EXHIBIT 10.3
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ROBBINS & MYERS, INC.
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN
(Effective August 31, 2006)
1. Definitions. As used herein, the following capitalized terms shall have
the meanings set forth below:
"Affiliate" means a person that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
a specified person.
"Beneficiary" means such person, trust or other recipient as Participant
shall have designated in writing. If Participant fails to designate a
Beneficiary, or if the Beneficiary (and any contingent Beneficiary) predeceases
Participant, the Beneficiary shall be the Participant's estate.
"Board" means the Board of Directors of the Company.
"Change in Control" means for the purpose of this Plan and shall be deemed
to have occurred the date on which one of the following events occurs with
respect to the Company:
(a) The Company is provided a copy of Schedule 13D, filed pursuant to
Section 13(d) of the Securities Exchange Act of 1934 (the "Act") indicating that
a group or person, as defined in Rule 13d-3 under the Act, has become the
beneficial owner of 25% or more of the outstanding Voting Shares of the Company
or the date upon which the Company first learns that a person or group has
become the beneficial owner of 25% or more of the outstanding Voting Shares of
the Company if a Schedule 13D is not filed provided, in each case, such group or
person is not controlled, directly or indirectly, by persons or entities that
were, at any time this Plan is in effect, partners, shareholders or members of
M.H.M. & Co. Ltd., an Ohio limited partnership, the Maynard H. Murch Co., Inc.
or Loftis Investments, Inc. or Affiliates of any of them;
(b) A change in the composition of the Board such that individuals who were
members of the Board on the date two years prior to such change (or who were
subsequently elected to fill a vacancy in the Board, or were subsequently
nominated for election by the Company's shareholders, by the affirmative vote of
at least two-thirds of the directors then still in office who were directors at
the beginning of such two year period) no longer constitute a majority of the
Board;
(c) The consummation of a reorganization, merger, statutory share exchange
or consolidation involving the Company or any of its Subsidiaries (each a
"BUSINESS COMBINATION") unless, following such Business Combination, all or
substantially all of the individuals and entities that were the beneficial
owners of the Voting Shares of the Company immediately prior to the Business
Combination beneficially own, directly or indirectly, more than 60% of the then
outstanding Voting Shares of the corporation resulting from such Business
Combination in substantially the same proportions as their ownership immediately
prior to such Business Combination of the outstanding Voting Shares of the
Company; or
Exhibit 10.3 - 1
(d) Shareholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of all,
or substantially all, of the Company's assets.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means Robbins & Myers, Inc., an Ohio corporation, and its
successors.
"Committee" means the Compensation Committee of the Board.
"Compensation" means any salary or incentive compensation or bonus payable
to a Participant in cash for services rendered to the Company or a Subsidiary of
the Company; provided, however, that in no event shall Compensation include any
severance or severance-related payments or compensation based on performance or
results over a period more than one year.
"Deferred Compensation Account" shall mean the account established and
maintained by the Company on its books for each Participant and to which a
Participant's deferred compensation shall be recorded. The Company shall credit
to such Deferred Compensation Account all amounts described in Section 3 of the
Plan. Notwithstanding the foregoing, each Participant's Deferred Compensation
Account shall be solely a memorandum account, and title to and beneficial
ownership of the amounts recorded to each Deferred Compensation Account shall at
all times remain with the Company. The effect of participation in the Plan is
simply to create an unfunded and unsecured promise to pay deferred compensation
to the Participant or the Participant's Beneficiary pursuant to the terms of the
Plan. Nothing contained in the Plan and no deferral payment pursuant to this
Plan shall by itself create or be construed to create a trust or fiduciary
relationship of any kind between the Company and any Participant or the
Participant's Beneficiary or any other person.
"Disabled" means the condition whereby a Participant (i) is unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than twelve
months; or (ii) is, by reason of any medically determinable physical or mental
impairment that can be expected to last for a continuous period of not less than
twelve months, receiving income replacement benefits for a period of not less
than three months under an accident and health plan of the Participant's
employer.
