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EXHIBIT 10.26
Revised Appendix C
PALL CORPORATION
SUPPLEMENTARY PROFIT-SHARING PLAN
As amended and restated
February 15, 1995
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PALL CORPORATION
SUPPLEMENTARY PROFIT-SHARING PLAN
This document sets forth the Pall Corporation Supplementary
Profit-Sharing Plan, as amended and restated February 15, 1995. The amendments
reflected in this document are effective as of January 1, 1995. The Plan was
previously amended and restated September 19, 1994, to reflect amendments
effective as of August 1, 1993.
The rights and entitlement to a benefit under the Plan of any person who
terminated employment with any Employer prior to the effective date of a
particular amendment to the Plan shall be determined solely under the terms of
the Plan as in effect on the date of such termination of employment, without
regard to such amendment.
SECTION 1. PURPOSE. The purpose of this Plan is to provide participants
in the Pall Corporation Profit-Sharing Plan (the "Profit Sharing Plan") with
benefits equivalent to those provided under the Profit Sharing Plan, with
respect to that portion of their annual compensation which may not be taken into
account under the Profit Sharing Plan because of the limitation on compensation
contained in section 401 (a) (17) of the Internal Revenue Code.
The Plan is intended to constitute an unfunded plan of deferred
compensation for "a select group of management or highly compensated employees"
within the meaning of sections 201(2), 301(a) (3) and 401(a) (1) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
SECTION 2. DEFINITIONS. When used herein, the following terms shall
have the following meanings:
(a) "Account" means the account established for a Participant
hereunder.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
(d) "Committee" means the Committee appointed by the Board to
administer the Plan.
(e) "Company" means Pall Corporation, a New York corporation.
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(f) "Compensation" means "Compensation", as defined in the Profit
Sharing Plan for purposes of Section 3.4 of the Profit Sharing Plan.
(g) "Corresponding PSP Plan Year" means, with respect to any Plan Year,
the plan year of the Profit Sharing Plan that corresponds to such Plan Year.
(h) "Corresponding Valuation Period" means, with respect to any
Valuation Date, the period of time which starts on the day after the immediately
preceding Valuation Date and ends on such Valuation Date.
(i) "Employer" means the Company or any subsidiary of the Company that
has adopted the Profit Sharing Plan.
(j) "Employer Contribution" means "Employer Contribution", as defined
in the Profit Sharing Plan.
(k) "Employer Contribution Account" means the "Employer Contribution
Account", as defined in the Profit Sharing Plan, maintained for a participant
under the Profit Sharing Plan.
(1) "Excess Compensation" means, for any Plan Year, the amount of a
Participant's Compensation for the taxable year of the Employer which ends in
such Plan Year that is in excess of the limitation on Compensation in effect for
such Plan Year under section 401(a) (17) of the Code.
It is provided, however, that for the Short Plan Year, "Excess
Compensation" shall be the amount of a Participant's Compensation paid to the
Participant during such Plan Year in excess of the limitation on Compensation in
effect for such Plan Year under section 401(a) (17) of the Code.
(m) "Participant" means any person (i) who, on or after August 1, 1993,
is employed by an Employer and is a participant in the Profit Sharing Plan, and
(ii) who has had Excess Compensation for any Plan Year beginning on or after
August 1, 1993.
(n) "Plan" means the Pall Corporation Supplementary Profit-Sharing
Plan, as set forth herein and as amended from time to time.
(o) "Plan Year" means, after July 31, 1993, the 5-consecutive month
period beginning on August 1, 1993 and ending on December 31, 1993 (the "Short
Plan Year"), and, thereafter, each calendar year.
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(p) "Profit Sharing Plan" means the Pall Corporation Profit-Sharing
Plan, as amended from time to time.
(q) "Termination of Service" means the termination of a Participant's
employment with all Employers.
(r) "Valuation Date" means (i) for the Short Plan Year, the last
business day of October and December of such year and (ii) after December 31,
1993, the last business day of the third, sixth, ninth and twelfth months during
a Plan Year.
SECTION 3. SUPPLEMENTAL PROFIT SHARING BENEFIT.
3.1 The Benefit. As of the last day of each Plan Year beginning on or
after August 1, 1993, each Participant's Account shall be credited with an
amount equal to (a) the Participant's Excess Compensation for such year,
multiplied by (b) a fraction, the numerator of which is the aggregate amount of
Employer Contributions allocated to all Employer Contribution Accounts with
respect to the Corresponding PSP Plan Year, and the denominator of which is the
aggregate amount of Compensation taken into account in making such allocation.
