Exhibit 10.8


 


EMPLOYMENT
AGREEMENT

(Gerald B. Engen, Jr.)


 


This EMPLOYMENT
AGREEMENT, dated as of December 1, 2007 (this “Agreement”), is by and between MYR Group Inc., a Delaware
corporation (the “Company”), and
Gerald B. Engen, Jr. (the “Key Employee”).
 This Agreement shall become effective
upon the closing of the offering and sale of equity securities by the Company
(the “Effective Date”) pursuant to a
Purchase/Placement Agreement to be entered into by and between the Company and
Friedman, Billings, Ramsey & Co., Inc. (the “Financing”);
provided, that this Agreement shall be null and void, and of no force or
effect, if such closing does not occur within ninety (90) days after the date
hereof.


 


W I T N E S
S E T H:


 


WHEREAS, the Company
has identified Key Employee as an integral part of the Company’s operation and
management; and


 


WHEREAS, the Company
recognizes Key Employee’s efforts and desires to reward those efforts to
protect and enhance the best interests of the Company.


 


NOW,
THEREFORE, in consideration of the foregoing and of the
respective covenants and agreements set forth below, the parties hereto agree
as follows:


 


ARTICLE I

DEFINITIONS AND INTERPRETATIONS


 


1.1          Definitions.


 


(a)                                  “Base Salary” means the Key Employee’s base salary as in
effect from time to time, as described in Section 2.3(a).


 


(b)                                 “Board” means the Board of Directors of the Company.


 


(c)                                  “Cause” means:


 


(i)                                     A material
breach by Key Employee of Sections 3.9(d), (e) or (f) of
this Agreement (regarding the noncompetition provisions);


 


(ii)                                  The commission
of a criminal act by Key Employee against the Company, including but not
limited to fraud, embezzlement or theft;


 


(iii)                               The conviction
or plea of no contest or nolo contendere of Key Employee for any felony or any
crime involving moral turpitude; or


 


(iv)                              Key Employee’s
failure or refusal to carry out, or comply with, in any material respect, any
lawful directive of the Board consistent with the terms of the Agreement which
is not remedied within thirty (30) days after Key Employee’s receipt of written
notice from the Company.


 


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Notwithstanding the
foregoing, Key Employee shall not be deemed to have been terminated for Cause
pursuant to this Section 1.1(c) unless and until there shall
have been delivered to him a copy of a resolution duly adopted by at least
seventy-five percent (75%) of the entire membership of the Board (not including
for this purpose Key Employee if Key Employee is then a member of the Board) at
a meeting of the Board called and held for such purpose (after reasonable
notice to Key Employee and a reasonable opportunity for him, together with his
counsel, to be heard before the Board), finding that in the good faith opinion
of the Board, Key Employee engaged in conduct set forth in this Section 1.1(c).


 


(d)                                 “Change in Control” means the occurrence of a “change in the
ownership of the Company,” a “change in the effective control of the Company,”
or a “change in the ownership of a substantial portion of the Company’s assets,”
as defined in Treasury Regulation §§1.409A-3(i)(5)(v), (vi) and (vii),
respectively.


 


(e)                                  “COBRA” means the Consolidated Omnibus Budget Reconciliation
Act of 1986, as amended.


 


(f)                                    “Code” means the Internal Revenue Code of 1986, as amended.


 


(g)                                 “Disability” means that, by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than
twelve months, Key Employee is unable to engage in any substantial gainful
activity or is receiving income replacement benefits under an accident and
health plan covering employees of the Company for a period of not less than
three months.


 


(h)                                 “Good Reason” means:


 


(i)                                     a reduction of
Key Employee’s Base Salary and/or annual target bonus opportunity without Key
Employee’s consent,


 


(ii)                                  a material
reduction of Key Employee’s duties (without the Key Employee’s consent) from
those in effect as of the Effective Date or as subsequently agreed to by Key
Employee and the Company for which Key Employee shall have given the Company
written notice of such breach and the Company shall have failed to cure such
breach within thirty (30) days after receipt of such notice,


 


(iii)                               the relocation
of the Key Employee’s primary work site to a location greater than fifty (50)
miles from the Key Employee’s work site as of the Effective Date, or


 


(iv)                              any other
material breach by the Company of a material provision of this Agreement for
which Key Employee shall have given the Company written notice of such breach
and the Company shall have failed to cure such breach within thirty (30) days
after receipt of such notice.


