DENNIS K. WILLIAMS

 

                       TRANSITION AND RETIREMENT AGREEMENT

 

 

     THIS AGREEMENT, dated as of February 25, 2005, is between IDEX CORPORATION,

a Delaware corporation with its executive offices at 630 Dundee Road, Suite 400,

Northbrook, Illinois 60062 (the "Corporation"), and DENNIS K. WILLIAMS (the

"Executive").

 

                                    RECITALS:

 

     A. The Executive is currently employed as the Chairman of the Board,

President and Chief Executive Officer of the Corporation pursuant to an

Employment Agreement dated April 14, 2000 (the "Employment Agreement").

 

     B. The original term of the Employment Agreement expires on April 30, 2005

and Executive has indicated his desire to resign from his position as President

and Chief Executive Officer effective as of March 22, 2005, and to retire as

Chairman of the Board effective as of the later of March 31, 2006 or the date of

the Corporation's annual meeting of shareholders in 2006.

 

     C. The Corporation desires that the Executive assist in the orderly

transition of leadership and management of the Corporation and the Executive is

willing to remain in an executive Chairman capacity in order to effect such

transition.

 

     D. The Corporation desires to receive from the Executive a lengthening of

the period during which the Executive will not compete with the business of the

Corporation from two years to a five-year period.

 

     E. The Corporation and the Executive desire to enter into this Agreement to

set forth the terms of Executive's continued employment and retirement from the

Corporation.

 

     NOW, THEREFORE, in consideration of the promises and of the covenants

contained in this Agreement, the Corporation and the Executive agree as follows:

 

 

     1. DEFINITIONS. The following definitions apply for purposes of this

Agreement.

 

 

     (a) "Board of Directors" or "Board" means the Board of Directors of the

Corporation.

 

 

<PAGE>

 

 

     (b) "Cause" means a finding by the Board of Directors that any of the

following conditions exist:

 

          (i) The Executive's willful and continued failure substantially to

     perform his material duties under this Agreement (other than as a result of

     his disability) if such failure is not substantially cured within 15 days

     after written notice is provided to the Executive.

 

          (ii) The Executive's willful breach in a substantive and material

     manner of his fiduciary duty or duty of loyalty to the Corporation which is

     injurious to the financial condition in more than a de minimus manner or

     the business reputation of the Corporation.

 

          (iii) The Executive's indictment for a felony offense under the laws

     of the United States or any state thereof (other than for a violation of

     motor or vehicular laws).

 

          (iv) A material breach by the Executive of any restrictive covenant

     contained in Sections 11 and 12 of this Agreement.

 

For purposes of this definition, no act or failure to act will be deemed

"willful" unless effected by the Executive not in good faith and without a

reasonable belief that his action or failure to act was in or not opposed to the

Corporation's best interests.

 

     (c) "Code" means the Internal Revenue Code of 1986, as amended.

 

     (d) "Corporation" means IDEX Corporation.

 

     (e) "Effective Date" means March 22, 2005.

 

     (f) "Fringe Benefits" means (i) medical, health and life insurance, and

(ii) other miscellaneous fringe benefits (including, but not limited to, the

personal accident plan at the level in effect on the date of termination, and

the use of the Corporation provided automobile or auto use allowance).

 

     (g) "Retirement Date" means the later of March 31, 2006 or the date of the

Corporation's annual meeting of shareholders in 2006.

 

     2. EMPLOYMENT; DUTIES. Subject to the terms and conditions set forth in

this Agreement, the Corporation hereby agrees to continue to employ the

Executive, and the Executive hereby agrees to continue employment as Chairman of

the Board on and after the Effective Date through and until his Retirement Date.

Subject to the terms and conditions set forth in this Agreement, as of the

Effective Date, the Executive will resign his position as President and Chief

Executive Officer of the Corporation. The Executive will perform those duties

and discharge those responsibilities as are commensurate with his position, and

as the

 

Board of Directors may from time to time reasonably direct, commensurate with

his position. In connection with the performance of those duties, the

Corporation acknowledges that Executive may perform those duties at locations

other than the Corporation's executive office and it will not ordinarily require

the Executive to be present in the Corporation's executive office more than six

days per month. The Executive agrees to perform his duties and discharge his

responsibilities in a faithful manner and to the best of his ability and to use

all reasonable efforts to promote the interests of the Corporation. The

Executive may not accept other gainful employment except with the prior consent

of the Board of Directors. With the prior consent of the Board of Directors,

which will not be unreasonably withheld, the Executive may become a director,

trustee or other fiduciary of other corporations, trusts or entities.

Notwithstanding the foregoing, the Executive may manage his passive investments

and be involved in charitable, civic and religious interests so long as they do

not materially interfere with the performance of the Executive's duties

hereunder.

 

     3. COMPENSATION.

 

     (a) From the Effective Date through April 27, 2005, the Executive will

receive $31,153.85 in each bi-weekly payroll payment.

 

     (b) Executive will receive $109,090.91 in each bi-weekly payroll payment

commencing with the May 11, 2005 payment and ending with payment made on or

prior to the earliest to occur of (i) March 1, 2006, (ii) his termination by the

Corporation for Cause or (iii) his voluntary resignation. These payments will

not be considered "compensation" for purposes of the Corporation's Supplemental

Executive Retirement Plan and, to the extent these payments increase the

Executive's accrued benefit under the Corporation's Retirement Plan, such

increased accrued benefit will be an offset to the Executive's benefit under the

Corporation's Supplemental Executive Retirement Plan.

 

     (c) Executive will not be entitled to participate in any bonus, long-term

or short-term equity or cash incentive compensation programs of the Corporation

in 2005 or 2006.

 

     (d) The Corporation will deduct or withhold from all salary and from all

other payments made to the Executive pursuant to this Agreement, all amounts

that may be required to be deducted or withheld under any applicable Social

Security contribution, income tax withholding or other similar law now in effect

or that may become effective during the term of this Agreement.

 

     4. OTHER BENEFITS AND TERMS. Except as otherwise provided, during the term

of Executive's employment through the Retirement Date, the Executive will be

entitled to the following other benefits and terms:

 

     (a) The Executive will be entitled to participate in the Corporation's

health and medical benefit plans, any pension, profit sharing and retirement

plans, and any insurance policies or programs from time to time generally

offered to all or substantially all executive employees who are employed by the

Corporation. These plans, policies and programs are

 

subject to change at the sole discretion of the Corporation. Notwithstanding the

foregoing, life insurance benefits will be provided at an amount not less than

one times base salary.

 

     (b) The Executive will be entitled to any other fringe benefit from time to

time generally offered to all or substantially all senior executive employees

who are employed by the Corporation.

 

     (c) The Corporation will provide the Executive with the use of an

automobile or an auto use allowance that is commensurate with his position.

 

     (d) The Executive will be entitled to limited use of the Corporation's

aircraft for non-business purposes, not to exceed usage in excess of incremental

cost to the Corporation of $110,000 (the "Personal Use Limitation") during the

period May 1 ,2005 through the Retirement Date, and subject to the terms of the

Corporation's Aircraft Use Guidelines as amended from time to time. If Executive

relocates his residence outside of the State of Illinois, travel at the request

of the Corporation from his residence to the Corporation's executive office and

return travel to his residence will not be charged against the Personal Use

Limitation. Executive's use of the Corporation's aircraft to attend board

meetings of corporations or entities other than the Corporation will be charged

against the Personal Use Limitation. If the Executive's use of the Corporation's

aircraft is for business purposes, his spouse accompanying him on such travel

will not cause the use to be charged against the Personal Use Limitation.

 

     (e) The Corporation will pay on behalf of or reimburse the Executive for

personal legal and financial advice in calendar year 2005 an amount not to

exceed $15,000 less amounts, if any, claimed by the Executive under the

Employment Agreement for 2005 prior to the Effective Date.

 

     (f) Notwithstanding anything to the contrary, for purposes of determining

the Executive's benefits under the Corporation's Supplemental Executive

Retirement Plan, the Executive's "compensation" shall include income recognized

by him with respect to the Restricted Stock Award under Section 3(d) of the

Employment Agreement.

