Employment Agreement With Alan C. Johnson

EXECUTIVE EMPLOYMENT AGREEMENT


EMPLOYMENT AGREEMENT ("Agreement") dated as of January 31, 2005 between CHAAS Holdings, LLC, a Delaware limited liability company (the "Company") and Alan C. Johnson (the "Executive").


WHEREAS, the parties wish to establish the terms of Executive's future employment with the Company; and


WHEREAS, for purposes of this Agreement, the term "Company" shall include direct and indirect subsidiaries of the Company and the Company may direct that one or more of such subsidiaries fulfill the Company's obligations under this Agreement, including, but not limited to, any applicable obligations under Section 3 or 4 hereof.


Accordingly, the parties agree as follows:


1. EMPLOYMENT, DUTIES AND ACCEPTANCE.


1.1 EMPLOYMENT BY THE COMPANY. The Company shall employ the Executive effective as of February 2, 2005 (the "Effective Date") to render exclusive, subject to the last sentence of this Section 1.1, and full-time services to the Company. The Executive will serve in the capacity of President and Chief Executive Officer of the Company and shall report to the Board of Managers of the Company, either directly or indirectly through its Chairman. The Executive will perform such lawful duties related to the business of the Company as are imposed on the holder of that office by the By-laws and operating agreement of the Company and such other lawful duties related to the business of the Company as are customarily performed by one holding such positions in the same or similar businesses or enterprises as those of the Company. The Executive will perform such other lawful duties related to the business of the Company as may be assigned to him from time to time by the Board of Managers of the Company, either directly or indirectly through its Chairman. The Executive will devote all his full working-time and attention to the performance of such duties and to the promotion of the business and interests of the Company. This provision, however, will not prevent the Executive from investing his funds or assets in any form or manner, or from acting as an advisor to or a member of, the board of directors of any companies, businesses, or charitable organizations, so long as such actions do not violate the provisions of Section 5 of this Agreement or interfere with the Executive's performance of his duties hereunder.


1.2 ACCEPTANCE OF EMPLOYMENT BY THE EXECUTIVE. The Executive accepts such employment and shall render the services described above.


2. DURATION OF EMPLOYMENT.


Subject to Section 4 of this Agreement, this Agreement and the employment relationship hereunder will continue in effect for one (1) year from the Effective Date (the "Initial Term"), and the terms of this Agreement shall continue beyond the Initial Term in the following manner: the Initial Term shall be automatically extended by one (1) day to always be not less than one (1) year (the "Extended Term"); provided, however, that this



extension shall cease upon the earlier of (i) the date of termination of employment or (ii) notice of termination of employment in the case of any termination under Section 4 hereof. The Initial Term and the Extended Term are sometimes referred to in this Agreement as the "Term." In the event of the Executive's termination of employment during the Term, the Company's obligation to continue to pay all base salary, as adjusted, bonus and other benefits then accrued shall terminate except as may be provided for in Section 4 of this Agreement.


3. COMPENSATION BY THE COMPANY.


3.1 BASE SALARY. As compensation for all services rendered pursuant to this Agreement, the Company will pay to the Executive an annual base salary of Four Hundred Fifty Thousand Dollars ($450,000), subject to an upward adjustment by the Board of Managers of the Company, in its sole discretion, and payable in accordance with the payroll practices of the Company ("Base Salary").


3.2. BONUSES. The Executive shall be eligible to receive from the Company an annual cash bonus. The target bonus shall be up to sixty percent (60%) of Base Salary, subject, in any event, to the achievement by the Company of performance goals established by the Board of Managers of the Company, in its sole discretion. This bonus shall be determined by the Compensation Committee of the Board of Managers of the Company.


3.3 PARTICIPATION IN EMPLOYEE BENEFIT PLANS. The Executive shall be permitted, during the Term, if and to the extent eligible, to participate in any group life, hospitalization or disability insurance plan (the "Disability Policy"), health program, pension plan or similar benefit plan of the Company, which may be available to other executives of the Company generally, on the same terms as such other executives.


3.4 CAR ALLOWANCE. The Executive shall be entitled to a monthly car allowance equal to Nine Hundred Dollars ($900).


3.5 CLUB MEMBERSHIP. The Company shall pay or reimburse the dues for a country club membership, during the Term, up to a maximum of $610 per month.


3.6 EXPENSE REIMBURSEMENT. During the Term, the Executive shall be entitled to receive prompt reimbursement of all reasonable out-of-pocket expenses properly incurred by him in connection with his duties under this Agreement, including reasonable expenses of entertainment and travel, provided that such expenses are documented and reported in accordance with the policies and procedures of the Company or the Board of Managers, as applicable, at the time the expenses are incurred.