 


(i)                                     “Post-Termination
Period” means the period beginning on the date that Key Employee’s employment
terminates and ending on the first anniversary of such date; provided, however,
that with respect to a termination without Good Reason, such period shall 


 


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begin on the date that Key
Employee’s employment terminates and end on the six-month anniversary of such
date.


 


(j)                                     “Protection Period” means the period beginning on the date of
the occurrence of a Change in Control and ending 12 months following the
occurrence of a Change in Control.


 


(k)                                  “Severance Pay” means


 


(i)                                     one-half (1/2)
the sum of Key Employee’s annual Base Salary and Target Bonus as of the date of
his termination of employment, in the case of a termination by Key Employee
without Good Reason, whether or not during the Protection Period;


 


(ii)                                  two (2) times
the sum of Key Employee’s annual Base Salary and Target Bonus as of the date of
his termination of employment, in the case of a termination Without Cause
outside the Protection Period or a termination by Key Employee with Good Reason
outside the Protection Period; and


 


(iii)                               three (3) times
the sum of Key Employee’s annual Base Salary and Target Bonus as of the date of
his termination of employment, in the case of a termination Without Cause
during the Protection Period or a termination by Key Employee for Good Reason
during the Protection Period.


 


(l)                                     “Severance Period” means


 


(i)                                     the six (6) month
period following the date of his termination of employment, in the case of a
termination by Key Employee without Good Reason, whether or not during the
Protection Period; and


 


(ii)                                  the two (2) year
period following the date of his termination of employment, in the case of a
termination Without Cause or a termination by Key Employee for Good Reason,
whether or not during the Protection Period.


 


(m)                               “Without Cause” means termination by the Company of Key
Employee’s employment at the Company’s sole discretion for any reason, other
than by reason of Key Employee’s death or Disability, and other than a
termination based upon Cause.


 


1.2                               Interpretations.  In this Agreement, unless a clear contrary
intention appears, (a) the words “herein,” “hereof” and “hereunder” and
other words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision; (b) reference to
any Article or Section, means such Article or Section hereof;
and (c) the word “including” (and with correlative meaning “include”)
means including, without limiting the generality of any description preceding
such term.


 


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ARTICLE II

EMPLOYMENT AND DUTIES


 


2.1          Term.  The term of this Agreement shall be three (3) years
commencing on the Effective Date of this Agreement (the “Initial Term”),
provided, however, that the Agreement shall automatically be extended for an
additional one-year period at the end of the Initial Term and each one-year
anniversary thereafter (each a “Renewal Term”
and together with the Initial Term being referred to herein as the “Employment Term”), unless not later than one-hundred eighty
(180) days prior to the end of the then-current period, either Key Employee or
the Company shall have provided written notice to the other party that it does
not wish to extend the Agreement.


 


2.2          Position, Duties and Services.  The Key Employee shall serve in the position
of Vice President, Chief Legal Officer and Secretary and shall have duties and
responsibilities consistent with an executive serving in such capacity.  The Key Employee shall perform such duties
and responsibilities diligently and to the best of his abilities.  The Key Employee’s employment will be subject
to the supervision and direction of the Chief Executive Officer of the Company
and the Board.


 


2.3          Compensation.


 


(a)           Base Salary.  Key Employee shall receive an initial Base
Salary at the rate of two hundred fifty thousand dollars ($250,000) per annum
payable in periodic installments in accordance with the Company’s normal
payroll practices and procedures, which Base Salary may be increased (but not
decreased) by the Board or (a committee thereof) from time to time.


 


(b)           Target Bonus.  During the Employment Term, Key Employee
shall be eligible to receive an annual target bonus (the “Target Bonus”) equal
to fifty percent (50%) of Executive’s Base Salary, based on the achievement of
annual performance objectives, as determined by the Board (or a committee
thereof) in its discretion.


