Document:

esl-ex103_353.htm

Exhibit 10.3

November 6, 2014

 

 

 

 

Paul Benson

105 Finchley Lane

Folsom, CA 95630

 

Dear Paul,

 

It is my pleasure to confirm our offer to you for the position of Senior Director, Human Resources effective November 19, 2014.  This will be an interim position until Esterline’s Board of Directors has an opportunity to meet in December to consider your nomination as a corporate officer with the title of Vice President Human Resources.  We expect their approval will be forthcoming.  For this interim period you will report directly to me.  Once you have been formally elected to the Vice President Human Resources position, you will report to our CEO, Curtis Reusser.

 

Your compensation and terms of employment will be comprised of several components, as follows: 

 

Base Salary – Your annual base salary rate will be $265,000.00 effective on your first day of work.

 

Annual Incentive Compensation – We will recommend to the Board that you participate in Esterline’s Annual Incentive Compensation Plan for fiscal year 2015 (“AIC Plan”).  Your target award will be 40% of your base salary, consistent with competitive market benchmarks.  The actual award will vary, of course, depending on the Company’s 2015 financial performance. The AIC Plan’s performance goals will be achievement of (1) budgeted earnings (EBIT); (2) budgeted return-on-sales; and (3) selected strategic objectives.  In December the Board will approve FY15 executive incentive plans in final form and we will provide you a copy then.   

 

Your participation in the AIC Plan is subject to its usual terms including a requirement that you continue employment through the date on which AIC Plan payments are made.  The AIC Plan is re-evaluated each year, such that the performance goals, formula, total funding, and your target award could vary from year to year. 

 

Long-Term Incentive Compensation – We will also recommend to the Board that you be appointed to Esterline’s Long Term Incentive Program with a total target value of $132,500 (0.5 times your starting annual base salary).  Currently, the total target value is allocated among Esterline’s three, long-term incentive compensation vehicles, as follows:

 

 

Paul Benson

November 6, 2014

Page 2

 

			
			
	
LTI Program
	
Allocation
	
Target Value

	
1.LTI Performance Plan
	
40%
	
$53,000

	
2.Option Grant
	
35%
	
$46,375

	
3.Restricted Stock Units (RSU’s)
	
25%
	
$33,125

 

LTI Performance Plan – The FY15 LTI Performance Plan design will also be determined by the Board in December.  We expect the performance goals will be achievement of our 3-year strategic plan targets for: (1) earnings per share; and (2) return-on-investment.  Actual LTI Plan awards will be denominated and paid in shares of company stock.  

 

As a new participant, your initial appointments will be pro-rated and phased-in with one-, two-, and three-year cycles so you will have an opportunity to earn an LTIP award at the end of fiscal years 2015, 2016, and 2017, depending on the corporation’s performance, as follows: 

 

			
	
LTI Plan Cycle
	
Pro-Rated Target Value 
	
Factor

	
FY13-FY15
	
$13,118
	
1/3rd of full target

	
FY14-FY16
	
$26,513
	
2/3rds of full target

	
FY15-FY17
	
$39,750
	
Full target

 

As with the Annual IC Plan, LTI Plan goals and plan design may change in the future at the discretion of Esterline’s Board of Directors.  

 

Option Grant – Our option grants vest ratably over a four-year period on the anniversary dates of the original grant.

 

Restricted Stock Units (RSU) – Our RSU grants vest 100% on the third anniversary of the grant (“3-year cliff vesting”).

 

Special, New Hire Equity Grants– Effective with your election as a corporate officer, you will receive two special equity grants.  One is a stock option grant of 5,500 shares priced at the closing price that day as reported in the Wall Street Journal on the following day.  The other is a grant of 1,800 Restricted Stock Units. 

 

Retirement and Other Fringe Benefits – You will be eligible to participate in the Esterline Voluntary Savings Plan (401(k)) and in the Esterline Retirement Plan (pension).  In the 401(k) plan, Esterline matches 50% of the first 6% of employee contributions, subject to certain IRS limits.  The pension plan is a cash balance formula with age-based annual credits + annual interest.  Annual credits increase with age from 2% for employees under age 30 to 6% for employees age 60+. 

