Exhibit 10.1
Employment Agreement – Lisa
McDermott
EMPLOYMENT AGREEMENT dated as of October 1, 2009
between PALL CORPORATION, a New York corporation (the “
Company ”), and (“ Executive ”)
(this “ Agreement ”).
In
consideration of the mutual agreements hereinafter set forth,
effective as of October 1, 2009 (the “ Effective Date
”), the parties hereto agree as follows.
Section 1.
Employment
The Company hereby employs Executive, and
Executive hereby agrees to serve, as Chief Financial Officer of the
Company with the duties set forth in Section 2, until such time as
Executive’s employment terminates in accordance with the
terms of Section 4 hereof.
Section 2.
Duties
(a) Executive agrees that during
Executive’s employment Executive will perform such duties and
have such authority as is customarily assigned to and possessed by
the Chief Financial Officer, and further agrees that Executive will
hold such other 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
Executive’s experience and qualifications.
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Exhibit 10.1
(b) 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 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.
(c) During Executive’s employment,
Executive shall, except during customary vacation periods and
periods of illness, devote substantially all of Executive’s
business time and attention to the performance of Executive’s
duties hereunder, to the business and affairs of the Company and
its subsidiaries and to promoting the best interests of the Company
and its subsidiaries, and Executive shall not, either during or
outside of such normal business hours, engage in any activity
inimical to such best interests.
Section 3.
Compensation
(a) Base Salary . During
Executive’s employment, the Company shall pay Executive a
base salary (“ Base Salary ”) at the rate of no
less than $371,400 per annum. Base Salary shall be paid in such
periodic installments as the Company may determine but not less
often than monthly. The Chief Executive Officer of the Company will
review Base Salary annually and may, in the Chief Executive
Officer’s discretion, recommend to the Compensation Committee
of the Board of Directors of the Company (the “
Compensation Committee ”) that an increase be made in
Base Salary. Any such recommended increase shall take effect only
if, and to the extent that, it is approved by the Compensation
Committee in its sole discretion. For the avoidance of doubt, with
respect to each fiscal year of the Company (a “ Fiscal
Year ”) beginning with the Fiscal Year which starts on
the first day of August next following the Effective Date, the
Company shall pay Executive Base Salary at such rate as the
Compensation Committee shall determine but not less than the amount
of Base Salary payable to Executive in the preceding Fiscal
Year.
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Exhibit 10.1
(b)
Bonus Compensation .
(i) Plan Bonus . With respect
to each Fiscal Year of the Company falling in whole or in part
during Executive’s employment following the Effective 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 Pall Corporation 2004 Executive
Incentive Bonus Plan as it may be amended from time to time, a copy
of which is annexed hereto and incorporated herein by reference
(the “ Bonus Plan ”). Words and terms used
herein with initial capital letters and not defined herein are used
herein as defined in the Bonus Plan. For purposes of determining
the amount of the bonus payable to Executive for any Fiscal Year
under the Bonus Plan (the “ Plan Bonus ”),
Executive’s Target Bonus Percentage shall be 105% for such
Fiscal Year.
(ii) Payment of Plan Bonus .
Executive’s Plan Bonus shall be paid in accordance with
§5 of the Bonus Plan. With respect to any Fiscal Year which
falls in part but not in whole during the period of
Executive’s employment, the pro rata portion of the Plan
Bonus to which Executive is entitled under this Section 3(b) shall
be determined in accordance with §3(c) of the Bonus
Plan.
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Exhibit 10.1
(c)
Fringe Benefits and Perquisites . During Executive’s
employment, Executive shall enjoy the customary perquisites of
office, including, but not limited to, office space and
furnishings, expense reimbursements and any similar emoluments
customarily afforded to executives of the Company at the same
level. During Executive’s employment, 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 executives or management personnel
generally (such as, but not limited to, group hospitalization,
medical, life and disability insurance, and pension, 401(k) 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.
Section 4. Separation from
Service; Change in Control
(a)
Separation from Service . Subject to Section 17 below, if
for any reason Executive experiences a “separation from
service” as defined under Section 409A of the of the Internal
Revenue Code of 1986, as amended (the “ Code ”)
and the rules and regulations issued thereunder (“ Section
409A ”), Executive (or Executive’s estate in the
event of Executive’s death) shall be entitled to (i) any
accrued but unpaid Base Salary as of the date of such separation,
(ii) any Plan Bonus earned but unpaid for the Fiscal Year preceding
the Fiscal Year that includes the date of such separation, paid to
the extent payable under and in accordance with the terms of the
Bonus Plan, (iii) any Plan Bonus or pro rata portion thereof that
Executive may be entitled to receive under the Bonus Plan with
respect to the Fiscal Year in which the separation from service
takes place, paid to the extent payable under and in accordance
with the terms of the Bonus Plan, (iv) any unreimbursed business
expenses as of the date of such separation, paid within thirty (30)
days of the separation from service upon presentation of supporting
documentation in accordance with normal practice and (v) any vested
benefits as of the date of such separation under any benefit plans
maintained, or contributed to, by the Company, or any disability
benefits program sponsored by the Company, in accordance with the
terms and conditions of each such plan or program.
