[PALL LOGO]
EXHIBIT 10.7
SERVICE AGREEMENT
AN AGREEMENT dated 1 March 2002 between PALL EUROPE LIMITED of Xxxxxx Xxxxx,
Xxxxxx Xxxxxx, Xxxxxxxxxx XX0 0XX, ("the Company") of the one part and XXXX
XXXXXXXXX of 00 Xxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxxxx, Xxxxxxxxx XX0 0XX ("the
Executive") of the other part
WHEREBY IT IS AGREED as follows:-
1. EMPLOYMENT AND TERM
SUBJECT as hereinafter provided the Company hereby agrees to employ the
Executive, and the Executive hereby agrees to act as an executive
employee of the Company with the duties set forth in Clause 3 hereof,
from the date hereof and thereafter until either party gives to the
other not less than two year's previous written notice such notice to
expire at any time.
2. GENERAL
THERE shall be deemed to form part of the terms and conditions of this
Agreement the Terms and Conditions of Employment for Monthly Paid Staff
(as amended from time to time) and the terms of the Company's Technical
Patent and Confidentiality Agreement, copies of which the executive
acknowledges having received PROVIDED ALWAYS that in the event of
conflict between any part of those terms and this Agreement the terms
and conditions of this Agreement shall prevail.
3. DUTIES
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(A) THE Executive agrees that during the continuance of this
Agreement he will hold such offices or positions with the
Company, and perform such duties and assignments relating to
the business of the Company as the Board of Directors or its
Chairman shall direct except that the Executive shall not be
required to hold any office or position or to perform any
duties or assignment inconsistent with his experience and
qualifications or not customarily performed by an officer of
the Company.
(B) If the Board of Directors or its Chairman so directs, the
Executive shall without further remuneration serve as an
officer of or perform services for one or more subsidiary or
associated company of the Company provided that the duties of
such office are not inconsistent with the Executive's
experience and qualifications and are duties customarily
performed by an officer of the Company. The Executive hereby
agrees that the Company shall be entitled from time to time to
second the Executive to any subsidiary or associated company
of the Company without prejudice to the rights of the
Executive hereunder or the other provisions of this Agreement
and the Company shall be at liberty to appoint other persons
to act jointly with the Executive whether in such secondment
or in his normal duties hereunder.
(C) During the continuance of this Agreement the Executive shall,
except during customary periods of holiday and periods of
illness, devote all of his business time and attention to the
performance of his duties hereunder and to the business and
affairs of the Company and its subsidiary and associated
companies and to promoting the best interests of the Company
and its subsidiary and associated companies.
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(D) The Executive shall not during the continuance of his
employment hereunder (except as a representative of the
Company or with the consent in writing of the Board of
Directors of the Company) be directly or indirectly engaged or
concerned in the conduct of any other business nor shall he be
directly or indirectly interested in any such business save
through his holding or being interested in investments (quoted
or unquoted) not representing more than five per cent of the
issued investments of any class of any one company.
4. SALARY AND OTHER BENEFITS
(A) THE Company shall pay to the Executive during the continuance
of his employment hereunder a salary at the annual rate set
out in the Schedule hereto (or such rate as may from time to
time be agreed or determined upon and notified by the Company
to the Executive). In the event of any alternation of salary
being so agreed or notified the alteration shall thereafter
have effect as if it were specifically provided for as a term
of this Agreement. Such salary shall be inclusive of any other
sums receivable as Director's fees or other remuneration from
the Company or any of its subsidiary or associated companies.
The said salary shall be payable by equal monthly payments in
arrears by the last day of each month.
(B) Bonus Compensation
The Bonus Compensation shall be paid to the Executive as per
the Pall Corporation Executive Incentive Bonus Plan ("Bonus
Plan") as attached hereto as Schedule 2.
Provided that the Bonus Compensation shall be paid in
instalments as follows:
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(i) 50% of the amount thereof in the October following
the fiscal year with respect to which the Bonus
Compensation is payable, and
(ii) the balance thereof not later than March 31st next
following the end of the fiscal year with respect to
which the Bonus Compensation is payable.