3.7 VESTING UNITS. Within thirty days after the Effective Date, the Executive shall purchase one percent (1%) of the Company's common units ("Restricted Time-Based Units"), at a price equal to $0.01 per common units. The Restricted Time-Based Units shall lapse (shall vest) in equal annual installments over a three (3) year period from the Effective Date; provided the Executive is employed with the Company on each applicable vesting date. The Executive shall purchase another one percent (1%) of the Company's common units ("Restricted Performance-Based Units"), at a price equal to $0.01 per common unit. The


- 2 -


Restricted Performance-Based Units shall lapse (shall vest) in equal annual installments over a three (3) year period from the Effective Date; provided that performance-based targets established by the Company's compensation committee for each of 2005, 2006 and 2007 calendar years are achieved, and the Executive is employed with the Company on each applicable vesting date. Restricted Time-Based Units and Restricted Performance Based Units, together, are referred to as "Restricted Units." The purchase of the Restricted Units shall be made subject to the terms and conditions of a vesting unit repurchase agreement (which shall incorporate the performance-based targets established by the Company's compensation committee and the right but not the obligation of the Company or its designee to repurchase the Restricted Units upon the termination of the Executive's employment with the Company for any reason), the Company's Operating Agreement and a customary subscription agreement between the Company and the Executive.


3.8 PURCHASE OF EQUITY. Within thirty days of the Effective Date, the Executive shall purchase additional equity in the Company in the form of strips (each strip shall consist of approximately 10.5 preferred units and one (1) common unit) ("Strips"), for an aggregate purchase price of Two Hundred Thousand Dollars ($200,000). The purchase price for each Strip shall be $100.00 per preferred unit and $0.01 per common unit comprising each Strip. The purchase of the Strips shall be made subject to a customary subscription agreement, unit repurchase agreement (which shall incorporate the right but not the obligation of the Company or its designee to repurchase the Strips upon the termination of the Executive's employment with the Company for any reason), and the Company's Operating Agreement.


3.9 VACATION. The Executive shall be entitled to twenty (20) days of vacation per year.


4. TERMINATION.


4.1 TERMINATION UPON DEATH. If the Executive dies during the Term, the Executive's legal representatives shall be entitled to receive the Executive's Base Salary and accrued bonus for the period ending on the last day of the month in which the death of the Executive occurs.


4.2 TERMINATION UPON DISABILITY. If during the Term the Executive's employment with the Company is terminated as a result of a "Disability" (as defined in the Disability Policy), the Executive (or his legal representatives) shall be entitled to receive the benefits set forth in the applicable Disability Policy.


4.3 TERMINATION FOR CAUSE. The Executive's employment hereunder may be terminated by the Board of Managers of the Company for "Cause" (as herein defined) at any time. "Cause" shall mean with respect to the Executive, (a) the Executive's continued failure to substantially perform the Executive's duties, (b) willful failure to follow the lawful directions of the Board of Managers of the Company, either directly or indirectly through its Chairman, (c) material, willful acts of dishonesty, theft or fraud resulting or intending to result in personal gain or enrichment at the expense of the Company, (d) commission of a felony, (e) a violation of any written policy of the Company including, but not limited to, the Company's employment manuals, rules and regulations which materially and adversely affects the Company or could reasonably be


- 3 -


expected to materially and adversely affect the Company, or (f) the Executive engaging in any act that is intended, or may reasonably be expected to materially harm the reputation, business or operations of the Company or any member of its Board of Managers or (g) any other material breach of this Agreement or any other agreement with the Company that the Executive signs in his personal capacity, including, but not limited to, any non-competition and confidentiality agreement. Prior to a termination for "Cause, the Executive shall be entitled to written notice from the Company and thirty (30) days to cure the deficiency leading to the Cause determination, if such deficiency is curable. Notwithstanding the foregoing and without limiting the foregoing in any way, for the avoidance of doubt, the Executive shall receive written notice and thirty (30) days to cure a deficiency under Section 4.3(a) or (b) hereof.


Upon termination for Cause hereunder, the Executive shall be entitled to receive the Executive's Base Salary through the date of termination.


4.4 VOLUNTARY TERMINATION WITHOUT EMPLOYEE GOOD REASON. The Executive may upon at least sixty (60) but not more than ninety (90) days prior written notice to the Company terminate employment hereunder without Employee Good Reason, as defined in Section 4.6. Upon a voluntary termination without Employee Good Reason, the Executive shall be entitled to receive the Executive's Base Salary through the date of termination; provided, however, that if the Company shall waive part or all of such sixty (60) but not more than ninety (90) day notice period, the Executive shall only receive Base Salary to the date of termination specified in such waiver.


4.5 TERMINATION BY THE COMPANY OTHER THAN FOR CAUSE.


(a) The Company may terminate the Executive's employment at any time other than for Cause. If, prior to the expiration of this Agreement, the Company terminates the Executive's employment for any reason other than Cause, then in lieu of additional salary payments to the Executive for periods subsequent to the date of such termination, the Company shall pay to the Executive (i) his B ...