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Exhibit 10.1
(b)
Disability or Death . If Executive shall die during
Executive’s employment or if Executive experiences a
separation from service because the Company terminates
Executive’s employment by reason of Executive becoming
Disabled, 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, subject, other than in the event of death, to
Executive’s compliance with Sections 5, 6, 7, 9 and 10 below
and subject, other than in the event of death, to Sections 17 and
18 below: (i) the benefits set forth under Section 4(a), (ii)
Executive’s Base Salary to the end of the month in which a
separation from service under this Section 4(b) occurs, paid in
accordance with the Company’s normal payroll practices, and
(iii) a cash payment equal to (x) 50% of Base Salary plus (y) 50%
of Executive’s Target Bonus Percentage multiplied by Base
Salary, in each case, as such Base Salary and Target Bonus
Percentage were in effect for Executive immediately prior to the
date on which separation from service under this Section 4(b)
occurs, paid in twelve (12) equal monthly installments commencing
on the Company’s first regularly scheduled payroll date in
the month following the month in which separation from service
under this Section 4(b) occurs and on the Company’s first
regularly scheduled payroll date in each of the next eleven (11)
months thereafter.
“Disabled”
means that Executive is, by reason
of physical or mental disability, incapable of performing
Executive’s principal duties hereunder for an aggregate of
one hundred thirty (130) working days out of any period of twelve
(12) consecutive months.
In
the event that Executive’s employment terminates as described
in this Section 4(b), Executive shall have no right to any
compensation or any other benefits under this Agreement except as
set forth in Section 4(a) and this Section 4(b).
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Exhibit 10.1
(c) Involuntary Separation From Service
Without Cause; Resignation for Good Reason . In the event that
Executive experiences a separation from service with the Company
due to (1) the Company’s termination of her employment
without Cause (as defined below) or (2) Executive’s
termination of her employment for Good Reason (as defined below),
then subject to Executive’s compliance with Sections 5, 6, 7,
9 and 10 below (where applicable), subject to Sections 17 and 18
below and other than in circumstances set forth in Sections 4(b),
4(e) or 4(f), Executive will receive the following compensation and
benefits under this Agreement in lieu of any compensation or
benefits to which she might otherwise be entitled under Section 3
of this Agreement or any benefit plans referenced
therein:
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(i)
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Each month for
a period of twenty-four (24) consecutive months, beginning with the
month following the month in which Executive’s separation
from service occurs, the Company shall make a payment in an amount
equal to (X) the sum of (1) Base Salary at the annual rate at which
Executive’s Base Salary was payable immediately prior to
Executive’s separation from service and (2) the amount
determined under clause (X)(1) multiplied by 70% of the Target
Bonus Percentage as in effect immediately prior to separation from
service, divided by (Y) 12. Each installment will be paid on the
Company’s first regularly scheduled payroll date in the
applicable month.
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(ii)
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During the
period beginning on the date of Executive’s separation from
service and ending on the two-year anniversary thereof, any of
Executive’s restricted stock units and stock options that are
(A) not yet vested under the 2005 Stock Compensation Plan, as
amended (the “ Stock Plan ”), and (B)
outstanding, in each case as of the date of Executive’s
separation from service, will not be cancelled, but will continue
to vest and be settled or become exercisable, as applicable, in the
manner and at the times set forth in the applicable grant
agreements and the Stock Plan as though Executive had not
experienced a separation from service until such two-year
anniversary.
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(iii)
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(A) During the
period beginning on the date of Executive’s separation from
service and ending on the two-year anniversary thereof, any of
Executive’s units not yet vested under the Management Stock
Purchase Plan, as amended (the “ MSPP ”), as of
the date of Executive’s separation from service will not be
cancelled, but will continue to be settled in the manner and at the
times set forth under the MSPP as though Executive had not
experienced a separation from service until such two-year
anniversary.
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(B) Any vested
units Executive had previously deferred under the MSPP, to the
extent payable upon a Termination of Employment (as defined in the
MSPP), will be paid on the one-year anniversary of
Executive’s separation from service.
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Exhibit 10.1
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(iv)
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Any monthly pension to which
Executive is entitled under the Pall Corporation Supplementary
Pension Plan (the “ SPP ”) will be calculated at
the time of the one-year anniversary of Executive’s
separation from service and will commence payment on the later of
the first day of the month after Executive has attained her Early
Retirement Date (as defined in the SPP) and the one-year
anniversary of Executive’s separation from service. Upon
separation from service, Executive shall be credited with two (2)
years of age and two (2) years of service for purposes of
eligibility and vesting under the SPP.
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(v)
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During the
period beginning on the date of Executive’s separation from
service and ending on the date that is eighteen (18) months after
active employee group medical coverage is terminated on account of
such separation from service, Executive shall, to the extent
Executive elects to continue to participate in the continuation
coverage under the Company’s Comprehensive Welfare Benefits
Plan offered by the Company under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“ COBRA ”), be
provided with a taxable reimbursement payment equal to the amount
of the COBRA premium payable by Executive. All expenses shall be
reimbursed within twelve (12) months following the two-year
anniversary of Executive’s separation from
service.