"Effective Date" shall be August 31, 2006.
"401(k) Plan" means the Robbins & Myers, Inc. Employee Savings Plan.
"Participant" means any officer or other key management employee of the
Company or a Subsidiary of the Company designated by the Committee to be
eligible to participate in this Plan.
"Plan" means this Executive Supplemental Retirement Plan, as the same may
be amended from time to time.
Exhibit 10.3 - 2
"Plan Year" means the period from the Effective Date through August 31,
2006 and thereafter each twelve month period beginning on September 1 of each
year.
"Subsidiary" means an entity (whether or not a corporation) of which 50% or
more of the voting stock in the case of a corporation, or other equity interest
having voting power in the case of an entity that is not a corporation, is owned
or controlled, directly or indirectly, by the Company.
"Voting Shares" means any securities of a corporation that vote generally
in the election of directors of that corporation.
2. Purpose of the Plan. The purpose of this Plan is to provide Participants
with deferred compensation payable to them at retirement (but in no event
earlier than age 60) or such later date as may be elected by each Participant
consistent with Section 5 of the Plan.
The Plan is intended to comply with all requirements of Section 409A of the
Code, and shall at all times be administered, interpreted and construed to carry
out such intention. Any provision of the Plan that cannot be so administered,
interpreted and construed shall be void and of no effect.
Further, the Plan is intended to be "unfunded and maintained primarily for
the purpose of providing deferred compensation to management or highly
compensated employees" and, thus, is exempt from Parts 2 through 4 of Title I of
the Employee Retirement Income Security Act of 1974, as amended.
3. Deferred Compensation Benefit. As soon as practicable following the last
day of each Plan Year, the Company shall credit to each Participant's Deferred
Compensation Account, effective as of the last day of the Plan Year, an amount
equal to ten percent (10%) of the Participant's Compensation for the Plan Year
less the Employer Discretionary Contribution (as defined in the 401(k) Plan)
which is credited to the Participant's account in the 401(k) Plan for the
preceding calendar year. Notwithstanding the foregoing, for the Plan Year ending
August 31, 2006, the Company shall, as soon as practicable following August 31,
2006, credit to each Participant's Deferred Compensation Account effective
August 31, 2006, an amount equal to the product of (a) ten percent (10%) of the
Participant's Compensation from September 1, 2005 through August 31, 2006, less
the Employer Discretionary Contribution (as defined in the 401(k) Plan) which is
credited to the Participant's account in the 401(k) Plan for the period of
January 1, 2006 through August 31, 2006, and (b) the fraction 8/12.
Amounts credited to each Participant's Deferred Compensation Account shall
earn interest at a rate of seven (7) percent per annum from and after the
effective date of the allocation, as described in the immediately preceding
paragraph.
4. Payment of Benefit. (a) Subject to the provisions of Section 5, a
Participant's Deferred Compensation Account balance shall be paid to the
Participant as a single lump sum on the first day of the 14th calendar month
following the later of (i) the Participant's retirement from the Company, or
(ii) the Participant's 60th birthday.
Exhibit 10.3 - 3
Notwithstanding the foregoing, if the Committee determines that a
Participant is Disabled, the Disabled Participant's Deferred Compensation
Benefit shall be paid to the Participant as a single lump sum on the first day
of the 14th calendar month following the determination of Disability.
(b) In the event a Participant dies prior to the payment of the
Participant's Deferred Compensation Benefit as described in subsection (a), the
Participant's Deferred Compensation Account shall be paid to the Participant's
Beneficiary as a lump sum as soon as practicable following the Participant's
death.