For the purpose of the preceding sentence, the aggregate amount of Employer
Contributions so allocated shall be determined without regard to the reduction
made from the Employer Contributions for amounts described in clause (b) (3) of
the second paragraph of Section 3.4 of the Profit Sharing Plan.
Notwithstanding the foregoing, no amount shall be allocated to the
Account of a Participant for the Plan Year in which the Participant's
Termination of Service occurs, unless the Participant is entitled to have a
portion of the Employer Contributions made to the Profit Sharing Plan for the
Corresponding PSP Plan Year allocated to his or her Profit Sharing Plan Account
for such year.
SECTION 4. ACCOUNTS, EARNINGS AND VESTING.
4.1. Accounts. The Committee shall establish and maintain, or cause to
be established and maintained, a separate memorandum Account for each
Participant. A Participant's Account shall be adjusted from time to time to
reflect the amounts to be credited to such Account under Section 3.1, the
amounts to be credited or charged to such Account under Section 4.2, and amounts
distributed to the Participant or his or her Beneficiary under Section 5.1.
4.2. Earnings. As of each Valuation Date occurring after August 1,
1993, each Participant's Account shall be credited, or charged, with an amount
determined by multiplying (a)
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the balance of Buch Accounts as of the immediately preceding Valuation Date, by
(b) the Earnings Adjustment Factor for such Valuation Date. The Earnings
Adjustment Factor for any Valuation Date shall be a fraction. The numerator of
such fraction shall be the amount of the earnings or losses that would have
resulted during the Corresponding Valuation Period for such Valuation Date if,
on the first day of such period, an amount equal to the balance of the
Participant's Employer Contribution Account as of the immediately preceding
Valuation Date had been invested in the Fidelity Asset Manager fund. The
denominator of such fraction shall be the balance of the Participant's Employer
Contribution Account as of the immediately preceding Valuation Date. If the
numerator of the Earnings Adjustment Factor for any Valuation Date is a negative
amount, the adjustment to be made to the Participant's Account pursuant to this
Section 4.2 as of such Valuation Date shall be a charge to such Account.
In the case of any Participant who had a balance to his credit in his
Account as of July 31, 1993, such date shall be treated as the Valuation Date
immediately preceding the Valuation Date occurring in October of 1993, for
purposes of determining the amount to be credited or charged to such
Participant's Account under this Section 4.2 as of the October, 1993 Valuation
Date.
4.3. Vesting. As of any date of reference or upon the occurrence of any
event, a Participant shall have a vested interest in the same percentage of his
or her Account as the vested percentage the Participant has in his or her
Employer Contribution Account on such date or by reason of the occurrence of
such event.
Notwithstanding any other provision herein to the contrary, if a
Participant does not have a 100% vested interest in his or her Account at the
time of the Participant's Termination of Service (and does not acquire a 100%
vested interest in his or her Account by reason of the circumstances of his or
her Termination of Service), the nonvested portion of the Participant's Account
shall be forfeited, and shall not be distributed to the Participant pursuant to
Section 5.
SECTION 5. PLAN DISTRIBUTIONS.
5.1 Distributions. A Participant's Account balance shall become
distributable to the Participant or his or her Beneficiary, as the case may be,
upon the Participant's Termination of Service, for any reason. Distribution
shall be made in accordance with the following rules:
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(a) Commencement of Distributions. Distributions hereunder shall be
made on the 60th day after the Valuation Date next following the Participant's
Termination of Service.
(b) Form and Amount of Distributions. Distributions hereunder shall be
made in the form of a single lump-sum payment, in an amount equal to the
Participant's vested percentage of the balance of his or her Account as of the
Valuation Date immediately preceding the date as of which the distribution is to
be made.
(c) Participant's Death. If the Participant dies prior to his or her
Termination of Service, or following his or her Termination Service but prior to
the distribution of his or her Account, the Participant's Account shall be
distributed to the Participant's Beneficiary. The Participant's "Beneficiary"
shall be the person(s) designated by the Participant to receive any amount
distributable hereunder by reason of his or her death, as indicated in the last
written designation of a Beneficiary filed by such Participant with the
Committee prior to such Participant's death. If a Participant has failed to
designate a Beneficiary, or if no Beneficiary designated by the Participant
survives to receive any amount distributable hereunder upon the Participant's
death, the following will be deemed to be such Participant's Beneficiary with
priority in the order named: (1) his or her spouse; and (2) his or her estate.
(d) Special Rule for Amounts Credited to a Participant's Account After
a Distribution. If a distribution is made to or on behalf of any Participant by
the Plan pursuant to this Section 5, and if any amount is credited to such
Participant's Account after such distribution has been made, then the portion of
the amount so credited in which the Participant is vested shall be paid to the
Participant, or, if the Participant has died, to his Beneficiary (as determined
in subsection (c)), in a single lump-sum payment, within 30 days of the later of
(1) the date as of which the amount is so credited, or (2) the date on which the
Committee determines that such amount is to be so credited.
