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EXHIBIT 10.10
SERVICE AGREEMENT
AN AGREEMENT dated 28 November 1995 between PALL DEUTSCHLAND GMBH HOLDING ("the
Company") of the one part and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ of Am ▇▇▇▇▇ ▇▇▇▇ 54.6072
Dreieich-Goetzenhain, West Germany ("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,
for two years from the date hereof and thereafter until either party
gives to the other not less than two year's previous written notice
until the executive reaches age 65 and one year's previous written
notice after age 65 such notice in either case 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.
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3. DUTIES
(A) THE Executive agrees that during the continuance of this
Agreement he will hold such offices or positions within 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 of assignment inconsistent with his experience and
qualifications or not customarily performed by an officer of
the company.
(B) The Executive shall serve as an officer of or perform services
for one or more subsidiary or associated company of the
Company as the Board of Directors or its Chairman so directs
provided that the duties of such offices 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 or a subsidiary or associated company of 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 alteration 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
arrear by the last day of each month.
(B) Formula Bonus Compensation. With respect to each fiscal year
of Pall Corporation falling in whole or in part within the
Term of Employment beginning with the fiscal year in which the
Term Commencement Date occurs, Executive shall be entitled to
a bonus (in addition to his Base Salary) in such amount and
computed in such manner as shall be determined by the Board of
Directors but in no event shall the bonus payable to Executive
under this 4(B) be less than an amount computed by applying to
the fiscal year in question the following bonus formula:
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"Formula Bonus Compensation" means the amount, if any, payable
to Executive under this 4(B) and "Bonus Compensation" means
the total amount payable under 4(B) and 4(C).
"Average Equity" means the average of stockholders' equity as
shown on the fiscal year-end consolidated balance sheet of
Pall Corporation as of the end of the fiscal year with respect
to which Formula Bonus Compensation is being computed
hereunder and as of the end of the immediately preceding
fiscal year (e.g., "Average Equity" to be used in computing
Bonus Compensation for the fiscal year ending August 3, 1996
will be the average of stockholders' equity as of July 29,
1995 and August 3, 1996) except that the amount shown as the
"equity adjustment from foreign currency translation" on each
such consolidated balance sheet shall be disregarded and the
amount of $3,744,000 shall be the equity adjustment (increase)
from foreign currency translation used to determine
stockholders' equity at each such year-end balance sheet date.
"Net Earnings" means the after-tax consolidated net earnings
of Pall Corporation and its subsidiaries as certified by its
independent accountants for inclusion in the annual report to
stockholders.
"Return on Equity" means Net Earnings as a percentage of
Average Equity.
For fiscal year 1996, "Zero Bonus Percentage" shall mean a
Return on Equity of 12.5% and "Maximum Bonus Percentage" shall
mean a Return on Equity of 20.0%. For fiscal years after
fiscal 1996 Pall Corporation shall determine the Zero Bonus
Percentage and the Maximum Bonus Percentage, consistent in
each case with expected results based upon the Company's
normal projection procedures, or based on sound statistical or
trend data, and the determination by the Company of such
percentage shall be conclusive and binding on Executive.
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If Return on Equity for the fiscal year in question is the
Zero Bonus Percentage or less, no Bonus Compensation shall be
payable. If Return on Equity equals or exceeds the Maximum
Bonus Percentage, the Formula Bonus Compensation payable to
Executive shall be 15% of his Base Salary. If Return on
Equity is more than the Zero Bonus Percentage and less than
the Maximum Bonus Percentage, the Formula Bonus Compensation
shall be increased from zero percent of Base Salary towards
15% of Base Salary in the same proportion that Return on
Equity increases from the Zero Bonus Percentage to the
Maximum Bonus Percentage. Thus, for example, if Return on
Equity for fiscal 1996 is 16.25% (the midpoint between 12.5%
and 20.0%) the Bonus Compensation shall be an amount equal to
7.5% of Executive's Base Salary (the midpoint between zero
percent of Base Salary and 15% of Base Salary).
(C) Business Segment Bonus Compensation. Inasmuch as Executive's
services for the Company relate primarily to the operations of
a subsidiary, division or other segment of the overall
operations of the Company and its subsidiaries (a "Business
Segment"), Executive shall be considered for additional bonus
compensation for each fiscal year based on the results of
operations of such Business Segment for such fiscal year. The
amount of such additional bonus compensation, if any, shall be
determined by the chief executive officer of Pall Corporation
in his sole discretion but in no event shall such additional
bonus compensation exceed 10% of Executive's Base Salary.
(D) The Bonus Compensation shall be paid in installments as
follows:
(i) 50% of the estimated amount thereof in the October
following the end of the fiscal year with respect to
which the Bonus Compensation is payable (e.g., 50% in
October 1996 with respect to Bonus Compensation for
the fiscal year ending August 3, 1996), based on the
then current projections of Return on Equity and
results of operations of Executive's Business
Segment, and
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(ii) the balance thereof not later than April 30 next
following the end of the fiscal year with respect to
which the Bonus Compensation is payable.
With respect to any fiscal year of Pall Corporation which
falls in part but not in whole within the Term of Employment,
the Bonus Compensation to which Executive is entitled under
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 proration
and the Bonus Compensation shall be payable with respect to
the full fiscal year ending within such five-day period.
(E) 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.
(F) 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
in the German associated company 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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(G) 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.
(H) 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 or 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.
5. TERMINATION
A THIS Agreement shall be subject to termination by the Company:
(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);
(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 this creditors generally or have been convicted
of any criminal offence involving a custodial
sentence;
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(iii) at any time after the Executive's 65th birthday
(irrespective of whether the Executive is age 65 when
this Agreement is entered into), by notice to the
Executive effective on the date specified in such
notice;
(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 so to do 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
subsidiaries or associated companies (other than ceasing to be
a Group Vice President of PaIL Corporation) this Agreement
shall not hereby automatically terminate.
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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 any 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 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 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 ▇▇▇ ▇▇▇▇ 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. PROPER LAW
THE construction validity and performance of this Agreement shall be
governed in all respects by English law and the parties agree that the
English Courts shall have exclusive jurisdiction in respect of any
dispute suit action or proceedings which may arise out of or in
connection with this Agreement and hereby submit to the jurisdiction of
the English Courts.
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10. ENTIRE CONTRACT ACT
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 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
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 ) /s/
was hereunto affixed )
in the presence of: ▇. ▇▇▇▇▇ ) /s/
SIGNED SEALED AND DELIVERED )
by the said ) /s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ )
in the presence of: ▇▇▇▇▇▇ ▇▇▇▇▇▇ ) /s/
SCHEDULE
Pursuant to Clause 4 (A) the annual salary of the Executive shall be DM438493.00
