☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
13-3668640
|
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
||
Common Stock, par value $0.01 per share
|
WAT
|
New York Stock Exchange, Inc.
|
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
Emerging growth company | ☐ |
|
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Page
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PART I
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FINANCIAL INFORMATION
|
|
|||
Item 1.
|
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3
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3
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4
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5
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6
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7
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8
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9
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10
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Item 2.
|
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31
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Item 3.
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42
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Item 4.
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42
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PART II
|
|
|
||||
Item 1.
|
|
|
|
43
|
|
|
Item 1A.
|
|
|
|
43
|
|
|
Item 2.
|
|
|
|
44
|
|
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Item 6.
|
|
|
|
45
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|
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|
46
|
|
|
|
|
|
|||||
|
(In thousands, except per share data)
|
|||||||
ASSETS
|
|
|
|
|||||
Current assets:
|
|
|
||||||
Cash and cash equivalents
|
$ |
339,036
|
$ |
335,715
|
||||
Investments
|
16,720
|
1,429
|
||||||
Accounts receivable, net
|
496,276
|
587,734
|
||||||
Inventories
|
344,009
|
320,551
|
||||||
Other current assets
|
73,386
|
67,062
|
||||||
Total current assets
|
1,269,427
|
1,312,491
|
||||||
Property, plant and equipment, net
|
459,173
|
417,342
|
||||||
Intangible assets, net
|
248,993
|
240,203
|
||||||
Goodwill
|
427,492
|
356,128
|
||||||
Operating lease assets
|
88,619
|
93,358
|
||||||
Other assets
|
154,598
|
137,533
|
||||||
Total assets
|
$ |
2,648,302
|
$ |
2,557,055
|
||||
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
||||||
Notes payable and debt
|
$ |
150,000
|
$ |
100,366
|
||||
Accounts payable
|
50,325
|
49,001
|
||||||
Accrued employee compensation
|
33,329
|
43,467
|
||||||
Deferred revenue and customer advances
|
213,402
|
176,360
|
||||||
Current operating lease liabilities
|
26,862
|
27,125
|
||||||
Accrued income taxes
|
87,841
|
45,967
|
||||||
Accrued warranty
|
10,113
|
11,964
|
||||||
Other current liabilities
|
125,448
|
137,084
|
||||||
Total current liabilities
|
697,320
|
591,334
|
||||||
Long-term liabilities:
|
|
|
||||||
Long-term debt
|
1,546,159
|
1,580,797
|
||||||
Long-term portion of retirement benefits
|
62,499
|
59,159
|
||||||
Long-term income tax liabilities
|
356,607
|
394,562
|
||||||
Long-term operating lease liabilities
|
63,828
|
66,881
|
||||||
Other long-term liabilities
|
113,631
|
80,603
|
||||||
Total long-term liabilities
|
2,142,724
|
2,182,002
|
||||||
Total liabilities
|
2,840,044
|
2,773,336
|
||||||
Commitments and contingencies (Notes 7, 8 and 12)
|
|
|
||||||
Stockholders’ deficit:
|
|
|
||||||
Preferred stock, par value $0.01 per share, 5,000 shares authorized, none issued at June 27, 2020 and December 31, 2019
|
—
|
—
|
||||||
Common stock, par value $0.01 per share, 400,000 shares authorized, 161,273 and 161,030 shares issued, 61,916 and 62,587 shares outstanding at June 27, 2020 and December 31, 2019, respectively
|
1,613
|
1,610
|
||||||
Additional
paid-in
capital
|
1,959,498
|
1,926,753
|
||||||
Retained earnings
|
6,762,909
|
6,587,403
|
||||||
Treasury stock, at cost, 99,357 and 98,443 shares at June 27, 2020 and December 31, 2019, respectively
|
(8,788,872
|
) |
(8,612,576
|
) | ||||
Accumulated other comprehensive loss
|
(126,890
|
) |
(119,471
|
) | ||||
Total stockholders’ deficit
|
(191,742
|
) |
(216,281
|
) | ||||
Total liabilities and stockholders’ deficit
|
$ |
2,648,302
|
$ |
2,557,055
|
||||
The accompanying notes are an integral part of the interim consolidated financial statements.
|
|
Three Months Ended
|
|||||||
|
June 27, 2020
|
|
June 29, 2019
|
|
||||
|
(In thousands, except per share data)
|
|||||||
Revenues:
|
|
|
||||||
Product sales
|
$ |
314,920
|
$ |
387,265
|
||||
|
|
|
|
|
|
|
|
|
Service sales
|
205,064
|
211,897
|
||||||
Total net sales
|
519,984
|
599,162
|
||||||
Costs and operating expenses:
|
|
|
||||||
Cost of product sales
|
134,802
|
156,975
|
||||||
Cost of service sales
|
78,332
|
92,571
|
||||||
Selling and administrative expenses
|
117,449
|
133,208
|
||||||
Research and development expenses
|
31,155
|
36,490
|
||||||
Purchased intangibles amortization
|
2,618
|
2,264
|
||||||
Litigation provision
|
514
|
—
|
||||||
Total costs and operating expenses
|
364,870
|
421,508
|
||||||
|
|
|
|
|
|
|
|
|
Operating income
|
155,114
|
177,654
|
||||||
Other expense
|
(736
|
) |
(342
|
) | ||||
|
|
|
|
|
|
|
|
|
Interest expense
|
(13,018
|
) |
(11,448
|
) | ||||
Interest income
|
4,003
|
5,871
|
||||||
|
|
|
|
|
|
|
|
|
Income before income taxes
|
145,363
|
171,735
|
||||||
Provision for income taxes
|
22,434
|
27,325
|
||||||
|
|
|
|
|
|
|
|
|
Net income
|
$ |
122,929
|
$ |
144,410
|
||||
|
|
|
|
|
|
|
|
|
Net income per basic common share
|
$ |
1.98
|
$ |
2.09
|
||||
|
|
|
|
|
|
|
|
|
Weighted-average number of basic common shares
|
61,944
|
68,989
|
||||||
|
|
|
|
|
|
|
|
|
Net income per diluted common share
|
$ |
1.98
|
$ |
2.08
|
||||
|
|
|
|
|
|
|
|
|
Weighted-average number of diluted common shares and equivalents
|
62,184
|
69,494
|
|
Six Months Ended
|
|||||||
|
June 27, 2020
|
|
June 29, 2019
|
|
||||
|
(In thousands, except per share data)
|
|||||||
Revenues:
|
|
|
||||||
Product sales
|
$ |
589,103
|
$ |
707,768
|
||||
Service sales
|
395,820
|
405,256
|
||||||
Total net sales
|
984,923
|
1,113,024
|
||||||
Costs and operating expenses:
|
|
|
||||||
Cost of product sales
|
254,641
|
289,365
|
||||||
Cost of service sales
|
169,137
|
181,212
|
||||||
Selling and administrative expenses
|
265,184
|
267,547
|
||||||
Research and development expenses
|
66,144
|
71,550
|
||||||
Purchased intangibles amortization
|
5,243
|
4,545
|
||||||
Litigation provision
|
1,180
|
—
|
||||||
Total costs and operating expenses
|
761,529
|
814,219
|
||||||
Operating income
|
223,394
|
298,805
|
||||||
Other expense
|
(1,110
|
) |
(867
|
) | ||||
Interest expense
|
(27,097
|
) |
(23,011
|
) | ||||
Interest income
|
8,039
|
14,186
|
||||||
Income before income taxes
|
203,226
|
289,113
|
||||||
Provision for income taxes
|
26,735
|
35,717
|
||||||
Net income
|
$ |
176,491
|
$ |
253,396
|
||||
Net income per basic common share
|
$ |
2.84
|
$ |
3.60
|
||||
Weighted-average number of basic common shares
|
62,085
|
70,331
|
||||||
Net income per diluted common share
|
$ |
2.83
|
$ |
3.57
|
||||
Weighted-average number of diluted common shares and equivalents
|
62,404
|
70,904
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
June 27,
2020 |
June 29,
2019 |
June 27,
2020 |
June 29,
2019 |
|||||||||||||
|
(In thousands)
|
(In thousands)
|
||||||||||||||
Net income
|
$ |
122,929
|
$ |
144,410
|
$ |
176,491
|
$ |
253,396
|
||||||||
Other comprehensive income (loss):
|
|
|
|
|
||||||||||||
Foreign currency translation
|
11,587
|
(7,031
|
) |
(7,757
|
) |
491
|
||||||||||
Unrealized gains on investments before income taxes
|
—
|
710
|
—
|
3,054
|
||||||||||||
Income tax expense
|
—
|
(157
|
) |
—
|
(704
|
) | ||||||||||
Unrealized gains on investments, net of tax
|
—
|
553
|
—
|
2,350
|
||||||||||||
Retirement liability adjustment before reclassifications
|
(522
|
) |
(41
|
) |
(226
|
) |
(102
|
) | ||||||||
Amounts reclassified to other income
|
336
|
90
|
676
|
183
|
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Retirement liability adjustment before income taxes
|
(186
|
) |
49
|
450
|
81
|
|||||||||||
Income tax
benefit (
expense
)
|
126
|
(23
|
) |
(112
|
) |
(47
|
) | |||||||||
|
|
|
|
|
|
|
|
|||||||||
Retirement liability adjustment, net of tax
|
(60
|
) |
26
|
338
|
34
|
|||||||||||
Other comprehensive income (loss)
|
11,527
|
(6,452
|
) |
(7,419
|
) |
2,875
|
||||||||||
Comprehensive income
|
$ |
134,456
|
$ |
137,958
|
$ |
169,072
|
$ |
256,271
|
||||||||
|
Six Months Ended
|
|||||||
June 27, 2020
|
June 29, 2019
|
|||||||
|
|
|
|
|||||
(In thousands)
|
||||||||
Cash flows from operating activities:
|
||||||||
Net income
|
$ |
176,491
|
$ |
253,396
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
||||||
Stock-based compensation
|
18,122
|
|
19,255
|
|||||
Deferred income taxes
|
(777
|
)
|
1,632
|
|||||
Depreciation
|
33,220
|
28,704
|
||||||
Amortization of intangibles
|
26,983
|
24,911
|
||||||
Change in operating assets and liabilities:
|
|
|
||||||
Decrease in accounts receivable
|
86,978
|
52,508
|
||||||
Increase in inventories
|
(27,089
|
) |
(62,200
|
) | ||||
Increase in other current assets
|
(14,699
|
) |
(11,627
|
) | ||||
Decrease (increase) in other assets
|
8,238
|
(15,060
|
) | |||||
Increase (decrease) in accounts payable and other current liabilities
|
34,714
|
(10,439
|
) | |||||
Increase in deferred revenue and customer advances
|
37,558
|
54,672
|
||||||
Effect of the 2017 Tax Cuts & Jobs Act
|
—
|
(3,229
|
) | |||||
Decrease in other liabilities
|
(29,293
|
) |
(29,720
|
)
|
||||
Net cash provided by operating activities
|
350,446
|
302,803
|
||||||
Cash flows from investing activities:
|
|
|
||||||
Additions to property, plant, equipment and software capitalization
|
(97,029
|
) |
(65,188
|
) | ||||
Business acquisitions, net of cash acquired
|
(76,664
|
) |
—
|
|||||
Investment in unaffiliated companies
|
(3,350
|
)
|
(4,750
|
) | ||||
Purchases of investments
|
(16,828
|
) |
(35,523
|
) | ||||
Maturities and sales of investments
|
1,536
|
890,524
|
||||||
Net cash (used in) provided by investing activities
|
(192,335
|
) |
785,063
|
|||||
Cash flows from financing activities:
|
|
|
||||||
Proceeds from debt issuances
|
315,000
|
363
|
||||||
Payments on debt
|
(300,366
|
) |
(245
|
) | ||||
Proceeds from stock plans
|
14,739
|
30,129
|
||||||
Purchases of treasury shares
|
(196,297
|
) |
(1,329,635
|
) | ||||
Proceeds from derivative contracts
|
7,558
|
4,654
|
||||||
Net cash used in financing activities
|
(159,366
|
) |
(1,294,734
|
) | ||||
Effect of exchange rate changes on cash and cash equivalents
|
4,576
|
(1,414
|
) | |||||
Increase (decrease) in cash and cash equivalents
|
3,321
|
(208,282
|
) | |||||
Cash and cash equivalents at beginning of period
|
335,715
|
796,280
|
||||||
Cash and cash equivalents at end of period
|
$ |
339,036
|
$ |
587,998
|
||||
Number
of Common Shares |
Common
Stock |
Additional
Paid-In
Capital |
Retained
Earnings |
Treasury
Stock |
Accumulated
Other Comprehensive Loss |
Total
Stockholders’ Equity |
||||||||||||||||||||||
Balance March 30, 2019
|
160,825
|
$ |
1,608
|
$ |
1,872,216
|
$ |
6,104,191
|
$ |
(6,901,629
|
) | $ |
(108,644
|
) | $ |
967,742
|
|||||||||||||
Net income
|
—
|
—
|
—
|
144,410
|
—
|
—
|
144,410
|
|||||||||||||||||||||
Other comprehensive loss
|
—
|
—
|
—
|
—
|
—
|
(6,452
|
) |
(6,452
|
) | |||||||||||||||||||
Issuance of common stock for employees:
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Employee Stock Purchase Plan
|
15
|
—
|
2,498
|
—
|
—
|
—
|
2,498
|
|||||||||||||||||||||
Treasury stock
|
—
|
—
|
—
|
—
|
(561,197
|
) |
—
|
(561,197
|
)
|
|||||||||||||||||||
Stock-based compensation
|
1
|
—
|
9,244
|
—
|
—
|
—
|
9,244
|
|||||||||||||||||||||
Balance June 29, 2019
|
160,841
|
$ |
1,608
|
$ |
1,883,958
|
$ |
6,248,601
|
$ |
(7,462,826
|
) | $ |
(115,096
|
) | $ |
556,245
|
|||||||||||||
Number
of Common Shares |
Common
Stock |
Additional
Paid-In
Capital |
Retained
Earnings |
Treasury
Stock |
Accumulated
Other Comprehensive
Incom
Loss
e
(
)
|
Total
Stockholders’ Deficit |
||||||||||||||||||||||
Balance March 28, 2020
|
161,253
|
$ |
1,613
|
$ |
1,947,626
|
$ |
6,639,980
|
$ |
(8,788,801
|
) | $ |
(138,417
|
) | $ |
(337,999
|
) | ||||||||||||
Net income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
122,929
|
|
|
|
—
|
|
|
|
—
|
|
|
|
122,929
|
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
11,527
|
|
|
|
11,527
|
|
Issuance of common stock for employees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee Stock Purchase Plan
|
|
|
12
|
|
|
|
—
|
|
|
|
2,216
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,216
|
|
Stock options exercised
|
|
|
6
|
|
|
|
—
|
|
|
|
779
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
779
|
|
Treasury stock
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(71
|
)
|
|
|
—
|
|
|
|
(71
|
)
|
Stock-based compensation
|
|
|
2
|
|
|
|
|
|
|
|
8,877
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8,877
|
|
Balance June 27, 2020
|
161,273
|
$ |
1,613
|
$ |
1,959,498
|
$ |
6,762,909
|
$ |
(8,788,872
|
) | $ |
(126,890
|
) | $ |
(191,742
|
) | ||||||||||||
Number
of Common Shares |
Common
Stock |
Additional
Paid-In
Capital |
Retained
Earnings |
Treasury
Stock |
Accumulated
Other Comprehensive Income (Loss) |
Total
Stockholders’ Equity |
||||||||||||||||||||||
Balance December 31, 2018
|
160,472
|
$ |
1,605
|
$ |
1,834,741
|
$ |
5,995,205
|
$ |
(6,146,322
|
) | $ |
(117,971
|
) | $ |
1,567,258
|
|||||||||||||
Net income
|
—
|
—
|
—
|
253,396
|
—
|
—
|
253,396
|
|||||||||||||||||||||