 


(c)           Incentive, Savings, Profit
Sharing, and Retirement Plans. 
During the Employment Term, Key Employee shall be entitled to
participate in all incentive, savings, profit sharing and retirement plans,
practices, policies and programs applicable generally, from time to time, to
other similarly situated employees of the Company.


 


(d)           Welfare Benefit Plans.  During the Employment Term, Key Employee
and/or Key Employee’s family, as the case may be, shall be eligible for
participation in and will receive all benefits under the welfare benefit plans,
practices, policies and programs applicable generally, from time to time, to
other similarly situated employees of the Company.


 


2.4          Severance Benefit.  Key Employee shall be entitled to receive the
severance benefits described in ARTICLE III upon his termination of
employment during the Employment Term, provided he satisfies the requirements
outlined in ARTICLE III. 
Notwithstanding anything in this Agreement to the contrary, for all
purposes of this Agreement, Key Employee shall not be deemed to have incurred a
termination of employment unless Key Employee has incurred a “separation from
service” as defined in Treasury Regulation §1.409A-1(h).


 


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2.5          Indemnification.  The Company shall (i) indemnify, hold
harmless and defend Key Employee to the extent permitted under applicable law
from and against reasonable costs, including reasonable attorneys fees,
incurred by him in connection with or arising out of any acts or decisions made
by Key Employee in the course and scope of his employment hereunder and (ii) pay
all reasonable expenses and reasonable attorney’s fees actually incurred by Key
Employee in connection with or relating to the defense of any claim, action,
suit or proceeding by any third party against Key Employee arising out of or
relating to any acts or decisions made by Key Employee in the course and scope
of his employment hereunder; provided, however, that such indemnification shall
not apply with respect to the commission of a criminal act or any gross
misconduct by Key Employee.  This Section 2.5
shall survive the termination or expiration of this Agreement.


 


ARTICLE III

EARLY TERMINATION


 


3.1          Death.  Upon the death of Key Employee during the
Employment Term, the Agreement shall terminate and Key Employee’s estate shall
be entitled to payment of his Base Salary through the date of such termination
plus any compensation and benefits payable pursuant to the terms of the
compensation and benefit plans specified in Section 2.3 in which
Key Employee is a participant.


 


3.2          Disability.  In the event of Key Employee’s Disability
during the Employment Term, the Agreement and Key Employee’s employment with
the Company shall terminate and Key Employee shall be entitled to payment of
the following benefits:  (a) his
Base Salary through the date of such termination; (b) long-term disability
benefits pursuant to the terms of any long-term disability policy provided to
similarly situated employees of the Company in which Key Employee is a
participant; and (c)  any compensation and benefits payable pursuant to
the terms of the compensation and benefit plans specified in Section 2.3
in which Key Employee is a participant.


 


3.3          Termination for Cause by Company.  If Key Employee’s employment is terminated
during the Employment Term for Cause, the Company shall pay Key Employee
through the date of termination (a) his Base Salary in effect at the time
notice of termination is given and (b)  any compensation and benefits
payable pursuant to the terms of the compensation and benefit plans specified
in Section 2.3 in which Key Employee is a participant.


 


3.4          Termination Without Good Reason by
Key Employee.  If Key
Employee terminates his employment with the Company during the Employment Term
without Good Reason, whether or not during the Protection Period, Key Employee
shall be entitled to (a) his unpaid Base Salary through the date of
termination; (b) any compensation and benefits payable pursuant to the
terms of the compensation and benefit plans specified in Section 2.3
in which Key Employee is a participant; (c) a lump sum payment equal to
his Severance Pay, and (d) during the Severance Period, Company-paid
benefit continuation coverage, on an insured or uninsured basis as determined
by the Company in its sole discretion, concurrent with COBRA, for Key Employee
and his family under the welfare benefit plans specified in Section 2.3(d) in
which Key Employee is a participant, on the same basis as such benefits are
provided to active employees; provided, however, that if Key Employee breaches
the provisions of Section 3.9(b), 


 