5. Subsequent Deferral Election. A Participant may elect to defer the
payment of the Participant's Deferred Compensation Benefit until a date later
than and in a form different from that specified in Section 4(a) by executing a
Subsequent Deferral Election and delivering the Subsequent Deferral Election to
the Secretary of the Company not less than 12 months prior to the date on which
payment is to begin pursuant to Section 4. A Subsequent Deferral Election must
provide that all payments with respect to which the Subsequent Deferral Election
is made will be deferred for a period of not less than five years from the date
such payments would otherwise have been made. A Subsequent Deferral Election
shall be irrevocable. In no event may a Subsequent Deferral Election result in
the acceleration of any payment under the Plan, except as may be permitted by
Treasury Regulations issued under Section 409A of the Code.
Consistent with this Section, the exclusive alternative form of payment
shall be substantially equal annual payments over a period of years, not to
exceed fifteen (15) years.
6. Change in Control Event. In the event of a Change in Control, the
Company shall, as soon as practicable following the Change in Control, establish
a grantor trust with terms consistent with those of the model grantor trust
provided in Revenue Procedure 92-64 (a "Rabbi Trust") in favor of the
Participant to which the Company shall transfer an amount of money equal to the
balance of the Participant's Deferred Compensation Account on the date of
transfer. Thereafter, all amounts that would have been credited to the
Participant's Deferred Compensation Account but for the Change in Control shall
be credited to the Rabbi Trust established for the Participant. This Section
shall have no effect on any provisions of the Plan other than those specifically
mentioned herein.
7. Agreement Not to Compete/Non-Disclosure. (a) Participant agrees that
while employed by the Company and for the 12-month period immediately after
Participant ceases to be employed by the Company for any reason, Participant
shall not, without the prior written consent of the Company, either directly or
indirectly, perform any services (whether advisory, consulting, employment or
otherwise) for, invest in or otherwise become associated with in any capacity,
any person, corporation, partnership or other entity which engages in a
Competitive Business (as defined in Section 7(b)); provided, however, that
nothing herein contained shall prevent Participant (i) from purchasing and
holding for investment less than 2% of the shares of any corporation, the shares
of which are regularly traded either on a national securities exchange or in the
over-the-counter market or (ii) from providing services to any corporation,
partnership, or other entity if the Competitive Business represents less than
15% of the gross revenues of such corporation, partnership, or entity and
Participant's services are not rendered, directly or indirectly, to the division
or subsidiary which is engaged in the Competitive Business.
Exhibit 10.3 - 4
(b) For purposes of this Plan, "Competitive Business" means the design,
engineering, manufacture, marketing, distribution, sale, or servicing in the
Prohibited Territory (as defined below) of (i) processing or packaging equipment
used in the pharmaceutical industry; (ii) wellhead, drilling, recovery and
transmission equipment used in the oil and gas industry; or (iii) progressing
cavity pumps, industrial mixers and agitators, or glass-lined reactor and
storage vessels used in any industry. "Prohibited Territory" means the countries
in which the Company or one of its Subsidiaries had manufacturing, distribution
facilities, or sales offices at any time that Participant was employed by the
Company. In addition, all records, files, drawings, documents, models,
equipment, and the like relating to the Company's business or its Subsidiary's,
which Participant has control over may not be removed from the Company's
premises without its written consent, unless removal is in the furtherance of
the Company's business and, if so removed, shall be returned to the Company
promptly after termination of Participant's employment with the Company.
(c) Participant acknowledges that he has had, and will have, access to
certain Confidential Information (as defined below) of the Company and its
Subsidiaries and Participant agrees that he will not at any time, directly or
indirectly, disclose orally or in writing or use any Confidential Information,
regardless of how it may have been acquired, unless the disclosure or use of
such Confidential Information is expressly authorized in writing in advance by
the Company, is necessary in the ordinary conduct of Participant's duties with
the Company, or is required by law. "Confidential Information" means all
information pertaining or relating to the Company's or its Subsidiaries'
business, including, but not limited to, products, pricing, drawings and bills
of materials, manufacturing and application of engineering know-how, services,
strategies, customers, customer list, customer account records, financial
information, employee compensation, marketing plans, computer software
(including all operating system and system application software) and other
proprietary business information. As used herein, Confidential Information shall
not include any information which (i) is or becomes generally known to the
public other than as a result of the disclosure or use thereof by Participant in
violation of the terms of this subsection, or (ii) is obtained by Participant
from a third party who is lawfully in possession of such information and is not
subject to any obligation to refrain from disclosing such information.
