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EXHIBIT 10.28
GELMAN SCIENCES INC.
EXECUTIVE STOCK OWNERSHIP PLAN
1. PURPOSE
The Gelman Sciences Inc. Executive Stock Ownership Plan (the "Plan") is
intended to foster and promote the long-term growth and performance of
Gelman Sciences Inc. (the "Company") by requiring and enabling the
acquisition of a significant personal equity interest in the Company by
those Company executives upon whose judgment and efforts the Company is
largely dependent for the successful conduct of its business. As equity
holders, Company executives will participate in future appreciation in
the share value of the Company's stock, thus further aligning their
interests with the interests of other shareholders of the Company, with
the goal of maximizing return on shareholder investment. The opportunity
to participate in Company stock appreciation should enable the Company to
attract and retain key executives critical to the long-term success of
the Company. The Plan was adopted by the Company's Board of Directors on
September 20, 1995, with an effective date of August 1, 1995, subject to
shareholder approval and ratification.
2. BACKGROUND
The Plan is a feature of the Company's Executive Compensation Plan, also
adopted by the Board on September 20, 1995, with an effective date of
August 1, 1995. Pursuant to the Executive Compensation Plan, the Board
or its Compensation Committee (the "Committee") will make an annual
determination as to the dollar amount of a bonus pool to be allocated
among the Company's executive officers and other employees. It is the
goal of the Company that each executive officer acquire and retain of no
fewer than that number of shares of the Company's common stock ("Common
Stock") with a value equal to fifty percent (50%) of such officer's
annual base salary (the "Equity Value Requirement"), as adjusted from
time to time. Consistent with that goal, the annual bonus paid to each
executive officer will be paid in the form of a specified amount of
Common Stock, and the remainder of the bonus will be paid in cash. As of
each July 31st during the period in which the Plan is in effect, the
value of each executive officer's beneficial ownership of Common Stock
will be calculated, using the closing price on the principal stock
exchange on which the Common Stock is then traded for such day, or, if it
is not a trading day, then on the last trading day immediately preceding
such day. If the Equity Value Requirement is not met by an executive
officer as of any July 31st, the annual bonus received by that officer
for that year will have a stock component. The size of the stock
component will be sufficient to satisfy the
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Equity Value Requirement, subject to the limitation that the value of the
stock component paid to an executive officer with respect to any year
will not exceed the lesser of thirty percent (30%) of that officer's
annual bonus or ten percent (10%) of such officer's annual base salary
for that year.
3. ADMINISTRATION
The Plan will be administered by a committee ("Committee"), comprised of
three or more disinterested members of the Board, none of whom will be an
employee of the Company or a participant in the Plan. A majority of
Committee members will constitute a quorum, and the action of a majority
of the members of the Committee present at any meeting at which a quorum
is present, or the unanimous written action of the Committee, will be
considered the action of the Committee. Except for the terms and
conditions explicitly set forth in the Plan, the Committee will have the
authority, in its discretion, to determine all matters relating to awards
under the Plan. All decisions made by the Committee pursuant to the
provisions of the Plan and related orders or resolutions of the Board
shall be final and conclusive.
4. PARTICIPANTS
The Chief Executive Officer, the Chief Operating Officer and all other
executive officers of the Company will participate in the Plan.
5. STOCK SUBJECT TO THE PLAN; ADJUSTMENTS
The stock awarded under the Plan will be shares of Common Stock and may
be authorized and unissued shares or shares now held or subsequently
acquired by the Company or a combination thereof, as the Board may from
time to time determine. The aggregate number of shares to be awarded
under the Plan will not exceed 100,000, subject to adjustment for any
increase or decrease in the number of issued shares of Common Stock
resulting from any reorganization, capitalization, stock split, stock
dividend or similar corporate transaction.
6. STOCK AWARDS
Stock awards under the Plan will be determined pursuant to the provisions
of Section 2, above.
7. WITHHOLDING TAXES
The Company will have the right to deduct from any award made under the
Plan an amount sufficient to cover withholding required by law for any
federal, state or local taxes or to take such other action as may be
necessary to satisfy any such withholding obligations, including the
withholding from any other cash amounts
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due or to become due from the Company to the participant an amount equal
to such taxes.
8. TERM OF THE PLAN
The Plan is effective as of August 1, 1995, and shall remain in full
force and effect until all the Common Stock subject to it shall have been
issued pursuant to the provisions hereof, unless sooner terminated by the
Board.
9. PLAN AMENDMENT; TERMINATION
This Plan is subject to initial ratification and approval by the
Company's shareholders, but may be terminated or suspended or amended
thereafter from time to time by the Committee or the Board; provided,
however, no amendment by the Committee or the Board shall (a) increase
the maximum number of shares of Common Stock that may be issued under the
Plan, subject to adjustments pursuant to Section 5 above, (b) change the
designation in Section 4 of the Plan participants or (c) cause Rule 16b-3
(or any successor rule) promulgated by the Securities and Exchange
Commission (the "Commission") under the Securities Exchange Act of 1934
(the "Exchange Act") to cease to be applicable to this Plan, without
further approval of the shareholders of the Company. The Plan may not be
amended more than once every six months, other than to comport with
changes in the Internal Revenue Code, the Employee Retirement Income
Security Act, or the rules thereunder, or rules promulgated by the
Commission.
10. INDEMNIFICATION
Each person who is or shall have been a member of the Committee shall be
indemnified and held harmless by the Company against and from any loss,
cost, liability, or expense that may be imposed upon or reasonably
incurred by him or her in connection with or resulting from any claim,
action, suit, or proceeding to which he or she may be a party or in which
he or she may be involved by reason of any action taken or failure to act
under the Plan and against and from any and all amounts paid by him or
her in settlement thereof, with the Company's approval, or paid by him or
her in satisfaction of any judgment in any such action, suit, or
proceeding against him or her, provided he or she shall give the Company
an opportunity, at its own expense, to handle and defend the same before
he or she undertakes to handle and defend it on his own behalf. The
foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which any such person may be entitled under
the Company's Articles of Incorporation or By-laws, as a matter of law,
or otherwise, or any power that the Company may have to indemnify or hold
such person harmless.
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11. REQUIREMENTS OF LAW
The issuance of Common Stock under the Plan will be subject to all
applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or national securities exchanges as may be
required. The Plan, and all agreements hereunder, shall be construed in
accordance with and be governed by the laws of the State of Michigan.
It is the intention of the Company that the Plan will comply in all
respects with Rule 16b-3, including any successor provision to Rule
16b-3, and, if any Plan provision is later found not to be in compliance
with Section 16 of the Exchange Act, that provision will be deemed null
and void, and in all events the Plan will be construed in favor of its
meeting the requirements of Rule 16b-3. Specifically, the Plan is
intended to comply with and be subject to Rule 16b-3 as in effect prior
to May 1, 1991. The Committee may at any time elect that this Plan shall
be subject to a successor to this rule and, without shareholder approval,
make any and all amendments to this Plan that are necessary to comply
with the provisions of the Rule as then in effect or make any other
amendments that do not require shareholder approval under applicable
rules and regulations then in effect. Notwithstanding anything in the
Plan to the contrary, the Board, in its absolute discretion, may
bifurcate the Plan so as to restrict, limit or condition the use of any
provision of the Plan to participants who are subject to Section 16 of
the Exchange Act without so restricting, limiting or conditioning the
Plan with respect to other participants, if any.
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