 

     (g) Notwithstanding any provision in any stock option award agreement with

the Executive, with respect to options which first become exercisable within the

calendar month of March 2006, if Executive may not exercise those options or may

not sell shares of the Corporation's stock because of the Corporation's policies

restricting trading of shares by certain individuals, the Corporation will, in

its discretion, which will be exercised in a manner so as not to cause adverse

tax consequences to Executive under Section 409A of the Code, either (i) waive

the restrictions with respect to the Executive (ii) allow Executive to sell the

shares received on exercise to the Corporation, (iii) allow for the Executive to

sell the shares received on exercise in a private sale transaction or (iv)

provide that those options remain exercisable for a period of time, not to

exceed 30 days, following the date on which the Executive is no longer

restricted from trading shares of the Corporation.

 

     (h) Except as specifically provided in Section 8, or as required by law,

the Executive acknowledges that he, his spouse and dependents will not receive

health and medical benefits following any termination of his employment.

 

     (i) If the Corporation does not amend its Supplemental Executive Retirement

Plan by December 15, 2005, to provide for distribution of benefits on separation

from service, the Corporation agrees to allow the Executive, in accordance with

the provisions of IRS Notice 2005-1 and any further similar guidance, to elect

to terminate his participation in the Supplemental Executive Retirement Plan in

2005 so that the amounts deferred under the Supplemental Executive Retirement

Plan would be distributed to him and causing such amounts to be included in

income in 2005.

 

     (j) Condition (1) contained in Section 2(a) of The Restricted Stock Award

Agreement between the Corporation and the Executive dated April 14, 2000 is

hereby amended to read as follows:

 

         1.    Executive remains employed by IDEX as its Chairman of the Board,

               and

 

     5. VACATIONS. The Executive will be entitled to five weeks of paid vacation

each year. Unused vacation in any year may not be carried over to subsequent

years.

 

     6. REIMBURSEMENT FOR EXPENSES. The Corporation will reimburse the Executive

for expenses which the Executive may from time to time reasonably incur on

behalf of the Corporation in the performance of his responsibilities and duties

including, but not limited to, professional dues and attendance at professional

conferences.

 

     7. PERIOD OF EMPLOYMENT. Subject to the provisions of this Section, the

period of employment of the Executive under this Agreement will begin on the

Effective Date and continue until the Retirement Date. Notwithstanding the

foregoing:

 

     (a) The Executive's employment will automatically terminate upon the death

of the Executive.

 

     (b) The Corporation may terminate the Executive's employment for Cause.

 

     8. BENEFITS UPON TERMINATION OF EMPLOYMENT. The Corporation will provide to

the Executive the following benefits in connection with his termination of

employment:

 

     (a) Retirement. In connection with the Executive's retirement, the

Corporation will provide the following:

 

          (i) Additional Compensation. The Executive will receive payments of

     $31,153.85 in each of 26 bi-weekly payroll payments commencing with the

 

 

     April 6, 2006 payment. If the Executive dies during the 26 bi-weekly

     payroll period, the balance of the payments will be paid as provided in

     Section 13.

 

          (ii) Bonus. The Executive will receive a bonus payment equal to

     $1,296,000 payable in one lump sum on April 1, 2006 (or as soon thereafter

     as practicable). Of this amount, $324,000 will be considered "compensation"

     for purposes of the Corporation's Supplemental Executive Retirement Plan.

 

          (iii) Accrued Vacation. Executive will receive payment for accrued but

     unused vacation, which payment will be equitably prorated based on the

     period of employment through the Retirement Date. Payment for accrued but

     unused vacation will be payable in one lump sum on the Retirement Date (or

     as soon thereafter as practicable).

 

          (iv) Accrued Benefits. Except as otherwise provided in this Agreement,

     the Executive shall be entitled to such benefits as he has accrued under

     the terms of the Corporation's employee benefit plans, including but not

     limited to the Retirement Plan, Deferred Compensation Plan for Officers,

     2001 Stock Plan for Officers and Supplemental Executive Retirement Plan (as

     they may be reasonably amended by the Corporation to comply with the

     provisions of Section 409A of the Code).

 

 

     (b) Upon Termination Other Than For Cause. If Executive's employment is

terminated for any reason (including death or disability) other than termination

by the Corporation for Cause, the Corporation will provide the following:

 

          (i) Salary And Fringe Benefits. The Executive, or the Executive's

     successor as provided in Section 13, will receive the Executive's full

     salary and Fringe Benefits through March 1, 2006. Any health or medical

     Fringe Benefits for Executive or his dependents will be provided through

     the Retirement Date.

 

          (ii) Additional Benefits. The Executive, or the Executive's successor

     as provided in Section 13, will receive those payments as provided under

     Section 8(a).

 

     (c) For Cause. Upon termination of the Executive's employment for Cause,

the Corporation will provide the following:

 

          (i) Salary And Fringe Benefits. The Executive's base salary and Fringe

     Benefits through the effective date of termination.

 

          (ii) Accrued Vacation. The Executive will receive payment for accrued

     but unused vacation, which payment will be equitably prorated based on the

     period of active employment for that portion of the fiscal year in which

     the

 

     Executive's termination of employment becomes effective. Payment for

     accrued but unused vacation will be payable in one lump sum on the

     effective date of the termination of employment (or as soon thereafter as

     practicable).

 

          (iii) Additional Benefits. The Executive will receive those payments

     as provided under Section 8(a)(i), (ii) and (iv).

 

     (d) Reduction In Fringe Benefits. Medical and health Fringe Benefits under

this Section will be reduced to the extent of any medical and health fringe

benefits provided by and available to the Executive from any subsequent

employer.

 

     (e) Stock Options. If the employment of the Executive is terminated for

reasons of disability or death or in the event of a "Control Event" (as defined

in any Stock Option award agreement) after the Effective Date but prior to the

Retirement Date, all Stock Option award agreements between the Corporation and

the Executive are hereby amended to provide that, with respect to options that

were not yet exercisable at time of termination due to disability, death or

occurrence of a Control Event, only those options that would have become

exercisable in March 2006 will become exercisable on account of termination for

reason of disability, death or occurrence of a Control Event and the period in

which they may be exercised will expire thirty days following the Retirement

Date or, if later, in case of disability which results in the Executive being

unable to mange his own affairs or death, one year from the date the disability

occurs or of death.

 

     (f) Compliance with Section 409A. Notwithstanding any other provision of

the Agreement, if necessary to comply with the requirements of Section 409A of

the Code, payment of benefits under this Agreement will not be made until six

months following the Executive's separation form service.

 

     9. NON-EXCLUSIVITY OF RIGHTS. Except as otherwise specifically provided,

nothing in this Agreement will prevent or limit the Executive's continued

participation in any benefit, incentive, or other plan, practice, or program

provided by the Corporation and for which the Executive may qualify. Any amount

of vested benefit or any amount to which the Executive is otherwise entitled

under any plan, practice, or program of the Corporation will be payable in

accordance with the plan, practice, or program, except as specifically modified

by this Agreement.

 

     10. NO OBLIGATION TO SEEK OTHER EMPLOYMENT. The Executive will not be

obligated to seek other employment or to take other action to mitigate any

amount payable to him under this Agreement and, except as provided in Section

8(d), amounts owed to him hereunder shall not be reduced by amounts he may

receive from another employer.

 

     11. CONFIDENTIALITY. During the course of his employment, the Executive

will have access to confidential information relating to the lines of business

of the Corporation, its trade secrets, marketing techniques, technical and cost

data, information concerning customers and suppliers, information relating to

product lines, and other valuable and confidential information relating to the

business operations of the Corporation not generally available to the

public (the "Confidential Information"). The parties hereby acknowledge that any

unauthorized disclosure or misuse of the Confidential Information could cause

irreparable damage to the Corporation. The parties also agree that covenants by

the Executive not to make unauthorized use or disclosures of the Confidential

Information are essential to the growth and stability of the business of the

Corporation. Accordingly, the Executive agrees to the confidentiality covenants

set forth in this Section.

