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SECOND AMENDED AND RESTATED IDEX CORPORATION
DIRECTORS DEFERRED COMPENSATION PLAN
ARTICLE I
BACKGROUND, PURPOSE, AND EFFECTIVE DATE
IDEX Corporation, a Delaware corporation (the "Corporation"), by
resolution of its Board of Directors, adopted the IDEX Corporation Directors
Deferred Compensation Plan (the "Plan"), effective as of January 1, 1993, for
the benefit of the non-employee members of its Board of Directors (the
"Directors").
In order to make certain changes to the Plan, an Amended and Restated IDEX
Corporation Directors Deferred Compensation Plan was adopted by a resolution of
the Board of Directors of IDEX Corporation, effective as provided below (the
"Amended Plan").
In order to make further changes to the Amended Plan, the Directors have
adopted the changes set forth in new Section 2.1.b and accompanying Exhibit D
and other clarifying changes in this Second Amended and Restated IDEX
Corporation Directors Deferred Compensation Plan (the "Second Amended Plan").
SECTION 1.1--BACKGROUND AND PURPOSE OF THE PLAN
The Corporation wishes to provide members of its Board of Directors who
are not employees of the Corporation with the opportunity to defer payment of
all of the compensation they receive in a particular year or years for serving
as Directors.
SECTION 1.2--EFFECTIVE DATE AND TERM
The Amended Plan was effective as of January 1, 1997. The Plan as in
effect prior to the date of approval of the Amended Plan by the shareholders of
the Corporation was in effect through December 31, 1996. The Second Amended
Plan shall become effective as of November 20, 1997 and shall continue until
such time as it is terminated or amended and restated by resolution of the
Board of Directors in accordance with Article V.
SECTION 1.3--SHARES SUBJECT TO PLAN
The shares of stock subject to Deferred Compensation Units shall be shares
of the Corporation's Common Stock. The aggregate number of such shares which
may be distributed pursuant to Deferred Compensation Units under the Amended
Plan shall not exceed 50,000 shares.
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ARTICLE II
CONTRIBUTIONS
SECTION 2.1--DEFERRED COMPENSATION
a. DEFERRAL ELECTION PROCEDURE. With respect to each quarter, beginning
with the first quarter of 1997 and continuing during the period in which this
Plan remains in effect, the Corporation shall credit with all of the amount of
future compensation as such Director has elected in writing to defer under the
Amended Plan (pursuant to the form attached hereto as Exhibit A and
incorporated herein by this reference) and carried in the accounts provided for
in Section 3.1 (the "Deferred Amounts"). An election to defer shall be made
prior to the calendar year for which the compensation so deferred is earned,
and shall be irrevocable with respect to the calendar year to which it applies
and shall remain in effect for future calendar years unless a new election is
made by such Director effective with respect to a calendar year and delivered
to the Corporation by the December 31 preceding such calendar year, provided,
however, that, to the extent necessary for such election or new election and
related deferrals to qualify for the exemption specified by Rule 16b-3 under
the Securities Exchange Act of 1934 as then in effect ("Rule 16b-3"), no such
election or new election may be made less than six months (or such other period
as Rule 16b-3 may specify) prior to the first date on which such deferred
compensation would have been paid if no deferral election were made, and such
election or new election shall otherwise comply with any applicable
requirements for exemption under Rule 16b-3. In that regard, a Director may
make a new election each year setting forth a deferral period and form of
payment pursuant to the form attached hereto as Exhibit A. The crediting of
the Deferred Amounts under this Amended Plan shall be made on the first day of
the quarter after the amounts are earned, or such other date on which such
amounts would otherwise have been paid to the Director. Any amounts credited to
the Deferred Compensation Account under the Plan prior to January 1, 1997 (the
"Prior Deferred Amounts") shall be credited to the Interest-Bearing Account as
set forth in Section 3.1.
b. DEFERRAL DISTRIBUTION DATE ELECTION CHANGES. A Director may change the
distribution date, subject to the requirements and limitations of this Section
2.1.b. A Director may change his or her distribution date by completing and
signing a Deferral Distribution Date Election Change Form and returning it to
the Administrator in accordance with the rules of the Second Amended Plan.
