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EXHIBIT 10.6(b)
SECOND AMENDMENT
TO
WAYNE P. SAYATOVIC EMPLOYMENT AGREEMENT
HODGSON, RUSS, ANDREWS, WOODS & GOODYEAR
1800 ONE M & T PLAZA
BUFFALO, NY 14203-2391
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SECOND AMENDMENT
TO
EMPLOYMENT AGREEMENT
THIS AMENDMENT ("Amendment"), made as of the 27th day of September,
1994, between IDEX CORPORATION, a Delaware corporation with its executive
offices at 630 Dundee Road, Suite 400, Northbrook, Illinois 60062 ("IDEX" or
the "Corporation"), and WAYNE P. SAYATOVIC, an individual residing at 91
Mallard Lane, Lake Forest, Illinois 60045 (the "Executive"), is the second
amendment to the Employment Agreement, dated as of January 22, 1988, between
IDEX and the Executive, as amended by the First Amendment to Employment
Agreement, dated January 13, 1993 (the "Employment Agreement").
IDEX and the Executive agree as follows:
1. Introductory Statement. The Executive has served as an Executive
of IDEX since its establishment. IDEX desires to continue the full-time
services of the Executive on the terms and conditions provided in the
Employment Agreement, subject to the amendments set forth in this Amendment.
The Executive is willing to execute this Amendment with respect to his
employment upon the terms and conditions set forth in this Amendment. This
Amendment changes only the provisions of the Employment Agreement set forth in
this Amendment. In all other respects, the Employment Agreement shall remain
in effect as previously written and executed.
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2. Agreement of employment. The text of the second paragraph of
Section 2 of the Employment Agreement is replaced in its entirety as follows:
"The Corporation shall not require the Executive to perform
services hereunder away from the Chicago, Illinois area of such
frequency and duration as would necessitate, in the reasonable
judgment of the Executive, the Executive moving his residence
from the Chicago, Illinois area. Following an Acquisition (as
hereinafter defined), the Corporation shall not, in the
reasonable judgment of the Executive, (a) significantly reduce
the scope of the duties of the Executive hereunder or (b)
significantly reduce the total potential compensation of the
Executive hereunder. If the Executive determines in accordance
with the preceding sentences that (a) the services required by
the Corporation necessitate that the Executive move his residence
from the Chicago, Illinois area, (b) the duties of the Executive
hereunder have been significantly reduced or (c) the total
potential compensation of the Executive hereunder has been
significantly reduced, the Executive, in his sole discretion, may
deem that the Corporation has
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terminated his services and shall so notify the Corporation in
writing, in which case the Corporation shall be deemed to have
terminated the services of the Executive for all purposes of
this Agreement as of the date specified by the Executive in his
notice to the Corporation."
3. Period of full-time service. (a) A new sentence is added at the
end of the second paragraph of Subsection 5(a) of the Employment Agreement to
read in its entirety as follows:
"In the event of the Executive's death, the balance of the
continuing salary payments shall be made to his wife, if
surviving, or if not, to his estate in addition to any and all
other benefits payable under this Agreement upon his death."
(b) The second sentence of the fourth paragraph of Subsection 5(a) of
the Employment Agreement is replaced in its entirety as follows:
"Such bonus shall be calculated in accordance with the
management incentive compensation program of the Corporation in
effect from time to time and
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shall in no event be less than the full target amount for the
Executive for such fiscal year."