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(d), (e) or (f) before the end
of the Severance Period, Key Employee shall forfeit the right to benefit
continuation coverage for the remainder of the Severance Period and, within
thirty (30) days of such breach, Key Employee shall be required to remit to the
Company a pro-rata portion of his Severance Pay, calculated as the product of (i) the
Severance Pay received by Key Employee upon his termination, times (ii) a
fraction, the numerator of which shall be the number of months from Key
Employee’s termination to the date of such breach and the denominator of which
shall be six (6) (the number of months in the Severance Period).  Notwithstanding anything to the contrary
herein, if Key Employee becomes re-employed by another employer during the
Severance Period, Key Employee shall provide written notice of such
re-employment to the Company within thirty (30) days of the commencement of
such new employment, at which time the Company-paid benefit continuation
coverage described herein shall be terminated and Key Employee shall be
required to remit to the Company a pro-rata portion of his Severance Pay,
calculated as the product of (i) the Severance Pay received by Key
Employee upon his termination, times (ii) a fraction, the numerator of
which shall be the number of months from Key Employee’s termination to the date
of such re-employment and the denominator of which shall be six (6).  Subject to Section 3.11, the
payment of any Severance Pay and the continuation of welfare benefit plan
coverage, as provided in Section 2.3(d), shall be made (or
commence) in the month immediately following the month in which the waiver and
release of claims described in Section 3.8 becomes non-revocable.


 


3.5          Termination Without Cause or for
Good Reason Outside the Protection Period.  If, during the Employment Term and outside
the Protection Period, the Key Employee’s employment is terminated by the
Company Without Cause or Key Employee terminates his employment with the
Company for Good Reason, he shall be entitled to (a) his unpaid Base
Salary through the date of termination; (b)  any compensation and benefits
payable pursuant to the terms of the compensation and benefit plans specified
in Section 2.3 in which Key Employee is a participant; (c)  a
lump sum payment equal to his Severance Pay; and (d) during the Severance
Period, Company-paid benefit continuation coverage, on an insured or uninsured
basis as determined by the Company in its sole discretion, concurrent with
COBRA, for Key Employee and his family under the welfare benefit plans
specified in Section 2.3(d) in which Key Employee is a
participant, on the same basis as such benefits are provided to active
employees.  Notwithstanding anything to
the contrary herein, if Key Employee becomes re-employed by another employer during
the Severance Period, Key Employee shall provide written notice of such
re-employment to the Company within thirty (30) days of the commencement of
such new employment, at which time the Company-paid benefit continuation
coverage described herein shall be terminated. 
Subject to Section 3.11, the payment of any Severance Pay
and the continuation of welfare benefit plan coverage, as provided in Section 2.3(d),
shall be made (or commence) in the month immediately following the month in
which the waiver and release of claims described in Section 3.8
becomes non-revocable.


 


3.6          Termination Without Cause or for
Good Reason During the Protection Period.  If, during the Employment Term and during the
Protection Period, Key Employee’s employment is terminated by the Company
Without Cause or Key Employee terminates his employment with the Company for
Good Reason, he shall be entitled to (a) his unpaid Base Salary through
the date of termination; (b) any compensation and benefits payable
pursuant to the terms of the compensation and benefit plans specified in Section 2.3
in which Key Employee is a participant; (c) a lump sum payment equal to
his Severance Pay; and (d) during the 


 


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Severance Period,
Company-paid benefit continuation coverage, on an insured or uninsured basis as
determined by the Company in its sole discretion, concurrent with COBRA, for
Key Employee and his family under the welfare benefit plans specified in Section 2.3(d) in
which Key Employee is a participant, on the same basis as such benefits are
provided to active employees. 
Notwithstanding anything to the contrary herein, if Key Employee becomes
re-employed by another employer during the Severance Period, Key Employee shall
provide written notice of such re-employment to the Company within thirty (30)
days of the commencement of such new employment, at which time the Company-paid
benefit continuation coverage described herein shall be terminated.  Subject to Section 3.11, the
payment of any Severance Pay and the continuation of welfare benefit plan
coverage, as provided in Section 2.3(d), shall be made (or
commence) in the month following the month in which the waiver and release of
claims described in Section 3.8 becomes non-revocable.  In the event of Key Employee’s termination
under this Section 3.6, Key Employee shall not be bound by the provisions
of Section 3.9(b).