 

Effective with your election as a corporate officer, you will also be eligible to participate in two types of Esterline Supplemental Executive Retirement Programs (SERPs).  The “defined benefit” SERP corresponds to the pension plan and allows executives to earn pension benefits on income that exceeds IRS limits that apply to the underlying tax-qualified plan.  The other “defined contribution” SERP corresponds to the 401(k) plan and similarly allows continuation of employee contributions and company matching on compensation that exceeds IRS limits.  If you have any questions or require further clarification on pension benefits, we would be happy to arrange an information session with our benefits advisors.

 

Paul Benson

November 6, 2014

Page 3

 

 

You will earn paid vacation at the rate of four weeks per year. In addition, we will award you an additional five days of vacation to start that will be available for use immediately.  Health, retirement, and other fringe benefits will be available to you in accordance with Esterline Bellevue office’s usual benefit program, which changes from time to time.  See the enclosed summary of current benefits for further information.  

 

Because our health benefits plan requires an initial waiting period, we will reimburse you for any COBRA costs you might incur before you become eligible for Esterline health care benefits.  Please bring us a copy of your COBRA payment to verify this expense.

 

Relocation – You have agreed to relocate from Folsom, California to the Bellevue/Seattle, Washington area.  As such, you will be eligible for Esterline’s relocation benefits that are administered by an outside vendor, Cartus Corporation.  Standard, comprehensive U.S. relocation benefits include company purchase of your home if it does not sell within 90 days 

 

When you are ready, and before you take any steps to list your house or make other moving arrangements, please contact Robin King in our office who can introduce you to Cartus and help you get all the detailed information you will need.

 

Car Allowance – Effective with your election as a corporate officer, you will be eligible for a car allowance under Esterline’s Vehicle Allowance Policy.  The allowance is intended to cover usual purchase, operating, maintenance, and insurance costs for cars in your new residential zip code.  The allowance will be approximately $800/month before taxes.

 

Other Terms – Also effective with your election as a corporate officer, Esterline will also provide the following forms of compensation, briefly described here:

	
 
	
·
	
Change in control agreement – at the standard executive level of 3 years’ average total cash compensation 

	
 
	
·
	
Financial advisory services – will be reimbursed up to $8,000 per year.

 

Requirements and Administrative Matters – This offer is contingent upon the following:

	
 
	
·
	
Satisfactorily completion of a pre-employment physical examination and drug screen 

	
 
	
·
	
Passing a background check

 

This physical examination is an annual requirement for all corporate executives.  Please schedule an appointment at your earliest convenience and have your doctor return the form to Robin King.  The Executive Physical Examination form and the Chain of Custody form have been mailed to your home address.

 

With respect to the background check, you will receive an email from our vendor, HireRight, within one to two business days of offer acceptance asking for some information and requiring an electronic signature.

 

These final conditions must be complete before you can begin work. In addition, please read, sign, and return the following to Robin:

	
 
	
·
	
A signed copy of this letter

	
 
	
·
	
Confidential Information & Inventions Assignment Agreement

	
 
	
·
	
Summary of Outside Business Interests

 

 

Paul Benson

November 6, 2014

Page 4

 

Except as specifically provided in this letter, other aspects of your employment will be the same as those that apply to other corporate staff.  We are all employed at-will, and the officers serve at the pleasure of the Board for one-year terms, subject to Company by-laws and Board action.

 

Paul, you have earned the confidence and strong support of the entire management staff here.  We look forward to your success leading the Human Resources function at Esterline Technologies, and to your contributions to the corporation overall in this key position.  Again, this offer is for an interim position.  We expect your election as an Esterline corporate officer to be forthcoming at the December Board of Directors meeting.

 

To accept this offer, please sign the enclosed copy of this letter and return it to me. Please also read, complete, and return the other forms enclosed here. 

 

If you have any questions at all, please contact me. I look forward to working with you.

 

Congratulations and best regards,

 

 

/s/ TOM HEINE

 

Tom Heine

Vice President, Human Resources

 

 

 

I accept this offer as outlined above.  

 

 

 

 

/s/ PAUL BENSON11/10/14

 SignatureDate

 

 

 

Attachments:

	
 
	
·
	
Copy of letter, for signature

	
 
	
·
	
Confidential Information & Inventions Assignment Agreement

	
 
	
·
	
Summary of Outside Business Interestsgst-ex101_21.htm

Exhibit 10.1

EMPLOYEE SEPARATION AND RELEASE

This release confirms the terms of your separation from employment with Gastar Exploration, Inc. (the “Company”) and Insperity PEO Services, L.P. (“Insperity”).

