or where as
a
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1
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result of such
audit or litigation no taxes are remitted, the end of the taxable
year following the taxable year in which the audit is completed or
there is a final and nonappealable settlement or other resolution
of the litigation).
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2.
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In
addition, you will remain eligible for any bonus payments you would
otherwise have received for 2008 performance. Subject to paragraph
8 of this letter, if and as applicable, such payment, if any, will
be made at the same time the Corporation makes 2008 bonus payments
to its other eligible employees and in all events within the first
2 1 / 2 months following the year in which
you obtain the vested right to receive payment.
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3.
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Any
payments you receive under this letter agreement shall be in
addition to any severance payments to which you may be entitled
under the Corporation’s Policy regarding Reductions in Force,
which appears at Section 5.1.3 of the Corporation’s
Policy Manual. I have attached a copy of this Section as
Exhibit A to this letter for your ready reference. Based upon
your qualifying years of service, if you are otherwise entitled to
severance under the Policy, you will receive a severance payment
equal to nine (9) weeks of compensation based upon your
compensation on the day you cease to be employed by the
Corporation. The amount, time and form of payment of benefits
described elsewhere herein shall not affect the amount, time or
form of severance payments provided pursuant to the
Corporation’s Policy regarding Reductions in Force. Any such
severance payments shall be paid at the time and in the form
described in the Policy Manual.
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4.
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You
will continue to be an employee at will and may be terminated by
the Corporation wi
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