Other comprehensive income
|
—
|
—
|
—
|
—
|
—
|
2,875
|
2,875
|
|||||||||||||||||||||
Issuance of common stock for employees:
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Employee Stock Purchase Plan
|
25
|
—
|
4,168
|
—
|
—
|
—
|
4,168
|
|||||||||||||||||||||
Stock options exercised
|
239
|
2
|
26,097
|
—
|
—
|
—
|
26,099
|
|||||||||||||||||||||
Treasury stock
|
—
|
—
|
—
|
—
|
(1,316,504
|
) |
—
|
(1,316,504
|
)
|
|||||||||||||||||||
Stock-based compensation
|
105
|
1
|
18,952
|
—
|
—
|
—
|
18,953
|
|||||||||||||||||||||
Balance June 29, 2019
|
160,841
|
$ |
1,608
|
$ |
1,883,958
|
$ |
6,248,601
|
$ |
(7,462,826
|
) | $ |
(115,096
|
) | $ |
556,245
|
|||||||||||||
Number
of Common Shares |
Common
Stock |
Additional
Paid-In
Capital |
Retained
Earnings |
Treasury
Stock |
Accumulated
Other Comprehensive Loss |
Total
Stockholders’ Deficit |
||||||||||||||||||||||
Balance December 31, 2019
|
161,030
|
$ |
1,610
|
$ |
1,926,753
|
$ |
6,587,403
|
$ |
(8,612,576
|
) | $ |
(119,471
|
) | $ |
(216,281
|
) | ||||||||||||
Net income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
176,491
|
|
|
|
—
|
|
|
|
—
|
|
|
|
176,491
|
|
Adoption of new accounting pronouncement
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(985
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(985
|
)
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,419
|
)
|
|
|
(7,419
|
)
|
Issuance of common stock for employees:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee Stock Purchase Plan
|
|
|
21
|
|
|
|
|
|
|
|
3,952
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,952
|
|
Stock options exercised
|
|
|
87
|
|
|
|
1
|
|
|
|
10,904
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,905
|
|
Treasury stock
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(176,296
|
)
|
|
|
—
|
|
|
|
(176,296
|
)
|
Stock-based compensation
|
|
|
135
|
|
|
|
2
|
|
|
|
17,889
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
17,891
|
|
Balance June 27, 2020
|
161,273
|
$ |
1,613
|
$ |
1,959,498
|
$ |
6,762,909
|
$ |
(8,788,872
|
) | $ |
(126,890
|
) | $ |
(191,742
|
) | ||||||||||||
Balance at
Beginning
of Period
|
Impact of
CECL
Adoption
|
Additions
|
Deduction
|
Balance at
End of
Period
|
||||||||||||||||
Allowance for Doubtful Accounts
|
|
|
|
|
|
|||||||||||||||
June 27, 2020
|
$ |
9,560
|
$ |
985
|
$ |
6,664
|
$ |
(3,901
|
) | $ |
13,308
|
|||||||||
June 29, 2019
|
$ |
7,663
|
$ |
—
|
$ |
3,793
|
$ |
(3,426
|
) | $ |
8,030
|
Total at
June 27, 2020 |
Quoted Prices
in Active Markets for Identical Assets
(Level 1)
|
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs
(Level 3)
|
|||||||||||||
Assets:
|
|
|
|
|
||||||||||||
Time deposits
|
$ |
16,720
|
$ |
—
|
$ |
16,720
|
$ |
—
|
||||||||
Waters 401(k) Restoration Plan assets
|
33,453
|
33,453
|
—
|
—
|
||||||||||||
Foreign currency exchange contracts
|
|
|
366
|
|
|
|
—
|
|
|
|
366
|
|
|
|
—
|
|
Interest rate cross-currency swap agreements
|
4,392
|
—
|
4,392
|
—
|
||||||||||||
Total
|
$ |
54,931
|
$ |
33,453
|
$ |
21,478
|
$ |
—
|
||||||||
|
|
|
|
|
|
|
|
|||||||||
Liabilities:
|
|
|
|
|
||||||||||||
Contingent consideration
|
$ |
2,787
|
$ |
—
|
$ |
—
|
$ |
2,787
|
||||||||
Foreign currency exchange contracts
|
733
|
—
|
733
|
—
|
||||||||||||
Total
|
$ |
3,520
|
$ |
—
|
$ |
733
|
$ |
2,787
|
||||||||
Total at
December 31, 2019 |
Quoted Prices
in Active Markets for Identical Assets
(Level 1)
|
Significant
Other Observable Inputs (Level 2) |
Significant
Unobservable Inputs
(Level 3)
|
|||||||||||||
Assets:
|
|
|
|
|
||||||||||||
Time deposits
|
$ |
1,642
|
$ |
—
|
$ |
1,642
|
$ |
—
|
||||||||
Waters 401(k) Restoration Plan assets
|
30,158
|
30,158
|
—
|
—
|
||||||||||||
Foreign currency exchange contracts
|
16
|
—
|
16
|
—
|
||||||||||||
Interest rate cross-currency swap agreements
|
4,485
|
|
4,485
|
|
||||||||||||
Total
|
$ |
36,301
|
$ |
30,158
|
$ |
6,143
|
$ |
—
|
||||||||
Liabilities:
|
|
|
|
|
||||||||||||
Contingent consideration
|
$ |
2,557
|
$ |
—
|
$ |
—
|
$ |
2,557
|
||||||||
Foreign currency exchange contracts
|
1,028
|
—
|
1,028
|
—
|
||||||||||||
Total
|
$ |
3,585
|
$ |
—
|
$ |
1,028
|
$ |
2,557
|
||||||||
|
June 27, 2020
|
December 31, 2019
|
||||||||||||||
|
Notional Value
|
|
Fair Value
|
|
Notional Value
|
|
Fair Value
|
|
||||||||
Foreign currency exchange contracts:
|
|
|
|
|
||||||||||||
Other current assets
|
$ |
29,735
|
$ |
366
|
$ |
119,576
|
$ |
16
|
||||||||
Other current liabilities
|
$ |
91,393
|
$ |
733
|
$ |
29,495
|
$ |
1,028
|
||||||||
Interest rate cross-currency swap agreements:
|
|
|
|
|
||||||||||||
Other assets
|
$ |
560,000
|
$ |
4,392
|
$ |
560,000
|
$ |
4,485
|
||||||||
Accumulated other comprehensive income
|
|
$ |
(4,392
|
) |
|
$ |
(4,485
|
)
|
Balance at
Beginning of Period |
Accruals for
Warranties |
Settlements
Made |
Balance at
End of Period |
|||||||||||||
Accrued warranty liability:
|
|
|
|
|
||||||||||||
June 27, 2020
|
$ |
11,964
|
$ |
3,577
|
$ |
(5,428
|
) | $ |
10,113
|
|||||||
June 29, 2019
|
$ |
12,300
|
$ |
3,571
|
$ |
(4,288
|
) | $ |
11,583
|
|
June 27, 2020
|
|
June 29, 2019
|
|
||||
Balance at the beginning of the period
|
$ |
213,695
|
$ |
204,257
|
||||
Recognition of revenue included in balance at beginning of the period
|
(141,297
|
) |
(172,949
|
)
|
||||
Revenue deferred during the period, net of revenue recognized
|
195,444
|
229,162
|
||||||
Balance at the end of the period
|
$ |
267,842
|
$ |
260,470
|
||||
|
June 27, 2020
|
|
||
Deferred revenue and customer advances expected to be recognized in:
|
|
|||
One year or less
|
|
$
|
213,402
|
|
13-24
months
|
34,151
|
|||
25 months and beyond
|
20,289
|
|||
Total
|
$ |
267,842
|
||
|
June 27, 2020
|
|||||||||||||||
Amortized
Cost |
Unrealized
Gain |
Unrealized
Loss |
Fair
Value |
|||||||||||||
Time deposits
|
16,720
|
—
|
—
|
16,720
|
||||||||||||
Total
|
$ |
16,720
|
$ |
—
|
$ |
—
|
$ |
16,720
|
||||||||
Amounts included in:
|
|
|
|
|
||||||||||||
Investments
|
16,720
|
—
|
—
|
16,720
|
||||||||||||
Total
|
$ |
16,720
|
$ |
—
|
$ |
—
|
$ |
16,720
|
||||||||
|
December 31, 2019
|
|||||||||||||||
Amortized
Cost |
Unrealized
Gain |
Unrealized
Loss |
Fair
Value |
|||||||||||||
Time deposits
|
1,642
|
—
|
—
|
1,642
|
||||||||||||
Total
|
$ |
1,642
|
$ |
—
|
$ |
—
|
$ |
1,642
|
||||||||
Amounts included in:
|
|
|
|
|
||||||||||||
Cash equivalents
|
$ |
213
|
$ |
—
|
$ |
—
|
$ |
213
|
||||||||
Investments
|
1,429
|
—
|
—
|
1,429
|
||||||||||||
Total
|
$ |
1,642
|
$ |
—
|
$ |
—
|
$ |
1,642
|
||||||||
|
June 27, 2020
|
December 31, 2019
|
||||||
Due in one year or less
|
$ |
16,720
|
$ |
1,642
|
||||
Total
|
$ |
16,720
|
$ |
1,642
|
||||
|
June 27, 2020
|
December 31, 2019
|
||||||
Raw materials
|
$ |
139,452
|
$ |
126,850
|
||||
Work in progress
|
15,878
|
15,457
|
||||||
Finished goods
|
188,679
|
178,244
|
||||||
Total inventories
|
$ |
344,009
|
$ |
320,551
|
||||
Cash
|
$ |
713
|
||
Accounts receivable and current other assets
|
806
|
|||
Inventory
|
669
|
|||
Prepaid and other assets
|
611
|
|||
Property, plant and equipment, net
|
757
|
|||
Operating lease assets
|
847
|
|||
Intangible assets
|
6,960
|
|||
Goodwill
|
71,632
|
|||
Total assets acquired
|
82,995
|
|||
Accrued expenses and other liabilities
|
2,093
|
|||
Total consideration
|
80,902
|
|||
Fair value of minority investment
|
3,525
|
|||
Cash consideration paid
|
$
|
77,377
|
||
|
June 27, 2020
|
December 31, 2019
|
||||||||||||||||||||||
Gross
Carrying Amount |
Accumulated
Amortization |
Weighted-
Average Amortization Period |
Gross
Carrying Amount |
Accumulated
Amortization |
Weighted-
Average Amortization Period |
|||||||||||||||||||
Capitalized software
|
$ |
512,047
|
$ |
356,036
|
5
years
|
$ |
481,986
|
$ |
333,255
|
5
years
|
||||||||||||||
Purchased intangibles
|
207,733
|
156,065
|
11
years
|
200,523
|
151,722
|
11
years
|
||||||||||||||||||
Trademarks and IPR&D
|
13,601
|
—
|
—
|
13,782
|
—
|
—
|
||||||||||||||||||
Licenses
|
5,483
|
5,195
|
6
years
|
5,669
|
5,298
|
6
years
|
||||||||||||||||||
Patents and other intangibles
|
84,453
|
57,028
|
8
years
|
83,035
|
54,517
|
8
years
|
||||||||||||||||||
Total
|
$ |
823,317
|
$ |
574,324
|
7
years
|
$ |
784,995
|
$ |
544,792
|
7
years
|
||||||||||||||
June 27, 2020
|
December 31, 2019
|
|||||||
Foreign subsidiary lines of credit
|
$ |
—
|
$ |
366
|
||||
Senior unsecured notes
-
Series B
-
5.00%, due February 2020
|
—
|
100,000
|
||||||
Senior unsecured notes
-
Series E
-
3.97%, due March 2021
|
50,000
|
—
|
||||||
Senior unsecured notes
-
Series F
-
3.40%, due June 2021
|
100,000
|
—
|
||||||
Total notes payable and debt, current
|
150,000
|
100,366
|
||||||
Senior unsecured notes
-
Series E
-
3.97%, due March 2021
|
—
|
50,000
|
||||||
Senior unsecured notes
-
Series F
-
3.40%, due June 2021
|
—
|
100,000
|
||||||
Senior unsecured notes
-
Series G
-
3.92%, due June 2024
|
50,000
|
50,000
|
||||||
Senior unsecured notes
-
Series H
-
floating rate*, due June 2024
|
50,000
|
50,000
|
||||||
Senior unsecured notes
-
Series I
-
3.13%, due May 2023
|
50,000
|
50,000
|
||||||
Senior unsecured notes
-
Series K
-
3.44%, due May 2026
|
160,000
|
160,000
|
||||||
Senior unsecured notes
-
Series L
-
3.31%, due September 2026
|
200,000
|
200,000
|
||||||
Senior unsecured notes
-
Series M
-
3.53%, due September 2029
|
300,000
|
300,000
|
||||||
Credit agreement
|
740,000
|
625,000
|
||||||
Unamortized debt issuance costs
|
(3,841
|
) |
(4,203
|
)
|
||||
Total long-term debt
|
1,546,159
|
1,580,797
|
||||||
Total debt
|
$ |
1,696,159
|
$ |
1,681,163
|
||||
*
|
Series H senior unsecured notes bear interest at a 3-month LIBOR for that floating rate interest period plus 1.25%. |
June 27, 2020
|
June 29, 2019
|
|||||||
Balance at the beginning of the period
|
$ |
27,790
|
$ |
26,108
|
||||
Net reductions for lapse of statutes taken during the period
|
(252
|
) |
(105
|
) | ||||
Net additions for tax positions taken during the current period
|
536
|
801
|
||||||
Balance at the end of the period
|
$ |
28,074
|
$ |
26,804
|
||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
June 27, 2020
|
June 29, 2019
|
June 27, 2020
|
June 29, 2019
|
|||||||||||||
Cost of sales
|
$ |
635
|
$ |
567
|
$ |
1,205
|
$ |
1,142
|
||||||||
Selling and administrative expenses
|
7,352
|
7,402
|
14,725
|
15,527
|
||||||||||||
Research and development expenses
|
939
|
1,345
|
2,192
|
2,586
|
||||||||||||
Total stock-based compensation
|
$ |
8,926
|
$ |
9,314
|
$ |
18,122
|
$ |
19,255
|
||||||||
|
Six Months Ended
|
|||||||
Options Issued and Significant Assumptions Used to Estimate Option Fair Values
|
June 27, 2020
|
June 29, 2019
|
||||||
Options issued in thousands
|
227
|
139
|
||||||
Risk-free interest rate
|
1.4
|
% |
2.5
|
%
|
||||
Expected life in years
|
6
|
5
|
||||||
Expected volatility
|
26.5
|
% |
24.3
|
%
|
||||
Expected dividends
|
—
|
—
|
|
Six Months Ended
|
|||||||
Weighted-Average Exercise Price and Fair Value of Options on the Date of Grant
|
June 27, 2020
|
June 29, 2019
|
||||||
Exercise price
|
$ |
216.08
|
|
$ |
231.30
|
|
||
Fair value
|
$ |
61.70
|
$ |
61.85
|
Number of Shares
|
Exercise Price per Share
|
Weighted-Average
Exercise Price per
Share
|
||||||||||||||||
Outstanding at December 31, 2019
|
1,455
|
$ |
61.63
|
to
|
$ |
238.52
|
$ |
158.61
|
||||||||||
Granted
|
227
|
$ |
203.37
|
to
|
$ |
235.06
|
$ |
216.08
|
||||||||||
Exercised
|
(87
|
) | $ |
61.63
|
to
|
$ |
208.47
|
$ |
125.50
|
|||||||||
Canceled
|
(148
|
) | $ |
128.93
|
to
|
$ |
238.52
|
$ |
172.91
|
|||||||||
Outstanding at June 27, 2020
|
1,447
|
$ |
75.94
|
to
|
$ |
238.52
|
$ |
168.15
|
||||||||||
Shares
|
Weighted-Average
Grant Date Fair
Value per Share
|
|||||||
Unvested at December 31, 2019
|
260
|
$ |
184.70
|
|||||
Granted
|
105
|
$ |
206.73
|
|||||
Vested
|
(86
|
) | $ |
161.84
|
||||
Forfeited
|
(15
|
) | $ |
185.91
|
||||
Unvested at June 27, 2020
|
264
|
$ |
200.84
|
|||||
Six Months Ended
|
||||||||
Performance Stock Units Issued and Significant Assumptions Used to Estimate Fair Values
|
June 27, 2020
|
June 29, 2019
|
||||||
Performance stock units issued (in thousands)
|
58
|
13
|
||||||
Risk-free interest rate
|
1.3
|
% |
2.4
|
%
|
||||
Expected life in years
|
2.9
|
2.8
|
||||||
Expected volatility
|
25.1
|
% |
|
23.5
|
% | |||
Average volatility of peer companies
|
26.1
|
% |
26.2
|
% | ||||
Correlation coefficient
|
36.6
|
% |
34.2
|
% | ||||
Expected dividends
|
—
|
—
|
Shares
|
Weighted-Average
Fair Value per Share |
|||||||
Unvested at December 31, 2019
|
105
|
$ |
233.11
|
|||||
Granted
|
58
|
$ |
190.45
|
|||||
Vested
|
(37
|
) | $ |
184.51
|
||||
Forfeited
|
(24
|
) | $ |
233.31
|
||||
Unvested at June 27, 2020
|
102
|
$ |
226.44
|
|||||
|
Three Months Ended June 27, 2020
|
|||||||||||
Net Income
(Numerator) |
Weighted-
Average Shares (Denominator) |
Per Share
Amount |
||||||||||
Net income per basic common share
|
$ |
122,929
|
61,944
|
$ |
1.98
|
|||||||
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
|
—
|
240
|
—
|
|||||||||
Net income per diluted common share
|
$ |
122,929
|
62,184
|
$ |
1.98
|
|||||||
|
Three Months Ended June 29, 2019
|
|||||||||||
Net Income
(Numerator) |
Weighted-
Average Shares (Denominator) |
Per Share
Amount |
||||||||||
Net income per basic common share
|
$ |
144,410
|
68,989
|
$ |
2.09
|
|||||||
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
|
—
|
505
|
(0.01
|
) | ||||||||
Net income per diluted common share
|
$ |
144,410
|
69,494
|
$ |
2.08
|
|||||||
|
Six Months Ended June 27, 2020
|
|||||||||||
Net Income
(Numerator) |
Weighted-
Average Shares (Denominator) |
Per Share
Amount |
||||||||||
Net income per basic common share
|
$ |
176,491
|
62,085
|
$ |
2.84
|
|||||||
Effect of dilutive stock option, restricted stock, performance stock unit and restricted stock unit securities