PROVIDED ALWAYS that the above clauses (i) and (ii) shall
override the payment periods set out in the Bonus Plan.
With respect to any fiscal year of the Company which falls in
part but not in whole within the Term of Employment, the Bonus
Compensation to which Executive is entitled under this Section
4(B) shall be prorated on the basis of the number of days of
such fiscal year falling within the Term of Employment except
that if the Term of Employment ends within five days before or
after the end of a fiscal year, there shall be no pro ration
and the Bonus Compensation shall be payable with respect to
the full fiscal year ending within such five-day period.
(C) There shall be refunded to the Executive all out-of-pocket
expenses properly incurred by him in the performance of his
duties including expenses of entertainment, subsistence and
travelling. The Executive shall produce to the Company at its
request all supporting vouchers and documents in respect of
such expenses.
(D) The Executive shall be entitled without loss of remuneration
to such holiday in each year (in addition to Bank and other
public holidays occurring when not on holiday) as stated in
the Terms and Conditions of Employment for Monthly Paid Staff
or as may otherwise be determined by the Board of Directors to
be taken at such time or times as may be approved by the Board
of Directors. No holiday entitlement may be carried over from
year to year and the Executive shall not be entitled to be
paid in lieu of untaken holiday.
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(E) The Executive shall be entitled to participate in such benefit
schemes as may be provided by the Company from time to time
including but not limited to medical insurance and life
insurance, and the executive supplementary pension scheme in
accordance with the rules and regulations and announcements
applicable to the said schemes from time to time in force.
(F) The Company shall provide a motor car for the use of the
Executive for the performance of his duties under this
Agreement. The motor car shall have an engine capacity of not
less than two litres and be of such make and model as shall be
determined by the Board of Directors to be consistent with the
Executive's office or position. The Company shall bear the
cost of maintaining, insuring, testing and taxing the motor
car. The Executive is authorised to use the motor car for
private purposes.
As an alternative to being allocated a Company car, you may
choose to receive an annual allowance of (pound)10,800 taxable
and payable monthly. If you elect to receive this allowance,
any car that you drive will be a private car and the Company
will have no responsibility for any aspect of owning or
running the car. It will be your responsibility to insure your
car, including any insurance for business use. If you are
required to use your own car for business purposes, you will
be entitled to claim expenses at the Company's business
mileage rate for fuel costs only.
5. TERMINATION
(A) NOTWITHSTANDING the provisions of Clause 1 hereof this
Agreement shall be subject to termination by the Company:-
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(i) by not less than six months' notice given at any time
while the Executive is incapacitated by reason of ill
health, mental disability or accident and shall have
been so incapacitated for an aggregate of 130 working
days (whether or not consecutive) in any rolling 12
month period;
(ii) by summary notice if the Executive shall have
committed any serious breach or have repeated or have
continued (after warning) any material breach of his
obligations hereunder or shall have been guilty of
conduct tending to bring himself or the Company or
any of its subsidiary or associated companies into
disrepute or shall have become bankrupt or compounded
with his creditors generally or have been convicted
of any criminal offence other than driving or road
traffic offences;
(iii) by not less than three months written notice in
circumstances where notice would expire on or after
the Executive's normal age of retirement which is his
65th birthday.
(B) In the event of a Change in Control (as hereinafter defined)
of the Company, the Executive shall have the right to
terminate this Agreement by giving not less than 3 months' and
not more than 24 months' prior written notice to the Company
such notice to be given not more than 24 months following such
Change in Control
(C) Upon the termination of this Agreement howsoever arising the
Executive shall at any time or from time to time thereafter
upon the request of the Company, resign without claim for
compensation from Office as a Director of the Company and all
offices held by him in subsidiary and associated companies of
the Company and should he fail to do so the Company is hereby
irrevocably authorised to appoint some person in his name and
on his behalf to sign and do any documents or things necessary
or requisite to give effect thereto. If the Executive shall
cease to be an officer of the Company or any of its subsidiary
or associated companies this Agreement shall not hereby
automatically determine.