 

     The Executive agrees that, except as required by his duties with the

Corporation or as authorized by the Corporation in writing, he will not use or

disclose to anyone at any time, regardless of whether before or after the

Executive ceases to be employed by the Corporation, any of the Confidential

Information obtained by him in the course of his employment with the

Corporation. The Executive shall not be deemed to have violated this Section 11

by disclosure of Confidential Information that at the time of disclosure (a) is

publicly available or becomes publicly available through no act or omission of

the Executive, or (b) is disclosed as required by court order or as otherwise

required by law, on the condition that notice of the requirement for such

disclosure is given to the Corporation prior to making any disclosure.

 

     The Executive agrees that since irreparable damage could result from his

breach of the covenants in this Section, in addition to any and all other

remedies available to the Corporation, the Corporation will have the remedies of

a restraining order, injunction or other equitable relief to enforce the

provisions thereof. The Executive consents to jurisdiction in Lake County,

Illinois on the date of the commencement of any action for purposes of any

claims under this Section. In addition, the Executive agrees that the issues in

any action brought under this Section will be limited to claims under this

Section, and all other claims or counterclaims under other provisions of this

Agreement will be excluded.

 

     In addition, the Executive has signed and is bound by the terms of the

Corporation's "Employee Inventions and Proprietary Information Agreement". To

the extent that the provisions of such agreement conflict with this Agreement,

the terms of this Agreement will be controlling.

 

     12. NON-COMPETITION. In consideration of the compensation and other

benefits to be paid to the Executive under and in connection with this

Agreement, the Executive agrees that, beginning on the date of this Agreement

and continuing until the Covenant Expiration Date (as defined in Subsection (b)

below), he will not, directly or indirectly, for his own account or as agent,

employee, officer, director, trustee, consultant, partner, stockholder or equity

owner of any corporation or any other entity (except that he may passively own

securities constituting less than 1% of any class of securities of a public

company), or member of any firm or otherwise, (i) engage or attempt to engage,

in the Restricted Territory (as defined in Subsection (d) below), in any

business activity which is directly or indirectly competitive with the business

conducted by the Corporation or any Affiliate at the Reference Date (as defined

in Subsection (c) below), (ii) employ or solicit the employment of any person

who is employed by the Corporation or any Affiliate at the Reference Date or at

any time during the six-month period preceding the Reference Date, except that

the Executive will be free to employ or solicit the employment of any such

person whose employment with the Corporation or any Affiliate has

 

terminated for any reason (without any interference from the Executive) and who

has not been employed by the Corporation or any Affiliate for at least six (6)

months, (iii) canvass or solicit business in competition with any business

conducted by the Corporation or any Affiliate at the Reference Date from any

person or entity who during the six-month period preceding the Reference Date

was a customer of the Corporation or any Affiliate or from any person or entity

which the Executive has reason to believe might in the future become a customer

of the Corporation or any Affiliate as a result of marketing efforts, contacts

or other facts and circumstances of which the Executive is aware, (iv) willfully

dissuade or discourage any person or entity from using, employing or conducting

business with the Corporation or any Affiliate or (v) intentionally disrupt or

interfere with, or seek to disrupt or interfere with, the business or

contractual relationship between the Corporation or any Affiliate and any

supplier who during the six-month period preceding the Reference Date shall have

supplied components, materials or services to the Corporation or any Affiliate.

 

     Notwithstanding the foregoing, the restrictions imposed by this Section

shall not in any manner be construed to prohibit, directly or indirectly, the

Executive from serving as an employee or consultant of the Corporation or any

Affiliate.

 

     For purposes of this Agreement, the following terms have the meanings given

to them below:

 

     (a) "Affiliate" means any joint venture, partnership or subsidiary now or

hereafter directly or indirectly owned or controlled by the Corporation. For

purposes of clarification, an entity shall not be deemed to be indirectly or

directly owned or controlled by the Corporation solely by reason of the

ownership or control of such entity by shareholders of the Corporation.

 

     (b) "Covenant Expiration Date" means the date which is five (5) years after

his Termination Date (as defined in this Section).

 

     (c) "Reference Date" means (A) for purposes of applying the covenants set

forth in this Section at any time prior to the Termination Date, the then

current date, or (B) for purposes of applying the covenants set forth in this

Section at any time on or after the Termination Date, the Termination Date.

 

     (d) "Restricted Territory" means anywhere in the world where the

Corporation or any Affiliate conducts or plans to conduct the business of the

Corporation or any other business activity, as the case may be, at the Reference

Date.

 

     (e) "Termination Date" means the date of termination of the Executive's

employment with the Corporation; provided however that the Executive's

employment will not be deemed to have terminated so long as the Executive

continues to be employed or engaged as an employee or consultant of the

Corporation or any Affiliate, even if such employment or engagement continues

after the expiration of the term of this Agreement, whether pursuant to this

Agreement or otherwise.

 

     13. SUCCESSORS. This Agreement is personal to the Executive and may not be

assigned by the Executive other than by will or the laws of descent and

distribution. This Agreement will inure to the benefit of and be enforceable by

the Executive's legal representatives or successors in interest. Notwithstanding

any other provision of this Agreement, the Executive may designate a successor

or successors in interest to receive any amounts due under this Agreement after

the Executive's death. If he has not designated a successor in interest, payment

of benefits under this Agreement will be made to his wife, if surviving, and if

not surviving, to his estate. A designation of a successor in interest must be

made in writing, signed by the Executive, and delivered to the Corporation in

accordance with Section 17. Except as otherwise provided in this Agreement, if

the Executive has not designated a successor in interest, payment of benefits

under this Agreement will be made to the Executive's estate. This Section will

not supersede any designation of beneficiary or successor in interest made by

the Executive or provided for under any other plan, practice, or program of the

Corporation. This Agreement will inure to the benefit of and be binding upon the

Corporation and its successors and assigns. The Corporation will require any

successor (whether direct or indirect, by acquisition of assets, merger,

consolidation or otherwise) to all or substantially all of the operations or

assets of the Corporation or any successor and without regard to the form of

transaction used to acquire the operations or assets of the Corporation, to

assume and agree to perform this Agreement in the same manner and to the same

extent that the Corporation would be required to perform it if no succession had

taken place. As used in this Agreement, "Corporation" means the Corporation and

any successor to its operations or assets as set forth in this Section that is

required by this clause to assume and agree to perform this Agreement or that

otherwise assumes and agrees to perform this Agreement.

 

     14. BENEFIT CLAIMS. In the event the Executive, or his beneficiaries, as

the case may be, and the Corporation 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 will pay all costs and expenses, including counsel

fees, which the Executive or his beneficiaries may incur in connection therewith

directly to the provider of the services or as may otherwise be directed by the

Executive or his beneficiaries. The Corporation will not delay or reduce the

amount of any payment provided for hereunder or setoff or counterclaim against

any such amount for any reason whatsoever; it is the intention of the

Corporation and the Executive that the amounts payable to the Executive or his

beneficiaries hereunder will continue to be paid in all events in the manner and

at the times herein provided. All payments made by the Corporation hereunder

will be final and the Corporation will not seek to recover all or any part of

any portion of any payments hereunder for any reason.

 

     15. FAILURE, DELAY OR WAIVER. No course of action or failure to act by the

Corporation or the Executive will constitute a waiver by the party of any right

or remedy under this Agreement, and no waiver by either party of any right or

remedy under this Agreement will be effective unless made in writing.

 

 

     16. SEVERABILITY. Whenever possible, each provision of this Agreement will

be interpreted in such a manner as to be enforceable under applicable law.

However, if any provision of this Agreement is deemed unenforceable under

applicable law by a court having jurisdiction, the provision will be

unenforceable only to the extent necessary to make it enforceable without

invalidating the remainder thereof or any of the remaining provisions of this

Agreement.