4. Guarantee of pension benefits. (a) The text following
subparagraph (iv) in the first full paragraph of Subsection 5(c)(2) of the
Employment Agreement is replaced in its entirety as follows:
"or (v) for purposes of determining eligibility for a
lump sum distribution, any condition under the Plan considered
necessary to receive a lump sum distribution, such as the
submission of medical evidence of reasonable health of the
Participant or the meeting of a specified age or service
requirement (in other words the lump sum distribution shall be
an election solely in the discretion of the Executive); or (vi)
any other restriction on the Executive's benefits as determined
under the Plan pursuant to the Code, to the Employee Retirement
Income Security Act of 1974, as in effect at such point in time
("ERISA") or to any other law affecting the determination of
such benefits. However, except as specifically described
otherwise in the preceding sentence, all calculations pursuant
to this Section 5(c)(2) of benefits shall be made on the basis of the
actual years of service to the Corporation,
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including any Affiliated Corporation and Company as defined
under the Plan, and actual compensation of the Executive taken
into account under the applicable Plan provisions. To the
extent that the benefits to which the Executive or his
beneficiaries are entitled under this Section 5(c)(2) are not paid from
the Trust under the Plan or from the IDEX Corporation
Supplemental Executive Retirement Plan, the Corporation shall
pay such benefits directly from its general assets."
(b) The text of the last full paragraph of Subsection 5(c)(2) of the
Employment Agreement is replaced in its entirety as follows:
"If payments are being made or have been made in full,
pursuant to this Section 5(c)(2), but the Executive or any of his
beneficiaries is required to make a payment to the Trustee under
the Plan (whether in the form of a loss of collateral, interest
on such collateral or otherwise) as the result of the
application of the restrictions in the Plan upon payments to the
Executive, as described in Section 1.401(a)(4)-5(b) of the
Treasury Regulations, or by virtue of the termination of the
Plan (including the operation of Section 4045 of ERISA or any
successor section) or for
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any other reason, the Corporation shall reimburse the Executive
or his beneficiaries, as the case may be, directly from its
general assets, for each such payment to the Trustee, and if the
Executive or any of his beneficiaries does not receive a
deduction for federal, state and/or local income tax purposes
for such a payment and/or if such payment would result in the
imposition of any penalty tax because of such repayment, then
the amount of such reimbursement shall be increased by an amount
such that after payment by the Executive or his beneficiaries of
all taxes, including, without limitation, any interest or
penalties imposed with respect to such reimbursement, the
Executive or his beneficiaries retain an amount from the
Corporation approximately equal to the amount repaid to the
Trustee."
(c) A new full paragraph is added to the end of Subsection 5(c)(2) of
the Employment Agreement to read in its entirety as follows:
"In the event (I) the Executive requests a lump sum
distribution from the Trustee or Committee under the Plan and is
denied the request, regardless of the reason for the denial, or
(II) (i) if the Plan is
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amended to eliminate the lump sum distribution option on future
benefit accruals or (ii) the Executive is not otherwise entitled
to a lump sum distribution under the Plan terms and, in the case
of (i) or (ii), the Executive states in writing to the
Corporation at any time prior to the Executive or his
beneficiaries receiving a benefit under the Plan that he
otherwise would have requested the lump sum distribution option,
the Corporation shall pay the Executive, or his beneficiaries,
as the case may be, in cash in a single lump sum benefit, an
amount equal to the benefit hereinbefore determined less any
amount received by the Executive or his beneficiaries from the
Plan directly or indirectly in a single payment, regardless of
the form of payment in which the benefit is being paid or is to
be paid under the Plan. In the case of a benefit provided under
this paragraph, the Corporation shall pay the Executive or his
beneficiaries an additional amount in cash in a single lump sum
payment such that after payment by the Executive or his
beneficiaries of all federal, state, and/or local income taxes
(including, without limitation, any interest or penalties
imposed with respect to such taxes) imposed upon such single
lump sum payment, the Executive or his beneficiaries retain an
amount that would have been
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retained by him or them (without regard to any limitations as
described in the first paragraph of this Section 5(c)(2)) had he or
they directly rolled the amount from the Plan into an individual
retirement account. If the Executive or his beneficiaries
receive the single lump sum payment from the Corporation under
this paragraph, the Executive and his beneficiaries agree to
waive and/or return to the Corporation all benefits to him or
them that he or they subsequently receive from the Plan.
