Document:

Exhibit 10.3

 

Execution Copy

 

FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT

 

THIS FIRST AMENDMENT TO EMPLOYMENT AGREEMENT (this “Agreement”)
is made as of the 20th day of February, 2009, between Boise Cascade, L.L.C., a
Delaware limited liability company (the “Company”), and Duane C. McDougall (“Executive”).

 

WHEREAS, Company and Executive are parties to an
Employment Agreement dated November 20, 2008 (as amended from time to
time, the “Employment Agreement”); and

 

WHEREAS, Company and Executive have agreed to make
certain changes to the Employment Agreement.

 

NOW THEREFORE, in consideration of the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

 

1.  Change in
Base Salary.  Sections 3(a) and
5(g) of the Employment Agreement are amended by deleting the references “$800,000”
therein and replacing same with “$808,250”.

 

2.  Change in
Health and Welfare Benefits. 
Notwithstanding anything to the contrary in Section 3(a) of
the Employment Agreement Executive acknowledges that neither he nor his
employees will have any right to participate in the Boise Cascade L.L.C Consumerwise Medical
Benefits Plan and any
successor plan thereto.  All other health
care plans normally made available to salaried employees and their dependents
shall be available to Executive on the same terms as they are from time to time
available to other salaried employees.

 

3.  Elimination
of Life Insurance Benefit.  Section 3(f) of
the Employment Agreement is deleted in its entirety.  Notwithstanding the foregoing Executive shall
be entitled to participate in Company’s customary life insurance program
provided to its salaried employees as it may from time to time be in effect, which,
as the date of this Agreement provides coverage equal to the amount of an
employee’s base salary up to a limit of $250,000 without payment by the
employee of any portion of the premium therefor.

 

4.  Change in
Severance Benefits.  Sections 5(b) and
5(c) of the Employment Agreement are hereby amended and restated in their
entirety to read as follows:

 

 

(b)  If the
Employment Period is terminated by the Company without Cause (and, for the
avoidance of doubt, a termination by the Company without Cause shall not be
deemed to occur if the Company provides written notice that it elects not to
renew the Employment Period or upon any expiration of the Employment Period for
non-renewal) or upon Executive’s resignation with Good Reason (and, for the
avoidance of doubt, a resignation by Executive for Good Reason shall not be
deemed to occur if Executive provides written notice that he elects not to
renew the Employment Period or upon any expiration of the Employment Period for
non-renewal), Executive shall be entitled to receive: (i) his Base Salary
at the rate then in effect as of the date of termination; (ii) any amount
owed Executive by reason of such termination under the terms of any other
compensation plan of Company in which Executive participates (when and as
payable under the terms of such plan); (iii) the value of any unused and
accrued time off, less any advanced time off, in accordance with the time off
policy applicable to Executive immediately prior to Executive’s date of
termination, (iv) an amount equal to two times the sum of (a) his
Base Salary at the rate then in effect and (b) his Target Bonus for the
calendar year in which such termination occurred.  In addition, if the Employment period is
terminated by the Company without Cause or upon Executive’s resignation with
Good Reason, the Company shall provide to Executive for an 18 month period
following the date of termination of his employment: (x) life insurance at
the level and cost to Executive provided for prior to termination pursuant to Section 3(f) of
the Employment Agreement, as amended hereby; and (y) and all other
financial counseling, disability accident and healthcare insurance plans (other
than as excluded pursuant to Section 2 of this Agreement) in which
Executive was participating as of the date of Termination, subject to payment
by the Executive of premiums and other cost sharing provided for under such
plans and programs.

 

(c)           If the Employment Period is
terminated by the Company for Cause, if the Employment Period expires due to the
Company or Executive electing not to renew the Employment Period or if the
Employment Period is terminated pursuant to paragraph 5(a)(i) above (other
than as a result termination with Good Reason), Executive shall only be
entitled to receive the items of compensation described under clauses)(i), (ii) and
(iii) of paragraph 5(b) above.

 

5.  Notices.  Any notice provided for in this Agreement
shall be in writing and shall be either personally delivered, sent by reputable
overnight courier service or mailed by first class mail, return receipt
requested, to the recipient at the address below indicated:

 

Notices to Executive:

 

	
   

  	
  Duane C. McDougall

  
	
   

  	
  [Address]

  

 

2

 

Notices to the Company:

 

	
   

  	
  Boise
  Cascade, L.L.C.