 

     17. NOTICE. All written communications to parties required hereunder must

be in writing and (a) delivered in person, (b) mailed by registered or certified

mail, return receipt requested, (such mailed notice to be effective four (4)

days after the date it is mailed) or (c) deposited with a reputable overnight

courier service (such couriered notice to be effective one (1) business day

after the date it is sent by courier) or (d) sent by facsimile transmission,

with confirmation sent by way of one of the above methods, to the party at the

address given below for the party (or to any other address as the party

designates in a writing complying with this Section, delivered to the other

party):

 

     If to the Corporation:

 

              IDEX Corporation

              Suite 400

              630 Dundee Road

              Northbrook, IL  60062

              Attention:   Vice President - General Counsel

              Telephone:   847-498-7070

              Telecopier:  847-498-9123

 

     with a copy to:

 

              Hodgson, Russ, Andrews, Woods & Goodyear, LLP

              2000 One M&T Plaza

              Buffalo, New York  14203

              Attention:   Richard E. Heath, Esq. and Richard W. Kaiser, Esq.

              Telephone:   716-856-4000

              Telecopier:  716-849-0349

 

     If to the Executive:

 

              Dennis K. Williams

              153 South Beach Road

              Hobe Sound, Florida 33455

              Telephone:   772-545-2016

              Telecopier:  772-546-7978

 

     with a copy to:

 

              Kronish Lieb Weiner & Hellman, LLP

              1114 Avenue of the Americas

              New York, New York  10036-7798

              Attention:   Paul M. Ritter, Esq.

              Telephone:   212-479-6000

              Telecopier:  212-479-6275

 

     18. MISCELLANEOUS. This Agreement (a) may not be amended, modified or

terminated orally or by any course of conduct pursued by the Corporation or the

Executive, but may be amended, modified or terminated only by a written

agreement duly executed by the Corporation and the Executive, (b) is binding

upon and inures to the benefit of the Corporation and the Executive and each of

their respective heirs, representatives, successors and assignees, except that

the Executive may not assign any of his rights or obligations pursuant to this

Agreement, (c) except as provided in Sections 4 and 11 of this Agreement,

constitutes the entire agreement between the Corporation and the Executive with

respect to the subject matter of this Agreement, and supersedes all oral and

written proposals, representations, understandings and agreements previously

made or existing with respect to such subject matter including, but not limited

to, the Employment Agreement and the Severance Agreement letter between the

Corporation and the Executive dated April 14, 2000, and (d) will be governed by,

and interpreted and construed in accordance with, the laws of the State of

Illinois, without regard to principles of conflicts of law.

 

     19. TERMINATION OF THIS AGREEMENT. This Agreement will terminate when the

Corporation has made the last payment provided for hereunder; provided, however,

that the obligations set forth under Sections 8, 11, 12, and 14 of this

Agreement will survive any termination and will remain in full force and effect.

 

     20. CONTINUATION OF OTHER AGREEMENTS. Except as specifically amended by

this Agreement, the following preexisting agreements between the Corporation and

the Executive shall remain in full force and effect and their survival will not

be affected by the termination of this Agreement : (i) Restricted Stock Award,

(ii) Stock Option Award Agreements, (ii) Indemnity Agreement, and (iv) Employee

Inventions and Proprietary Information Agreement.

 

     21. MULTIPLE COUNTERPARTS. This Agreement may be executed in one or more

counterparts, each of which shall be deemed an original, but all of which

together shall constitute one and the same instrument. Any party may execute

this Agreement by facsimile signature and the other party shall be entitled to

rely on such facsimile signature as evidence that this Agreement has been duly

executed by such party. Any party executing this Agreement by facsimile

signature shall immediately forward to the other party an original page by

overnight mail.

 

 

                 

 

     IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the

date first above written.

 

                                      IDEX CORPORATION

 

 

                                      By:

                                          -------------------------------------

                                           Frank J. Notaro

                                           Vice President - General Counsel

                                               and Secretary

 

                                      EMPLOYEE

 

 

                                      -----------------------------------------

                                      Dennis K. Williams

 

 

EMPLOYMENT AGREEMENT

 

 

     THIS AGREEMENT, dated as of April 14, 2000, is between IDEX CORPORATION, a Delaware corporation with its executive offices at 630 Dundee Road, Suite 400,

Northbrook, Illinois 60062 (the "Corporation"), and DENNIS K. WILLIAMS, an

individual residing at 10 Triton Way, Mashpee, MA 02649 (the "Executive").

 

                                    RECITALS:

 

     A. The Executive will be employed as the Chairman of the Board, President

and Chief Executive Officer of the Corporation.

 

     B. The Corporation and the Executive desire to set forth the terms upon

which the Executive will be employed by the Corporation.

 

     NOW, THEREFORE, in consideration of the promises and of the covenants

contained in this Agreement, the Corporation and the Executive agree as follows:

 

 

     1. DEFINITIONS. The following definitions apply for purposes of this

Agreement.

 

 

     (a) "Board of Directors" or "Board" means the Board of Directors of the

Corporation.

 

     (b) "Cause" means a finding by the Board of Directors that any of the

following conditions exist:

 

         (i)   The Executive's willful and continued failure substantially to

     perform his material duties under this Agreement (other than as a result of

     his Disability) if such failure is not substantially cured within 15 days

     after written notice is provided to the Executive.

 

        (ii)   The Executive's willful breach in a substantive and material

     manner of his fiduciary duty or duty of loyalty to the Corporation which is

     injurious to the financial condition in more than a de minimus manner or

     the business reputation of the Corporation.

 

         (iii) The Executive's indictment for a felony offense under the laws

     of the United States or any state thereof (other than for a violation of

     motor or vehicular laws).

 

 

         (iv)  A material breach by the Executive of any restrictive covenant

     contained in Sections 13 and 14 of this Agreement.

 

For purposes of this definition, no act or failure to act will be deemed

"willful" unless effected by the Executive not in good faith and without a

reasonable belief that his action or failure to act was in or not opposed to the

Corporation's best interests.

 

     (c) A "Change in Control " means the occurrence of (i) any transaction or

series of transactions which within a 12-month period constitute a change of

management or control where (A) at least 51 percent of the then outstanding

shares of common stock 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 (B) 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 (C) 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

(ii) any substantial equivalent of any such redemption, purchase, exchange,

change, transaction or series of transactions, acquisition, merger or

consolidation constituting such a change of management or control. For purposes

hereof, the term "control" shall have the meaning ascribed thereto under the

Securities Exchange Act of 1934, as amended and the regulations thereunder, and

the term "management" shall mean the chief executive officer of the Corporation.

For purposes of clause (i)(B) above or as appropriate for purposes of clause

(ii) above, 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.

 

     (d) "Code" means the Internal Revenue Code of 1986, as amended.

 

     (e) "Corporation" means IDEX Corporation.

 

     (f) "Disability" means a disability that has existed for a period of six

(6) consecutive months and because of which the Executive is physically or

mentally unable to substantially perform his regular duties as Chairman of the

Board, President or Chief Executive Officer of the Corporation, as the case may

be.

 

     (g) "Effective Date" means April 14, 2000, the date on which this Agreement

is executed.

 

     (h) "Employment Date" means May 1, 2000.

 

     (i) "Good Reason" means:

 

 

        (i)   There has been a material diminution in the Executive's

     responsibilities, duties, title, reporting responsibilities within the

     business organization, status, role or authority which is not restored

     within 15 days after written notice is provided to the Corporation.

 

         (ii)  Removal from, or failure to re-elect, the Executive to the

     position of Chairman of the Board, President or Chief Executive Officer.

 

         (iii) A requirement, in the Executive's reasonable judgment, that the

     services required to be performed by the Executive would necessitate the

     Executive moving his residence from the Chicago, Illinois area.

 

         (iv)  A material breach by the Corporation of any of the material terms

     of this Agreement if such breach is not substantially cured within 15 days

     after written notice is provided to the Corporation.

