Contract
Exhibit 10.8
[Senior Vice President
Single Bonus]
Single Bonus]
EMPLOYMENT AGREEMENT dated August 1, 2005 between PALL CORPORATION, a New York corporation
(the “Company”), and Xxxx Xxx Xxxxxxxx (“Executive”).
In consideration of the mutual agreements hereinafter set forth, the parties hereto agree as
follows:
§1. Employment and Term
The Company hereby employs Executive, and Executive hereby agrees to serve, as an executive
employee of the Company with the duties set forth in §2, for a term (hereinafter called the “Term
of Employment”) beginning August 1, 2005 (the “Term Commencement Date”) and ending, unless sooner
terminated under §4, on the effective date specified in a notice of termination given by either
party to the other except that such effective date shall not be earlier than the second
anniversary of the date on which such notice is given.
§2. Duties.
Executive agrees that during the Term of Employment she will hold such offices or positions
with the Company, and perform such duties and assignments relating to the business of the Company,
as the chief executive officer of the Company shall direct except that Executive shall not be
required to hold any office or position or to perform any duties or assignment inconsistent with
her experience and qualifications or not customarily performed by a corporate officer.
If the chief executive officer of the Company so directs, Executive shall serve as an officer
of one or more subsidiaries of the Company (provided that the duties of such office are not
inconsistent with Executive’s experience and qualifications and are duties customarily performed
by a corporate officer) and part or all of the compensation to which Executive is entitled
hereunder may be paid by such subsidiary or subsidiaries. However, such employment and/or payment
of Executive by a subsidiary or subsidiaries shall not relieve the Company from any of its
obligations under this Agreement except to the extent of payments actually made to Executive by a
subsidiary.
During the Term of Employment Executive shall, except during customary vacation periods and
periods of illness, devote substantially all of her business time and attention to the performance
of her duties hereunder and to the business and affairs of the Company and its
subsidiaries and to promoting the best interests of the Company and its subsidiaries and she shall
not, either during or outside of such normal business hours, engage in any activity inimical to
such best interests.
§3. Compensation During Term of Employment.
(a) Base Salary. With respect to the period beginning on the Term Commencement
Date and ending on the 31st day of July next following the Term Commencement Date, the
Company shall pay Executive a Base Salary (in addition to the compensation provided for elsewhere
in this Agreement) at the rate of $215,000 per annum (hereinafter called the “Original Base
Salary”). With respect to each Contract Year beginning with the Contract Year which starts on the
first day of August next following the Term Commencement Date, the Company shall pay Executive a
Base Salary at such rate as the Board of Directors may determine but not less than the Original
Base Salary adjusted as follows: The term “Contract Year” as used herein means the period from
August 1 of each year through July 31 of the following year. The term “Consumer Price Index” as
herein used means the “Consumer Price Index for all Urban Consumers” compiled and published by the
Bureau of Labor Statistics of the United States Department of Labor for “New York — Northern N.J. -
Long Island, NY-NJ-CT-PA”, For each Contract Year during the Term of Employment beginning with the
Contract Year which starts on the first day of August next following the Term Commencement Date,
the minimum compensation payable to Executive under this §3(a) (hereinafter called the “Minimum
Base Salary”) shall be determined by increasing (or decreasing) the Original Base Salary by the
percentage increase (or decrease) of the Consumer Price Index for the month of June immediately
preceding the start of the Contract Year in question over (or below) the Consumer Price Index for
the month of June next preceding the Term Commencement Date. [To illustrate the operation of the
foregoing provisions of this paragraph: In an Employment Agreement as to which the Term
Commencement Date was August 1, 2003, the executive’s base salary for the Contract Year August 1,
2004 through July 31, 2005 would be not less than the Original Base Salary under that Employment
Agreement adjusted by the percentage increase (or decrease) of the Consumer Price Index for June
2004 over (or below) said Index for June 2003.] Further adjustment in the Minimum Base Salary shall
be made for each ensuing Contract Year, in each case (i) using the Consumer Price Index for the
month of June next preceding the Term
Commencement Date as the base except as provided in the immediately following paragraph
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hereof and (ii) applying the percentage increase (or decrease) in the Consumer Price Index since
said base month to the Original Base Salary to determine the Minimum Base Salary. The Base Salary
shall be paid in such periodic installments as the Company may determine but not less often than
monthly.