|
—
|
319
|
(0.01
|
)
|
||||||||
Net income per diluted common share
|
$ |
176,491
|
62,404
|
$ |
2.83
|
|||||||
|
Six Months Ended June 29, 2019
|
|||||||||||
Net Income
(Numerator) |
Weighted-
Average Shares (Denominator) |
Per Share
Amount |
||||||||||
Net income per basic common share
|
$ |
253,396
|
70,331
|
$ |
3.60
|
|||||||
Effect of dilutive stock option, restricted stock, performance
s
ck unit and restricted stock unit securities
to
|
—
|
573
|
(0.03
|
) | ||||||||
Net income per diluted common share
|
$ |
253,396
|
70,904
|
$ |
3.57
|
|||||||
Currency Translation
|
Unrealized Gain (Loss)
on Retirement Plans |
Accumulated Other
Comprehensive Loss |
||||||||||
Balance at December 31, 2019
|
$ |
(104,066
|
) | $ |
(15,405
|
) | $ |
(119,471
|
) | |||
Other comprehensive income (loss), net of tax
|
(7,757
|
) |
338
|
(7,419
|
) | |||||||
Balance at June 27, 2020
|
$ |
(111,822
|
) | $ |
(15,067
|
) | $ |
(126,890
|
) | |||
|
Three Months Ended
|
|||||||||||||||||||||||
|
June 27, 2020
|
June 29, 2019
|
||||||||||||||||||||||
U.S.
Pension Plans |
U.S. Retiree
Healthcare Plan |
Non-U.S.
Pension Plans |
U.S.
Pension Plans |
U.S. Retiree
Healthcare Plan |
Non-U.S.
Pension Plans |
|||||||||||||||||||
Service cost
|
$ |
—
|
$ |
151
|
$ |
1,095
|
$ |
—
|
$ |
108
|
$ |
1,075
|
||||||||||||
Interest cost
|
—
|
177
|
338
|
10
|
230
|
430
|
||||||||||||||||||
Expected return on plan assets
|
—
|
(220
|
) |
(454
|
) |
—
|
(177
|
) |
(538
|
) | ||||||||||||||
Net amortization:
|
|
|
|
|
|
|
||||||||||||||||||
Prior service credit
|
—
|
(5
|
) |
(41
|
) |
—
|
(5
|
) |
(37
|
) | ||||||||||||||
Net actuarial loss
|
—
|
—
|
382
|
—
|
—
|
132
|
||||||||||||||||||
Net periodic pension cost
|
$ |
—
|
$ |
103
|
$ |
1,320
|
$ |
10
|
$ |
156
|
$ |
1,062
|
||||||||||||
|
Six Months Ended
|
|||||||||||||||||||||||
|
June 27, 2020
|
June 29, 2019
|
||||||||||||||||||||||
U.S.
Pension Plans |
U.S. Retiree
Healthcare Plan |
Non-U.S.
Pension Plans |
U.S.
Pension Plans |
U.S. Retiree
Healthcare Plan |
Non-U.S.
Pension Plans |
|||||||||||||||||||
Service cost
|
$ |
—
|
$ |
302
|
$ |
2,194
|
$ |
—
|
$ |
250
|
$ |
2,157
|
||||||||||||
Interest cost
|
—
|
353
|
683
|
23
|
389
|
864
|
||||||||||||||||||
Expected return on plan assets
|
—
|
(439
|
) |
(910
|
) |
—
|
(354
|
) |
(1,081
|
) | ||||||||||||||
Net amortization:
|
|
|
|
|
|
|
||||||||||||||||||
Prior service credit
|
—
|
(10
|
) |
(81
|
) |
—
|
(10
|
) |
(74
|
) | ||||||||||||||
Net actuarial loss
|
—
|
—
|
767
|
—
|
—
|
267
|
||||||||||||||||||
Net periodic pension cost
|
$ |
—
|
$ |
206
|
$ |
2,653
|
$ |
23
|
$ |
275
|
$ |
2,133
|
||||||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
June 27, 2020
|
June 29, 2019
|
June 27, 2020
|
June 29, 2019
|
|||||||||||||
Product net sales:
|
|
|
|
|
||||||||||||
Waters instrument systems
|
$ |
181,399
|
$ |
238,777
|
$ |
324,228
|
$ |
423,389
|
||||||||
Chemistry consumables
|
95,105
|
100,292
|
192,350
|
199,545
|
||||||||||||
TA instrument systems
|
38,416
|
48,196
|
72,525
|
84,834
|
||||||||||||
Total product sales
|
314,920
|
387,265
|
589,103
|
707,768
|
||||||||||||
Service net sales:
|
|
|
|
|
||||||||||||
Waters service
|
189,205
|
192,048
|
363,342
|
368,097
|
||||||||||||
TA service
|
15,859
|
19,849
|
32,478
|
37,159
|
||||||||||||
Total service sales
|
205,064
|
211,897
|
395,820
|
405,256
|
||||||||||||
Total net sales
|
$ |
519,984
|
$ |
599,162
|
$ |
984,923
|
$ |
1,113,024
|
||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
June 27, 2020
|
June 29, 2019
|
June 27, 2020
|
June 29, 2019
|
|||||||||||||
Net Sales:
|
|
|
|
|
||||||||||||
Asia:
|
|
|
|
|
||||||||||||
China
|
$ |
89,816
|
$ |
112,796
|
$ |
137,047
|
$ |
202,887
|
||||||||
Japan
|
41,230
|
45,958
|
86,319
|
89,462
|
||||||||||||
Asia Other
|
77,163
|
80,081
|
143,923
|
146,998
|
||||||||||||
Total Asia
|
208,209
|
238,835
|
367,289
|
439,347
|
||||||||||||
Americas:
|
|
|
|
|
||||||||||||
United States
|
148,928 | 173,940 | 292,826 | 323,097 | ||||||||||||
Americas Other
|
25,854
|
32,835
|
54,132
|
65,546
|
||||||||||||
Total Americas
|
174,782
|
206,775
|
346,958
|
388,643
|
||||||||||||
Europe
|
136,993
|
153,552
|
270,676
|
285,034
|
||||||||||||
Total net sales
|
$ |
519,984
|
$ |
599,162
|
$ |
984,923
|
$ |
1,113,024
|
||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
June 27, 2020
|
June 29, 2019
|
June 27, 2020
|
June 29, 2019
|
|||||||||||||
Pharmaceutical
|
$ |
311,018
|
$ |
350,145
|
$ |
583,581
|
$ |
644,657
|
||||||||
Industrial
|
152,110
|
176,109
|
295,464
|
331,327
|
||||||||||||
Academic and governmental
|
56,856
|
72,908
|
105,878
|
137,040
|
||||||||||||
Total net sales
|
$ |
519,984
|
$ |
599,162
|
$ |
984,923
|
$ |
1,113,024
|
||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
June 27, 2020
|
June 29, 2019
|
June 27, 2020
|
June 29, 2019
|
|||||||||||||
Net sales recognized at a point in time:
|
|
|
|
|
||||||||||||
Instrument systems
|
$ |
219,815
|
$ |
286,973
|
$ |
396,753
|
$ |
508,223
|
||||||||
Chemistry consumables
|
95,105
|
100,292
|
192,350
|
199,545
|
||||||||||||
Service sales recognized at a point in time (time & materials)
|
78,867
|
84,807
|
146,609
|
157,566
|
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total net sales recognized at a point in time
|
393,787
|
472,072
|
735,712
|
865,334
|
||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net sales recognized over time:
|
|
|
|
|
||||||||||||
Service and software maintenance sales recognized over time (contracts)
|
126,197
|
127,090
|
249,211
|
247,690
|
||||||||||||
Total net sales
|
$ |
519,984
|
$ |
599,162
|
$ |
984,923
|
$ |
1,113,024
|
||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||||||
June 27,
2020 |
June 29,
2019 |
% change
|
June 27,
2020 |
June 29,
2019 |
% change
|
|||||||||||||||||||
Revenues:
|
||||||||||||||||||||||||
Product sales
|
$ | 314,920 | $ | 387,265 |
|
(19
|
%)
|
$ | 589,103 | $ | 707,768 |
|
(17
|
%)
|
||||||||||
Service sales
|
205,064 | 211,897 |
|
(3
|
%)
|
395,820 | 405,256 |
|
(2
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net sales
|
519,984 | 599,162 |
|
(13
|
%)
|
984,923 | 1,113,024 |
|
(12
|
%)
|
||||||||||||||
Costs and operating expenses:
|
||||||||||||||||||||||||
Cost of sales
|
213,134 | 249,546 |
|
(15
|
%)
|
423,778 | 470,577 |
|
(10
|
%)
|
||||||||||||||
Selling and administrative expenses
|
117,449 | 133,208 |
|
(12
|
%)
|
265,184 | 267,547 |
|
(1
|
%)
|
||||||||||||||
Research and development expenses
|
31,155 | 36,490 |
|
(15
|
%)
|
66,144 | 71,550 |
|
(8
|
%)
|
||||||||||||||
Purchased intangibles amortization
|
2,618 | 2,264 |
|
16
|
%
|
5,243 | 4,545 |
|
15
|
%
|
||||||||||||||
Litigation provision
|
514 | — |
|
—
|
|
1,180 | — |
|
—
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Operating income
|
155,114 | 177,654 |
|
(13
|
%)
|
223,394 | 298,805 |
|
(25
|
%)
|
||||||||||||||
Operating income as a % of sales
|
|
29.8
|
%
|
|
29.7
|
%
|
|
22.7
|
%
|
|
26.8
|
%
|
||||||||||||
Other expense
|
(736 | ) | (342 | ) |
|
115
|
%
|
(1,110 | ) | (867 | ) |
|
28
|
%
|
||||||||||
Interest expense, net
|
(9,015 | ) | (5,577 | ) |
|
62
|
%
|
(19,058 | ) | (8,825 | ) |
|
116
|
%
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income before income taxes
|
145,363 | 171,735 |
|
(15
|
%)
|
203,226 | 289,113 |
|
(30
|
%)
|
||||||||||||||
Provision for income taxes
|
22,434 | 27,325 |
|
(18
|
%)
|
26,735 | 35,717 |
|
(25
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income
|
$ | 122,929 | $ | 144,410 |
|
(15
|
%)
|
$ | 176,491 | $ | 253,396 |
|
(30
|
%)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income per diluted common share
|
$ | 1.98 | $ | 2.08 |
|
(5
|
%)
|
$ | 2.83 | $ | 3.57 |
|
(21
|
%)
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||||||
June 27,
2020 |
June 29,
2019 |
%
change |
June 27,
2020 |
June 29,
2019 |
%
change |
|||||||||||||||||||
Net Sales:
|
||||||||||||||||||||||||
Asia:
|
||||||||||||||||||||||||
China
|
$ | 89,816 | $ | 112,796 |
|
(20
|
%)
|
$ | 137,047 | $ | 202,887 |
|
(32
|
%)
|
||||||||||
Japan
|
41,230 | 45,958 |
|
(10
|
%)
|
86,319 | 89,462 |
|
(4
|
%)
|
||||||||||||||
Asia Other
|
77,163 | 80,081 |
|
(4
|
%)
|
143,923 | 146,998 |
|
(2
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Asia
|
208,209 | 238,835 |
|
(13
|
%)
|
367,289 | 439,347 |
|
(16
|
%)
|
||||||||||||||
Americas:
|
||||||||||||||||||||||||
United States
|
148,928 | 173,940 |
|
(14
|
%)
|
292,826 | 323,097 |
|
(9
|
%)
|
||||||||||||||
Americas Other
|
25,854 | 32,835 |
|
(21
|
%)
|
54,132 | 65,546 |
|
(17
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Americas
|
174,782 | 206,775 |
|
(15
|
%)
|
346,958 | 388,643 |
|
(11
|
%)
|
||||||||||||||
Europe
|
136,993 | 153,552 |
|
(11
|
%)
|
270,676 | 285,034 |
|
(5
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net sales
|
$ | 519,984 | $ | 599,162 |
|
(13
|
%)
|
$ | 984,923 | $ | 1,113,024 |
|
(12
|
%)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||||||||
June 27,
2020 |
June 29,
2019 |
%
change |
June 27,
2020 |
June 29,
2019 |
%
change |
|||||||||||||||||||
Pharmaceutical
|
$ | 311,018 | $ | 350,145 |
|
(11
|
%)
|
$ | 583,581 | $ | 644,657 |
|
(9
|
%)
|
||||||||||
Industrial
|
152,110 | 176,109 |
|
(14
|
%)
|
295,464 | 331,327 |
|
(11
|
%)
|
||||||||||||||
Academic and governmental
|
56,856 | 72,908 |
|
(22
|
%)
|
105,878 | 137,040 |
|
(23
|
%)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total net sales
|
$ | 519,984 | $ | 599,162 |
|
(13
|
%)
|
$ | 984,923 | $ | 1,113,024 |
|
(12
|
%)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||||||||||||||||
June 27, 2020
|
% of
Total |
June 29, 2019
|
% of
Total |
% change
|
||||||||||||||||
Waters instrument systems
|
$ | 181,399 |
|
39
|
%
|
$ | 238,777 |
|
45
|
%
|
|
(24
|
%)
|
|||||||
Chemistry consumables
|
95,105 |
|
20
|
%
|
100,292 |
|
19
|
%
|
|
(5
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Waters product sales
|
276,504 |
|
59
|
%
|
339,069 |
|
64
|
%
|
|
(18
|
%)
|
|||||||||
Waters service
|
189,205 |
|
41
|
%
|
192,048 |
|
36
|
%
|
|
(1
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Waters net sales
|
$ | 465,709 |
|
100
|
%
|
$ | 531,117 |
|
100
|
%
|
|
(12
|
%)
|
|||||||
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||||||||||||||||
June 27, 2020
|
% of
Total |
June 29, 2019
|
% of
Total |
% change
|
||||||||||||||||
Waters instrument systems
|
$ | 324,228 |
|
37
|
%
|
$ | 423,389 |
|
43
|
%
|
|
(23
|
%)
|
|||||||
Chemistry consumables
|
192,350 |
|
22
|
%
|
199,545 |
|
20
|
%
|
|
(4
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Waters product sales
|
516,578 |
|
59
|
%
|
622,934 |
|
63
|
%
|
|
(17
|
%)
|
|||||||||
Waters service
|
363,342 |
|
41
|
%
|
368,097 |
|
37
|
%
|
|
(1
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Waters net sales
|
$ | 879,920 |
|
100
|
%
|
$ | 991,031 |
|
100
|
%
|
|
(11
|
%)
|
|||||||
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||||||||||||||||
June 27, 2020
|
% of
Total |
June 29, 2019
|
% of
Total |
% change
|
||||||||||||||||
TA instrument systems
|
$ | 38,416 |
|
71
|
%
|
$ | 48,196 |
|
71
|
%
|
|
(20
|
%)
|
|||||||
TA service
|
15,859 |
|
29
|
%
|
19,849 |
|
29
|
%
|
|
(20
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total TA net sales
|
$ | 54,275 |
|
100
|
%
|
$ | 68,045 |
|
100
|
%
|
|
(20
|
%)
|
|||||||
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||||||||||||||||
June 27, 2020
|
% of
Total |
June 29, 2019
|
% of
Total |
% change
|
||||||||||||||||
TA instrument systems
|
$ | 72,525 |
|
69
|
%
|
$ | 84,834 |
|
70
|
%
|
|
(15
|
%)
|
|||||||
TA service
|
32,478 |
|
31
|
%
|
37,159 |
|
30
|
%
|
|
(13
|
%)
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total TA net sales
|
$ | 105,003 |
|
100
|
%
|
$ | 121,993 |
|
100
|
%
|
|
(14
|
%)
|
|||||||
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||||
June 27, 2020
|
June 29, 2019
|
|||||||
Net income
|
$ | 176,491 | $ | 253,396 | ||||
Depreciation and amortization
|
60,203 | 53,615 | ||||||
Stock-based compensation
|
18,122 | 19,255 | ||||||
Deferred income taxes
|
(777 | ) | 1,632 | |||||
Change in accounts receivable
|
86,978 | 52,508 | ||||||
Change in inventories
|
(27,089 | ) | (62,200 | ) | ||||
Change in accounts payable and other current liabilities
|
34,714 | (10,439 | ) | |||||
Change in deferred revenue and customer advances
|
37,558 | 54,672 | ||||||
Effect of the 2017 Tax Cuts & Jobs Act
|
— | (3,229 | ) | |||||
Other changes
|
(35,754 | ) | (56,407 | ) | ||||
|
|
|
|
|||||
Net cash provided by operating activities
|
350,446 | 302,803 | ||||||
Net cash (used in) provided by investing activities
|
(192,335 | ) | 785,063 | |||||
Net cash used in financing activities
|
(159,366 | ) | (1,294,734 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents
|
4,576 | (1,414 | ) | |||||
|
|
|
|
|||||
Increase (decrease) in cash and cash equivalents
|
$ | 3,321 | $ | (208,282 | ) | |||
|
|
|
|
• |
The changes in accounts receivable were primarily attributable to timing of payments made by customers and timing of sales. Days sales outstanding increased to 87 days at June 27, 2020 as compared to 79 days at June 29, 2019.
|
• |
The changes in inventory were primarily attributable to the reduction in the inventory build plan to adjust inventory levels for lower anticipated sales volume due to the
COVID-19
pandemic.
|
• |
The changes in accounts payable and other current liabilities were a result of the timing of payments to vendors, as well as the annual payment of management incentive compensation.
|
• |
Net cash provided from deferred revenue and customer advances results from annual increases in new service contracts as a higher installed base of customers renew annual service contracts.