 

     2. EMPLOYMENT; DUTIES. Subject to the terms and conditions set forth in

this Agreement, the Corporation hereby agrees to employ the Executive, and the

Executive hereby accepts employment, and, as of the Employment Date, will assume

the roles as Chairman of the Board, President and Chief Executive Officer of the

Corporation, in full charge of the operation of its business and affairs,

subject to the provisions of the by-laws of the Corporation in respect of the

duties and responsibilities assigned from time to time by the Board of Directors

to the Chairman of the Board, President and Chief Executive Officer, and subject

also at all times to the control of the Board of Directors. Subject to the

yearly election by the Board of Directors in the exercise of its judgment, it is

contemplated that the Executive will continue to be elected to the positions of

Chairman of the Board, President and Chief Executive Officer. The Executive will

perform those duties and discharge those responsibilities as are commensurate

with his position, and as the Board of Directors may from time to time

reasonably direct, commensurate with his position. The Executive agrees to

perform his duties and discharge his responsibilities in a faithful manner and

to the best of his ability and to use all reasonable efforts to promote the

interests of the Corporation. The Executive may not accept other gainful

employment except with the prior consent of the Board of Directors. With the

prior consent of the Board of Directors, the Executive may become a director,

trustee or other fiduciary of other corporations, trusts or entities.

Notwithstanding the foregoing, the Executive may manage his passive investments

and be involved in charitable, civic and religious interests so long as they do

not materially interfere with the performance of the Executive's duties

hereunder.

 

 

 

     3. COMPENSATION.

 

     (a) During the term of the Executive's employment under this Agreement, the

Executive will receive a base salary at the rate of $650,000 per year, payable

in equal monthly installments. On an annual basis, the Board of Directors will,

in good faith, review the base salary of the Executive to consider appropriate

increases (but not decreases) in the base salary. If the Executive dies during

the period of time of his service under this Agreement, service for any part of

the month of his death will be considered service for the entire month.

 

     (b) During the term of the Executive's employment under this Agreement, the

Executive will be entitled to receive an annual cash bonus from the Corporation

calculated pursuant to the Corporation's Management Incentive Compensation

Program (the "MICP") in effect from time to time. The Target Incentive Amount

for the Executive, as defined in the MICP, will be 120% of his base salary for

fiscal periods of the Corporation subsequent to December 31, 2000. The maximum

bonus to be awarded under the MICP will not exceed 200% of his base salary. The

Board of Directors, in its discretion, may award bonuses to the Executive in

addition to those provided for above, as it may from time to time determine.

Notwithstanding the foregoing, for the fiscal period ending December 31, 2000

the Executive will receive an annual cash bonus from the Corporation, which will

be paid in January 2001, of an amount not less than 80% and not more than 120%

of his base salary for that period as determined in the discretion of the Board.

It is recognized and agreed to by the Executive that for fiscal periods

commencing after December 31, 2000 the MICP will need to be modified and receive

shareholder approval to preserve the deductibility of bonus payments under

Section 162(m) of the Code. The Executive will have substantial input in the

modification of the MICP which will be considered by the Board.

 

     (c) On or before the Effective Date, the IDEX Corporation Compensation

Committee will meet and award the Executive 350,000 options on the Corporation's

common stock. The price of the options will be the closing share price of the

Corporation's common stock, as reported by the New York Stock Exchange, as of

the immediately previous business day. A copy of the Option Agreement pursuant

to which the options will be awarded to the Executive is attached hereto as

Exhibit A. It is acknowledged that the Corporation's failure to award the

options to the Executive shall constitute a material breach of this Agreement.

The Executive will be annually considered for additional awards of options

which, if awarded, will be granted on terms no less favorably than the Option

Agreement attached hereto as Exhibit A.

 

     (d) Simultaneously with the execution of this Agreement, the Corporation

and the Executive shall enter into a Restricted Stock Award in the form attached

hereto as Exhibit B.

 

     (e) The Corporation will reimburse the Executive for all reasonable moving

expenses incurred by the Executive in relocating to the Chicago, Illinois area.

For purposes of clarification, "reasonable moving expenses incurred" will

include lease or rental expenses on the Executive's current residence in Italy,

temporary housing expenses in the Chicago, Illinois area, travel expenses of the

Executive and his wife to or from the Chicago, Illinois area and payment of an amount equal to one month base salary for incidental expenses. If any such

reimbursements are not excludible from the income of the Executive because a

corresponding deduction would not be allowable under Section 217 of the Code,

then the Corporation will make an additional payment to the Executive in an

amount such that after payment by the Executive of all taxes imposed on the

additional payment and the amount of the reimbursement includable in income, the

Executive retains an amount equal to the amount of the reimbursement includable

in income.

 

     (f) The Corporation will deduct or withhold from all salary and bonus

payments, and from all other payments made to the Executive pursuant to this

Agreement, all amounts that may be required to be deducted or withheld under any

applicable Social Security contribution, income tax withholding or other similar

law now in effect or that may become effective during the term of this

Agreement.

 

     4. OTHER BENEFITS AND TERMS. During the term of the Executive's employment

under this Agreement, the Executive will be entitled to the following other

benefits and terms:

 

     (a) The Executive will be entitled to participate in the Corporation's

ChoiceComp health and medical benefit plans, any pension, profit sharing and

retirement plans, and any insurance policies or programs from time to time

generally offered to all or substantially all executive employees who are

employed by the Corporation. These plans, policies and programs are subject to

change at the sole discretion of the Corporation. Notwithstanding the foregoing,

life insurance benefits will be provided at an amount not less than one times

base salary. Notwithstanding anything to the contrary, for purposes of

determining the Executive's benefits under the IDEX Corporation Supplemental

Executive Retirement Plan, the Executive's "compensation" shall include income

recognized by him with respect to the Restricted Stock Award under Section 3(d)

of this Agreement.

 

     (b) The Executive will be entitled to any other fringe benefit from time to

time generally offered to all or substantially all senior executive employees

who are employed by the Corporation.

 

     (c) The Corporation will provide the Executive with the use of an

automobile or an auto use allowance that is commensurate with his position.

 

     (d) The Corporation will pay on behalf of or reimburse the Executive for

personal legal and financial advice an amount not to exceed $15,000 in any

calendar year.

 

     (e) Except as specifically provided in Sections 9(a)(i), 9(c)(i), 9(d)(i),

9(e) and 9(f)(i), or as required by law, the Executive acknowledges that he, his

spouse and dependents will not receive health and medical benefits following any

termination of his employment.

 

     5. VACATIONS. The Executive will be entitled to five weeks of paid vacation

each year. Unused vacation in any year may not be carried over to subsequent

years.

 

 

 

     6. REIMBURSEMENT FOR EXPENSES. The Corporation will reimburse the Executive

for expenses which the Executive may from time to time reasonably incur on

behalf of the Corporation in the performance of his responsibilities and duties

including, but not limited to, professional dues and attendance at professional

conferences.

 

     7. PERIOD OF EMPLOYMENT. Subject to the provisions of this Section, the

period of employment of the Executive under this Agreement will begin on the

Employment Date and continue until April 30, 2005. Upon the expiration of the

initial period, the period of employment will be automatically extended for 12

consecutive month periods thereafter, unless either party provides 120 days

prior written notice to the other party that it does not wish to extend the

Executive's employment period beyond its then present term.

 

     Notwithstanding the foregoing:

 

     (a) The Executive's employment will automatically terminate upon the death

or Disability of the Executive. The foregoing is subject to the duty of the

Corporation to provide reasonable accommodation under the Americans with

Disabilities Act.

 

     (b) The Corporation may, at its sole option, terminate the Executive's

employment at any time and for any reason by delivering written notice to the

Executive.

 

     (c) The Executive, at his sole option, may terminate his employment for

Good Reason by providing written notice to the Corporation at least 30 days

prior to the effective date of the termination of employment specified in the

notice.

 

     (d) The Executive, at his sole option, may terminate his employment absent

Good Reason by providing written notice to the Corporation at least 90 days

prior to the effective date of the termination of employment specified in the

notice.

 

     Any notice of termination of employment given by a party must specify the

particular termination provision of this Agreement relied upon by the party and

must set forth in reasonable detail the facts and circumstances that provide a

basis for the termination.

 

     8. INDEMNIFICATION. The Corporation will enter into an indemnity agreement

with the Executive substantially in the form contained in Exhibit C of this

Agreement.