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6. COMPANY'S RIGHTS TO INJUNCTIVE RELIEF
THE Executive acknowledges that his services to the Company are of a
unique character, which gives them a peculiar value to the Company, the
loss of which cannot be reasonably or adequately compensated in damages
in an action at law, and that therefore, in addition to any other
remedy which the Company may have at law or in equity, the Company
shall be entitled to injunctive relief for a breach of this Agreement
by the Executive.
7. HEADINGS
THE headings in this Agreement are not part of the provisions hereof,
are merely for the purposes of reference and shall have no force or
effect for any purpose whatsoever, including the construction of the
provisions of this Agreement, and if any heading is inconsistent with
any provisions of this Agreement, the said provisions shall govern.
8. IN this Agreement:-
(i) words and phrases defined for the purposes of Section 736 of
the Companies Xxx 0000 shall bear the same meaning;
(ii) "associated company" means any company which is (a) a company
having an ordinary share capital of which not less than 25 per
cent is owned directly or indirectly by the Company applying
the provisions of Section 838 of the Income and Corporation
Taxes Act 1988 in the determination of ownership or (b) a
holding company of the Company or a subsidiary of any such
holding company or (c) a company to which the Company or any
of its subsidiaries renders managerial, administrative or
technical service otherwise than in the ordinary course of its
business;
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(iii) "the Board of Directors" means the Board of Directors of the
Company as the same may be constituted from time to time and
includes any duly appointed committee thereof;
(iv) "Change of Control" - a Change in Control of the Company
shall be deemed to have occurred if:
(a) the Company or its holding company sells or agrees to
sell the whole or substantially the whole of the
undertaking and assets of the Company; or
(b) the Company or its holding company sells or agrees to
sell the whole or not less than 50% of the equity
share capital of the Company; or
(c) a member of the Company or its holding company
obtains control of the composition of the Board of
Directors of the Company. For the purpose of this
paragraph (c) the composition of the Company's Board
of Directors shall be deemed to be controlled by a
member if (but only if) the member by the exercise of
some power exercisable by it without the consent or
concurrence of any other person can appoint or remove
all or a majority of the Directors of the Company.
9. CHOICE OF LAW
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THIS Agreement is made in, and shall be governed by and construed in
accordance with the laws of England.
10. ENTIRE CONTRACT
THIS instrument together with the documents referred to herein contains
the entire agreement of the parties on the subject matter hereof except
that the rights of the Company hereunder shall be deemed to be in
addition to and not in substitution for its rights under the Company's
standard form of Technical Patent and Confidentiality Agreement if
heretofore or hereafter entered into between the parties hereto so that
the making of this Agreement shall not be construed as depriving the
Company of any of its rights or remedies under any such Technical
Patent and Confidentiality Agreement. This Agreement may not be changed
orally, but only by an agreement in writing signed by the parties
hereto.
11. NOTICES
ALL notices given hereunder shall be in writing and shall be sent by
registered post or delivered by hand, and, if intended for the Company,
shall be addressed to it (if sent by post) or delivered to it (if
delivered by hand) at its registered office for the attention of the
Secretary of the Company, or at such other address and for the
attention of such other person of which the Company shall have given
notice to the Executive in the manner herein provided, and, if intended
for the Executive, shall be delivered to him personally or shall be
addressed to him (if sent by post) at his most recent residence address
shown in the Company's employment records or at such other address or
to such designee of which the Executive shall have given notice to the
Company in the manner herein provided. Each such notice shall be deemed
to be given on the date of posting thereof or, if delivered personally,
on the date so delivered.
12. TERMINATION OF ANY PRIOR EMPLOYMENT AGREEMENT
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THIS Agreement is in substitution for all previous employment
agreements in effect between the Company and Executive on the date
hereof which shall be deemed to have been terminated by mutual consent
as from the date of commencement of this Agreement.
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IN WITNESS WHEREOF the Company has affixed its Common Seal and the Executive has
set his hand and seal the day and year first above written.