Such Deferral Distribution Date Election Change Form shall be in the form
attached hereto as Exhibit D. For purposes of this Section 2.1.b., a Director
shall be considered to have made a new deferral distribution date election on
the date that the Administrator receives such form.
If a Director's new deferral distribution date election made in accordance
with this Section 2.1.b. designates a new distribution date, such distribution
date shall be no earlier than the later of (i) such Director's distribution
date (if any) under his or her present deferral election (as elected on the
original election form or a prior deferral distribution date election change
form, as the case may be), or (ii) the first day of the second deferral year
following the year in which the change in the deferral is made. A Director may
not make a new deferral election in
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accordance with this Section 2.1.b. during the four calendar years following
the year in which the Director made his or her last change in the deferral
distribution date.
ARTICLE III
ACCOUNTS AND INVESTMENT
SECTION 3.1--THE DEFERRED AMOUNTS
The Corporation shall establish on its books the necessary accounts to
accurately reflect the Corporation's liability to each Director who has
deferred compensation under the Amended Plan. To each account shall be
credited, as applicable, Deferred Amounts and Dividend Equivalents (as defined
below) on the common stock, par value $.01 per share, of the Corporation (the
"Common Stock") and interest. The Corporation shall maintain separate
subaccounts for each annual compensation deferral election in order to
accurately reflect the Benefits (as defined in Section 4.1 ) distributable in a
particular distribution year. Payments to the Director under the Amended Plan
shall be debited to the appropriate accounts.
a. INTEREST-BEARING ACCOUNT. Compensation which a Director has elected to
defer into an Interest-Bearing Account shall be credited to the
Interest-Bearing Account on the same date that it would otherwise be payable to
such Director (the "Deferral Date"). Deferred Amounts carried in this account
shall earn interest from the Deferral Date to the date of payment. The
Deferred Amount allocated to the Interest-Bearing Account shall be adjusted no
less often than quarterly to reflect hypothetical earnings for the quarter
equal to the U.S. Government Securities Treasury Constant Maturities with 10
year maturities as of the December 1 of the calendar year preceding the quarter
for which the earnings are credited plus 200 basis points, compounded at least
annually. Such adjustments shall be made until no amounts remain in the
Director's Interest-Bearing Account.
b. DEFERRED COMPENSATION UNITS ACCOUNT. A Director who has elected to
defer compensation into a Deferred Compensation Units Account shall have the
amount of such compensation credited to his or her account as of the Deferral
Date, and such Deferred Amount shall also be converted into a number of
Deferred Compensation Units as of the Deferral Date by dividing the Deferred
Amount by the Fair Market Value of the Corporation's Common Stock as of the
Deferral Date. For purposes of the Plan, "Fair Market Value" shall mean the
fair market value of a share of the Common Stock as of a given date measured as
(i) the closing price of a share of the Common Stock on the principal exchange
on which shares of the Common Stock are then trading, if any, on the day
previous to such date, or, if shares were not traded on the day previous to
such date, then on the next preceding trading day during which a sale occurred;
or (ii) if such Common Stock is not traded on an exchange but is quoted on
NASDAQ or a successor quotation system, (1) the last sales price (if the Common
Stock is then listed as a National Market Issue under the NASD National Market
System) or (2) the mean between the closing representative bid and asked prices
(in all other cases) for the Common Stock on the day
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previous to such date as reported by NASDAQ or such successor quotation system;
or (iii) if such Common Stock is not publicly traded on an exchange and not
quoted on NASDAQ or a successor quotation system, the mean between the closing
bid and asked prices for the Common Stock, on the day previous to such date, as
determined in good faith by the Committee; or (iv) if the Common Stock is not
publicly traded, the fair market value established by the Compensation
Committee of the Board acting in good faith.
If Deferred Compensation Units exist in a Director's account on a dividend
record date for the Common Stock, Dividend Equivalents shall be credited to the
Director's account on the corresponding dividend payment date, and shall be
converted into the number of Deferred Compensation Units which could be
purchased. at a price equal to the Fair Market Value of the Common Stock as of
such dividend payment date, with the amount of Dividend Equivalents so
credited. For purposes of the Amended Plan, "Dividend Equivalent" shall mean an
amount equal to the cash dividend payable on any dividend payment date on one
share of Common Stock multiplied by the number of Deferred Compensation Units
in the Deferred Compensation Units Account as of the dividend record date.