SECTION 6. SOURCE OF PAYMENT. All payments to be made hereunder shall
be paid from the general assets of the Company, and no special or separate fund
shall be established and no segregation of assets shall be made to assure such
payments. Nothing contained in the Plan, and no action taken pursuant to the
provisions of the Plan, shall create or be construed to create a trust of any
kind, or as creating in any Participant or Beneficiary any right, title or
beneficial ownership interest in or to any assets of the Company. The Plan
constitutes a mere promise by the Company to make benefit payments in the
future. It is the intention of the Company that the Plan be treated as
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unfunded for Federal income tax purposes and for purposes of Title I of ERISA.
To the extent that any person acquires a right to receive payments from the
Company under the Plan, such right shall be no greater than the right of any
unsecured general creditor of the Company.
Notwithstanding the foregoing, the Company may establish a bookkeeping
reserve to reflect its obligations hereunder, or may establish a "grantor"
trust, within the meaning of sections 671 through 679 of the Code, to assist it
in making the payments provided for hereunder; provided, however, that any
bookkeeping reserve, and the assetS of any trust, so established shall not be
deemed to constitute assets of this Plan, and the assets of any trust so
established shall at all times prior to payment to Participants or their
beneficiaries remain a part of the general assets of the Company and subject to
the claims of the Company's general creditors.
SECTION 7. ADMINISTRATION OF THE PLAN. The Plan shall be administered by
the Committee, which shall have full power and authority to interpret and
construe the Plan, to make all determinations considered necessary or advisable
for the administration of the Plan and the calculation of the amounts creditable
and payable thereunder, and to review claims for benefits under the Plan. The
Committee's interpretations and constructions of the Plan and its decisions or
actions thereunder shall be binding and conclusive on all persons for all
purposes.
No member of the Committee shall be personally liable by reason of any
contract or other instrument executed by such member or on his or her behalf in
his or her capacity as a member of the Committee nor for any mistake of judgment
made in good faith, and the Company shall indemnify and hold harmless each
member of the Committee and each other employee, officer, or director of the
Company to whom any duty or power relating to the administration or
interpretation of the Plan may be allocated or delegated, against any cost or
expense (including counsel fees) or liability (including any sum paid in
settlement of a claim) arising out of any act or omission to act in connection
with the Plan unless arising out of such person's own fraud or bad faith.
SECTION 8. AMENDMENT AND TERMINATION. The Plan may be amended,
suspended or terminated, in whole or in part, by the Board without the consent
of any Participant or any other person. The Committee may adopt any amendment
that may be necessary or appropriate to facilitate the administration,
management and interpretation of the Plan or to conform the Plan thereto,
provided any such amendment does not have a material effect on the currently
estimated cost to the Company of maintaining the Plan. No such amendment,
suspension or termination shall retroactively
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impair or otherwise adversely affect the rights of any Participant or other
person to benefits under the Plan that have accrued prior to the date of such
action as determined by the Committee in its sole discretion.
SECTION 9. GENERAL PROVISIONS. The following additional provisions
shall be applicable with respect to the Plan.
(a) The Plan shall be binding upon and inure to the benefit of the
Company and its successors and assigns, and Participants, beneficiaries, and
their estates. The Plan shall also be binding upon any successor corporation or
organization succeeding to substantially all of the assets and business of the
Company, but nothing in the Plan shall preclude the Company from merging or
consolidating into or with, or transferring all or substantially all of its
assets to, another corporation or organization that assumes the Plan and all
obligations of the Company hereunder. The Company agrees that it will make
appropriate provision for the preservation of Participants' rights under the
Plan in any agreement or plan that it may enter into to effect any merger,
consolidation, reorganization or transfer of assets. Upon such a merger,
consolidation, reorganization or transfer of assets and assumption, the term
"Company" shall refer to such other corporation or organization and the Plan
shall continue in full force and effect.
(b) Neither the Plan nor any action taken hereunder shall be construed
as giving to any Participant the right to be retained in the employ of any
Employer or as affecting the right of any Employer to dismiss any Participant.
(c) The Company shall withhold from all amounts otherwise payable under
the Plan all Federal, state, local or other taxes required pursuant to law to be
withheld with respect to such payments.
(d) The rights or interests of any Participant under the Plan are not
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, or garnishment by the Participant's creditors
or beneficiary.
(e) The Plan shall be governed by the laws of the State of New York
from time to time in effect.
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