Notwithstanding the preceding sentence, if the Executive or any
of his beneficiaries does not receive a deduction for federal,
state and/or local income tax purposes for such benefits and/or
if such benefits would result in the imposition of any penalty
tax because of such repayment, then the amount of such waiver
and/or return to the Corporation shall be decreased by an amount
such that after payment by the Executive or his beneficiaries of
all taxes, including, without limitation, any interest or
penalties imposed with respect to such waiver and/or return, the
Executive or his beneficiaries incur no net expense from such
benefits he or they subsequently receive from the Plan. For
purposes of this Section, beneficiaries means the beneficiaries
as determined under the Plan."
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5. Medical benefits. Subsection 5(c)(3) of the Employment
Agreement is replaced in its entirety as follows:
"5(c)(3). MEDICAL BENEFITS. The Executive and/or his
wife, as the case may be, shall be entitled to prompt
reimbursement for all medical, dental, hospitalization,
convalescent, nursing, extended care facilities and similar
health and welfare expenses incurred by the Executive (or by his
wife in the event of the Executive's death or disability) for
the Executive or for the benefit of his wife or other
dependents. Such benefits shall continue at all times while the
Executive is employed by the Corporation, and thereafter for the
remainder of his life or the life of his wife, whichever shall
be the longer time, if (a) the Executive continues in the employ
of the corporation until the commencement of his 6Oth year or
(b) the Executive prior to the commencement of his 60th year
dies or becomes disabled while employed by the Corporation or
(c) the Executive is terminated at any time following an
Acquisition. The Corporation may, in its discretion, insure
such benefits; provided, however, that such benefits shall not
be affected by the existence or non-existence of any available
insurance from any source, shall not be limited by the
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terms of any such insurance or the failure of any insurer to
meet its obligations thereunder, shall not limit the Executive
or his beneficiaries in the choice of any physician, medical
care facility or type of medical expenses in any way, and,
except as provided in the following sentence, shall not be
affected by the availability of any medical benefits provided by
and available to the Executive from any subsequent employer. If
the Executive leaves the service of the Corporation prior to
attaining age 55 as the result of his termination by the
Corporation at any time following an Acquisition, such benefits
shall be reduced until the Executive attains age 55 to the
extent of any medical benefits provided by and available to the
Executive from any subsequent employer without cost to the
Executive or subject to full reimbursement of any such cost by
the Corporation to the Executive but shall not be limited by the
terms of any such insurance or reimbursement. For purposes of
this Agreement, the term "medical expenses" shall include, but
not be limited to, prescription drugs, prosthetics, optical care
(including corrective lenses) and travel and lodging associated
with medical expenses."
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6. Termination. Section 7 of the Employment Agreement is amended to
read in its entirety as follows:
"7. TERMINATION OF THIS AGREEMENT. This Agreement
shall terminate when the Corporation has made the last payment
provided for hereunder; provided, however, that the obligations
set forth under Section 5(d) of this Agreement shall survive any such
termination and shall remain in full force and effect. Without
the written consent of the Executive, the Corporation shall have
no right to terminate this Agreement prior thereto. In the
event the Executive, or his beneficiaries, as the case may be,
and the Corporation shall disagree as to their respective rights
and obligations under this Agreement, and the Executive or his
beneficiaries are successful in establishing, privately or
otherwise, that his or their position is substantially correct,
or that the Corporation's position is substantially wrong or
unreasonable, or in the event that the disagreement is resolved
by settlement, the Corporation shall pay all costs and expenses,
including counsel fees, which the Executive or his beneficiaries
may incur in connection therewith. The Corporation shall not
delay or reduce the amount of any payment provided for hereunder
or setoff or
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counterclaim against any such amount for any reason whatever; it
is the intention of the Corporation and the Executive that the
amounts payable to the Executive or his beneficiaries hereunder
shall continue to be paid in all events in the manner and at the
times herein provided. All payments made by the Corporation
hereunder shall be final and the Corporation shall not seek to
recover all or any part of any such payments for any reason
whatsoever."
7. Additional payments by the Corporation. In Subsection 8(a) of
the Employment Agreement the words "any and all equity appreciation rights
plans of the Corporation" are replaced in their entirety by: "the Non-Qualified
Stock Option Plan for Officers of the Corporation".