|
• |
Other changes were attributable to variation in the timing of various provisions, expenditures, prepaid income taxes and accruals in other current assets, other assets and other liabilities.
|
• |
Risks related to the effects of the
COVID-19
pandemic on our business, including: portions of our global workforce being unable to work fully and/or effectively due to working remotely, illness, quarantines, government actions, facility closures or other reasons related to the pandemic, increased risks of cyber attacks resulting from our temporary remote working model, disruptions in our manufacturing capabilities or to our supply chain, volatility and uncertainty in global capital markets limiting our ability to access capital, customers being unable to make timely payment for purchases and volatility in demand for our products.
|
• |
Foreign currency exchange rate fluctuations that could adversely affect translation of the Company’s future sales, financial operating results and the condition of its
non-U.S.
operations, especially when a currency weakens against the U.S. dollar.
|
• |
Current global economic, sovereign and political conditions and uncertainties, particularly regarding the effect of the
COVID-19
pandemic; new or proposed tariffs or trade regulations or changes in the interpretation or enforcement of existing regulations; the U.K. voting to exit the European Union as well as the Chinese government’s ongoing tightening of restrictions on procurement by government-funded customers; the Company’s ability to access capital and maintain liquidity in volatile market conditions; changes in timing and demand for the Company’s products among the Company’s customers and various market sectors or geographies, particularly if they should reduce capital expenditures or are unable to obtain funding, as in the cases of governmental, academic and research institutions; the effect of mergers and acquisitions on customer demand for the Company’s products; and the Company’s ability to sustain and enhance service.
|
• |
Negative industry trends; changes in the competitive landscape as a result of changes in ownership, mergers and continued consolidation among the Company’s competitors; introduction of competing products by other companies and loss of market share; pressures on prices from customers or resulting from competition; regulatory, economic and competitive obstacles to new product introductions; lack of acceptance of new products; expansion of our business in developing markets; spending by certain
end-markets;
ability to obtain alternative sources for components and modules; and the possibility that future sales of new products related to acquisitions, which trigger contingent purchase payments, may exceed the Company’s expectations.
|
• |
Increased regulatory burdens as the Company’s business evolves, especially with respect to the United States Food and Drug Administration and the United States Environmental Protection Agency, among others, as well as regulatory, environmental and logistical obstacles affecting the distribution of the Company’s products, completion of purchase order documentation by our customers and ability of customers to obtain letters of credit or other financing alternatives.
|
• |
Risks associated with lawsuits, particularly involving claims for infringement of patents and other intellectual property rights.
|
• |
The impact and costs incurred from changes in accounting principles and practices; the impact and costs of changes in statutory or contractual tax rates in jurisdictions in which the Company operates, specifically as it relates to the 2017 Tax Act in the U.S.; shifts in taxable income among jurisdictions with different effective tax rates; and the outcome of and costs associated with ongoing and future tax audit examinations or changes in respective country legislation affecting the Company’s effective rates.
|
Period
|
Total Number
of Shares Purchased (1) |
Average
Price Paid per Share |
Total Number of
Shares Purchased as Part of Publicly Announced Programs |
Maximum Dollar
Value of Shares that May Yet Be Purchased Under the Programs (2) |
||||||||||||||
March 29, 2020 to April 25, 2020
|
— | $ | — | — | $ | 1,524,905 | ||||||||||||
April 26, 2020 to May 23, 2020
|
— | $ | — | — | $ | 1,524,905 | ||||||||||||
May 24, 2020 to June 27, 2020
|
— | $ | — | — | $ | 1,524,905 | ||||||||||||
|
|
|
|
|||||||||||||||
Total
|
— | $ | — | — | $ | 1,524,905 | ||||||||||||
|
|
|
|
(1) |
The Company repurchased less than one thousand shares of common stock at a cost of less than $1 million related to the vesting of restricted stock during the three months ended June 27, 2020.
|
(2) |
In January 2019, the Company’s Board of Directors authorized the Company to repurchase up to $4 billion of its outstanding common stock in open market or private transactions over a
two-year
period. This new program replaced the remaining amounts available under the
pre-existing
authorization. During the second quarter of 2020, the Company has temporarily suspended its share repurchases due to the uncertain business conditions caused by the
COVID-19
pandemic.
|
(*) |
This exhibit shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any filing, except to the extent the Company specifically incorporates it by reference.
|
WATERS CORPORATION | ||
/s/ Sherry L. Buck
|
||
Sherry L. Buck
|
||
Senior Vice President and
Chief Financial Officer
|
Exhibit 10.1
TRANSITION AND SEPARATION AGREEMENT
This Transition and Separation Agreement (the Agreement) is by and between Christopher J. OConnell (the Executive) and Waters Corporation, a corporation organized under the laws of the State of Delaware (the Company).
WHEREAS, the Executive and the Company are party to that certain offer letter dated as of June 23, 2015 (the Offer Letter); and
WHEREAS, the Executive will separate from his position as President and Chief Executive Officer of the Company effective as of the Transition Date and as an employee of the Company effective as of the Separation Date (each, as defined below).
NOW, THEREFORE, for the promises and covenants set forth herein and for such other good and valuable consideration, the receipt of which is hereby acknowledged, the Executive and the Company enter into this Agreement on the following terms and conditions:
1. Transition; Separation. The Executive will continue to be employed as the President and Chief Executive Officer of the Company from the date of this Agreement through the earlier of (i) the date on which a new Chief Executive Officer has commenced employment and (ii) December 31, 2020 (the Transition Date). If the Transition Date occurs before December 31, 2020, the Executive will continue to be employed by the Company as a full-time employee of the Company, and a Senior Advisor to the Chief Executive Officer, from the Transition Date through December 31, 2020 (unless earlier terminated by the Company for Cause (as defined in the Offer Letter) or by the Executive for any reason, which termination by Executive shall not be treated as noncompliance with this Agreement) (the date of the Executives actual termination of employment with the Company, including in the event of Executives death or Disability (as defined in the Offer Letter), the Separation Date). The parties also agree that if the Transition Date is December 31, 2020, the Separation Date will also be December 31, 2020. For the avoidance of doubt, prior to the Separation Date, the Executives employment with the Company will continue to be governed in all respects with the terms and conditions set forth in the Offer Letter, provided that, (i) the change in the Executives duties and responsibilities as contemplated by this Agreement shall in no event constitute Good Reason for purposes of the Offer Letter or any other agreement or arrangement by and between the Executive and the Company or any of its affiliates, including but not limited to that certain Change of Control/Severance Agreement by and between the Executive and the Company, dated September 8, 2015 (the Severance Agreement), and (ii) the Executive will not initiate or otherwise engage in any discussions regarding a potential merger, consolidation or similar transaction regarding the Company or any of its subsidiaries, and the Executive acknowledges that such discussions will be the exclusive responsibility of the Board following the execution of this Agreement. Effective as of the Transition Date (unless otherwise mutually agreed by the parties), the Executive will resign (and will be deemed to have resigned without any further action by the Executive) from his position as the President and Chief Executive Officer of the Company, and, except as expressly provided in this Section 1, from all of the Executives positions with the Company and its affiliates (and as a fiduciary of any benefit plan of the Company and its affiliates), including, without limitation, as a member of the Board of Directors of the Company (the Board). The Executive shall execute such additional documents as reasonably requested by the Company to evidence the foregoing resignations.
For the avoidance of doubt, in order to receive the Severance Benefits (as defined below), the Executive must not voluntarily terminate his employment prior to the Transition Date (other than in the event of Good Reason as modified above or a material breach of this Agreement by the Company, subject, in each case, to the notice and cure provisions set forth in the definition of Good Reason as provided in the Offer Letter); provided, however, that in the event of the Executives death or Disability (or termination for Good Reason as modified above or as a result of a material breach of this Agreement by the Company, subject, in each case, to the notice and cure provisions set forth in the definition of Good Reason as provided in the Offer Letter), the Executive (or the Executives estate) will be entitled to receive the Severance Benefits in accordance with the terms of this Agreement.
2. Final Compensation; Severance; Survival of Rights and Obligations.
(a) Final Compensation. Within thirty (30) business days following the Separation Date (or such earlier time as may be required by applicable law), the Company shall pay the Executive (i) the Executives Base Salary (as defined in the Offer Letter) for the final payroll period of the Executives employment through the Separation Date, (ii) any vacation time earned but not used as of the Separation Date, (iii) reimbursement for business expenses incurred by the Executive but not yet paid to the Executive as of the Separation Date; provided that the Executive submits all expenses and supporting documentation required within sixty (60) days of the Separation Date, and provided further that such expenses are reimbursable under Company policies as then in effect; and (iv) any amounts or benefits due to the Executive under any benefit or equity plan, program or arrangement in accordance with the terms of such plan, program or arrangement. In addition, the Executive will be entitled to a prorated (or full) portion (calculated based on the number of days in calendar year 2020 prior to the Separation Date) of the annual bonus under the MIP (as defined in the Offer Letter) for calendar year 2020, to the extent that an annual bonus would have been earned by the Executive under the MIP based on actual full-year performance had the Executive remained employed through the end of calendar year 2020, which will be paid when such bonuses are paid to active employees. The Executive shall also receive his vested and accrued benefits pursuant to the terms of any applicable Company employee benefit plans, which vested and accrued benefits shall be paid or provided to the Executive in accordance with the terms of such applicable Company employee benefit plans
(b) Severance Payments. Provided that the Second Release Effective Date occurs, and subject to the Executives compliance in all material respects with the terms and conditions of this Agreement (provided, that, in the event of any noncompliance, the Company provides Executive with written notice of such noncompliance and not less than ten (10) days to cure such noncompliance if capable of cure), the Company agrees to pay to Executive $4,252,500.00, which represents two (2) times the sum of the Executives (i) annual base salary rate for calendar year 2020, and (ii) target annual incentive compensation opportunity for calendar year 2020 (such payments, less applicable federal, state, and local withholdings, taxes and any other deductions required by law, the Severance Payment), which shall be paid in substantially equal installments in accordance with the Companys regular payroll practices during the twenty- four (24) -month period commencing on the first regularly scheduled pay period following the
2
Second Release Effective Date, but in no event later than the date that is sixty (60) days following the Separation Date, with the first payment of the Severance Payments to include payment of any portion of the Severance Payments that were otherwise scheduled to be paid prior thereto; provided that if such sixty (60) -day period begins in one calendar year and ends in the next calendar year, the Severance Payments shall commence in the second calendar year even if the Second Release Effective Date occurs in the first calendar year (with the first payment of the Severance Payments to include payment of any portion of the Severance Payments that were otherwise scheduled to be paid prior thereto).