In the event of any change in the Corporation's Common Stock outstanding,
by reason of any stock split or dividend, recapitalization, merger,
consolidation, combination or exchange of stock or similar corporate change,
such equitable adjustments, if any, by reason of any such change, shall be made
in the number of Deferred Compensation Units credited to each Director's
Deferred Compensation Units Account.
c. TRANSFERS BETWEEN ACCOUNTS. If and only if permissible under any
applicable provisions of Rule 16b-3 as then in effect without affecting a
director's disinterested status thereunder, upon advice of counsel, transfers
from the Interest-Bearing Account to the Deferred Compensation Units Account
may be made at any time requested by the Director on a date specified in a
notice to the Corporation; provided, however, that, to the extent necessary for
such transfer to qualify for the exemption specified by Rule 16b-3, the date
such notice is received by the Corporation must be at least six months (or such
other period as Rule 16b-3 may specify) prior to the date specified for such
transfer and such transfer shall otherwise comply with any applicable
requirements for exemption under Rule 16b-3. No transfers may be made from the
Deferred Compensation Units Account to the Interest-Bearing Account.
SECTION 3.2--VESTING
At all times a Director shall have a 100% nonforfeitable right to the
amounts credited to his or her accounts.
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ARTICLE IV
BENEFITS
SECTION 4.1--AFTER STATED PERIOD OR UPON CESSATION OF SERVICE AS DIRECTOR
The balance in the Interest-Bearing Account, including adjustments that
continue to be made pursuant to Article Ill, shall be paid in cash by the
Corporation. and the number of shares of Common Stock equal to the number of
Deferred Compensation Units (rounded down to the nearest whole unit) (together,
the balance in the Interest-Bearing Account and the Deferred Compensation Units
are referred to as the "Benefit") shall be paid or distributed, as the case may
be, to the Director on the January 1 following the number of deferral years
elected by the Director (either five or ten years after the year for which
compensation is deferred) (for example if a five year deferral election were
made, deferral of 1993 compensation would first be distributed on January 1,
1999) or following the Director's cessation of service as Director for any
reason other than death (the date of which shall be referred to as the "Date of
Cessation"), in one lump sum or in five substantially equal annual payments
with respect to the balance in the Interest-Bearing Account and five
substantially equal numbers of shares of Common Stock with respect to Deferred
Compensation Units, as selected by a Director. Elections pursuant to this
Section shall be made at the same time and in the same manner as election to
defer is made pursuant to Section 2.1.
SECTION 4.2--UPON DEATH
In the event of a Director's death, the Corporation shall pay the Benefit,
or in the event of a Director's death after commencement of the payment of the
Benefit under Section 4.1, the remaining balance of the Benefit, in one lump
sum as soon as practicable following the death of the Director or to the
Director's Beneficiary.
SECTION 4.3--CHANGE IN CONTROL
In the event of (a) any transaction or series of transactions which within
a 12-month period constitute a change of management or control where (i) at
least 51 percent of the then outstanding common shares of the Corporation are
(for cash, property (including, without limitation, stock in any corporation),
or indebtedness, or any combination thereof) redeemed by the Corporation or
purchased by any person (s), firm (s) or entity(ies), or exchanged for shares
in any other corporation whether or not affiliated with the Corporation, or any
combination of such redemption, purchase or exchange, or (ii) at least 51
percent of the Corporation's assets are purchased by any person(s), firm(s) or
entity(ies) whether or not affiliated with the Corporation for cash, property
(including, without limitation, stock in any corporation) or indebtedness or
any combination thereof, or (iii) the Corporation is merged or consolidated
with another corporation regardless of whether the Corporation is the survivor
(except any such transaction solely for the purpose of changing the
Corporation's domicile or which does not change the ultimate beneficial
ownership of the equity interests in the Corporation), or (b) any substantial
equivalent of any
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such redemption, purchase, exchange, change, transaction or series of
transactions, merger or consolidation constituting such change of management or
control, the Corporation shall pay the Benefit to the Director in one lump sum.