 

     9. BENEFITS UPON TERMINATION. The Corporation will provide the following

benefits upon the termination of the Executive's employment with the

Corporation.

 

 

     (a) Upon Termination By The Corporation Other Than For Cause Or By The

Executive With Good Reason. Upon the Executive's termination of his employment

for Good Reason or the Corporation's termination of the Executive's employment

other than for Cause, the Corporation will provide the following:

 

 

         (i)   Salary And Fringe Benefits. The Executive will receive his full

     salary and fringe benefits through the effective date of termination

     together with any unpaid bonus for a prior period. The Executive will also

     receive (i) his full salary, (ii) medical, health and life insurance, and

     (iii) other miscellaneous fringe benefits (including, but not limited to,

     the personal accident plan at the level in effect on the date of

     termination, and the use of the Corporation provided automobile or auto use

     allowance) ((ii) and (iii) are hereinafter referred to as "Fringe

     Benefits") as in effect on the date of either the Corporation's or the

     Executive's receipt of a notice of termination from the other party for a

     period of 24 months beginning with the month next following the month

     during which his employment terminates. If the Executive dies during the 24

     month period, the balance of the salary payments will be paid as provided

     in Section 15 and any dependent health or medical Fringe Benefits will be

     provided for the balance of the 24 month period.

 

         (ii)  Bonus. The Executive will receive a bonus payment equal to the

     sum of (A) 240% of his base salary in effect in the year of the termination

     of his employment, plus (B) an amount determined by multiplying 120% of his

     base salary by a fraction the numerator of which is the number of full and

     partial calendar months in the calendar year that precedes the date of the

     termination of his employment and the denominator of which is 12.

 

         (iii) Accrued Vacation. The Executive will receive payment for accrued

     but unused vacation, which payment will be equitably prorated based on the

     period of active employment for that portion of the fiscal year in which

     the Executive's termination of employment becomes effective. Payment for

     accrued but unused vacation will be payable in one lump sum on the

     effective date of the termination of employment.

 

     (b) Upon Termination By The Executive Absent Good Reason Or By The

Corporation For Cause. Upon the Executive's termination of employment absent

Good Reason or by the Corporation for Cause, the Corporation will provide the

following:

 

         (i)   Salary And Fringe Benefits. The Executive will receive his full

     salary and Fringe Benefits through the effective date of termination

     together with any unpaid bonus for a prior period.

 

         (ii)  Accrued Vacation. The Executive will receive payment for accrued

     but unused vacation, which payment will be equitably prorated based on the

     period of active employment for that portion of the fiscal year in which

     the Executive's termination of employment becomes effective. Payment for

     accrued but unused vacation will be payable in one lump sum on the

     effective date of the termination of employment.

 

 

     (c) Upon Termination For Disability. Upon termination of the Executive's

employment because of Disability, the Corporation will provide the following:

 

         (i)   Salary And Fringe Benefits. The Executive will receive his full

     salary and Fringe Benefits through the effective date of termination

     together with any unpaid bonus for a prior period. The Executive will also

     receive his full salary and Fringe Benefits, as in effect on the date

     immediately before the Disability, for a period of 18 months commencing

     with the month following the month during which his Disability commences.

     If the Executive dies during the 18 month period, the balance of the salary

     payments will be paid as provided in Section 15 and any dependent health or

     medical Fringe Benefits will be provided for the balance of the 18 month

     period.

 

         (ii)  Bonus. The Executive will receive a bonus payment equal to the

     sum of (A) 180% of his base salary in effect in the year of the termination

     of his employment, plus (B) an amount determined by multiplying 120% of his

     base salary by a fraction the numerator of which is the number of full and

     partial calendar months in the calendar year that precedes the date of the

     termination of his employment and the denominator of which is 12.

 

         (iii) Accrued Vacation. The Executive will receive payment for accrued

     but unused vacation, which payment will be equitably prorated based on the

     period of active employment for that portion of the fiscal year in which

     the Executive's Disability commences. Payment for accrued but unused

     vacation will be payable in one lump sum on the date the Disability

     commences (or as soon thereafter as practicable).

 

     (d) Upon Termination For Death. Upon termination of the Executive's

employment because of his death, the Corporation will provide the following:

 

         (i)   Salary And Fringe Benefits. The (i) Executive's full salary and

     Fringe Benefits through the effective date of termination, (ii) any unpaid

     bonus for a prior period and (iii) his full salary, on the date immediately

     before his death, for a period of 18 months beginning with the month next

     following the month during which he died will be paid as provided in

     Section 15. Any dependent health or medical Fringe Benefits will be

     provided for the 18-month period following the month in which he died.

 

         (ii)  Bonus. The Executive's successor as provided in Section 15 will

     receive a bonus payment equal to the sum of (A) 180% of his base salary in

     effect in the year of the termination of his employment, plus (B) an amount

     determined by multiplying 120% of his base salary by a fraction the

     numerator of which is the

 

 

     number of full and partial calendar months in the calendar year that

     precedes the date of the termination of his employment and the denominator

     of which is 12.

 

         (iii) Accrued Vacation. The Executive's successor as provided in

     Section 15 will receive payment for accrued but unused vacation, which

     payment will be equitably prorated based on the period of active employment

     for that portion of the fiscal year in which the Executive died. Payment

     for accrued but unused vacation will be payable in one lump sum on the date

     of the Executive's death (or as soon thereafter as practicable).

 

     (e) Upon Termination Following A Change In Control. Upon the Executive's

termination of employment by the Corporation without Cause or the Employee's

termination with Good Reason which, in either case, occurs in contemplation of

or within the 24 month period following a Change in Control, the Corporation

will provide the Executive compensation and benefits under the agreement

attached hereto as Exhibit D, the terms of which, if in conflict with this

Agreement will be controlling.

 

     (f) Upon Expiration Of Term. Upon the expiration of the term of this

Agreement pursuant to the first paragraph of Section 7, the Corporation will

provide the following:

 

         (i)   Salary And Fringe Benefits. The Executive will receive his full

     salary and fringe benefits through the effective date of termination

     together with any unpaid bonus for a prior period. The Executive will also

     receive (i) his full salary, (ii) medical, health and life insurance, and

     (iii) other miscellaneous fringe benefits (including, but not limited to,

     the personal accident plan at the level in effect on the date of

     termination, and the use of the Corporation provided automobile or auto use

     allowance) ((ii) and (iii) are hereinafter referred to as "Fringe

     Benefits") as in effect on the date of either the Corporation's or the

     Executive's receipt of a notice of termination from the other party for a

     period of 12 months beginning with the month next following the month

     during which his employment terminates. If the Executive dies during the 12

     month period, the balance of the salary payments will be paid as provided

     in Section 15 and any dependent health or medical Fringe Benefits will be

     provided for the balance of the 12 month period.

 

         (ii)  Bonus. The Executive will receive a bonus payment equal to (A)

     120% of his base salary in effect in the year of the termination of the

     Executive's employment, plus (B) an amount determined by multiplying 120%

     of his base salary by a fraction the numerator of which is the number of

     full and partial calendar months in the calendar year that precedes the

     date of the termination of his employment and the denominator of which is

 

 

         (iii) Accrued Vacation. The Executive will receive payment for accrued

     but unused vacation, which payment will be equitably prorated based on the

     period of active employment for that portion of the fiscal year in which

     the Executive's termination of employment becomes effective. Payment for

     accrued but unused vacation will be payable in one lump sum on the

     effective date of the termination of employment.

 

     (g) Reduction In Fringe Benefits. Medical and health Fringe Benefits under

this Section will be reduced to the extent of any medical and health fringe

benefits provided by and available to the Executive from any subsequent

employer.

 

     (h) Determination Of Disability. Any question as to the existence of a

physical or mental condition which would give rise to the Disability of the

Executive upon which the Executive and the Corporation cannot agree will be

determined by a qualified independent physician selected by the Executive and

reasonably acceptable to the Corporation (or, if the Executive is unable to make

a selection, the selection of the physician will be made by any adult member of

his immediate family). The physician's written determination to the Corporation

and to the Executive will be final and conclusive for all purposes of this

Agreement.