 


3.7          Termination of Company’s
Obligations.  Upon
termination of Key Employee’s employment for any reason, the Company’s
obligations under this Agreement shall terminate and Key Employee shall be
entitled to no compensation and benefits other than that provided in this ARTICLE III.  Notwithstanding such termination, the parties’
obligations under Sections  2.5 and 3.9 of this Agreement shall
remain in full force and effect.


 


3.8          Release.  Notwithstanding the foregoing provisions of
this ARTICLE III, Key Employee shall be entitled to the additional
benefits specified in Section 3.4 (regarding termination Without
Good Reason whether or not during the Protection Period), Section 3.5
(regarding termination Without Cause or for Good Reason outside the Protection
Period) and Section 3.6 (regarding termination Without Cause or for
Good Reason during the Protection Period) (i.e., those in
addition to the payment of his Base Salary through the date of termination and
any benefits payable pursuant to the terms of the compensation and benefit
plans specified in Section 2.3 in which Key Employee is a
participant), only upon his execution (and non-revocation) of a waiver and
release of all claims substantially in the form attached hereto, which
execution must occur before the forty-fifth (45th) day immediately
following the date of termination; provided, however, that in any case where
such forty-five (45) day period extends into December of any calendar
year, any payments required to be made to Key Employee that are treated as
deferred compensation for purposes of Section 409A shall be made no
earlier than January 1 of the following calendar year.


 


3.9          Non-Competition;
Non-Solicitation; Confidentiality.


 


(a)           Key Employee acknowledges and agrees
that:  (i) the Company is engaged in
the business of power line and commercial/industrial electrical construction
services for electric utilities, telecommunication providers, commercial/industrial
facilities, and government agencies and electrical construction and maintenance
services for industrial and power generation clients (the “Business”); (ii) the
Business is intensely competitive; (iii) Key Employee’s customer
relationships are near permanent and but for Key Employee’s association with
the Company, Key Employee would not have had contact with the customers; (iv) Key
Employee will continue to develop and have access to and knowledge of
non-public information of the Company and its clients; (v) the direct or
indirect disclosure of any such confidential 


 


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information to existing or
potential competitors of the Company would place the Company at a competitive
disadvantage and would do damage to the Company; (vi) Key Employee has
developed goodwill with the Company’s clients at the substantial expense of the
Company; (vii) but for Key Employee entering into the covenants set forth
in this Section 3.9, the Company would not have entered into the
Financing and the closing of the offering and sale of equity securities by the
Company as set forth above, (viii) Key Employee engaging in any of the
activities prohibited by this Section 3.9, would constitute
improper appropriation and/or use of the Company’s confidential information
and/or goodwill, (ix) Key Employee’s association with the Company has been
critical, and Key Employee’s association with the Company is expected to
continue to be critical, to the success of the Company, (x) the services
to be rendered by Key Employee to the Company are of a special and unique
character, (xi)  Company conducts the
Business throughout the United States, (xii) the noncompetition and other
restrictive covenants and agreements set forth in this Agreement are fair and
reasonable and it would not be reasonable to enter into the Financing without
obtaining such non-competition and other restrictive covenants and agreements,
and (xiii) in light of the foregoing and of Key Employee’s education, skills,
abilities and financial resources, Key Employee acknowledges and agrees that
the Key Employee will not assert, and it should not be considered, that
enforcement of any of the covenants set forth in this Section 3.9
would prevent Key Employee from earning a living or otherwise are void,
voidable or unenforceable or should be voided or held unenforceable.


 


(b)           Agreement not to Compete.  Key Employee will not, during his employment
and the Post-Termination Period, directly or indirectly, carry on or conduct,
the Business or any business of the nature in which the Company or its
subsidiaries are then engaged in any geographical area in which the Company or
its subsidiaries or affiliates engage in business at the time of such
termination or any new line of business with respect to which Key Employee has
created, received or had access to confidential information (as set forth
below).  Key Employee agrees that he will
not so conduct or engage in the Business or any such business in any capacity,
including as an individual on his own account or as a partner or joint venturer
or as an employee, agent, consultant or salesman for any other person or
entity, or as an officer or director of a corporation, provided, that
Key Employee may be a shareholder in any public corporation if he does not own
ten percent (10%) or more of any class of its stock.