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Exhibit 10.1
“ Good Reason ” shall mean
any of the following conditions arising without Executive’s
written consent: (i) a material diminution in Executive’s
Base Salary, (ii) a material diminution in Executive’s
authority, duties, or responsibilities, (iii) a material diminution
in the authority, duties, or responsibilities of the person to whom
Executive is required to report (Executive’s “
Direct Report ”), or Executive’s being required
to report to a different person whose authority, duties, or
responsibilities are materially diminished as compared with the
authority, duties, or responsibilities of the Direct Report to whom
Executive reported immediately prior to such change, (iv) a
material diminution in the budget over which Executive retains
authority, (v) a material change in the geographic location at
which Executive must perform services or (vi) any other action or
inaction that constitutes a material breach by the Company of this
Agreement; provided that (A) Executive must provide notice
to the Company of the existence of the condition described in this
paragraph within a period not to exceed ninety (90) days of the
initial existence of the condition and (B) the Company must be
provided with a period of at least thirty (30) days during which it
may remedy the condition and not be required to pay the amounts
described in this Section 4(c). If the Company does not remedy the
condition during such period, Executive’s employment shall
terminate on the thirty-first (31 st ) day following the
initial notice.
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Exhibit 10.1
In
the event that the Company terminates Executive’s employment
without Cause, or Executive terminates her employment for Good
Reason, Executive shall have no right to any compensation or any
other benefits under this Agreement except as set forth in Section
4(a) and this Section 4(c).
(d) Change in Control . If a Change in
Control (as defined in the MSPP or the Stock Plan, as applicable)
occurs, then any of Executive’s (i) restricted units not yet
vested under the MSPP (if the Change in Control constitutes a
Change in Control as defined in the MSPP) and/or (ii) restricted
stock units and stock options not yet vested under the Stock Plan
(if the Change in Control constitutes a Change in Control as
defined in the Stock Plan), as applicable, that are outstanding on
the date of such Change in Control will vest on such
date.
(e) Voluntary Separation or Involuntary
Separation from Service For Cause . “ Cause
” shall mean Executive’s (i) failure or refusal to
substantially perform the material duties of Executive’s
employment or other violation of this Agreement in a material
manner, (ii) failure in a material manner to comply with the
written rules and policies of the Company that has caused or would
reasonably be expected to result in material injury to the Company,
(iii) willful and serious misconduct in connection with
Executive’s employment that has caused or would reasonably be
expected to result in material injury to the Company, (iv)
dishonesty or fraudulent conduct in regards to the Company or (v)
conviction of, or plea of nolo contendere to, a crime that
constitutes a felony. The Company may terminate Executive’s
employment for Cause with immediate effect; provided that,
prior to termination for any of the reasons in (i) or (ii) above,
Executive shall have thirty (30) days after notice from the Company
to remedy such matter if such matter is reasonably capable of being
remedied.
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Exhibit 10.1
In the
event that the Company terminates Executive’s employment for
Cause, or Executive terminates her employment without Good Reason,
in each case except under the circumstances set forth in Sections
4(b), 4(c) or 4(f), Executive shall have no right to any
compensation or any other benefits under this Agreement except as
set forth in Section 4(a).
(f)
Retirement . This Agreement shall automatically expire and
be of no further force and effect on Executive’s sixty-fifth
(65 th ) birthday.
Anything
hereinabove to the contrary notwithstanding, if any provision of
this Section 4(f) 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.
(g)
Supplementary Pension Plan . In no event will any monthly
pension to which Executive is entitled under the SPP commence
payment prior to the one-year anniversary of Executive’s
separation from service, except that on or after the date Executive
attains sixty-five (65) years of age, upon separation from service
for any reason, the monthly pension shall be payable at the time
and in the form set forth under the terms of the SPP.
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Exhibit 10.1
Section 5. Restrictive
Covenants
During Executive’s employment and for the
longer of (a) any period for which Executive is receiving any
payments or benefits under Sections 4(b), 4(c) or 4(f) or (b) one
(1) year following Executive’s separation from service with
the Company (the “ Restrictive Covenant Period
”), Executive shall not, without the written permission of
the Company, render services to any corporation, individual or
other entity engaged in any activity, or himself 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.
Section 6.
Non-Disparagement
While employed by the Company, and during the
Restrictive Covenant Period, Executive shall not make any
disparaging or untruthful remarks concerning the Company or any of
its subsidiaries, or their officers, directors, employees or
agents, whether acting in their individual or representative
capacities. Executive shall not be deemed to have breached
Executive’s obligations under the foregoing sentence if
during Executive’s employment with the Company Executive
criticizes the job performance of employees who report to
Executive, or makes remarks which Executive believes to be truthful
about any Company employee as part of performing her duties
hereunder, as part of such employees’ performance reviews and
evaluations, provided such remarks are made in the ordinary course
of business, not malicious or unfounded, are