 

     (i) Continuation Of Healthcare Coverage. For purposes of COBRA continuation

healthcare coverage, the "qualifying event" will be deemed to have occurred at

the end of the period during which health and medical benefits are provided

under Sections 9(a)(i), 9(c)(i), 9(d)(i), 9(e) and 9(f)(i).

 

     10. ADDITIONAL PAYMENTS. Notwithstanding anything in this Agreement or any

other agreement to the contrary, in the event it is determined that any payments

or distributions by the Corporation or any affiliate (as defined under the

Securities Act of 1933, as amended, and the regulations thereunder) thereof or

any other person to or for the benefit of the Executive, whether paid or payable

pursuant to the terms of this Agreement, or pursuant to any other agreement or

arrangement with the Corporation or any such affiliate ("Payments"), would be

subject to the excise tax imposed by Section 4999 of the Code, or any successor

provision, or any interest or penalties with respect to the excise tax (the

excise tax, together with any interest and penalties, are hereinafter

collectively referred to as the "Excise Tax"), then the Executive will be

entitled to receive an additional payment from the Corporation (a "Gross-Up

Payment") in an amount that after payment by the Executive of all taxes

(including, without limitation, any interest or penalties imposed with respect

to such taxes and any Excise Tax) imposed upon the Gross-Up Payment, the

Executive retains an amount of the Gross-Up Payment equal to the Excise Tax

imposed upon the Payments. The amount of the Gross-Up Payment will be calculated

by the Corporation's independent accounting firm, engaged immediately prior to

the event that triggered the payment, in consultation with the Corporation's

outside legal counsel. For purposes of making the calculations required by this

Section, the accounting firm may make reasonable assumptions and approximations

concerning applicable taxes and may rely on reasonable, good faith

interpretations concerning the application of Sections 280G and 4999 of the

Code, provided that the accounting firm's determinations must be made with

substantial authority (within the meaning of Section 6662 of the Code). The Gross-Up Payment will be paid on the

Executive's last day of employment or on the occurrence of the event that

results in the imposition of the Excise Tax, if later. If the precise amount of

the Gross-Up Payment cannot be determined on the date it is to be paid, an

amount equal to the best estimate of the Gross-Up Payment will be made on that

date and, within 10 days after the precise calculation is obtained, either the

Corporation will pay any additional amount to the Executive or the Executive

will pay any excess amount to the Corporation, as the case may be. If

subsequently the Internal Revenue Service (the "IRS") claims that any additional

Excise Tax is owing, an additional Gross-Up Payment will be paid to the

Executive within 30 days of the Executive providing substantiation of the claim

made by the IRS. After payment to the Executive of the Gross-Up Payment, the

Executive will provide to the Corporation any information reasonably requested

by the Corporation relating to the Excise Tax, the Executive will take those

actions as the Corporation reasonable requests to contest the Excise Tax,

cooperate in good faith with the Corporation to effectively contest the Excise

Tax and permit the Corporation to participate in any proceedings contesting the

Excise Tax. The Corporation will bear and pay directly all costs and expenses

(including any interest or penalties on the Excise Tax), and indemnify and hold

the Executive harmless, on an after-tax basis, from all such costs and expenses

related to such contest. Should it ultimately be determined that any amount of

an Excise Tax is not properly owed, the Executive will refund to the Corporation

the related amount of the Gross-Up Payment.

 

     11. NON-EXCLUSIVITY OF RIGHTS. Except as otherwise specifically provided,

nothing in this Agreement will prevent or limit the Executive's continued or

future participation in any benefit, incentive, or other plan, practice, or

program provided by the Corporation and for which the Executive may qualify. Any

amount of vested benefit or any amount to which the Executive is otherwise

entitled under any plan, practice, or program of the Corporation will be payable

in accordance with the plan, practice, or program, except as specifically

modified by this Agreement.

 

     12. NO OBLIGATION TO SEEK OTHER EMPLOYMENT. The Executive will not be

obligated to seek other employment or to take other action to mitigate any

amount payable to him under this Agreement and, except as provided in Section

9(g), amounts owed to him hereunder shall not be reduced by amounts he may

receive from another employer.

 

     13. CONFIDENTIALITY. During the course of his employment, the Executive

will have access to confidential information relating to the lines of business

of the Corporation, its trade secrets, marketing techniques, technical and cost

data, information concerning customers and suppliers, information relating to

product lines, and other valuable and confidential information relating to the

business operations of the Corporation not generally available to the public

(the "Confidential Information"). The parties hereby acknowledge that any

unauthorized disclosure or misuse of the Confidential Information could cause

irreparable damage to the Corporation. The parties also agree that covenants by

the Executive not to make unauthorized use or disclosures of the Confidential

Information are essential to the growth and stability of the business of the

Corporation. Accordingly, the Executive agrees to the confidentiality covenants

set forth in this Section.

 

 

The Executive agrees that, except as required by his duties with the

Corporation or as authorized by the Corporation in writing, he will not use or

disclose to anyone at any time, regardless of whether before or after the

Executive ceases to be employed by the Corporation, any of the Confidential

Information obtained by him in the course of his employment with the

Corporation. The Executive shall not be deemed to have violated this Section 13

by disclosure of Confidential Information that at the time of disclosure (a) is

publicly available or becomes publicly available through no act or omission of

the Executive, or (b) is disclosed as required by court order or as otherwise

required by law, on the condition that notice of the requirement for such

disclosure is given to the Corporation prior to making any disclosure.

 

     The Executive agrees that since irreparable damage could result from his

breach of the covenants in this Section, in addition to any and all other

remedies available to the Corporation, the Corporation will have the remedies of

a restraining order, injunction or other equitable relief to enforce the

provisions thereof. The Executive consents to jurisdiction in Lake County,

Illinois on the date of the commencement of any action for purposes of any

claims under this Section. In addition, the Executive agrees that the issues in

any action brought under this Section will be limited to claims under this

Section, and all other claims or counterclaims under other provisions of this

Agreement will be excluded.

 

     In addition, the Executive will sign and be bound by the terms of the

attached "Employee Inventions and Proprietary Information Agreement" attached

hereto as Exhibit E. To the extent that the provisions of Exhibit E conflict

with this Agreement, the terms of this Agreement will be controlling.

 

     14. NON-COMPETITION. In consideration of the compensation and other

benefits to be paid to the Executive under and in connection with this

Agreement, the Executive agrees that, beginning on the date of this Agreement

and continuing until the Covenant Expiration Date (as defined in Subsection (b)

below), he will not, directly or indirectly, for his own account or as agent,

employee, officer, director, trustee, consultant, partner, stockholder or equity

owner of any corporation or any other entity (except that he may passively own

securities constituting less than 1% of any class of securities of a public

company), or member of any firm or otherwise, (i) engage or attempt to engage,

in the Restricted Territory (as defined in Subsection (d) below), in any

business activity which is directly or indirectly competitive with the business

conducted by the Corporation or any Affiliate at the Reference Date (as defined

in Subsection (c) below), (ii) employ or solicit the employment of any person

who is employed by the Corporation or any Affiliate at the Reference Date or at

any time during the six-month period preceding the Reference Date, except that

the Executive will be free to employ or solicit the employment of any such

person whose employment with the Corporation or any Affiliate has terminated for

any reason (without any interference from the Executive) and who has not been

employed by the Corporation or any Affiliate for at least six (6) months, (iii)

canvass or solicit business in competition with any business conducted by the

Corporation or any Affiliate at the Reference Date from any person or entity who

during the six-month period preceding the Reference Date was a customer of the

Corporation or any Affiliate or from any person or entity which the Executive

has reason to believe might in the future become a customer of the Corporation or any

Affiliate as a result of marketing efforts, contacts or other facts and

circumstances of which the Executive is aware, (iv) willfully dissuade or

discourage any person or entity from using, employing or conducting business

with the Corporation or any Affiliate or (v) intentionally disrupt or interfere

with, or seek to disrupt or interfere with, the business or contractual

relationship between the Corporation or any Affiliate and any supplier who

during the six-month period preceding the Reference Date shall have supplied

components, materials or services to the Corporation or any Affiliate.