In the transaction giving rise to such change of management or control was
approved in advance by a majority of the Board of Directors, payment of the
Benefit shall be made at the closing of such transaction. If the transaction
giving rise to the change of management or control was not so approved, payment
of the Benefit shall be made immediately upon the occurrence of the event or
transaction giving rise to the change of management or control.
ARTICLE V
AMENDMENT, SUSPENSION, OR TERMINATION
SECTION 5.1--AMENDMENT, SUSPENSION, OR TERMINATION
The Board of Directors may amend, suspend or terminate the Amended Plan,
in whole or in pan, at any time and from time to time by resolution adopted at
a regular or special meeting of the Board or Directors, and only in such
manner.
SECTION 5.2--NO REDUCTION
No amendment, suspension or termination shall operate to adversely affect
the Benefit otherwise available to a Director if the Director had ceased being
a Director as of the effective date of such amendment, suspension, or
termination. Any Benefit determined as of such date shall continue to be
adjusted as provided in Article III and payable as provided in Article IV.
ARTICLE VI
MISCELLANEOUS PROVISIONS
SECTION 6.1--BENEFICIARY
"Beneficiary" shall mean any one or more persons, corporation, trusts,
estates, or any combination thereof, last designated by a Director to receive
the Benefit provided under this Amended Plan. Any designation made hereunder
shall be revocable, shall be in writing either on a facsimile of the form
annexed hereto as Schedule I or in a written instrument containing the
information requested in Schedule 1, and shall be effective when delivered to
the Corporation at its principal office. If the Corporation, in its sole
discretion, determines that there is not a valid designation, the Beneficiary
shall be the executor or administrator of the Director's estate.
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SECTION 6.2--NONASSIGNABILITY
The interest of any person under this Amended Plan (other than the
Corporation) shall not be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, attachment or encumbrance, or to the claims
of creditors of such person, and any attempt to effectuate any such actions
shall be void.
SECTION 6.3--INTEREST OF DIRECTOR
The Director and any Beneficiary shall, in respect to accounts and any
Benefit to be paid, shall be and remain simply a general unsecured creditor of
the Corporation in the same manner as any other creditor having a general claim
for compensation, if and when the Director's or Beneficiary's rights to receive
payments shall mature and become payable. At no time shall the Director be
deemed to have any right, title or interest, legal or equitable, in any asset
of the Corporation, including, but not limited to, any Common Stock or
investments which represent amounts credited to the Interest-Bearing Account.
SECTION 6.4--WITHHOLDING
The Corporation shall have the right to deduct or withhold from the Benefits
paid under this Amended Plan or otherwise all taxes which may be required to be
deducted or withheld under any provision of law (including, but not limited to,
Social Security payments, income tax withholding and any other deduction or
withholding required by law) now in effect or which may become effective any
time during the term of this Amended Plan.
SECTION 6.5--FUNDING
This Amended Plan shall not be a funded plan. The Corporation shall not
set aside any funds, or make any investments or set aside Common Stock, for the
specific purpose of making payments under the Amended Plan. All Benefits paid
under the Amended Plan shall be paid from the general assets of the
Corporation. Benefits payable under the Amended Plan may be reflected on the
accounting records of the Corporation, but such accounting shall not be
construed to create or require the creation of a trust, custodial or escrow
account.
SECTION 6.6--EXCLUSIVITY OF PLAN
This Amended Plan is intended solely for the purpose of deferring
compensation to the Directors to the mutual advantage of the parties. Nothing
contained in this Amended Plan shall in any way affect or interfere with the
right of a Director to participate in any other benefit plan in which he or she
may be entitled to participate.
SECTION 6.7--NO RIGHT TO CONTINUED SERVICE
This Amended Plan shall not confer any right to continued service on a Director.
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SECTION 6.8--NOTICE
Each notice and other communication to be given pursuant to this Amended
Plan shall be in writing and shall be deemed given only when (a) delivered by
hand, (b) transmitted by telex or telecopier (provided that a copy is sent at
approximately the same time by registered or certified mail, return receipt
requested), (c) received by the addressee, if sent by registered or certified
mail, return receipt requested, or by Express Mail, Federal Express or other
overnight delivery service, to the Corporation at its principal office and to a
Director at the last known address of such Director (or to such other address
or telecopier number as a party may specify by notice given to the other party
pursuant to this Section).