THE COMMON SEAL OF )
PALL EUROPE LIMITED )
was hereunto affixed )
in the presence of:- )
A T Xxxxxx /s/ A T Xxxxxx
X X Louch /s/ X X Xxxxx
SIGNED SEALED AND DELIVERED )
by the said )
Xxxx XxxXxxxxx ) /s/ Xxxx XxxXxxxxx
in the presence of: )
X X Xxxxxxx-Surry /s/ X X Xxxxxxx-Surry
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SCHEDULE 1
1. Your Starting Date for the purposes of Statutory Continuity is
19th June 1972
2. Pursuant to Clause 4 (A) the annual salary of the Executive shall be
(pound)130,000 per annum paid monthly by bank transfer.
3. There are no collective agreements relevant to your employment.
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PALL CORPORATION
EXECUTIVE INCENTIVE BONUS PLAN
-----
1. Purpose
This document sets forth the Pall Corporation Executive Incentive Bonus
Plan as adopted effective July 17, 2001.
The purpose of the Plan is to encourage greater focus on performance
among the key executives of the Corporation by relating a significant portion of
their total compensation to the achievement of annual financial objectives.
2. Certain Definitions
As used herein with initial capital letters, the following terms shall
have the following meanings:
"Average Equity" shall mean, for any Fiscal Year, the average of
stockholders' equity as shown on the fiscal year-end consolidated balance sheet
of the Corporation and its subsidiaries as of the end of such Fiscal Year and as
of the end of the immediately preceding Fiscal Year except that the amounts
shown on said balance sheets as "Accumulated other comprehensive" income or
loss, as the case may be, shall be disregarded.
"Base Salary" shall mean, with respect to any Executive and for any
Fiscal Year, the annual rate of base salary in effect for the Executive as of
the first day of such year or, if later, as of the first day of the Executive's
Term of Employment, as determined under the Executive's Employment Agreement.
"Board of Directors" shall mean the Board of Directors of the
Corporation.
"Bonus" shall mean the bonus payable to an Executive under this Plan
for any Fiscal Year.
"CEO" shall mean the Chief Executive Officer of the Corporation.
"Change in Control" means the occurrence of any of the following:
(a) the "Distribution Date" as defined in Section 3 of the Rights
Agreement dated as of November 17, 0000 xxxxxxx xxx
Xxxxxxxxxxx xxx Xxxxxx Xxxxxx Trust Company of New York as
Rights Agent, as amended by Amendment No. 1 thereto dated
April 20, 1999, and as the same may have been further amended
or extended to the time in question or in any successor
agreement (the "Rights Agreement"); or
(b) any event described in Section 11(a)(ii)(B) of the Rights
Agreement; or
(c) any event described in Section 13 of the Rights Agreement; or
(d) the date on which the number of duly elected and qualified
directors of the Corporation who were not either elected by
the Board of Directors or nominated by the Board of Directors
or its Nominating Committee for election by the shareholders
shall equal or exceed one-third of the total number of
directors of the Corporation as fixed by its by-laws;
provided, however, that no Change in Control shall be deemed to have occurred,
and no rights arising upon a Change in Control as provided in Section 6 shall
exist, to the extent that the Board of Directors so determines by resolution
adopted prior to the Change in Control.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Committee" shall mean the Compensation Committee of the Board of
Directors.
"Corporation" shall mean Pall Corporation.
"Covered Executive" shall mean, with respect to any Fiscal Year, each
individual who is a "Covered Employee" of the Corporation for such year for the
purpose of section 162(m) of the Code.
"Employment Agreement" shall mean, with respect to any executive
employee of the Corporation, an employment agreement between the Corporation and
such employee which provides that the employee shall be eligible to receive
annual bonuses under this Plan.
"Executive" shall mean an executive employee of the Corporation with
whom the Corporation has entered into an Employment Agreement.
"Fiscal Year" shall mean the fiscal year of the Corporation ending on
August 3, 2002, and each subsequent fiscal year of the Corporation.
"Maximum X.X.X. Target" shall mean, for any Fiscal Year, the Return on
Equity that must be achieved or exceeded in order for the Performance Percentage
for the year to equal 100%, as determined by the Committee prior to the first
day of such year or within such period of time thereafter as may be permitted
under the regulations issued under section 162(m) of the Code.