  
	
   

  	
  1111
  W. Jefferson Street, Suite 300

  
	
   

  	
  Boise,
  ID 83702-5389

  
	
   

  	
  Attention: General Counsel

  

 

or such other address or to the attention of such
other person as the recipient party shall have specified by prior written
notice to the sending party.  Any notice
under this Agreement shall be deemed to have been given when so delivered, sent
or mailed.

 

6.  Severability.  Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or rule in
any jurisdiction, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement or any action in any other
jurisdiction, but this Agreement shall be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.

 

7.  Complete Agreement.  This Agreement embodies the complete
agreement and understanding among the parties and supersedes and preempts 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.

 

8.  No Strict Construction.  The language used in this Agreement shall be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction shall be applied against any
party.  Whenever used herein, “including”
shall mean “including, without limitation.”

 

9.  Counterparts.  This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.

 

10.  Choice of Law.  ALL ISSUES AND QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT AND
THE EXHIBITS AND SCHEDULES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO
ANY CHOICE OF LAW OR CONFLICT OF LAW RULES OR PROVISIONS (WHETHER OF THE STATE
OF IDAHO OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE
LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE.

 

11.  Confirmation.  Except as amended hereby, the Employment
Agreement is hereby ratified and confirmed in all respects as of the date
hereof.

 

3

 

IN WITNESS WHEREOF, the
parties have caused this agreement to be signed as of the date first set forth
above.

 

 

	
  BOISE CASCADE, L.L.C.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
  /s/
  Tom Carlile

  	
   

  	
  /s/
  Duane McDougall

  
	
  Executive Vice
  President and Chief Financial Officer

  	
   

  	
  Duane C. McDougall

  

 

4Exhibit 10.39

 

AMENDMENT
TO EMPLOYMENT AGREEMENT

 

THIS
AMENDMENT to the EMPLOYMENT AGREEMENT between The Ryland Group, Inc., a
Maryland corporation (the “Company”) and R. Chad Dreier (the “Executive”) is
effective as of February 25, 2009 (the “Effective Date”) and amends the
Employment Agreement between the Company and the Executive originally dated as
of July 1, 2002 which was amended and restated as of April 20, 2005
(the “Employment Agreement”).

 

The Employment Agreement
currently provides for the employment of the Executive through December 31,
2010.  In agreeing to terminate the
Employment Agreement effective May 29, 2009, the Executive is giving up
significant compensation and other benefits that otherwise would be payable to
him, including significant amounts that would be payable in the event he
remained in the employment of the Company or the Company were to terminate the
Employment Agreement without cause. 
Accordingly, in consideration of the mutual covenants and agreements of the parties set forth in this
Amendment of the Employment Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are acknowledged, the
parties agree as follows:

 

1.                                       Termination of Employment Agreement.  The
Employment Agreement will terminate effective May 29, 2009.

 

2.                                       Term of Employment, Position and
Responsibilities.  Effective May 29, 2009 (the “Retirement
Date”), the Executive will terminate employment with the Company and cease to
serve as Chief Executive Officer.  The
Executive and the Company mutually agree that this termination of employment will
be treated as a “Retirement” of the Executive for all purposes, including
pursuant to the Employment Agreement and any incentive, benefit or other plans
or programs of the Company.  After May 29,
2009, the Executive will serve as Chairman of the Board and as a non-employee
Director of the Company, receiving compensation as a Director of the Company.

 

3.                                       Compensation and Benefits.  From
the Effective Date of this Amendment until May 29, 2009 (the “Remaining
Term”), the Executive will receive a pro-rated annual Base Salary of $900,000
per year paid in installments consistent with the normal payroll practices of
the Company.

 

On
November 30, 2009, the Executive will receive a lump sum cash payment of
$2 million, subject to withholding by the Company, in consideration for
the amendment and termination of the Employment Agreement and his agreement to
treat the termination as a “Retirement.”