SECTION 6.9--CLAIMS PROCEDURES
If a Director or the Director's Beneficiary does not receive benefits to
which he or she believes he or she is entitled, such person may file a claim in
writing with the Corporation. The Corporation shall establish a claims
procedure under which:
(a) the Corporation shall be required to provide adequate notice in
writing to the Director or the Beneficiary whose claim for benefits has
been denied, setting forth specific reasons for such denial, written in a
manner calculated to be understood by the Director or the Beneficiary,
and
(b) the Corporation shall afford a reasonable opportunity to the
Director or the Beneficiary whose claim for Benefits has been denied for
a full and fair review by the Corporation of the decision denying the
claim.
SECTION 6.10--ILLINOIS LAW CONTROLLING
This Amended Plan shall be construed in accordance with the laws of the
State of Illinois.
SECTION 6.11--BINDING ON SUCCESSORS
This Amended Plan shall be binding upon the Directors and the Corporation,
their heirs, successors, legal representatives and assigns.
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* * * *
I hereby certify that the foregoing Plan was duly approved by the Board of
Directors of IDEX Corporation effective November 20, 1997.
Executed on this 16th day of December, 1997.
/s/ Wayne P. Sayatovic
Secretary
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Exhibit A
IDEX CORPORATION
SECOND AMENDED AND RESTATED DIRECTORS DEFERRED COMPENSATION PLAN
ELECTION FORM
I hereby elect to defer all of my compensation earned after December 31 of this
year for serving as Director of IDEX Corporation (the "Corporation"). This
election is irrevocable and shall remain in effect for the calendar year
beginning with the next January 1. My election shall remain in effect for each
subsequent calendar year until it is revoked by me in a writing delivered to
the Corporation, in accordance with the terms of the Second Amended and
Restated Directors Deferred Compensation Plan (the "Plan"), prior to the
beginning of such calendar year. Once revoked, there will be no deferral of my
compensation until I make a new election in accordance with the terms of the
Plan.
With respect to the compensation deferred pursuant to this election, I
hereby elect to have such deferral credited as follows [check one]:
______ interest-Bearing Account, or
______ Deferred Compensation Units Account; and
I further elect to receive distribution of the Deferred Amount in [check one]:
______ five annual installments pursuant to Section 4.1 of the Plan, or
______ a single lump sum pursuant to Section 4.1 of the Plan;
beginning on the January 1 following [check one]:
______ my cessation of service as a Director of IDEX Corporation,
______ five years after the year for which compensation is deferred, or
______ ten years after the year for which compensation is deferred.
I understand that in the event that my directorship with IDEX Corporation
terminates for any reason other than death, payment of the balance of my
Accounts shall be accelerated beginning on the January 1 following my cessation
of service as a director and I shall receive such payment or the distribution
of such payment will commence as elected above. I understand that in the event
of my death, payment of the entire balance of my Accounts shall be made to my
beneficiary(ies) as soon as practicable following my death. I also understand
that in the event of a change of control, payment of the entire balance of my
Accounts in one lump sum will be made immediately upon the occurrence of the
event giving rise to the change of control.
I acknowledge that I have received a copy of the Plan, and I understand
that all of my deferred Director's compensation and my Deferred Compensation
Accounts are subject to the terms and conditions of the Corporation's Directors
Deferred Compensation Plan, including that such Accounts are unfunded and my
right to such compensation is subject to the claims of general creditors.
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Director's Name
Dated:
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Director's Signature
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Exhibit B
IDEX CORPORATION
SECOND AMENDED AND RESTATED DIRECTORS
DEFERRED COMPENSATION PLAN
INVESTMENT CHANGE FORM
**********
INVESTMENT CHANGE
I hereby elect to change the vehicle used for the investment of Deferred
Amounts under the Plan from Interest-Bearing Account to Deferred
Compensation Units Account for the following Plan Year(s): ______________.
I understand that the number of Deferred Compensation Units to be credited
to the Deferred Compensation Units Account as a result of this investment
change election will be based upon the value of IDEX Corporation's Common Stock
on the fourth business day following the date of release of the quarterly or
annual summary statement of sales and earnings preceding this election, as
specified in Section 3.1(c) of the Second Amended and Restated Directors
Deferred Compensation Plan.