 


(c)           Confidential Information.  Key Employee will not, directly or
indirectly, at any time following termination of his employment with the
Company for any reason, reveal, divulge or make known to any person or entity,
or use for Key Employee’s personal benefit (including for the purpose of
soliciting business, whether or not competitive with any business of the
Company or its subsidiaries or affiliates), any information acquired during the
Employment Term with regard to the financial, business or other affairs of the
Company or its subsidiaries or affiliates (including any list or record of
persons or entities with which the Company or its subsidiaries or affiliates
has any dealings), other than (i) information already in the public
domain; or (ii) information that Key Employee is required to disclose
under the following circumstances:  (A) at
the direction of any authorized governmental entity; (B) pursuant to a
subpoena or other court process; (C) as otherwise required by law or the
rules, regulations, or orders of any applicable regulatory body; or (D) as
otherwise necessary, in the opinion of counsel for Key Employee, to be
disclosed by Key Employee in connection with any legal action or proceeding
involving Key Employee in his capacity as an employee, officer, director, or
stockholder of the Company or any subsidiary or affiliate of the Company.


 


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(d)           Key Employee will, upon the earlier
of (i) any time requested by the Company or (ii) termination of his
employment with the Company for any reason, promptly deliver to the Company all
documents, memoranda, notes, reports, lists, files, customer lists, mailing
lists, software, disks, credit cards, door and file keys, computer access
codes, instructional manuals, and other physical or personal property which Key
Employee received or prepared or helped to prepare in connection with his
relationship with the Company including, but not limited to, any confidential
information (as set forth above) of the Company or any of its subsidiaries and
affiliates which he may then possess or have under his control, and Key
Employee shall not retain any copies, duplicates, reproductions or excerpts
thereof.


 


(e)           Agreement not to Solicit.    During the Employment Term and for the
Post-Termination Period, Key Employee shall not (except on behalf of or with
the written consent of the Company), either directly or indirectly, on Key
Employee’s own behalf or in the service or on behalf of others, (i) solicit,
divert, or appropriate, or (ii) attempt to solicit, divert, or
appropriate, any person or entity that is or was a customer of the Company or
any of its affiliates at any time during the twelve (12) months prior to the
date of termination and with whom Key Employee has had material contact.


 


(f)            Agreement not to Recruit.  During the Employment Term and for the
Post-Termination Period, Key Employee shall not, either directly or indirectly,
on Key Employee’s behalf or in the service or on behalf of others, (i) solicit,
divert, or hire away, or (ii) attempt to solicit, divert, or hire away,
any employee of or consultant to the Company or its subsidiaries or affiliates.


 


(g)           Reasonableness of Restrictions.  Key Employee acknowledges that the geographic
boundaries, scope of prohibited activities, and time duration set forth in this
Section 3.9 are reasonable in nature and are no broader than are
necessary to maintain the goodwill of the Company and the confidentiality of
its confidential information and to protect the legitimate business interests
of the Company, and that the enforcement of such provisions would not cause Key
Employee any undue hardship nor unreasonably interfere with Key Employee’s
ability to earn a livelihood.  If any
court determines that any portion of this Section 3.9 is invalid or
unenforceable, the remainder of this Section 3.9 will not thereby
be affected and will be given full effect without regard to the invalid
provisions.  If any court construes any
of the provisions of this Section 3.9, or any part thereof, to be
unreasonable because of the duration or scope of such provision, such court
shall reduce the duration or scope of such provision and enforce such provision
as so reduced.