"Minimum X.X.X. Target" shall mean, for any Fiscal Year, the Return on
Equity that must be exceeded in order for any Bonus to be paid to any Executive
for the year, as determined by the Committee prior to the first day of such year
or within such period of time thereafter as may be permitted under the
regulations issued under section 162(m) of the Code.
"Net Earnings" shall mean, for any Fiscal Year, the after-tax
consolidated net earnings of the Corporation and its subsidiaries as certified
by the Corporation's independent accountants for inclusion in the annual report
to shareholders ("Annual Report"), adjusted so as to eliminate the effects of
any decreases in or charges to earnings for (a) the effect of foreign currency
exchange rates, (b) any acquisitions, divestitures, discontinuance of business
operations, restructuring or any other special charges, (c) the cumulative
effect of any accounting changes, and (d) any "extraordinary items" as
determined under generally accepted accounting principles, to the extent such
decreases or charges referred to in clauses (a) through (d) are separately
disclosed in the Corporation's Annual Report for the year.
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"Plan" shall mean the Pall Corporation Executive Incentive Bonus Plan,
as set forth herein and as amended from time to time.
"Return on Equity" shall mean, for any Fiscal Year, the percentage
determined by dividing the Net Earnings for the year by the Average Equity for
the year.
"Target Bonus Percentage" shall mean, with respect to any Executive,
the target bonus percentage specified for such Executive in his or her
Employment Agreement.
3. Determination of Bonus Amounts
For each Fiscal Year falling in whole or in part within an Executive's
Term of Employment, as defined in his or her Employment Agreement, the Executive
shall be entitled to receive a Bonus in an amount determined in accordance with
the provisions of this Section 3, subject, however, to the provisions of Section
4.
(a) The amount of the Bonus payable to an Executive for each such
Fiscal Year shall be equal to (i) the Target Bonus Percentage of the Executive's
Base Salary for such year, multiplied by (ii) the Performance Percentage for
such year, as determined under (b) below.
(b) The Performance Percentage for any Fiscal Year shall be determined
in accordance with he following provisions:
(i) If the Return on Equity equals or exceeds the Maximum
X.X.X. Target for the year, the Performance Percentage for the year
shall be 100%.
(ii) If the Return on Equity is less than the Maximum X.X.X.
Target for the year but exceeds the Minimum X.X.X. Target for the year,
the Performance Percentage for the year shall be equal to the quotient
resulting from dividing (A) the excess of the Return on Equity for the
year over the Minimum X.X.X. Target for the year, by (B) the excess of
the Maximum X.X.X. Target for the year over the Minimum X.X.X. Target
for the year.
(iii) If the Return on Equity equals or is less than the
Minimum X.X.X. Target for the year, the Performance Percentage for the
year shall be zero, and no Bonus shall be payable under the Plan for
such year to any Executive.
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(c) If an Executive's Term of Employment commences after the start of a
Fiscal Year, or ends prior to the close of a Fiscal Year, the amount of the
Bonus payable to the Executive for the Fiscal Year in which the Executive's Term
of Employment commences, or for the Fiscal Year in which the Executive's Term of
Employment ends, as determined in accordance with the other applicable
provisions of the Plan, shall be prorated on the basis of the number of days of
such Fiscal Year that fall within the Executive's Term of Employment; provided,
however, that (i) if an Executive's Term of Employment ends within 5 days prior
to the close of a Fiscal Year, there shall be no proration and the Executive
shall be entitled to receive the entire amount of the Bonus payable to the
Executive for such year, as determined in accordance with such other provisions,
and (ii) if the Executive's Term of Employment ends within 5 days following the
start of a Fiscal Year, the Executive shall not be entitled to receive any Bonus
with respect to such Fiscal Year.