You are entitled to a bonus payment as previously agreed to between you and the Company, which will be paid to you, less required withholdings, in accordance with the Company’s normal practice regarding the payment of a bonus. The bonus payment will be paid even if you choose not to sign this release and you have notified the Company of your decision not to sign. You understand that this payment is due solely from the Company and that Insperity has no obligation to make the payment, even though it may be processed through Insperity.

The Company has vested you in 89,080 performance based shares, before tax forfeitures, on January 30, 2016, representing all shares due you under that plan.

Except as stated above, you agree that you have been paid all wages, salary, bonuses, commissions, expense reimbursements, and any other amounts that you are owed, if any. You also agree that you have been paid what you are owed for any vacation time, sick time, paid time off or paid leave of absence, or in connection with any severance or deferred compensation plan, if eligible, and that you have been given all time off to which you were entitled under any policy or law, including but not limited to leave under the Family and Medical Leave Act.

The Company will also pay you a lump-sum payment of FIVE HUNDRED TWENTY-FIVE THOUSAND and 00/100 DOLLARS ($525,000.00), less required withholdings, in connection with your separation from the Company and Insperity. In addition, the Company will accelerate the vesting of your 111,590 restricted shares, before tax forfeitures, on January 30, 2016. You agree that this payment and the accelerated vesting is something of value and that you are not already entitled to payment of this additional compensation and the accelerated vesting of your shares.

The Company will also reimburse you COBRA premiums to continue your coverage under the Insperity Group Health Plan, should you be eligible for and elect COBRA coverage (equal to the amount paid during your employment) until the earlier of (a) 18 months from the effective date of termination of employment; (b) the date on which you commence regular, full-time employment pursuant to which you are eligible for health and dental insurance; or (c) the date on which you become ineligible to receive COBRA benefits. Please note that it is solely your responsibility to enroll in COBRA and to make the monthly premium payments on a timely basis. If you do not timely enroll in and pay for COBRA, you will not be eligible to receive COBRA reimbursement. You can submit a request for reimbursement to the Company within ninety (90) days after each premium payment is made. The Company will reimburse you within 20 days of receipt of your request.

You agree that the additional compensation to be paid under this release is due solely from the Company and that Insperity has no obligation to pay the additional compensation, even though its payment may be processed through Insperity.

You are solely responsible for any and all tax obligations or other obligations under federal and/or state law pertaining to the receipt of the additional compensation in this release, 

 

 

and you hereby agree to hold the Company and Insperity and their respective affiliates harmless from any and all liability relating to such obligations. 

In exchange for providing you with this additional compensation, you agree to fully release the Company and Insperity and their respective current and former parent companies, subsidiaries, and other affiliated companies as well as any of their respective current and former insurers, directors, officers. agents, shareholders, and employees (collectively, the “Released Parties”) from any claims you may have against them as of the date you sign the release, whether such claims arise from common law, statute, regulation, or contract. This release includes but is not limited to rights and claims arising under Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Genetic Information Nondiscrimination Act, the Family and Medical Leave Act, and any state leave or workers’ compensation retaliation law. By accepting the additional compensation, you have agreed to release the Released Parties from any liability arising out of your employment with and separation from the Company and Insperity, including any payment or benefit under the Employment Agreement between you and the Company, dated June 19, 2014 (the “Employment Agreement”). This would include, among other things, claims alleging breach of contract, defamation, emotional distress, harassment, retaliation, or discrimination based on age, gender, race, religion, national origin, disability or any other status under local, state, or federal law.

RIGHTS RESERVED: This release does not prevent you from pursuing any workers’ compensation benefits to which you may be entitled. This release does not prevent you from filing an administrative charge or participating in an investigation before any governmental agency charged with enforcement of any law, including, but not limited to, the Equal Employment Opportunity Commission, any similar state or local agency, or the National Labor Relations Board. This release does not prevent you from engaging in any concerted activity for the purpose of collective bargaining or other mutual aid and protection. You do agree, however, that by signing this release, you waive any right to recover monetary damages or other individual relief in connection with any such charge you file or investigation in which you participate.