 

     Notwithstanding the foregoing, the restrictions imposed by this Section

shall not in any manner be construed to prohibit, directly or indirectly, the

Executive from serving as an employee or consultant of the Corporation or any

Affiliate.

 

     For purposes of this Agreement, the following terms have the meanings given

to them below:

 

     (a) "Affiliate" means any joint venture, partnership or subsidiary now or

hereafter directly or indirectly owned or controlled by the Corporation. For

purposes of clarification, an entity shall not be deemed to be indirectly or

directly owned or controlled by the Corporation solely by reason of the

ownership or control of such entity by shareholders of the Corporation.

 

     (b) "Covenant Expiration Date" means the date which is two (2) years after

the Termination Date (as defined in this Section).

 

     (c) "Reference Date" means (A) for purposes of applying the covenants set

forth in this Section at any time prior to the Termination Date, the then

current date, or (B) for purposes of applying the covenants set forth in this

Section at any time on or after the Termination Date, the Termination Date.

 

     (d) "Restricted Territory" means anywhere in the world where the

Corporation or any Affiliate conducts or plans to conduct the business of the

Corporation or any other business activity, as the case may be, at the Reference

Date.

 

     (e) "Termination Date" means the date of termination of the Executive's

employment with the Corporation; provided however that the Executive's

employment will not be deemed to have terminated so long as the Executive

continues to be employed or engaged as an employee or consultant of the

Corporation or any Affiliate, even if such employment or engagement continues

after the expiration of the term of this Agreement, whether pursuant to this

Agreement or otherwise.

 

     15. SUCCESSORS. This Agreement is personal to the Executive and may not be

assigned by the Executive other than by will or the laws of descent and

distribution. This Agreement will inure to the benefit of and be enforceable by

the Executive's legal representatives or successors in interest. Notwithstanding

any other provision of this Agreement, the Executive may designate a successor or successors in interest to receive any amounts due

under this Agreement after the Executive's death. If he has not designated a

successor in interest, payment of benefits under this Agreement will be made to

his wife, if surviving, and if not surviving, to his estate. A designation of a

successor in interest must be made in writing, signed by the Executive, and

delivered to the Employer in accordance with Section 19. Except as otherwise

provided in this Agreement, if the Executive has not designated a successor in

interest, payment of benefits under this Agreement will be made to the

Executive's estate. This Section will not supersede any designation of

beneficiary or successor in interest made by the Executive or provided for under

any other plan, practice, or program of the Employer. This Agreement will inure

to the benefit of and be binding upon the Corporation and its successors and

assigns. The Corporation will require any successor (whether direct or indirect,

by acquisition of assets, merger, consolidation or otherwise) to all or

substantially all of the operations or assets of the Corporation or any

successor and without regard to the form of transaction used to acquire the

operations or assets of the Corporation, to assume and agree to perform this

Agreement in the same manner and to the same extent that the Corporation would

be required to perform it if no succession had taken place. As used in this

Agreement, "Corporation" means the Corporation and any successor to its

operations or assets as set forth in this Section that is required by this

clause to assume and agree to perform this Agreement or that otherwise assumes

and agrees to perform this Agreement.

 

     16. BENEFIT CLAIMS. In the event the Executive, or his beneficiaries, as

the case may be, and the Corporation 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 will pay all costs and expenses, including counsel

fees, which the Executive or his beneficiaries may incur in connection therewith

directly to the provider of the services or as may otherwise be directed by the

Executive or his beneficiaries. The Corporation will not delay or reduce the

amount of any payment provided for hereunder or setoff or counterclaim against

any such amount for any reason whatsoever; it is the intention of the

Corporation and the Executive that the amounts payable to the Executive or his

beneficiaries hereunder will continue to be paid in all events in the manner and

at the times herein provided. All payments made by the Corporation hereunder

will be final and the Corporation will not seek to recover all or any part of

any portion of any payments hereunder for any reason.

 

     17. FAILURE, DELAY OR WAIVER. No course of action or failure to act by the

Corporation or the Executive will constitute a waiver by the party of any right

or remedy under this Agreement, and no waiver by either party of any right or

remedy under this Agreement will be effective unless made in writing.

 

     18. SEVERABILITY. Whenever possible, each provision of this Agreement will

be interpreted in such a manner as to be enforceable under applicable law.

However, if any provision of this Agreement is deemed unenforceable under

applicable law by a court having jurisdiction, the provision will be

unenforceable only to the extent necessary to make it enforceable without

invalidating the remainder thereof or any of the remaining provisions of this

Agreement.

 

 

 

 

     19. NOTICE. All written communications to parties required hereunder must

be in writing and (a) delivered in person, (b) mailed by registered or certified

mail, return receipt requested, (such mailed notice to be effective four (4)

days after the date it is mailed) or (c) sent by facsimile transmission, with

confirmation sent by way of one of the above methods, to the party at the

address given below for the party (or to any other address as the party

designates in a writing complying with this Section, delivered to the other

party):

 

     If to the Corporation:

 

         IDEX Corporation

         Suite 400

         630 Dundee Road

         Northbrook, IL  60062

         Attention:       Vice President - General Counsel

         Telephone:       847-498-7070

         Telecopier:      847-498-9123

 

     with a copy to:

 

         Hodgson, Russ, Andrews, Woods & Goodyear, LLP

         2000 One M&T Plaza

         Buffalo, New York  14203

         Attention:       Richard E. Heath, Esq. and Richard W. Kaiser, Esq.

         Telephone:       716-856-4000

         Telecopier:      716-849-0349

 

     If to the Executive:

 

         Dennis K. Williams

         10 Triton Way

         Mashpee, MA  02649

         Telephone:       508-477-5216

         Telecopier:      508-477-6045

 

     with a copy to:

 

         Kronish Lieb Weiner & Hellman, LLP

         1114 Avenue of the Americas

         New York, New York  10036-7798

         Attention:       Paul M. Ritter, Esq.

         Telephone:       212-479-6000

         Telecopier:      212-479-6275

 

 

 

 

     20. MISCELLANEOUS. This Agreement (a) may not be amended, modified or

terminated orally or by any course of conduct pursued by the Corporation or the

Executive, but may be amended, modified or terminated only by a written

agreement duly executed by the Corporation and the Executive, (b) is binding

upon and inures to the benefit of the Corporation and the Executive and each of

their respective heirs, representatives, successors and assignees, except that

the Executive may not assign any of his rights or obligations pursuant to this

Agreement, (c) except as provided in Sections 4 and 11 of this Agreement,

constitutes the entire agreement between the Corporation and the Executive with

respect to the subject matter of this Agreement, and supersedes all oral and

written proposals, representations, understandings and agreements previously

made or existing with respect to such subject matter, and (d) will be governed

by, and interpreted and construed in accordance with, the laws of the State of

Illinois, without regard to principles of conflicts of law.

 

     21. TERMINATION OF THIS AGREEMENT. This Agreement will terminate when the

Corporation has made the last payment provided for hereunder; provided, however,

that the obligations set forth under Sections 8, 9, 10, 12, 13, 14 and 16 of

this Agreement will survive any termination and will remain in full force and

effect.

 

     22. MULTIPLE COUNTERPARTS. This Agreement may be executed in one or more

counterparts, each of which shall be deemed an original, but all of which

together shall constitute one and the same instrument. Any party may execute

this Agreement by facsimile signature and the other party shall be entitled to

rely on such facsimile signature as evidence that this Agreement has been duly

executed by such party. Any party executing this Agreement by facsimile

signature shall immediately forward to the other party an original page by

overnight mail.

 

     IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the

date first above written.

 

                                    IDEX CORPORATION

 

 

                                    By /s/ Frank J. Notaro

                                       ----------------------------------------

                                       Frank J. Notaro

                                       Vice President - General Counsel

                                          and Secretary

 

                                    EMPLOYEE

 

 

                                    /s/ Dennis K. Williams

                                       ----------------------------------------

                                    Dennis K. Williams