 

The
Executive is eligible to receive an Annual Bonus for 2009 pro-rated for the
period from January 1, 2009 until the Executive’s date of retirement on May 29,
2009, which is 5/12 of the 2009 Annual Bonus payment for which the Executive is
eligible.  Subject to the terms and
conditions of the Executive’s 2009 Annual Bonus program, the Executive can
receive this payment of the 2009 Annual Bonus after December 31, 2009 and on
or before January 25, 2010.

 

 

During
the Remaining Term, the Executive is entitled to receive other employee
benefits, such as disability, group life, sickness, accident and health
insurance programs, executive life insurance programs and other perquisites
available to executive officers of the Company.

 

4.                                       Equity Awards and Outstanding Grants. 
Effective as of May 29, 2009, the Executive will receive no further
equity awards from the Company.  Also
effective on May 29, 2009, the Executive will cease to be eligible to vest
in the remaining 40,000 Stock Units scheduled to vest, subject to satisfaction
of performance objectives, on March 1, 2010, and these Stock Units are
forfeited and cancelled as of May 29, 2009.

 

5.                                       TRG Incentive Plan.  The
Executive is not eligible to receive a 2009 TRGIP Performance Award.  Effective May 29, 2009, the Executive is
fully vested in his remaining Deferred 2007 TRGIP Performance Award and
Deferred 2008 TRGIP Performance Award. 
On November 30, 2009 (six months after his Retirement Date), the
Executive will receive payment of the remaining amount of his Deferred 2007
TRGIP Performance Award and the full amount of his Deferred 2008 TRGIP
Performance Award, including all earnings credited by the Company and
established by the Compensation Committee with respect to the Cash Accounts of
Participants pursuant to the TRG Incentive Plan.

 

6.                                       Supplemental Executive Retirement Plan.  On May 29,
2009, which is the Executive’s Retirement Date, the Executive will receive a
lump sum cash payment of $8,217,100, subject to withholding by the Company, in
payment of the Executive’s vested SERP Benefit pursuant to the Dreier
Supplemental Executive Retirement Plan (SERP) which was previously entered into
and effective as of July 1, 2002.  On
November 30, 2009, which is the date that is six (6) months after the
Executive’s Retirement Date, the Executive will receive a lump sum cash payment
of $16,434,199, subject to withholding by the Company, in payment of the
Executive’s vested SERP II Benefit pursuant to the Dreier Supplemental
Executive Retirement Plan II (SERP II) which was previously entered into and
effective as of January 1, 2005.

 

7.                                       Executive Retirement Health Insurance Program. 
Effective May 29, 2009, the Executive will receive an Executive
Retirement Health Insurance Program for the Executive and the Executive’s
spouse for a period of fifteen (15) years extending until May 29, 2024.  The Executive Retirement Health Insurance
Program is equivalent to and shall provide the same coverage and benefits as
the Company’s executive health insurance program in which the Executive
currently participates as of the Effective Date of this Amendment.

 

{Signature page follows}

 

 

IN
WITNESS WHEREOF, the Executive and the Company have executed this Amendment to
the Employment Agreement as of February 25, 2009.

 

	
  THE
  RYLAND GROUP, INC.

  	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  William L. Jews

  	
   

  	
  /s/
  R. Chad Dreier

  	
   

  
	
   

  	
       William
  L. Jews,

  	
   

  	
  R.
  Chad Dreier

  
	
   

  	
       Lead
  Director of the

  	
   

  	
   

  
	
   

  	
       Board
  of Directors

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Norman J. Metcalfe

  	
   

  	
   

  
	
   

  	
       Norman
  J. Metcalfe

  	
   

  	
   

  
	
   

  	
       Chairman
  of the

  	
   

  	
   

  
	
   

  	
       Compensation
  Committee of

  	
   

  	
   

  
	
   

  	
       the
  Board of Directors

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Robert J. Cunnion, III

  	
   

  	
   

  
	
   

  	
       Robert
  J. Cunnion, III

  	
   

  	
   

  
	
   

  	
       Senior
  Vice President

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Attest:

  	
  /s/
  Timothy J. Geckle

  	
   

  	
   

  
	
   

  	
  Timothy
  J. Geckle

  	
   

  	
   

  
	
   

  	
  Secretary

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