You agree that this release does not alter any agreements or promises you made prior to or during your employment concerning intellectual property, confidentiality, non-solicitation, or non-competition, including, but not limited to, your Employment Agreement.

You agree that you are the only person who is able to assert any right or claim arising out of your employment with or separation from the Company and Insperity. You promise that you have not assigned, pledged or otherwise sold such rights or claims, nor have you relied on any promises other than those contained in this release.

You agree that neither this release nor the payment of the additional compensation being offered to you for this release is an admission by the Company or Insperity of any liability or unlawful conduct of any kind. You agree that the additional compensation being offered in exchange for your release of claims and rights is sufficient.

Page 2 of 4(McCown, Michael / 1924664 / 2/2/2016 / 3502300)

 

You agree that you will not seek employment with either the Company or Insperity in the future. Both the Company and Insperity have reserved the right to waive this restriction independent of each other.

You agree not to disparage the Company or to do anything that portrays the Company, its products or personnel in a negative light or that might injure the Company’s business or affairs. This would include, but is not limited to, disparaging remarks about the Company as well as its shareholders, officers, directors, employees, agents, advisors, partners, affiliates, consultants, products, formulae, business processes, corporate structure or organization, and marketing methods. Nothing in this paragraph affects your rights under the paragraph in this release entitled “Rights Reserved.”

You agree to return to the Company, before you sign this release, all property belonging to either the Company or Insperity. This would include, for example, documents, files, forms, customer information and lists, confidential business information, keys, computer equipment such as laptop computers and printers, electronic equipment, cell phones and similar handheld devices, pagers and Company-issued credit cards.

You agree to keep this release strictly confidential and not to discuss its terms or existence with any person, except with your immediate family, tax preparers, and attorneys, provided that any person with whom you discuss the release also agrees to keep it confidential. You agree to assume responsibility for any such person’s confidentiality obligations. You may, however, fully respond to questions from governmental entities or discuss this release if required to do so by law.

You agree that, if you violate the terms of this release, you will reimburse the Released Parties for any attorneys’ fees, costs, or other damages arising from your breach of the release, unless you are challenging your waiver of claims under the Age Discrimination in Employment Act. You agree that, if any portion of this release is found to be unenforceable, the remainder of the release will remain enforceable.

Before signing this release, you should make sure that you understand what you are signing, what benefits you are receiving, and what rights you are giving up, including your rights under the Age Discrimination in Employment Act. You should also consult an attorney about the contents and meaning of this release. You have 21 days to consider this release, which will expire if not executed within that period. You must deliver or mail the timely executed release to Jason Blansett, Insperity HR Specialist, within 25 days of the date this release is presented to you. If mailing, please use the attached self-addressed and stamped envelope. Also, after you have signed the release, you may revoke the release at any time within seven days of your signing it by mailing written notice of your revocation to Jason Blansett, Insperity HR Specialist at 3 Waterway Square Place, Suite 425, The Woodlands, TX 77380. The additional compensation being offered to you will be paid after the seven day period, if you do not revoke the release, but no later than April 1, 2016.

Any modifications to this release do not become part of this release unless expressly agreed to in writing by you and the Company.

Page 3 of 4(McCown, Michael / 1924664 / 2/2/2016 / 3502300)

 

If this release fully and accurately describes the complete agreement concerning your separation of employment and your agreement to release the Released Parties for any acts occurring prior to the date you sign this release, please confirm this agreement by signing and dating this release before a notary public. By signing this release, you agree that your waiver of rights and claims is knowing and voluntary. You further confirm that you fully understand the benefits you are receiving and the rights and claims you are waiving under this release and that you have accepted those benefits and waived those rights and claims of your own free will.

This release was presented to Michael McCown on February 4, 2016.

ACCEPTED AND AGREED TO:

 

 

/s/ Michael McCownFebruary 4, 2016

Michael McCownDate

 

THE STATE OF WV                   ________§

§ACKNOWLEDGMENT

COUNTY OF Wood   _________________§

 

This instrument was acknowledged before me on February 4                ________, 2016, by Michael McCown.

[Seal]/s/ David W. Perkinson

Notary Public, State of WV

My Commission Expires: 6-11-2020

Notary’s Name (Typed, Stamped or Printed)

David W. Perkinson

Page 4 of 4(McCown, Michael / 1924664 / 2/2/2016 / 3502300)

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