4. Adjustment of and Limitation on Bonus Amounts
The amount of the Bonus otherwise payable to an Executive for any
Fiscal Year in accordance with Section 3 shall be subject to the following
adjustments and limitation:
(a) The Committee may, in its discretion, reduce the amount of the
Bonus otherwise payable to any Executive in accordance with Section 3, (i) to
reflect any decreases in or charges to earnings that were not taken into account
in determining Net Earnings for the year pursuant to clause (a), (b), (c) or (d)
contained in the definition of such term in Section 2, (ii) to reflect any
credits to earnings for extraordinary items of income or gain that were taken
into account in determining Net Earnings for the year, (iii) to reflect the
Committee's evaluation of the Executive's individual performance, or (iv) to
reflect any other events, circumstances or factors which the Committee believes
to be appropriate in determining the amount of the Bonus to be paid to the
Executive for the year.
(b) The Committee may, in its discretion, increase the amount of the
Bonus otherwise payable to any Executive who is not a Covered Executive, as
determined under Section 3, to reflect the Committee's evaluation of the
Executive's individual performance, or to reflect such other circumstances or
factors as the Committee believes to be appropriate in determining the amount of
the Bonus to be paid to the Executive for the year. The Committee shall not have
any discretion to increase the amount of the Bonus payable to any Covered
Executive for the year, as determined under Section 3.
(c) Notwithstanding any other provision herein to the contrary, the
amount of the Bonus otherwise payable to any Executive for any Fiscal Year shall
not exceed the lesser of (i) $1.0 million and (ii) 100% of the Executive's Base
Salary for the year.
5. Payment of Bonuses
The Bonus payable to an Executive for any Fiscal Year shall be paid in
accordance with the following provisions:
(a) Except as otherwise provided in (b) or (c) below,
(i) if the Executive is not a Covered Executive for such year,
50% of the estimated amount of the Executive's Bonus shall be paid to
the Executive at such date in August next following the close of such
year as the Committee in its discretion shall determine, and the
remaining amount of the Executive's Bonus shall be paid to the
Executive by no later than January 15 next following the close of such
year;
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(ii) if the Executive is a Covered Executive for such year,
50% of the amount of the Executive's Bonus shall be paid to the
Executive as soon as practicable after the Committee has certified in
writing that all conditions for the payment of such Bonus to the
Executive for such year have been satisfied, and the remaining amount
of the Executive's Bonus shall be paid to the Executive by no later
than January 15 next following the close of such year;
(iii) each amount payable to an Executive under (i) and (ii)
above, reduced by the amount of all federal, state and local taxes
required by law to be withheld therefrom, shall be paid to the
Executive in the form of a single lump sum cash payment.
(b) To the extent that an Executive has elected under the applicable
provisions of the Pall Corporation Management Stock Purchase Plan (the "MSPP")
to have any part of the Bonus payable to the Executive for any Fiscal Year paid
in the form of Restricted Units to be credited to the Executive's account under
the MSPP, no cash payments shall be made to the Executive pursuant to (a) above
with respect to the part of the Executive Bonus that is subject to such
election; and the obligation of the Corporation under this Plan with respect to
payment of such part of the Executive's Bonus shall be fully discharged upon the
crediting of Restricted Units to the Executive's account under the MSPP in
accordance with the applicable provisions of such Plan.
(c) To the extent that an Executive has elected under the applicable
provisions of the Pall Corporation Profit-Sharing Plan (the "Profit-Sharing
Plan") to have any part of the Bonus payable to the Executive for any Fiscal
Year reduced, and to have an amount equal to such part of the Executive's Bonus
contributed to the Profit-Sharing Plan as a 401(k) Contribution on the
Executive's behalf, an amount equal to such part of the Executive's Bonus shall
be contributed to the Profit-Sharing Plan on behalf of the Executive; and
thereupon, the obligation of the Corporation under this Plan with respect to
payment of such part of the Executive's Bonus shall be fully discharged.
However, no such contribution shall be made to the extent it would cause any
limitation applicable under the 401(k) Plan to be exceeded.
6. Change in Control
Notwithstanding any other provision in the Plan to the contrary (but
subject to the "provided, however" clause contained in the definition of "Change
in Control" in Section 2), upon the occurrence of a Change in Control, the
following provisions shall apply.