(c) Health Payment. Provided that the Second Release Effective Date occurs, and subject to the Executives compliance with the terms and conditions of this Agreement, the Company agrees to pay to Executive an amount equal to the amount the Company would have paid in premiums under the life, accident, health and dental insurance plans of the Company in which the Executive (and the Executives dependents) were participating as of the Separation Date for the twenty-four (24) -month period following the Separation Date (such payment, as determined based on the premium rates in effect as of the Separation Date, less applicable federal, state, and local withholdings, taxes and any other deductions required by law, the Health Payment, and together with the Severance Payments and the stock option extension described in Section 2(d), collectively, the Severance Benefits), which shall be paid in one lump sum payment in accordance with the Companys regular payroll practices on the first regularly scheduled pay period following the Second Release Effective Date.
(d) Equity Awards. Executives rights with respect to any outstanding equity awards will be governed by the terms and conditions of the governing plan and award agreements; provided that, if the Second Release Effective Date occurs, the Executives then vested portion of the Executives stock options with a grant date of December 5, 2017 and December 10, 2018, respectively, shall remain outstanding and exercisable until the one (1)-year anniversary of the Separation Date, subject to the Executives compliance with the Continuing Obligations, and the governing award agreements shall be deemed amended to so provide.
(e) No Other Compensation; Severance Agreement. The Executive acknowledges and agrees that the payments provided pursuant to this Agreement are in full discharge of any and all liabilities and obligations of the Company and its affiliates to the Executive, monetarily or with respect to employee benefits or otherwise, including, but not limited to, any and all obligations arising under the Offer Letter, any alleged written or oral employment agreement, policy, plan or procedure of the Company and its affiliates and/or any alleged understanding or arrangement between the Executive and the Company. Notwithstanding the foregoing, for the avoidance of doubt, the Executive retains the right to receive all payments and benefits, if any, that may become due under the Severance Agreement, which shall be paid or provided to the Executive in accordance with the terms of the Severance Agreement.
3
3. Release.
(a) In consideration for the payments and benefits to be provided to the Executive pursuant to this Agreement and pursuant to the Offer Letter, which are conditioned on the Executives execution of this Agreement, and to which the Executive not otherwise entitled, and other good and valuable consideration, the receipt and sufficiency of which the Executive hereby acknowledges, on the Executives own behalf and on behalf of the Executives heirs, executors, administrators, beneficiaries, representatives, successors and assigns, and all others connected with or claiming through the Executive, the Executive hereby releases and forever discharges the Company and its affiliates, and all of their respective past, present and future officers, directors, shareholders, employees, employee benefits plans, administrators, trustees, agents, representatives, consultants, successors and assigns, and all those connected with any of them, in their official and individual capacities (collectively, the Released Parties), from any and all causes of action, suits, rights and claims, demands, damages and compensation of any kind and nature whatsoever, whether at law or in equity, whether now known or unknown, suspected or unsuspected, contingent or otherwise, which the Executive now has or ever has had against the Released Parties, or any of them, in any way related to, connected with or arising out of the Executives employment and/or other relationship with the Company or any of its affiliates, or pursuant to Title VII of the Civil Rights Act, the Americans With Disabilities Act, the Family and Medical Leave Act, the Age Discrimination in Employment Act (as amended by the Older Workers Benefit Protection Act), the Employee Retirement Income Security Act, the wage and hour laws, wage payment and fair employment practices laws of the state or states in which the Executive has provided services to the Company (each as amended from time to time) and/or any other federal, state or local law, regulation, or other requirement (collectively, the Claims) through the date that the Executive signs this Agreement, and the Executive hereby waives all such Claims.
(b) The Executive understands that nothing contained in this Section 3 shall be construed to prohibit the Executive from filing a charge with or participating in any investigation or proceeding conducted by the federal Equal Employment Opportunity Commission or a comparable state or local agency; provided, however, that the Executive hereby agrees to waive the Executives right to recover monetary damages or other individual relief in any charge, complaint or lawsuit filed by the Executive or by anyone else on the Executives behalf. The Executive further understands that nothing contained in this Section 3 shall be construed to limit, restrict or in any other way affect the Executives communicating with any governmental agency or entity, or communicating with any official or staff person of a governmental agency or entity, concerning non-privileged matters relevant to the governmental agency or entity. For the avoidance of doubt, no provision of this Agreement shall be construed as prohibiting or restricting the Executive (or the Executives attorney) from responding to any inquiry about this Agreement or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), any other self-regulatory organization or any governmental entity. 18 U.S.C. § 1833(b) provides: An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that(A) is made(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, the parties to this Agreement have the right to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.
4
(c) The Executive acknowledges that the Executive will continue to be bound by the Executives obligations under the Offer Letter that survive the termination of the Executives employment on the Separation Date by the terms thereof or by necessary implication, including without limitation the Restrictive Covenants (all of the foregoing obligations, the Continuing Obligations). The Executive further acknowledges that the obligation of the Company to pay or provide the Severance Benefits, and the Executives right to retain the same, are expressly conditioned upon the Executives continued performance of the Executives obligations hereunder and of the Continuing Obligations.
(d) The Executive understands that nothing contained in this Section 3 will adversely affect the Executives rights to enforce the terms of this Agreement or the Severance Agreement, and shall not adversely affect the Executives right to any indemnification coverage under the Companys directors and officers liability insurance policy in accordance with its terms or right to reimbursement of expenses by the Company to which the Executive would otherwise be entitled to under, without limitation, any charter document or Company insurance policy, by reason of services the Executive rendered for the Company or any of its subsidiaries as an officer and/or an employee thereof.
(e) Subject to Section 3(b), the Executive agrees that the Executive will not disparage or criticize the Company, its affiliates, their business, their directors, management or their products or services. The Company agrees that no member of the Board or any executive officer of the Company will disparage or criticize the Executive. Notwithstanding the foregoing, nothing contained in this Section 3(e) shall preclude the Executive or the Company (or its directors or executive officers) from making truthful statements that are required by applicable law, regulation or governmental investigation or are pursuant to legal process. The provisions of this Section 3(e) shall expire on the second (2nd) anniversary of the Separation Date.
(f) The Board acknowledges and represents that, as of the date this Agreement is executed, the Board is unaware of the existence of any claims that the Company may have against the Executive.
4. Return of Company Property. All correspondence, records, documents, software, promotional materials, and other Company property, including all copies, which came into the Executives possession by, through or in the course of Executives employment, regardless of the source and whether created by the Executive, are the sole and exclusive property of the Company, and immediately upon the Separation Date, or any time prior thereto at the Companys request, the Executive shall return to the Company all such property of the Company. Notwithstanding the foregoing, the Executive may retain his contacts and calendar along with his Company-provided laptop, printer, iPad and phone. The Company may have an IT specialist scrub such equipment for any proprietary or confidential information on or immediately prior to the Separation Date.
5. Publicity. The Executive shall not issue, without consent of the Company, any press release or make any public announcement with respect to this Agreement.
5
6. No Assignments; Binding Effect. Except as provided in this Section 6, no party may assign or delegate any rights or obligations hereunder without first obtaining the written consent of the other party hereto. The Company shall assign this Agreement to any successor to all or substantially all of the operations and/or assets of the Company. As used in this Agreement, the term Company shall mean the Company and any successor to its operations and/or assets, which assumes and agrees to perform the duties and obligations of the Company under this Agreement by operation of law or otherwise. This Agreement is binding upon, and shall inure to the benefit of, the parties and their respective heirs, executors and administrators (including the Executives estate or designated beneficiary, in the event of the Executives death), and their respective permitted successors and assigns.
7. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the principles of conflicts of law thereof.
8. Venue. The Executive and the Company agree to submit to the exclusive jurisdiction of the courts of the Commonwealth of Massachusetts in connection with any dispute arising out of this Agreement.
9. Entire Agreement; Restrictive and Other Covenants.
(a) The Executive understands that this Agreement, all relevant plans referred to herein and the sections of the Offer Letter and Severance Agreement that survive termination, including but not limited to Section 3 of the Offer Letter, constitute the complete understanding between the Company and the Executive, and, except as specifically provided herein, supersedes any and all agreements, understandings, and discussions, whether written or oral, between the Executive and any of the Released Parties. No other promises or agreements shall be binding unless in writing and signed by both the Company and the Executive.
(b) Notwithstanding the foregoing, Section 3 of the Offer Letter shall survive in accordance with their terms. For the avoidance of doubt, Executive agrees to comply at all times with Section 3 of the Offer Letter.
10. Notices. All notices, demands and other communications to be given or delivered under or by reason of the provisions of this Agreement shall be done in accordance with Section 15 of the Offer Letter.
11. Miscellaneous. This Agreement is not intended, and shall not be construed, as an admission that any of the Released Parties has violated any federal, state or local law (statutory or decisional), ordinance or regulation, breached any contract or committed any wrong whatsoever against the Executive. Should any provision of this Agreement require interpretation or construction, it is agreed by the parties that the entity interpreting or constructing this Agreement shall not apply a presumption against one party by reason of the rule of construction that a document is to be construed more strictly against the party who prepared the document. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. Neither party shall be deemed to have made any admission of wrongdoing as a result of executing this Agreement.
6
12. Withholding; Code Section 409A. Withholding. The Company may withhold from any and all amounts payable to the Executive under this Agreement such federal, state or local taxes as may be required to be withheld pursuant to any applicable law or regulation and any authorized or required reductions.
(b) Section 409A. The intent of the parties is that all payments, compensation and benefits contemplated hereunder that are subject to Section 409A (as defined in the Offer Letter) will be paid or provided in compliance with Section 409A, and the provisions of this Agreement shall be construed and administered in accordance with and to implement such intent. The provisions of the Offer Letter relating to Section 409A, including Section 9 of the Offer Letter, are hereby incorporated into this Agreement with full force and effect.
13. Executive Acknowledgements. The Executive acknowledges that the Executive: (a) has carefully read this Agreement in its entirety; (b) has had an opportunity to consider this Agreement for twenty-one (21) days; (c) fully understands the significance of all of the terms and conditions of this Agreement; (d) has been advised to consult with an attorney before executing this Agreement and the Executive has done so or, after careful reading and consideration, has chosen not to do so of the Executives own volition; and (e) is entering into this Agreement, knowingly, freely and voluntarily in exchange for good and valuable consideration to which the Executive would not be entitled in the absence of executing and not revoking this Agreement.
14. Initial Consideration and Revocation Period; Effectiveness. The Executive understands that the Executive will have twenty-one (21) days from the date of receipt of this Agreement to consider the terms and conditions of this Agreement. The Executive understands that the Executive may execute this Agreement less than twenty-one (21) days from its receipt from the Company, but agrees that such execution will represent the Executives knowing waiver of such consideration period. The Executive may accept this Agreement by signing it and returning it to the Companys General Counsel, within such twenty-one (21) day period. After executing this Agreement, the Executive shall have seven (7) days (the Revocation Period) to revoke this Agreement by indicating the Executives desire to do so in writing delivered to the Companys General Counsel by no later than the seventh (7th) day after the date that the Executive signs this Agreement. The effective date of this Agreement shall be the eighth (8th) day after the Executive signs this Agreement (the Effective Date). In the event that the Executive does not accept this Agreement as set forth above, or in the event that the Executive revokes this Agreement during the Revocation Period, this Agreement shall be deemed automatically null and void.
15. Re-Execution of Agreement. The Companys obligations under Sections 2(b), 2(c) and 2(d) of this Agreement are strictly contingent upon the Executives re-execution and non- revocation of this Agreement within twenty-one (21) days following the Separation Date. The date of the Executives re-execution of this Agreement is referred to herein as the Re-Execution Date. By re-executing this Agreement, the Executive advances to the Re-Execution Date Executives general waiver and release of all Claims against the Released Parties and the other covenants set forth in Section 3 of this Agreement. The Executive shall have seven (7) calendar days from the Re-Execution Date to revoke his re-execution of this Agreement by indicating the Executives desire to do so in writing delivered to the Companys General Counsel by no later than the seventh (7th) day after the Re-Execution Date. In the event of no revocation by the Executive, the date of the releases and covenants set forth in Section 3 of this Agreement shall be
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advanced through the Re-Execution Date on the eighth (8th) day after the Re-Execution Date (the Second Release Effective Date). In the event of such revocation by the Executive, the date of the releases and covenants set forth in Section 3 of this Agreement shall not be advanced, but shall remain effective up to and including the date upon which Executive originally signs this Agreement and the Company shall not be obligated to provide the consideration in Sections 2(b), 2(c) and 2(d) of this Agreement.
16. Third Party Beneficiaries. The Released Parties are intended third-party beneficiaries of this Agreement, and this Agreement may be enforced by each of them in accordance with the terms hereof in respect of the rights granted to such Released Parties hereunder. Except and to the extent set forth in the preceding sentence and as otherwise set forth in this Agreement, this Agreement is not intended for the benefit of any person other than the parties hereto, and no such other person or entity shall be deemed to be a third party-beneficiary hereof. Without limiting the generality of the foregoing, it is not the intention of the Company to establish any policy, procedure, course of dealing, or plan of general application for the benefit of or otherwise in respect of any other employee, officer, director, or stockholder, irrespective of any similarity between any contract, agreement, commitment, or understanding between the Company and such other employee, officer, director, or stockholder, on the one hand, and any contract, agreement, commitment, or understanding between the Company and the Executive, on the other hand, and irrespective of any similarity in facts or circumstances involving such other employee, officer, director, or stockholder, on the one hand, and the Executive, on the other hand.
17. Counterpart Agreements. This Agreement may be signed in counterparts, and by facsimile or e-mail transmission, all of which shall be considered as original documents and which together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Transition and Separation Agreement as of the date set forth below.
WATERS CORPORATION | ||||||
By: |
/s/ Sherry L. Buck |
Dated: June 17, 2020 | ||||
Name: Sherry L. Buck | ||||||
Title: Senior Vice President and Chief Financial Officer | ||||||
EXECUTIVE | ||||||
By: |
/s/ Christopher J. OConnell |
Dated: June 17, 2020 | ||||
Print Name: Christopher J. OConnell |
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RE-EXECUTED (ON OR FOLLOWING THE SEPARATION DATE) | Dated: , 20 | |||
|
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Print Name: Christopher J. OConnell |
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Exhibit 10.2
July 14, 2020
Mr. Udit Batra
Dear Udit:
This letter (the Agreement) confirms the terms and conditions of your employment with Waters Corporation (the Company).
1. Position and Duties.
(a) Effective as of September 1, 2020 (the Start Date), you will be employed by the Company, on a full-time basis, as its President and Chief Executive Officer and you shall report solely to the Board of Directors of the Company (the Board). In addition to serving as the Companys President and Chief Executive Officer, you will be appointed to serve as a member of the Board effective as of the Start Date. Thereafter, for so long as you remain employed by the Company as its Chief Executive Officer, at each annual meeting of the Companys stockholders, the Board or a committee thereof shall nominate you to serve as a member of the Board and you shall so serve if elected or reelected without further compensation, subject to receiving the required approval of the Companys stockholders and compliance with the Companys policies applicable to Board members generally. At the time you cease to be employed as the Chief Executive Officer of the Company for any reason, you shall resign from the Board effective immediately upon such cessation. In addition, you may be asked from time to time to serve as a director or officer of one or more of the Companys Affiliates, without further compensation. For purposes of this Agreement, Affiliates means all persons and entities directly or indirectly controlling, controlled by or under common control with the Company.