**********
- ---------------------------- ------------------------------
Name Social Security Number
- ---------------------------- ------------------------------
Signature Date
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EXHIBIT C
IDEX CORPORATION
SECOND AMENDED AND RESTATED DIRECTORS
DEFERRED COMPENSATION PLAN
BENEFICIARY DESIGNATION FORM
Name [ ] Original
---------------------------------------
Social Security Number [ ] Change
----------------------
Instructions: This form is used to designate a beneficiary under the Second
Amended and Restated IDEX Corporation Directors Deferred Compensation Plan.
The percentages indicated must total 100%. If you desire, you may indicate a
primary beneficiary(ies) and a contingent beneficiary(ies) (the person who will
receive the benefit if your primary beneficiary does not survive you).
I hereby direct that any benefits which may become payable under the Second
Amended and Restated IDEX Corporation Directors Deferred Compensation Plan on
my death be paid as I have indicated below:
Name of Beneficiary* Relationship Address Percentage
- -------------------- ------- ------------ -------
- -------------------- ------- ------------ -------
- -------------------- ------- ------------ -------
- -------------------- ------- ------------ -------
* See reverse side for alternative designations
I understand that if I do not complete this form or if my beneficiary does not
survive me, the benefits will be paid to my estate.
SIGN HERE:
- --------------------------- ---------------------
Signature Date
C-1
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OTHER TYPES OF BENEFICIARY DESIGNATIONS
TYPE OF BENEFICIARY LANGUAGE TO BE USED
1. One Beneficiary and Dorothy Smith, Wife, if she survives
per stirpes provision me; otherwise, the issue of my
for unnamed children marriage to said Wife who survives me,
and their children. per stirpes. (This provides that
Children shall take equally but that
Children of a deceased Child shall
take equally the share their parent
would have received if living.)
2. One Beneficiary and Dorothy Smith, Wife, if she survives
Unnamed Children. me; otherwise in equal shares to such
of the Children born of my marriage to
said Wife as survive me.
3. Two Beneficiaries in Three-eighths (3/8) to Peter Smith,
Unequal Portions. Father, and five-eighths (5/8) to Joan
Smith, Mother, if both survive me;
otherwise all to such one of them as
survive me.
4. Trustee (see note (Name and Complete Address) Trustee,
below) under a trust agreement with me
dated ________, or to the successor
in said Trust.
5. Common Disaster Dorothy Smith, if living on the tenth
(10) day after my death; otherwise, in
equal shares to such of the Children
born of my marriage to said Wife as
survive me.
6. Director's Estate Executor or Administrator of my Estate.
NOTE: Enter the address for each beneficiary.
If a beneficiary is a married women, her given name must be used; for
example: "Mary A. Doe" and not "Mrs. John C. Doe".
If a beneficiary is not related to the Director, use the term "no
relation".
Under No. 1 through No. 3, the phrase "otherwise the executor or
administrator of my estate" may be added to the designation if desired by
the Director.
No. 4 should not be used unless there is an executed Trust Agreement in
existence.
C-2
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EXHIBIT D
IDEX CORPORATION
SECOND AMENDED AND RESTATED DIRECTORS DEFERRED
COMPENSATION PLAN
DEFERRAL DISTRIBUTION DATE ELECTION CHANGE FORM
CHANGE IN DEFERRAL DISTRIBUTION DATE ELECTION
I hereby elect to change my distribution date for my Deferred Amount (for
compensation originally deferred from the 19__ calendar year) from January 1,
_________ (the "Current Distribution Date") to. January 1 following [check
one]:
______ my cessation of service as a Director of IDEX Corporation.
______ five years after the Current Distribution Date.
______ ten years after the Current Distribution Date.
I understand that this new deferral election may not be made earlier than
the later of my Current Distribution Date or the first day of the second
deferral year following the year in which the change in the deferral is made.
I also understand that I may not make a new deferral election during the four
calendar years following the year in which I have made my last change in the
deferral distribution date.
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Director's Name
Dated:
--------------------
--------------------------------
Director's Signature
D-1