Participant acknowledges and agrees that all of the Confidential Information is
and shall continue to be the exclusive proprietary property of the Company and
its Subsidiaries whether or not prepared in whole or in part by Participant and
whether or not disclosed to or entrusted to the custody of Participant.
8. Forfeiture of Benefit. A Participant shall forfeit his Deferred
Compensation Benefit upon the occurrence of any of the following:
(a) Termination of employment with the Company if the Participant has less
than 5 Years of Service (as defined below) with the Company; however, in the
event the Participant is employed by the Company (i) at the time of his death,
(ii) at the time he is determined to be Disabled, or (iii) immediately preceding
the occurrence of a Change in Control, this subsection (a) shall not apply.
"Years of Service" for the purpose of the Plan means each consecutive 12-month
period the Participant is employed by the Company;
(b) Termination of employment with the Company for Cause (as defined below)
at any time. "Cause" for the purpose of the Plan means any of the following: (i)
the willful and
Exhibit 10.3 - 5
continued failure of Participant to perform substantially Participant's duties
with the Company or one of its Subsidiaries (other than any such failure
resulting from incapacity due to physical or mental illness), after a written
demand for substantial performance is delivered to Participant by the Board
which specifically identifies the manner in which the Board believes that
Participant has failed to substantially perform his duties and such failure is
not cured within thirty (30) days of such written notice; (ii) an act or acts of
dishonesty taken by Participant and intended to result in substantial personal
enrichment of Participant at the expense of the Company; (iii) the willful
engaging by Participant in illegal conduct or gross misconduct; or (iv) a
clearly established violation by Participant of the Company's Code of Conduct
that is materially and demonstrably injurious to the Company. Further, for
purposes of this Section 8(b), no act, or failure to act, on Participant's part
shall be deemed "willful" if done, or omitted to be done, by Participant in good
faith and with a reasonable belief that his action or omission was in the best
interest of the Company; or
(c) Violation of Section 7 of the Plan.
9. Administration. This Plan shall be administered by the Committee. The
decision of the Committee shall be final and binding with respect to the
interpretation, construction, and application of this Plan. The Committee may
refer to the Board the exercise of any power, authority, or discretion assigned
to the Committee in this Plan and, in any such case, the decision of the Board
shall have the same effect as a decision of the Committee.
10. Amendment or Termination. The Board may amend or terminate this Plan at
any time. No amendment or termination of this Plan shall adversely affect the
right of any Participant or former Participant to payment of amounts credited to
the Participant's account prior to such amendment or termination, and interest
thereon shall continue to be credited to such account and paid in accordance
with this Plan.
11. Miscellaneous. (a) This Plan shall not confer upon any Participant the
right to continued employment with the Company or any of its subsidiaries or
affect in any way the right of the Company and its subsidiaries to terminate the
employment of any Participant at any time and for any reason.
(b) Except as specified herein, no right or benefit under this Plan shall
be subject to anticipation, alienation, sale, assignment, pledge, encumbrance,
or charge, and any attempt to anticipate, alienate, sell, assign, pledge,
encumber, or charge the same shall be void.
(c) This Plan shall inure to the benefit of and be binding upon each
successor of the Company and its subsidiaries. All right and obligations imposed
upon a Participant and all rights granted to the Company and its subsidiaries
under this Plan shall be binding upon the Participant's heirs, legal
representatives, and successors.
Exhibit 10.3 - 6