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Foster Wheeler and the million dollar consultant….

The Ides of March may have been unlucky for Julius Caesar, but it was a pretty good day for Raymond Milchovich.

That’s because March 15th is the day that Milchovich, the Chairman/CEO of Foster Wheeler, Inc., (a subsidiary of Foster Wheeler AG) (FWLT), signed an agreement to retire as CEO on May 31, 2010 and become a consultant. The company filed an 8-K and Consulting Agreement on Thursday afternoon to disclose the new relationship. (You may recall that in January we reported the generous contract terms Foster Wheeler gave to two executives who agreed to work in Switzerland for up to five years.)

There are several interesting things about this new deal, which will officially start on June 1, 2010 and end on November 3, 2011.

First, it’s one of the most lucrative contracting agreements we—ve read lately (though worth a bit less than this one). Milchovich will get $104,466.67 per month as a consulting fee, which works out to $1,253,600 per year. There’s also a clause stating that on the contract’s anniversary or whenever the parties agree it’s appropriate, —the Company shall review the Consulting Fee and determine if, and by how much, the Consulting Fee should be increased. Once the Consulting Fee has been increased hereunder, it shall not be decreased.

Foster Wheeler notes that by relocating its primary office from New Jersey to Switzerland, it is in —material breach of its employment agreement with Milchovich. That breach would entitle Milchovich to terminate his employment —for good cause and receive a lump sum cash payment from the company, which appears to be (according to his Nov. 2008 Employment Agreement) 200% of his 2009 base salary, or $2,500,000.

Milchovich is to work primarily in New Jersey or Florida, and there is no requirement that he work a set number of hours per month. His duties, which are described in —Annex 1 to the agreement, are stated simply:

—Consultant shall provide the Company with assistance in the transition of the Consultant’s duties and responsibilities and such other business consulting services as the Board or the CEO may request, from time to time.

In addition to his consulting fees, Milchovich may earn millions more if the company achieves its target objectives. Per the contractual formula, his incentive fee shall be —equal to the product of (i) the Consultant’s monthly Consulting Fee at the rate in effect at the beginning of such fiscal year, multiplied by twelve and (ii) 130%. And the Compensation Committee can double that amount — whatever it turns out to be — if it determines that the company achieved objectives that are —significantly beyond expectations.

Although the agreement specifies that Milchovich will be an independent contractor rather than employee, the company also states – rather incongruously – that he’s eligible to participate in employee pension benefits plans, as well as group medical and dental plans. Foster Wheeler is also giving him $6,000 per month to pay for miscellaneous home office and car expenses, life insurance, and tax and financial planning; and furthermore, it will gross-up any amount Milchovich would owe if those benefits are taxable. And finally, the agreement provides for large sums to be paid to Milchovich’s estate if he dies, or to him if he becomes disabled or if there’s a change of control at the company.

Personally, we’d probably take Switzerland over Florida and especially New Jersey, especially given that state’s current budget woes. But then again such a sweet consulting deal is hard to come by these days.