If with respect to any Contract Year (including the Contract Year beginning on the first day
of August next following the Term Commencement Date) the Board of Directors fixes the Base Salary
at an amount higher than the Minimum Base Salary, then (unless the resolution fixing such higher
Base Salary provides otherwise), for the purpose of determining the Minimum Base Salary for
subsequent Contract Years: (1) the amount of the higher Base Salary so fixed shall be deemed
substituted for the Original Base Salary wherever the Original Base Salary is referred to in the
immediately preceding paragraph hereof, and (ii) the base month for determining the Consumer Price
Index adjustment shall be June of the calendar year in which the Contract Year to which such higher
Base Salary is applicable begins. [To illustrate the operation of the foregoing provisions of this
paragraph: If the Board of Directors were to fix a Base Salary for a Contract Year beginning, say,
August 1, 2005 which is higher than the Minimum Base Salary for that Contract Year, then June 2005
would become the base month for the purposes of making the Consumer Price Index adjustment to
determine the Minimum Base Salary for subsequent Contract Years unless and until the Board of
Directors were to fix a Base Salary higher than the Minimum Base Salary for a subsequent Contract
Year.]
(b) Bonus Compensation. As used herein, the term “Bonus Plan” means the Pall
Corporation Executive Incentive Bonus Plan adopted by the Compensation Committee of the Board of
Directors of the Company on October 16, 2003, approved by shareholders at the annual meeting of
shareholders on November 19, 2003 and amended by the Compensation Committee on July 19, 2004, a
copy of which is annexed hereto and incorporated herein by reference. Words and terms used herein
with initial capital letters and not defined herein are used herein as defined in the Bonus Plan.
With respect to each Fiscal Year of the Company falling in whole or in part within the Term of
Employment beginning with the Fiscal Year ending on the Saturday nearest to the 31st day
of the month of July next following the Term Commencement Date,
Executive shall be entitled to receive a Bonus pursuant to this Agreement in an amount
determined in accordance with and subject to all of the terms of the Bonus Plan.
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For purposes of determining the amount of the Bonus payable to Executive for any Fiscal Year
as provided in this §3(b) (the “Plan Bonus”), Executive’s Target Bonus Percentage shall be 105% of
her Base Salary for such Fiscal Year.
(c) Fringe Benefits and Perquisites. During the Term of Employment, Executive
shall enjoy the customary perquisites of office, including, but not limited to, office space
and furnishings, secretarial services, expense reimbursements and any similar
emoluments customarily afforded to senior executive officers of the Company at the same level as
Executive. Executive shall also be entitled to receive or participate in all “fringe benefits” and
employee benefit plans provided or made available by the Company to its executives or management
personnel generally (such as, but not limited to, group hospitalization, medical, life and
disability insurance, and pension, retirement, profit-sharing and stock option or purchase plans), at
such time and on such terms and conditions as each such plan provides.
(d) Vacations. Executive shall be entitled each year to a vacation or vacations in
accordance with the policies of the Company as determined by the Board or by an authorized
senior officer of the Company from time to time. The Company shall not pay Executive any
additional compensation for any vacation time not used by Executive.