(a) The amount of the Bonus payable to any Executive for the Fiscal
Year in which a Change in Control occurs shall be at least equal to the Target
Bonus Percentage of the Executive's Base Salary for such year or, in the case of
any Executive whose Term of Employment commences after the start of such year or
ends prior to the close of such year, a pro rata portion thereof determined on
the basis of the number of days of such Fiscal Year that fall within the
Executive's Term of Employment.
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(b) Each Executive whose Term of Employment has not ended prior to the
occurrence of a Change in Control shall be entitled to receive a Bonus for each
Contract Year (as defined in the Executive's Employment Agreement) that falls in
whole or in part within the Executive's Term of Employment and that ends after
the Fiscal Year in which the Change in Control occurs. The amount of the Bonus
payable to the Executive for each such Contract Year shall be at least equal to
the Target Bonus Percentage of the Executive's Base Salary for such Contract
Year or, in the case of any Executive whose Term of Employment ends after the
start of such Contract Year but prior to the close of such year, a pro rata
portion thereof determined on the basis of the number of days of such Contract
Year that fall within the Executive's Term of Employment.
(c) The entire amount of the Bonus payable to an Executive for any
Fiscal Year or Contract Year pursuant to (a) or (b) above, reduced by the amount
of all federal, state and local taxes required to be withheld therefrom, shall
be paid to the Executive in a single cash lump sum as soon as practicable after
the close of such Fiscal Year or Contract Year.
7. Rights of Executives
An Executive's rights and interests under the Plan shall be subject to
the following provisions:
(a) An Executive's rights to payments under the Plan shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, or garnishment by creditors of the Executive.
(b) Neither the Plan nor any action taken hereunder shall be construed
as giving any Executive any right to be retained in the employment of the
Corporation or any of its subsidiaries.
8. Administration
The Plan shall be administered by the Committee. A majority of the
members of the Committee shall constitute a quorum. The Committee may act at a
meeting, including a telephone meeting, by action of a majority of the members
present, or without a meeting by unanimous written consent. In addition to the
responsibilities and powers assigned to the Committee elsewhere in the Plan, the
Committee shall have the authority, in its discretion, to establish from time to
time guidelines or regulations for the administration of the Plan, interpret the
Plan, and make all determinations considered necessary or advisable for the
administration of the Plan.
The Committee may delegate any ministerial or nondiscretionary function
pertaining to the administration of the Plan to any one or more officers of the
Corporation.
All decisions, actions or interpretations of the Committee under the
Plan shall be final, conclusive and binding upon all parties. Notwithstanding
the foregoing, any determination made by the Committee after the occurrence of a
Change in Control that denies in whole or in part any claim made by any
individual for benefits under the Plan shall be subject to judicial review,
under a "de novo", rather than a deferential standard.
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9. Amendment or Termination
The Board of Directors may, with prospective or retroactive effect,
amend, suspend or terminate the Plan or any portion thereof at any time;
provided, however, that (a) no amendment, suspension or termination of the Plan
shall adversely affect the rights of any Executive with respect to any Bonus
that has become payable to the Executive under the Plan, without his or her
written consent, and (b) following a Change in Control, no amendment to Section
6, and no termination of the Plan, shall be effective if such amendment or
termination adversely affects the rights of any Executive under the Plan.
10. Successor Corporation
The obligations of the Corporation under the Plan shall be binding upon
any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the Corporation, or upon any successor
corporation or organization succeeding to substantially all of the assets and
business of the Corporation. The Corporation agrees that it will make
appropriate provision for the preservation of Executives' rights under the Plan
in any agreement or plan which it may enter into or adopt to effect any such
merger, consolidation, reorganization or transfer of assets.
11. Governing Law
The Plan shall be governed by and construed in accordance with the laws
of the State of New York.
12. Effective Date
The Plan was adopted effective as of July 17, 2001 by the Board of
Directors, acting by the Committee, subject, however, to approval by the
shareholders of the Corporation by a majority of the votes cast in person or by
proxy at the 2001 annual meeting of the Corporation's shareholders, including
any adjournment thereof.
[The Plan was approved
by shareholders at the
annual meeting on
November 14, 2001.]
7