(b) In your capacity as President and Chief Executive Officer of the Company, you shall have the duties, responsibilities and authorities that are commensurate with the duties, authorities and responsibilities of chief executive officers of similar size and type companies and such other duties, responsibilities and authorities as may reasonably be assigned to you by the Board from time to time that are not inconsistent with your position. You agree that, while employed by the Company, you will devote your full business time and your best efforts, business judgment, skill and knowledge exclusively to the advancement of the business interests of the Company and its Affiliates and to the discharge of your duties and responsibilities for them. Notwithstanding the foregoing, you shall be permitted to engage in civic, charitable and philanthropic activities, manage your passive personal investments, and with the consent of the Board, to serve on the board of directors of for and not-for-profit companies or organizations, provided that, in the aggregate, such activities do not interfere or conflict with your duties to the Company. All employees of the Company shall report, directly or indirectly, to you or one of your designees.
(c) Further, you agree that, while employed by the Company, you will comply with all written Company policies, practices and procedures and all codes of ethics or business conduct policies applicable to your position, as in effect from time to time.
2. Compensation and Benefits. During your employment, as compensation for all services performed by you for the Company and its Affiliates, the Company will provide you the following pay and benefits:
(a) Base Salary. The Company shall pay you a base salary at the rate of $1,000,000 per year, payable in accordance with the regular payroll practices of the Company and subject to annual review and increase (not decrease, except as would not constitute Good Reason as contemplated by Section 4(d)(ii)) by the Compensation Committee of the Board (the Compensation Committee) (such base salary, as in effect from time to time, Base Salary). Your Base Salary may be subject to earlier review by the Compensation Committee at its meeting expected to be held in February 2021.
(b) Annual Incentive Compensation. For each fiscal year completed during your employment under this Agreement, you will be eligible to earn annual incentive compensation under the Companys Annual Incentive Plan, or such other bonus plan in which Company executives participate generally (such plan, as in effect from time to time, the AIP). Your target annual incentive compensation opportunity will be 125% of your Base Salary, with a maximum annual incentive compensation opportunity of 250% of your Base Salary. The actual amount payable in respect of your annual incentive compensation opportunity, if any, for any fiscal year will be determined by the Compensation Committee based on the achievement of performance goals previously established by the Compensation Committee in its discretion. Any annual incentive compensation due hereunder will be paid in accordance with the terms of the AIP and on or before March 15th of the year following the fiscal year with respect to which the annual incentive compensation is earned, subject to your remaining employed by the Company on the date that such annual incentive compensation is paid, except as otherwise provided herein. For the 2020 fiscal year, your annual incentive compensation, to the extent earned, will be prorated based on the number of days you are employed by the Company during such fiscal year.
(c) 2021 Equity Grant. For the 2021 fiscal year, pursuant to the approval of the Compensation Committee at the time annual equity awards are granted to executives of the Company generally (anticipated to be at the Compensation Committee meeting expected to be held in February 2021), you will be granted an award or combination of equity awards under the Companys 2020 Equity Incentive Plan (as in effect from time to time, including any successor plan, the EIP) having a grant date fair value (determined using the Companys customary assumptions for other executive awards) on the date of grant of $5,000,000 (the 2021 Equity Award). The 2021 Equity Award will be structured in the same form and subject to the same terms and conditions as those provided to other executive officers of the Company. To be eligible to receive the 2021 Equity Award, you must be employed by the Company on the date the award is granted.
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(d) Future Equity Grants. After 2021, you will be eligible for annual equity grants under the EIP at such times and in such form as determined by the Compensation Committee in its discretion.
(e) Sign-on Awards. Pursuant to the approval of the Compensation Committee, you will be granted:
(i) on the Start Date, a restricted stock unit award under the EIP, with the number of restricted stock units subject to the award determined by dividing $2,500,000 by the closing price of a share of Common Stock on the date of grant (the Sign-On RSU Award). The Sign-On RSU Award will vest as to 1/3 of the award on each of the first three (3) anniversaries of the Start Date, subject to your continued employment on each vesting date (except as expressly provided in the award agreement evidencing the grant of the Sign-On RSU Award, including full vesting of the unvested portion of the Sign-On RSU Award upon any termination of your employment by the Company without Cause or by you for Good Reason (as each such term is defined below)). The Sign-On RSU Award will be subject to the terms and conditions of the EIP and the award agreement evidencing its grant in the form attached hereto as Exhibit A consistent with the above terms.
(ii) on the Start Date, a non-qualified stock option award under the EIP, having a Black-Scholes value on the date of grant of $2,500,000, with the number of shares of Common Stock underlying the stock option determined using Black-Scholes assumptions in effect in the month of grant and an exercise price equal to the closing price of a share of Common Stock on the date of grant (the Sign-On Option Award). The Sign-On Option Award will vest as to 20% of the shares of Common Stock underlying the award on each of the first (5) five anniversaries of the Start Date, subject to your continued employment on each vesting date (except as expressly provided in the award agreement evidencing the grant of the Sign-On Option Award, including full vesting of the unvested portion of the Sign-On Option Award upon any termination of your employment by the Company without Cause or by you for Good Reason). The Sign-On Option Award will be subject to the terms and conditions of the EIP and the award agreement evidencing its grant in the form attached hereto as Exhibit B consistent with the above terms.
(f) Participation in Employee Benefit Plans. You will be entitled to participate in all employee benefit plans or programs and personal benefits from time to time in effect for executives of the Company generally, except to the extent such plans are duplicative of benefits otherwise provided to you under this Agreement. Your participation will be subject to the terms of the applicable plan or program documents and generally applicable Company policies, as the same may be in effect from time to time, and any other restrictions or limitations imposed by law.
(g) Vacations. You will be entitled to earn up to five (5) weeks of vacation per year, in addition to holidays observed by the Company. Vacation may be taken at such times and intervals as you shall determine, subject to the business needs of the Company. Vacation shall otherwise be subject to the policies of the Company, as in effect from time to time.
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(h) Business Expenses. The Company will pay or reimburse you for all reasonable business expenses incurred or paid by you in the performance of your duties and responsibilities for the Company, subject to any restrictions on such expenses set by the Company and to such reasonable substantiation and documentation as may be specified from time to time. Your right to payment or reimbursement for expenses hereunder shall be subject to the following additional rules: (i) the amount of expenses eligible for payment or reimbursement during any calendar year shall not affect the expenses eligible for payment or reimbursement in any other calendar year, (ii) payment or reimbursement shall be made not later than December 31 of the calendar year following the calendar year in which the expense or payment was incurred, and (iii) the right to payment or reimbursement is not subject to liquidation or exchange for any other benefit.
(i) Professional Fees. The Company will reimburse you for up to $35,000 in the aggregate for reasonable legal and other professional advisor fees you incur in connection with the negotiation of this Agreement, the Change of Control Agreement (as defined below), the agreements attached hereto as exhibits and your commencement of employment with the Company. The Company will reimburse your legal and other professional fees within thirty (30) days of your submission of reasonably satisfactory documentation of such fees.
3. Confidential Information and Restricted Activities.
(a) Confidential Information. During the course of your employment with the Company, you will learn of Confidential Information, as defined below, and you may develop Confidential Information on behalf of the Company and its Affiliates. You agree that you will not use or disclose to any Person, as defined below, (except as required by applicable law or for the good faith performance of your duties and responsibilities for the Company) any Confidential Information obtained by you incident to your employment or any other association with the Company or any of its Affiliates. You agree that this restriction shall continue to apply after your employment terminates, regardless of the reason for such termination. For purposes of this Agreement, Confidential Information means any and all information of the Company and its Affiliates that is not generally available to the public. Confidential Information also includes any information received by the Company or any of its Affiliates from any Person with any understanding, express or implied, that it will not be disclosed. Confidential Information does not include information that enters the public domain, other than through your breach of your obligations under this Agreement. Notwithstanding anything to the contrary herein, nothing in this Agreement shall be construed to prohibit you from reporting possible violations of federal or state law or regulations to any governmental agency or self-regulatory organization, or making other disclosures that are protected under whistleblower or other provisions of applicable federal or state law or regulations. You shall not need the prior authorization of the Company or the Companys legal department to make any such reports or disclosures and you are not required to notify the Company that you have made such reports or disclosures. For purposes of this Agreement, Person means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust or any other entity or organization, other than the Company or any of its Affiliates.
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(b) Protection of Documents. All documents, records and files, in any media of whatever kind and description, relating to the business, present or otherwise, of the Company or any of its Affiliates, and any copies, in whole or in part, thereof (the Documents), whether or not prepared by you, shall be the sole and exclusive property of the Company. You agree to safeguard all Documents and to surrender to the Company, at the time your employment terminates or at such earlier time or times as the Board or its designee may specify, all Documents then in your possession or control; provided that you will be entitled to retain your personal address book to the extent it only contains contact information (other than Company address lists). You also agree to disclose to the Company, at the time your employment terminates or at such earlier time or times as the Board or its designee may specify, all passwords necessary or desirable to obtain access to, or that would assist in obtaining access to, any information which you have password-protected on any computer equipment, network or system of the Company or any of its Affiliates.
(c) Assignment of Rights to Intellectual Property. You shall promptly and fully disclose all Intellectual Property to the Company. You hereby assign and agree to assign to the Company (or as otherwise directed by the Company) your full right, title and interest in and to all Intellectual Property. You agree to execute any and all applications for domestic and foreign patents, copyrights or other proprietary rights and to do such other acts (including without limitation the execution and delivery of instruments of further assurance or confirmation) requested by the Company to assign the Intellectual Property to the Company and to permit the Company to enforce any patents, copyrights or other proprietary rights to the Intellectual Property. You will not charge the Company for time spent in complying with these obligations. All copyrightable works that you create during your employment shall be considered work made for hire and shall, upon creation, be owned exclusively by the Company. For purposes of this Agreement, Intellectual Property means inventions, discoveries, developments, methods, processes, compositions, works, concepts and ideas (whether or not patentable or copyrightable or constituting trade secrets) conceived, made, created, developed or reduced to practice by you (whether alone or with others, whether or not during normal business hours or on or off Company premises) during your employment that relate either to the business of the Company or to any prospective activity of the Company or any of its Affiliates or that result from any work performed by you for the Company or any of its Affiliates or that make use of Confidential Information or any of the equipment or facilities of the Company or any of its Affiliates.
(d) Trade Secrets. 18 U.S.C. § 1833(b) provides: An individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that(A) is made(i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, the parties to this Agreement have the right to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.
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(e) Restricted Activities. You acknowledge that by virtue of your employment with the Company or any of its Affiliates, you will provide services or have a material presence or influence in every country, city, county and other locale in which the Company or any of its Affiliates provides services or has a material presence or influence during the last two (2) years of your employment with the Company or any of its Affiliates (the Restricted Area). You agree that the following restrictions on your activities during and after your employment are necessary to protect the good will, Confidential Information, trade secrets and other legitimate interests of the Company and its Affiliates and are supported by mutually agreed upon fair, reasonable, valid and sufficient consideration:
(i) While you are employed by the Company and for (a) one (1) year after your termination of employment for any reason, except as provided in clause (b), or (b) two (2) years following your termination of your employment if, at any time, you have breached any fiduciary duty to the Company or its Affiliates or have engaged in an Unlawful Taking of Company Property (as defined below), (either such period, as applies, the Non-Compete Restricted Period), you shall not, directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with the Company or any of its Affiliates or undertake any planning for any business that is competitive with the business of the Company or any of its Affiliates in the Restricted Area in a Restricted Position. Specifically, but without limiting the foregoing, you agree not to work or provide services, in any capacity, whether as an employee, independent contractor or otherwise, whether with or without compensation, to any Person that is engaged in any business that is competitive with the business of the Company or its Affiliates, as conducted or in planning (provided such planning has been approved by the Board) during your employment with the Company anywhere in the Restricted Area; provided, however, this Section 3(e)(i) will not apply after you are terminated without Cause for Purposes of Section 3(e)(i). Notwithstanding the foregoing, neither (x) nor (y), as provided below, shall be considered a violation of this Section 3(e)(i): (x) the ownership of not more than two percent (2%) of the outstanding securities of any class of any entity that is listed on a national securities exchange or quoted or traded in the over-the-counter market, or (y) the provision of services (as an employee, independent contractor or otherwise) to an entity where no more than a de minimis amount of revenue is derived from a business that is competitive with the business of the Company or any of its Affiliates, provided you are not responsible for (and do not participate in) the day-to-day management or supervision of such business and provided you do not have direct (which shall not mean indirect) supervision over the individual or individuals who are so responsible for such day-to-day management or supervision.
(ii) While you are employed by the Company and during the two (2)- year period immediately following termination of your employment, regardless of the reason therefor (the Restricted Period), you will not directly or indirectly, except in the good faith performance of your duties to the Company, (a) solicit or encourage any customer of the Company or any of its Affiliates to terminate or diminish its relationship with them; or (b) seek to persuade any such customer or prospective customer of the Company or any of its Affiliates to conduct with anyone else any business or activity which such customer or prospective customer conducts or could conduct with the Company or any of its Affiliates; provided, however, that these restrictions shall apply only with respect to those Persons who are or have been a customer of the Company or any of its Affiliates at any time within the immediately preceding one (1)- year period or whose business has been solicited on behalf of the Company or any of the Affiliates by any of their officers, employees or agents within such one (1)-year period, other than by form letter, blanket mailing or published advertisement.
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(iii) During the Restricted Period, you will not, and will not assist any other Person to, (a) hire or solicit for hiring any employee of the Company or any of its Affiliates or seek to persuade any employee of the Company or any of its Affiliates to discontinue employment or (b) solicit or encourage any independent contractor providing services to the Company or any of its Affiliates to terminate or diminish its relationship with them; provided, however, the foregoing shall not be violated by (x) following your termination of employment, serving solely as a reference for any employee of the Company or its Affiliates, (y) discussing with an employee his or her leaving employment with the Company and its Affiliates in the good faith performance of your duties to the Company or (z) general advertising or general solicitation for employment not specifically directed at the Companys employees. For the purposes of this Agreement, an employee or an independent contractor of the Company or any of its Affiliates is any person who was such at any time within the preceding one year.
(iv) In signing this Agreement, you give the Company assurance that you have carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed on you under this Section 3. You agree without reservation that these restraints are necessary for the reasonable and proper protection of the Company and its Affiliates, and that each and every one of the restraints is reasonable in respect to subject matter, length of time and geographic area. You further agree that, were you to breach any of the covenants contained in this Section 3, the damage to the Company and its Affiliates would be irreparable. You therefore agree that the Company, in addition to any other remedies available to it, shall be entitled to seek a preliminary and permanent injunctive relief against any breach or threatened breach by you of any of those covenants, without having to post bond. So that the Company may enjoy the full benefit of the covenants contained in this Section 3, you further agree that the Non-Compete Restricted Period and the Restricted Period, as applicable, shall be tolled, and shall not run, during the period of any breach by you of any such covenant contained in this Section 3. You and the Company further agree that, in the event that any provision of this Section 3 is determined by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area or too great a range of activities, that provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law. It is also agreed that each of the Companys Affiliates shall have the right to enforce all of your obligations to that Affiliate under this Agreement, including without limitation pursuant to this Section 3. Finally, no claimed breach of this Agreement or other violation of law attributed to the Company, or change in the nature or scope of your employment relationship with the Company or any of its Affiliates shall operate to excuse you from the performance of your obligations under this Section 3.