| §4. Termination by Reason of Disability, Death, Retirement or Change in Control. | ||||
(a) Disability or Death. If, during the Term of Employment, Executive, by reason
of physical or mental disability, is incapable of performing her principal duties hereunder for an
aggregate of 130 working days out of any period of twelve consecutive months, the Company at its
option may terminate the Term of Employment effective immediately by notice to Executive given
within 90 days after the end of such twelve-month period. If Executive shall die during the
Term of Employment or if the Company terminates the Term of Employment pursuant to the
immediately preceding sentence by reason of Executive’s disability, the Company shall pay to
Executive, or to Executive’s legal representatives, or in accordance with a direction given by
Executive to the Company in writing, the following: (i) Executive’s Base Salary to the end of the
month in which such death or termination for disability occurs and any Plan Bonus or pro rata
portion thereof that Executive is entitled to receive in accordance with §3(b) hereof and (ii) for
each month in the period from the end of the month in which such death or termination for
disability occurs until the earlier of (x) the first anniversary of the date of death or
termination and (y) the date on which the Term of Employment would have ended but for such death or
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termination for disability, monthly payments of an amount equal to 1/12th of 102.5% of the annual
rate of Base Salary in effect for Executive immediately prior to the date on which Executive’s
death or termination for disability occurs (such 102.5% being comprised of one-half of such Base
Salary and one-half of Executive’s Target Bonus Percentage set forth in §3 (b) hereof).
(b) Retirement. (i) The Term of Employment shall end automatically, without
action by either party, on Executive’s 65th birthday unless, prior to such birthday, Executive and
the Company have agreed in writing that the Term of Employment shall continue past such 65th
birthday. In the latter event, unless the parties have agreed otherwise, the Term of Employment
shall be automatically renewed and extended each year, as of Executive’s birthday, for an
additional one-year term, unless either party has given a Non-Renewal Notice. A Non-Renewal Notice
shall be effective as of Executive’s ensuing birthday only if given not less than 60 days before
such birthday, and shall state that the party giving such notice elects that this Agreement shall
not automatically renew itself further, with the result that the Term of Employment shall end on
Executive’s ensuing birthday.
(ii) If the Term of Employment ends pursuant to this §4(b) by reason of a notice given by
either party as herein permitted or automatically at age 65 or any subsequent birthday, the
Company shall pay to Executive, or to another payee specified by Executive to the Company in
writing, (i) Executive’s Base Salary prorated to the date on which the Term of Employment ends and
(ii) any Plan Bonus or pro rata portion thereof that Executive is entitled to receive in
accordance with §3(b) hereof.
(iii) Anything hereinabove to the contrary notwithstanding, if any provision of
this §4(b) violates federal or applicable state law relating to discrimination on account of
age, such provision shall be deemed modified or suspended to the extent necessary to eliminate such
violation of law. If at a later date, by reason of changed circumstances or otherwise, the
enforcement of such provision as set forth herein would no longer constitute a violation of law,
then it shall be enforced in accordance with its terms as set forth herein.
(c) Change in Control. In the event of a Change in Control (as defined in the
Bonus Plan), Executive shall have the right to terminate the Term of Employment, by notice to the
Company given at any time after such Change in Control, effective on the date specified in such
notice, which date shall not be more than (but can be less than) one year after the giving of such
notice.
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§5. Covenant Not to Compete.
For a period of eighteen months after the end of the Term of Employment if the Term of
Employment is terminated by notice to the Company given by Executive under §1 or §4 hereof, or for
a period of twelve months after the end of the Term of Employment if the Term of Employment is
terminated by notice to Executive given by the Company under § 1 or §4 hereof or terminates under
§4 by reason of Executive’s attaining the age of 65, Executive shall not render services to any
corporation, individual or other entity engaged in any activity, or herself engage directly or
indirectly in any activity, which is competitive to any material extent with the business of the
Company or any of its subsidiaries, provided, however, that if the Company terminates
under §1 following a Change in Control (as defined in the Bonus Plan), the foregoing covenant not
to compete shall not apply.
§6. Company’s Right to Injunctive Relief.
Executive acknowledges that her 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 Executive.
§7. Inventions and Patents.
All inventions, ideas, concepts, processes, discoveries, improvements and trademarks
(hereinafter collectively referred to as intangible rights), whether patentable or registrable or
not, which are conceived, made, invented or suggested either by Executive alone or by Executive in
collaboration with others during the Term of Employment, and whether or not during regular
working hours, shall be disclosed to the Company and shall be the sole and exclusive property of
the Company. If the Company deems that any of such intangible rights are patentable or otherwise
registrable under any federal, state or foreign law, Executive, at the expense of the Company,
shall execute all documents and do all things necessary or proper to obtain patents and/or
registrations and to vest the Company with full title thereto.