 


(h)           Enforcement.  Upon Key Employee’s employment with an entity
that is not a subsidiary or affiliate of the Company (a “Successor
Employer”) during the period that the provisions of this Section 3.9
remain in effect, Key Employee will provide such Successor Employer with a copy
of this Agreement and will notify the Company of such employment within thirty
(30) days thereof.  Key Employee agrees
that in the event of a breach or threatened breach of the terms and conditions
of this Section 3.9 by Key Employee, the Company will be entitled,
if it so elects, to institute and prosecute proceedings, either in law or in
equity, against Key Employee, to obtain damages for any such breach, or to
enjoin (in the form of specific performance, temporary restraining order,
temporary or permanent injunction or otherwise) Key Employee from any conduct
in violation of this Section 3.9, without having to post a bond.


 


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3.10        Parachute Payments.  Notwithstanding anything to the contrary in
this Agreement, if it is determined (as hereafter provided) that any payment or
distribution to or for Key Employee’s benefit, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise pursuant to or by reason of any other agreement, policy, plan,
program or arrangement, including without limitation any stock option, stock
appreciation right or similar right, or the lapse or termination of any
restriction on or the vesting or exercisability of any of the foregoing (a “Payment”),
would be subject to the excise tax imposed by Section 4999 of the Code (or
any successor provision thereto) or to any similar tax imposed by state or
local law, or any interest or penalties with respect to such excise tax (such
tax or taxes, together with any such interest and penalties, are hereafter
collectively referred to as the “Excise Tax”), then Key Employee shall
be entitled to receive an additional payment or payments (a “Gross-Up
Payment”) in an amount such that, after payment by Key Employee of all
taxes (including any interest or penalties imposed with respect to such taxes),
including any Excise Tax, imposed upon the Gross-Up Payment, Key Employee
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.  For purposes of
determining whether any of the Payments will be subject to the Excise Tax and
the amount of such Excise Tax, (i) all of the Payments shall be treated as
“parachute payments” within the meaning of section 28OG(b)(2) of the Code,
and all “excess parachute payments” within the meaning of section 28OG(b)(1) of
the Code shall be treated as subject to the Excise Tax, unless in the opinion
of tax counsel selected by the Company’s independent auditors and reasonably
acceptable to Key Employee such other payments or benefits (in whole or in
part) do not constitute parachute payments, including by reason of section
28OG(b)(4)(A) of the Code, or such excess parachute payments (in whole or
in part) represent reasonable compensation for services actually rendered,
within the meaning of section 28OG(b)(4)(B) of the Code, in excess of the “base
amount” (as such term is defined in section 28OG(b)(3) of the Code)
allocable to such reasonable compensation, or are otherwise not subject to the
Excise Tax, (ii) the amount of the Payments which shall be treated as
subject to the Excise Tax shall be equal to the lesser of (A) the total
amount of the Payments or (B) the amount of excess parachute payments
within the meaning of section 28OG(b)(1) of the Code (after applying
clause (i), above), and (iii) the value of any non-cash benefits or any
deferred payment or benefit shall be determined by the Company’s independent
auditors in accordance with the principles of sections 28OG(d)(3) and (4) of
the Code.  For purposes of determining
the amount of the Gross-Up Payment, Key Employee shall be deemed to pay federal
income taxes at the highest marginal rate of federal income taxation in the
calendar year in which the Gross-Up Payment is to be made and state and local income
taxes at the highest marginal rate of taxation in the state and locality of Key
Employee’s residence on the date of termination, net of the maximum reduction
in federal income taxes which could be obtained from deduction of such state
and local taxes.  In the event that the
Excise Tax is subsequently determined to be less than the amount taken into
account hereunder at the time of Key Employee’s termination of employment, Key
Employee shall repay to the Company, at the time that the amount of such reduction
in Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction (plus that portion of the Gross-Up Payment
attributable to the Excise Tax and federal, state and local income tax imposed
on the Gross-Up Payment being repaid by Key Employee to the extent that such
repayment results in a reduction in Excise Tax and/or a federal, state or local
income tax deduction) plus interest on the amount of such repayment at the rate
provided in section 1274(b)(2)(B) of the Code.  In the event that the Excise Tax is
determined to exceed the amount 


 


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taken into account hereunder
(including by reason of any payment the existence or amount of which cannot be
determined at the time of the Gross-Up Payment), the Company shall make an
additional Gross-Up Payment in respect of such excess (plus any interest,
penalties or additions payable by Key Employee with respect to such excess) at
the time that the amount of such excess is finally determined.  Key Employee and the Company shall each
reasonably cooperate with the other in connection with any administrative or
judicial proceedings concerning the existence or amount of liability for Excise
Tax with respect to the Severance Payments. 
Notwithstanding anything in this Agreement to the contrary, in no event
shall payments under this Section be made later than the end of Key
Employee’s taxable year following the taxable year in which the related Excise
Tax is remitted by or on behalf of the Key Employee.