(f) Definitions. For purposes of this Agreement, the following terms will have the meanings set forth below:
Cause for Purposes of Section 3(e)(i) will exist if there is either (A) Cause, (B) a reasonable basis for the Companys dissatisfaction with you for reasons such as lack of capacity or diligence, failure to conform to usual standards of conduct, or other culpable or inappropriate behavior, or (C) grounds for termination exist that are reasonably related, in the Companys honest judgment, to the needs of the business.
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Restricted Position means the services provided by you to the Company or any of its Affiliates during the last two (2) years of your employment with the Company or any of its Affiliates.
Unlawful Taking of Company Property means your failure to (A) return to the Company or its Affiliate (as applicable), within five (5) days following your termination of employment for any reason, all Documents and physical property of the Company or any of its Affiliates, including but not limited to, any credit cards; work laptops, iPads, mobile phones, data storage devices of any kind or other computer or electronic equipment; employee identification materials; keys; documents, files, papers, memoranda, letters or other communications or work product; or work-related passwords or passcodes, in each case, which you have in your possession, custody or control that were written, created, authorized, signed, received or transmitted during your employment; and (B) at the direction of the Company, within ten (10) days following your termination of employment, either provide copies to the Company and then permanently delete the originals of, or permanently delete the originals of, all electronic property of the Company or any of its Affiliates, including, but not limited to, work files and emails, including, but not limited to, on any personal email account, personal computer, Dropbox account, zip drive, thumb drive, external hard drive, or cloud storage system.
4. Termination of Employment. Your employment under this Agreement shall continue until terminated pursuant to this Section 4.
(a) By the Company For Cause. The Company may terminate your employment for Cause upon notice to you setting forth in reasonable detail the nature of the cause. Cause shall mean: (i) the conviction of you by a court of competent jurisdiction of, or the pleading of guilty or nolo contendere to, any felony or any crime involving moral turpitude; (ii) gross negligence, breach of fiduciary duty, breach of any non-competition, non-solicitation or developments agreement or covenant in favor of the Company or material breach of any confidentiality agreement or covenant in favor of the Company; (iii) you shall have willfully and continually failed to substantially perform your duties with the Company after a written demand for substantial performance is delivered by the Company, which demand specifically identifies the manner in which the Company believes that you have not substantially performed your duties pursuant to the disciplinary procedures of the Company, and such failure of substantial performance shall have continued for a period of thirty (30) days after such written demand, (iv) you have been chronically absent from work (excluding vacations, illnesses or leaves of absences), (v) the commission by you of an act of fraud, embezzlement or misappropriation against the Company; (vi) you shall have refused, after explicit notice, to obey any lawful resolution or direction by the Board which is consistent with your duties as an officer of the Company; or (vii) a material breach by you of this Agreement, which breach (if curable) has remained uncured for a period of thirty (30) days following the Companys delivery of written notice to you specifying the manner in which the Agreement has been materially breached.
(b) By the Company Without Cause. The Company may terminate your employment at any time other than for Cause upon notice to you.
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(c) Resignation by You Without Good Reason. You may terminate your employment at any time upon thirty (30) days notice to the Company. The Board may elect to waive such notice period or any portion thereof; but in that event, the Company shall pay you your Base Salary for that portion of the notice period so waived.
(d) Resignation by You With Good Reason. You may terminate your employment as provided below for Good Reason. Good Reason shall mean: (i) a material diminution in your duties, authorities, responsibilities or reporting lines; (ii) a material reduction in your Base Salary (other than a reduction of your Base Salary of no more than 10% in the aggregate from your highest Base Salary and that is proportional to reductions of the Companys other senior executives) or target annual bonus opportunity; (iii) a material change in your principal place of business (provided, however, that travel for business purposes consistent with past practices shall not be considered a change in the place of your principal place of business for the purpose of this clause (iii)); or (iv) a material breach by the Company of this Agreement; provided that the occurrence of any of the foregoing events shall not constitute Good Reason unless (x) you provide written notice of the event to the Company within ninety (90) days after it first existed, (y) the Company fails to remedy the condition within thirty (30) days after the notice and (z) you actually terminate employment within thirty (30) days after the expiration of the Companys cure period.
(e) Death and Disability. Your employment hereunder shall automatically terminate in the event of your death during employment and the Company may terminate your employment due to Disability. The Company shall only be permitted to terminate your employment, or give you notice to terminate your employment, due to Disability while you are disabled. For purposes of this Agreement, Disability means an independent medical doctor (selected by the Companys health or disability insurer) has certified that you have, for six (6) months consecutive or nonconsecutive in any twelve (12)-month period, been disabled in a manner that seriously interferes with your ability to perform your responsibilities as an employee of the Company. Any refusal by you to submit to a medical examination for the purpose of certifying disability shall be deemed to constitute conclusive evidence of your disability. You shall continue to receive your Base Salary in accordance with Section 2(a) and benefits in accordance with Section 2(e), to the extent permitted by the then-current terms of the applicable benefit plans, until you become eligible for disability income benefits under the Companys disability income plan or until the termination of your employment, whichever shall first occur.
5. Other Matters Related to Termination.
(a) Final Compensation. In the event of termination of your employment with the Company, howsoever occurring, the Company shall pay you (i) your Base Salary for the final payroll period of your employment, through the date your employment terminates; (ii) any vacation time earned but not used as of the date your employment terminates; (iii) reimbursement for business expenses incurred by you but not yet paid to you as of the date your employment terminates; provided you submit all expenses and supporting documentation required within sixty (60) days of the date your employment terminates, and provided further that such expenses are reimbursable under Company policies as then in effect; (iv) any amounts or benefits due to you under any benefit or equity plan, program or arrangement in accordance with the terms of such plan, program or arrangement; and (v) except if your employment is
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terminated by the Company for Cause or you resign without Good Reason (and not due to Disability), (x) any unpaid annual bonus earned under the AIP for the year preceding the year of termination, payable when such bonus is paid to active employees (the Prior Years Bonus) and (y) and if you are employed by the Company on or after July 1 of the fiscal year in which your employment was terminated, a prorated portion (calculated based on the number of days in such year of termination that you were employed by the Company) of the annual bonus earned under the AIP for the year of termination, to the extent that an annual bonus would have been earned by you under the AIP based on actual full year performance had you remained employed through the end of such year (with any subjective performance objectives deemed fully satisfied, and no negative discretion applied other than is consistent with negative discretion applied to other active executive bonuses for such year), and paid when such bonus is paid to active executives (the Pro-Rata Bonus) (all of the foregoing, Final Compensation). The Final Compensation, other than any Prior Years Bonus or the Pro-Rata Bonus, if any, which shall be paid in accordance with the provision of subsection (v), shall be paid within thirty (30) days following the termination of your employment.
(b) Severance Payments. In the event of a termination of your employment pursuant to Sections 4(b) or 4(d) above, subject to the Change in Control Agreement (as defined below), the Company will pay you, in addition to Final Compensation, (i) an amount equal to two (2) times the sum of (x) your Base Salary and (y) your target annual incentive compensation opportunity, which amount shall be payable in substantially equal installments during the twenty-four (24)-month period following the date of termination (the Severance Payments); and (ii) in a lump sum, an amount equal to the amount the Company would have paid in premiums under the life, accident, health and dental insurance plans of the Company in which you and your dependents were participating immediately prior to the termination of your employment for the twenty-four (24)-month period following the date of termination, with such lump sum amount payable pursuant to this Section 5(b) to be determined based on the premium rates in effect at the time of the termination of your employment (the Health Payment).
(c) Conditions to and Timing of Severance Payments. Notwithstanding any other provision of this Agreement to the contrary, the Severance Payments and the Health Payment shall be paid or provided to you only if you enter into a release of claims (the Release) substantially in the form attached hereto as Exhibit C, with such changes as may be necessary to comply with applicable law at the time of termination of your employment, within a period of time not to exceed forty-five (45) days from the date of termination of your employment and you do not revoke such Release. Any Severance Payments to which you are entitled will be provided in the form of salary continuation, payable in accordance with the normal payroll practices of the Company. The Health Payment will be paid in a lump sum. Except as provided in Section 9(a) of this Agreement, the first payment of the Severance Payments and the Health Payment will be made on the Companys next regular payday following the date the Release becomes effective, but no later than the date that is sixty (60) days following the date your employment terminates, with the first payment of the Severance Payments being retroactive to the date of termination. Notwithstanding the foregoing, if the date your employment terminates occurs in one taxable year and the date that is sixty (60) days following such termination date occurs in a second taxable year, to the extent required by Section 409A of the Internal Revenue Code, as amended and the regulations and guidance promulgated thereunder (Section 409A), such payment shall not be made prior to the first day of the second
10
taxable year. For the avoidance of doubt, if you do not execute the Release within the period specified in this Section 5(c) or if you revoke the executed Release within the time period permitted by law, you will not be entitled to the Severance Payments or the Health Payment, any equity and equity-based awards that vested on account of such termination in accordance with their terms shall be cancelled for no consideration due to you, and neither the Company nor any of its Affiliates will have any further obligations to you under this Agreement or otherwise except as otherwise set forth herein or in any other agreement with the Company. Further, the obligation of the Company to make payments to you under Section 5(b) and provide any accelerated vesting of equity or equity-based awards upon employment termination, and your right to retain the same, are conditioned upon your continued compliance with Section 3 of this Agreement.
6. Termination of Employment in Connection with a Change of Control. Concurrently with the execution of this Agreement you are entering into a Change of Control/Severance Agreement dated as of the Start Date (the Change of Control Agreement). Any rights you may have to payments or benefits upon certain terminations of your employment in connection with a change of control of the Company are set forth in the Change of Control Agreement. In no event will you be entitled to severance benefits under both this Agreement and the Change of Control Agreement and in the event of any inconsistency, the more favorable to you of the Change of Control Agreement and this Agreement will apply.
7. Employment At-Will. This Agreement is not intended to constitute a contract of employment for a definite term. Your employment with the Company is at-will. This means that if you accept this offer both you and the Company will retain the right to terminate our employment relationship at any time, subject to the terms of this Agreement.
8. Conflicting Agreements. You hereby represent and warrant that your signing of this Agreement and the performance of your obligations under it will not breach or be in conflict with any other agreement to which you are a party or are bound, and that you are not now subject to any covenants against competition or similar covenants or any court order that could affect the performance of your obligations under this Agreement. You agree that you will not disclose to or use on behalf of the Company or its Affiliates any confidential or proprietary information of a third party without that partys consent.
9. Timing of Payments and Section 409A.
(a) Notwithstanding anything to the contrary in this Agreement, if at the time your employment terminates, you are a specified employee, as defined below, any and all amounts payable under this Agreement on account of such separation from service that would (but for this provision) be payable within six (6) months following the date of termination, shall instead be paid on the next business day following the expiration of such six (6)-month period or, if earlier, upon your death; except (A) to the extent of amounts that do not constitute a deferral of compensation within the meaning of Treasury regulation Section 1.409A-1(b) (including without limitation by reason of the safe harbor set forth in Section 1.409A-1(b)(9)(iii), as determined by the Company in its reasonable good faith discretion); (B) benefits which qualify as excepted welfare benefits pursuant to Treasury regulation Section 1.409A-1(a)(5); or (C) other amounts or benefits that are not subject to the requirements of Section 409A.
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(b) For purposes of this Agreement, all references to termination of employment and correlative phrases shall be construed to require a separation from service (as defined in Section 1.409A-1(h) of the Treasury regulations after giving effect to the presumptions contained therein), and the term specified employee means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i).
(c) Each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments.
(d) It is the intent of the parties hereto that the payments and benefits under this Agreement comply with (or be exempt from) Section 409A and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted in accordance therewith. In no event, however, shall the Company have any liability relating to the failure or alleged failure of any payment or benefit under this Agreement to comply with, or be exempt from, the requirements of Section 409A, except if the same is the result of a negligent or improper act of the Company.
10. Withholding. All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.
11. Recoupment. The Company may recover amounts paid to you hereunder or under any other plan or program of, or agreement or arrangement with, the Company, and any gain in respect of any equity awards granted to you, in accordance with any applicable Company clawback or recoupment policy that is generally applicable to the Companys other senior executives, as such policy may be amended and in effect from time to time, or as otherwise required by applicable law or applicable stock exchange listing standards, including, without limitation, Section 10D of the Securities Exchange Act of 1934, as amended.
12. Assignment. Neither you nor the Company may make any assignment of this Agreement or any interest in it, by operation of law or otherwise, without the prior written consent of the other; provided, however, the Company may assign its rights and obligations under this Agreement without your consent to an entity with which the Company shall hereafter effect a reorganization, consolidate with, or merge into or to which it transfers all or substantially all of its properties or assets. This Agreement shall inure to the benefit of and be binding upon you and the Company, and each of your and the Companys respective successors, executors, administrators, heirs and permitted assigns. In the event of your death (including following a termination of your employment), any unpaid amounts due to you will be paid to your beneficiary(s) or, if none, to your estate.
13. Severability. If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.
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14. Miscellaneous. This Agreement, together with the Change of Control Agreement and the equity and equity-based award agreements attached as exhibits hereto, set forth the entire agreement between you and the Company, and replace all prior and contemporaneous communications, agreements and understandings, written or oral, with respect to the terms and conditions of your employment. This Agreement may not be modified or amended, and no breach shall be deemed to be waived, unless agreed to in writing by you and an expressly authorized representative of the Board. The headings and captions in this Agreement are for convenience only and in no way define or describe the scope or content of any provision of this Agreement. This Agreement may be executed in two or more counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument. Provisions of this Agreement shall survive any termination or expiration hereof or any termination of your employment if so provided in this Agreement or necessary or desirable to accomplish the purpose of other surviving provisions. This is a Massachusetts contract and shall be governed and construed in accordance with the laws of the Commonwealth of Massachusetts, without regard to any conflict of laws principles that would result in the application of the laws of any other jurisdiction, except that any equity or equity-based awards granted to you shall be governed by and construed in accordance with the governing law provisions set forth in the agreements evidencing such awards. You and the Company agree to submit to the exclusive jurisdiction of the courts of the Commonwealth of Massachusetts in connection with any dispute arising out of this Agreement or your employment with the Company; provided, however, any suit, action or proceeding brought by you or against you in connection with the enforcement of Section 3(e)(i) shall be brought in Suffolk county, Massachusetts, and the superior court or the business litigation session of the superior court shall have exclusive jurisdiction.
15. Notices. Any notices provided for in this Agreement shall be in writing and shall be effective when delivered in person or deposited in the United States mail, postage prepaid, and addressed to you at your last known address on the books of the Company or, in the case of the Company, to it at its principal place of business, attention of the Chair of the Board, or to such other address as either party may specify by notice to the other actually received.
16. Counsel; Review Period. You have been advised of your right to consult with counsel prior to executing this Agreement and acknowledge that you have had the opportunity to review this Agreement for at least ten (10) business days prior to signing it.
17. No Mitigation or Offset. You shall not be required, as a condition of receiving any payments or benefits under this Agreement, to seek or obtain any other employment after termination of employment hereunder or to take any steps to reduce the amount of any payment or benefit described in this Agreement. Further, the amount of any payment or benefit provided in this Agreement shall not be reduced by any compensation earned by you as a result of any employment by another employer, subject to the covenants contained in Section 3 hereof.
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18. Indemnification. To the maximum extent permitted under and in accordance with applicable law, the Company will indemnify you and hold you harmless (including advancement of legal fees) against all losses, claims, expenses or other liabilities arising by reason of the fact that you are or were an employee, officer, director, fiduciary or agent of the Company, its Affiliates or subsidiaries. In all events, you will be entitled to indemnification and advancement of costs to the extent permitted by the by-laws and charter of the Company as in effect from time to time.