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§8. Trade Secrets and Confidential Information.
Executive shall not, either directly or indirectly, except as required in the course of her
employment by the Company, disclose or use at any time, whether during or subsequent to the Term
of Employment, any information of a proprietary nature owned by the Company, including, but not
limited to, records, data, formulae, documents, specifications, inventions, processes, methods and
intangible rights which are acquired by her in the performance of her duties for the Company and
which are of a confidential information or trade secret nature. All records, files, drawings,
documents, equipment and the like, relating to the Company’s business, which Executive shall
prepare, use, construct or observe, shall be and remain the Company’s sole property. Upon the
termination of her employment or at any time prior thereto upon request by the Company, Executive
shall return to the possession of the Company any materials or copies thereof involving any
confidential information or trade secrets and shall not take any material or copies thereof from
the possession of the Company.
§9. Mergers and Consolidations; Assignability.
In the event that the Company, or any entity resulting from any merger or consolidation
referred to in this §9 or which shall be a purchaser or transferee so referred to, shall at any
time be merged or consolidated into or with any other entity or entities, or in the event that
substantially all of the assets of the Company or any such entity shall be sold or otherwise
transferred to another entity, the provisions of this Agreement shall be binding upon and shall
inure to the benefit of the continuing entity in or the entity resulting from such merger or
consolidation or the entity to which such assets shall be sold or transferred. Except as provided
in the immediately preceding sentence of this §9, this Agreement shall not be assignable by the
Company or by any entity referred to in such immediately preceding sentence. This Agreement
shall not be assignable by Executive, but in the event of her death, it shall be binding upon
and inure to the benefit of her legal representatives to the extent required to effectuate the
terms hereof.
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§10. Captions.
The captions in this Agreement are not part of the provisions hereof, are merely for the
purpose 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 caption is inconsistent with any
provisions of this Agreement, said provisions shall govern.
§11. Choice of Law.
This Agreement is made in, and shall be governed by and construed in accordance with the laws
of, the State of New York.
§12. Entire Contract.
This instrument 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 printed form of “Employee’s Secrecy and
Invention Agreement” or “Employee 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 Secrecy and Invention Agreement or
Employee Agreement. This Agreement may not be changed orally, but only by an agreement in writing
signed by the party against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
§13. Notices.
All notices given hereunder shall be In writing and shall be sent by registered or certified
mail, overnight courier service such as Federal Express or UPS Next Day Air or delivered by hand,
and, if intended for the Company, shall be addressed to it (if sent by mail or overnight courier
service) or delivered to it (if delivered by hand) at its principal office for the attention of the
Chief Executive Officer 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 Executive in the manner herein
provided, and, if intended for Executive, shall be delivered to her personally or shall be
addressed to her (if sent by mail or overnight delivery service) at her most recent residence
address shown in the Company’s employment records or at such other address or to such designee
of which 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 on which it is mailed or delivered to the overnight
courier service or, if delivered personally, on the date so delivered.
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§14. Termination of Existing Agreement.
Any employment agreement between the parties hereto which is in effect on the date hereof is
hereby terminated and replaced and superseded by this Agreement effective on the Term Commencement
Date. All payments, of Base Salary or otherwise, made by the Company under any such existing
agreement with respect to any period commencing on or after the Term Commencement Date shall be
credited against the corresponding payment obligations of the Company under this Agreement with
respect to such period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.
| PALL CORPORATION | ||||||
| By: | /s/ Xxxx Xxxxxxxx
|
|||||
| Title: Chairman & Chief Executive Officer | ||||||
| EXECUTIVE | ||||||
| /s/ Xxxx Xxx Xxxxxxxx | ||||||
| Xxxx Xxx Xxxxxxxx | ||||||
[Form prepared 2/03]
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