 


3.11        Payments Subject to Section 409A
of the Code. 
Notwithstanding the foregoing provisions of this ARTICLE III,
to the extent required by Section 409A of the Code and applicable guidance
thereunder, payments that Key Employee would otherwise be entitled to receive
hereunder during the first six months following the date of Key Employee’s
termination of employment will be accumulated and paid on the date that is six
months and one day after the date of Key Employee’s termination of employment
(or if such payment date does not fall on a business day of the Company, the
next following business day of the Company), or such earlier date upon which
such amount can be paid without adverse tax consequences to Key Employee under
section 409A of the Code; provided, however, that no such delay shall
apply with respect to payments to which Key Employee is entitled in the event
of his death.


 


ARTICLE IV

MISCELLANEOUS


 


4.1          Governing Law.  This Agreement is governed by and will be
construed in accordance with the laws of the State of Illinois, without regard
to the conflicts of law principles of such State.


 


4.2          Amendment and Waiver.  The provisions of this Agreement may be
amended, modified or waived only with the prior written consent of the Company
and Key Employee, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement will be construed as a waiver of such provisions
or affect the validity, binding effect or enforceability of this Agreement or
any provision hereof.


 


4.3          Severability.  Any provision in this Agreement which is
prohibited or unenforceable in any jurisdiction by reason of applicable law
will, as to such jurisdiction, be ineffective only to the extent of such
prohibition or unenforceability without invalidating or affecting the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction will not invalidate or render unenforceable such provision in any
other jurisdiction.


 


4.4          Entire Agreement.  Except as provided in the written benefit
plans and programs referenced in Section 2.3(c) and Section 2.3(d),
this Agreement embodies the complete agreement and understanding among the
parties hereto with respect to the subject matter hereof and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof
in any way.


 


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4.5          Withholding of Taxes and Other
Employee Deductions.  The
Company may withhold from any benefits and payments made pursuant to this
Agreement all federal, state, city, and other taxes as may be required pursuant
to any law or governmental regulation or ruling and all other normal employee
deductions made with respect to the Company’s employees generally.


 


4.6          Legal Fees.  The Company shall reimburse Key Employee for
all reasonable legal fees and expenses incurred by the Executive in a dispute
regarding the Key Employee’s rights under this Agreement, within forty-five
(45) day of when such fees and expenses are incurred, but in no event later
than the end of the taxable year in which such fees and expenses are incurred,
unless a court of competent jurisdiction determines the Key Employee’s position
in such dispute not to be bona fide.


 


4.7          Headings.  The paragraph headings have been inserted for
purposes of convenience and will not be used for interpretive purposes.


 


4.8          Actions by the Board.  Any and all determinations or other actions
required of the Board (or a committee thereof) hereunder that relate
specifically to Key Employee’s employment by the Company or the terms and
conditions of such employment will be made by the members of the Board or such
committee other than Key Employee (if Key Employee is a member of the Board or
such committee), and Key Employee will not have any right to vote or decide
upon any such matter.


 


4.9          Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rule of strict construction will be applied against any party.


 


[Signature Page Follows]


 


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INTENDING
TO BE BOUND, the parties hereto have executed this Agreement as
of the date first set forth above.


 


	
   

  	
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
  MYR GROUP INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William
  A. Koertner

  	
   

  
	
   

  	
  Name:

  	
  William A. Koertner

  	
   

  
	
   

  	
  Title:

  	
  President and CEO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  KEY EMPLOYEE:

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Gerald B.
  Engen, Jr.

  	
   

  
	
   

  	
  Gerald B. Engen, Jr.

  	
   

  



 


 


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