8. Assurances on liquidation. A new Section 9 is added to the
Employment Agreement to read in its entirety as follows:
"9. ASSURANCES ON LIQUIDATION. The Corporation agrees
that until the termination of this Agreement as above provided,
it will not voluntarily liquidate or dissolve, or enter into or
be a party to any other transaction the effect of which would be
to materially
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reduce the net assets or operations of the Corporation, without
first making a written agreement with the Executive or other
beneficiary, satisfactory to and approved by him or such
beneficiary in writing within 30 days of receipt of a notice
from the Corporation of such proposed liquidation, dissolution
or other transaction, in fulfillment of or in lieu of its
obligations to him or such beneficiary under this Agreement or
any other agreement, plan, policy or program of the Corporation
or, in the absence of such agreement, paying him or such
beneficiary in a lump sum settlement of all such obligations
prior to such proposed liquidation, dissolution or other
transaction. Notwithstanding anything in the preceding sentence
to the contrary, in the event that pursuant to the preceding
sentence the Corporation is obligated to pay to the Executive or
such beneficiary in a lump sum settlement all of the obligations
of the Corporation to the Executive or such beneficiary under
this Agreement or any other agreement, plan, policy or program
of the Corporation, the Executive or, in the event of his death
or inability to act, his wife or, if not surviving, his eldest
surviving child, shall have the right, in his or her sole
discretion, to elect not to receive a lump sum settlement of the
obligations of the
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Corporation to the Executive or other beneficiary under Section 5(c)(3)
of this Agreement and, in lieu thereof, to receive a guaranty
(including, without limitation, a letter of credit), in form and
substance satisfactory to the Executive or other beneficiary, as
the case may be, in his or her sole discretion, of the payment
of such obligations from any entity satisfactory to the
Executive or other beneficiary, as the case may be, in his or
her sole discretion. Any lump sum settlement shall be
determined using the interest rate that would be used (as of the
date of payment) by the Pension Benefit Guaranty Corporation for
purposes of valuing a lump sum distribution upon a plan
termination on the January 1 of the calendar year in which the
single sum is paid and the mortality assumptions of the Unisex Pension
1984 Mortality Table. For purposes of this Subsection,
the Corporation shall be deemed to include on a consolidated
basis all subsidiaries and other affiliated corporations or
other entities with the same effect as if they were divisions."
9. Binding effect. The second sentence of Section 12, which shall
be renumbered by this Amendment as Section 13, of the Employment Agreement is
replaced in its entirety as follows:
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"In addition to inuring to the benefit of the Executive, Sections 5(a)
and 5(b) are intended to inure to the benefit of the Executive's
beneficiaries, Section 5(c)(2) is intended to inure to the benefit of
the Executive's beneficiaries, to the extent contemplated in
that provision, Section 5(c)(3) is intended to inure to the benefit of
the Executive's wife and his dependents, and Section 7 and
Section 8 are intended to inure to the benefit of the Executive's
beneficiaries; such provisions shall be enforceable by the
aforesaid beneficiaries, wife and/or dependents, as the case may
be, who upon the Executive's death shall be deemed successors in
interest."
10. Renumbering of Sections. Sections 9, 10, 11, 12, 13, 14, 15 and
16 of the Employment Agreement are renumbered as Sections 10, 11, 12, 13, 14,
15, 16 and 17, respectively, of the Employment Agreement.
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IN WITNESS WHEREOF, the Executive has hereunto set his hand and the
Corporation has caused this Amendment to be executed in its name and on its
behalf as of the date first above written.
/s/ Wayne P. Sayatovic
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Wayne P. Sayatovic
DATE OF EXECUTION: October 25, 1994
IDEX CORPORATION
BY /s/ Donald N. Boyce
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Donald N. Boyce, President
DATE OF EXECUTION: October 25, 1994
The undersigned hereby executes this Amendment to evidence her
agreement to be bound by the terms of Subsection 5(c)(2) of the Employment
Agreement.
/s/ Janice Z. Sayatovic
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Janice Z. Sayatovic
DATE OF EXECUTION: October 31, 1994