19. D&O Insurance. You shall be entitled to coverage under the directors and officers indemnification insurance policy maintained by the Company as in effect from time to time with respect to acts undertaken by you in connection with your employment by the Company in accordance with the terms of such insurance policy.
[Signature page follows.]
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If the foregoing is acceptable to you, please sign this letter in the space provided and return it to me no later than July 15, 2020. If you do accept as provided, this Agreement will take effect as a binding agreement between you and the Company as of the Start Date.
Sincerely yours, | ||
Waters Corporation | ||
By: |
/s/ Dr. Flemming Ornskov |
|
Dr. Flemming Ornskov | ||
Chairman of the Board | ||
Accepted and Agreed: | ||
/s/ Udit Batra |
||
Udit Batra | ||
Date: | July 14, 2020 |
[Signature Page to Employment Agreement]
EXHIBIT A
Sign-On RSU Award
Name of Participant: | Udit Batra | |
Number of Restricted Stock Units: | [ ] | |
Date of Grant: | [ ] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT
This agreement (this Agreement) evidences Restricted Stock Units granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of RSUs. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant the number of Restricted Stock Units set forth above (the RSUs), giving the Participant the conditional right to receive, with respect to each RSU granted hereunder, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a Share), subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof (the Award).
2. Vesting. Unless earlier terminated, forfeited, relinquished or expired, one-third (1/3) of the RSUs will vest on each of the first three (3) anniversaries of the Date of Grant, with the number of RSUs that vest on any such date being rounded down to the nearest whole RSU and the Award becoming vested as to one hundred percent (100%) of the RSUs on the third (3rd) anniversary of the Date of Grant, subject to the Participant remaining in continuous Employment from the Date of Grant through the applicable vesting date except as described in this Section 2 or Section 3 below. In the event the Participants Employment terminates due to his death or Disability, or is terminated by the Company for reasons other than Cause or by the Participant for Good Reason (as such terms are defined in the Letter Agreement between the Participant and the Company dated as of [DATE], 2020 (the Letter Agreement)), and subject to the release requirements set forth in the Letter Agreement, any RSUs that are then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in Section 2 above or in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the RSUs, to the extent not then vested, will be immediately forfeited for no consideration. The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Award and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less
or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he shall be treated for purposes of the Award and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
4. Issuance of Shares. The Company shall, as soon as practicable upon the vesting of any RSUs (but in no event later than sixty (60) days following vesting), issue Shares with respect to such vested RSUs to the Participant (or, in the event of the Participants death, to the person to whom the Award has passed by will or the laws of descent and distribution). No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
5. Company Policies. By accepting the Award, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the RSUs, including the right to any Shares issued in respect of the RSUs or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
6. Nontransferability. The RSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of vested RSUs may be transferred subject to applicable law and the terms of any policies of the Company or any of its Affiliates.
7. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to receive Shares following the vesting of any portion of the Award, are subject to the satisfaction of all taxes required to be withheld with respect to the Award. Unless otherwise determined by the Company, the Company shall automatically satisfy such tax withholding obligations by withholding from the Shares that would otherwise be issued with respect to any vested RSUs a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement. The Participant authorizes the Company and its Affiliates to withhold any amounts due in respect of any required tax withholdings by withholding from the Shares otherwise deliverable with respect to the Award, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant. Nothing in this Section 7 shall be construed as relieving the Participant of any liability for satisfying his tax obligations relating to the Award.
8. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been furnished or made available to the Participant. By accepting, or being deemed to have accepted, all or any part of the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
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9. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument, (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder, and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
|
|
Name: |
|
|
Title: |
|
Agreed and Accepted: | ||
By |
|
|
Udit Batra |
A-19
EXHIBIT B
Sign-On Option Award
Name of Participant: | Udit Batra | |
Number of Shares of Stock subject to the Stock Option: | [ ] | |
Exercise Price Per Share: | $[ ] | |
Date of Grant: | [ ] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
STOCK OPTION AWARD AGREEMENT
This agreement (this Agreement) evidences a stock option granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of Option. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant an option (the Stock Option) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the Shares), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.
The Stock Option is a non-statutory option (that is, an option that is not intended to qualify as an ISO) and was granted to the Participant in connection with the Participants Employment.
2. Vesting. The term vest as used herein with respect to the Stock Option (or any portion thereof) means to become exercisable and the term vested with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable. Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to twenty percent (20%) of the Shares on each of the first five anniversaries of the Date of Grant, with the number of Shares that vest on any such date being rounded down to the nearest whole Share and the Stock Option becoming vested as to 100% of the Shares on the fifth (5th) anniversary of the Date of Grant, subject, in each case, to the Participant remaining in continuous Employment from the Date of Grant through the applicable vesting date except as described in this Section 2 or Section 4 below. Notwithstanding the foregoing, in the event the Participants Employment terminates due to his death or Disability, or is terminated by the Company for reasons other than Cause or by the Participant for Good Reason (as each such term is defined in the Letter Agreement between the Participant and the Company dated as of [DATE], 2020 (the Letter Agreement), and subject to the release requirements set forth in the Letter Agreement, the portion of the Stock Option that is then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Exercise of the Stock Option. No portion of the Stock Option may be exercised until such portion vests. Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to a permitted transferee, the permitted transferee. Each such written or electronic exercise election must be received by the Company at its principal office or by such other party as the Administrator may prescribe and be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan. The latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the Final Exercise Date) and, if not exercised by such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate. No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
4. Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in Section 2 above or an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period described in Section 6(a)(4) of the Plan, except that if the Participants Employment terminates due to his Retirement, the vested portion of the Stock Option will remain exercisable until the earlier of (i) the one-year anniversary of such Retirement or (ii) the Final Exercise Date. For purposes of this Agreement, Retirement means the Participants termination of Employment (other than for Cause or at a time when the Participants Employment could have been terminated for Cause) (i) at any time after the Participant has reached age sixty (60) with ten (10) years of service to the Company and its Affiliates and (ii) with the intention of concluding his working or professional career. The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Stock Option and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he shall be treated for purposes of the Stock Option and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
5. Company Policies. By accepting the Stock Option, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
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6. Nontransferability. The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of the Stock Option may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
7. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to be issued Shares upon exercise of the Stock Option, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes required to be withheld with respect to the Stock Option. No Shares will be issued pursuant to the exercise of the Stock Option unless and until the person exercising the Stock Option has remitted to the Company an amount in cash sufficient to satisfy any federal, state, or local withholding tax requirements, or has made other arrangements satisfactory to the Company with respect to such taxes. The Participant authorizes the Company and its subsidiaries to withhold such amount from any amounts otherwise owed to the Participant, but nothing in this sentence will be construed as relieving the Participant of any liability for satisfying his obligation under the preceding provisions of this Section 7.
8. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been made available to the Participant. By accepting the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
9. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
|
|
Name: |
|
|
Title: |
|
Agreed and Accepted: | ||
By |
|
|
Udit Batra |
C-1
EXHIBIT C
Form of Release
General Release and Waiver of Claims
For and in consideration of certain benefits to be provided to me under the [Employment Letter, dated as of [DATE], 2020] [Change of Control/Severance Agreement, dated as of [DATE], 2020] (the Agreement), between me and Waters Corporation (the Company), which are conditioned on my signing this General Release and Waiver of Claims (this Release of Claims), and to which I am not otherwise entitled, and other good and valuable consideration, the receipt and sufficiency of which I hereby acknowledge, on my own behalf and on behalf of my heirs, executors, administrators, beneficiaries, representatives, successors and assigns, and all others connected with or claiming through me, I hereby release and forever discharge the Company and its affiliates, and all of their respective past, present and future officers, directors, shareholders, employees, employee benefits plans, administrators, trustees, agents, representatives, consultants, successors and assigns, and all those connected with any of them, in their official and individual capacities (collectively, the Released Parties), from any and all causes of action, suits, rights and claims, demands, damages and compensation of any kind and nature whatsoever, whether at law or in equity, whether now known or unknown, suspected or unsuspected, contingent or otherwise, which I now have or ever have had against the Released Parties, or any of them, in any way related to, connected with or arising out of my employment and/or other relationship with the Company or any of its affiliates, or pursuant to Title VII of the Civil Rights Act, the Americans With Disabilities Act, the Family and Medical Leave Act, the Age Discrimination in Employment Act (as amended by the Older Workers Benefit Protection Act), the Employee Retirement Income Security Act, the wage and hour, wage payment and fair employment practices laws of the state or states in which I have provided services to the Company (each as amended from time to time) and/or any other federal, state or local law, regulation, or other requirement (collectively, the Claims) through the date that I sign this Release of Claims, and I hereby waive all such Claims.
I understand that nothing contained in this Release of Claims shall be construed to prohibit me from filing a charge with or participating in any investigation or proceeding conducted by the federal Equal Employment Opportunity Commission or a comparable state or local agency, provided, however, that I hereby agree to waive my right to recover monetary damages or other individual relief in any charge, complaint or lawsuit filed by me or by anyone else on my behalf. I further understand that nothing contained in this Release of Claims shall be construed to limit, restrict or in any other way affect my communicating with any governmental agency or entity, or communicating with any official or staff person of a governmental agency or entity, concerning non-privileged matters relevant to the governmental agency or entity. For the avoidance of doubt, no provision of this Agreement shall be construed as prohibiting or restricting me (or my attorney) from responding to any inquiry about this Agreement or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), any other self-regulatory organization or any governmental entity.
I acknowledge that I will continue to be bound by my obligations under the Agreement that survive the termination of my employment by the terms thereof or by necessary implication,
D-1
including without limitation my confidentiality, non-competition and non-solicitation obligations set forth therein (all of the foregoing obligations, the Continuing Obligations). I further acknowledge that the obligation of the Company to make payments to me or on my behalf under Section [●] of this Agreement, and my right to retain the same, are expressly conditioned upon my continued full performance of my obligations hereunder and of the Continuing Obligations.
I understand that nothing contained in this Release of Claims will adversely affect my rights to enforce the terms of the Agreement, and shall not adversely affect my right to any indemnification, coverage under the Companys directors and officers liability insurance policy in accordance with its terms or right to reimbursement of expenses by the Company to which I would otherwise be entitled to under, without limitation, any charter document or Company insurance policy, by reason of services I rendered for the Company or any of its subsidiaries as an officer and/or an employee thereof.
Subject to the second paragraph of this Release of Claims, I agree that I will not disparage or criticize the Company, its affiliates, their business, their directors, management or their products or services. The Company agrees that no member of the Board of Directors of the Company or any executive officer of the Company will disparage or criticize you.
Notwithstanding the foregoing, nothing contained in this paragraph shall preclude you or the Company (or its directors or executive officers) from making truthful statements that are required by applicable law, regulation or legal process.
I acknowledge that this Release of Claims creates legally binding obligations, and that the Company has advised me to consult an attorney before signing it. In signing this Release of Claims, I give the Company assurance that I have signed it voluntarily and with a full understanding of its terms; that I have had sufficient opportunity of not less than [twenty-one (21)/forty-five (45)]1 days before signing this Release of Claims to consider its terms and to consult with an attorney, if I wished to do so, or to consult with any of the other persons described in the first sentence of the immediately preceding paragraph; and that I have not relied on any promises or representations, express or implied, that are not set forth expressly in this Release of Claims. I understand that I will have seven (7) days after signing this Release of Claims to revoke my signature, and that, if I intend to revoke my signature, I must do so in writing addressed and delivered to [ ] prior to the end of the seven (7)-day revocation period. I understand that this Release of Claims will become effective upon the eighth (8th) day following the date that I sign it, provided that I do not revoke my acceptance in accordance with the immediately preceding sentence.
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Consideration period to be determined by the Company at the time of separation. |
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Accepted and agreed: | ||
Signature: |
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Udit Batra | ||
Date: |
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Acknowledged (and agreed, respecting the penultimate paragraph) by:
Waters Corporation | ||
By: |
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Name: | ||
Title: |
D-3
Exhibit 10.3
CHANGE OF CONTROL/SEVERANCE AGREEMENT
This CHANGE OF CONTROL/SEVERANCE AGREEMENT (this Agreement), dated as of July 14, 2020, is made by and between Waters Corporation (together with all subsidiaries or affiliates hereinafter referred to as the Company) and Udit Batra (the Executive).
WHEREAS, the Executive has been hired as the Chief Executive Officer of the Company and is expected to make major contributions to the Company; and
WHEREAS, the Company desires continuity of management; and
WHEREAS, the Executive is willing to render services to the Company subject to the conditions set forth in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Executive agree as follows:
1. Termination prior to a Change of Control. If, within nine (9) months prior to a Change of Control (as such term is defined in Section 3(c) below) and subsequent to the commencement of substantive discussions that ultimately result in the Change of Control, but prior to such Change of Control, the Company terminates the Executives employment with the Company for a reason other than Cause (as such term is defined in Section 3(d) below), death or Disability (as such term is defined in Section 3(e) below), or the Executive resigns for Good Reason (as such term is defined in Section 2(e) below), the Company shall have paid to the Executive the Final Compensation (as such term is defined in the Employment Letter between the Executive and the Company dated as of July 14, 2020 (the Employment Letter)) and the Health Payment in accordance with the terms of the Employment Letter, and, subject to the Executives satisfaction of the Release Condition (as such term is defined in Section 3 below):
(a) Cash Payment. (i) Continue to pay to the Executive the Severance Payments (as defined in the Employment Letter) in accordance with the terms of the Employment Letter, and, (ii) upon a Change of Control, pay to the Executive a lump sum amount (reduced by any required withholding), within ten (10) business days following the Change of Control, equal to the amount by which (A) the sum of (1) thirty-six (36) times his monthly base salary (at the highest monthly base salary rate in effect for the Executive in the twelve (12)-month period prior to the termination of his employment) and (2) an amount equal to the amount payable pursuant to the immediately preceding clause (1) times the greater of (x) his target bonus percentage under the Companys Annual Incentive Plan or any successor plan for the year in which the termination of the Executives employment occurs or (y) his bonus percentage theretofore accrued thereunder for that year exceeds (B) the aggregate amount of the Severance Payments;
(b) Benefits. Upon a Change of Control, pay to the Executive a lump sum amount (reduced by any required withholding) within ten (10) business days following the Change of Control equal to the amount by which (A) the amount the Company would have paid in premiums under the life, accident, health and dental insurance plans of the Company in which the Executive and his dependents were participating immediately prior to the termination of his employment for the thirty-six (36)-month period following the date of the Change of Control, with such lump sum amount payable pursuant to this Section 1(b) to be determined based on the premium rates in effect at the time of the termination of the Executives employment exceeds (B) the Health Payment;
(c) Equity Arrangements. In the event of a termination of employment described in this Section 1 and notwithstanding any contrary provisions of the 2020 Equity Incentive Plan (or any plans that may become the successors to such plan) and any equity incentive agreements entered into between the Company and the Executive pursuant to such plan or otherwise, cause any outstanding equity awards that are unvested or unexercisable and held by the Executive on the date of such termination of employment to remain outstanding (but not beyond the original expiration dates of such awards and such awards shall not otherwise vest or become exercisable except as provided herein) and, subject to a Change of Control occurring within nine (9) months following such date of such termination, to vest or become exercisable upon such Change of Control. To the extent a Change of Control does not occur within such nine (9)-month period, all such equity awards shall terminate at the end of such period; and
(d) Qualified Plan Arrangements. On the Change of Control, cause any unvested portion of any qualified or non-qualified capital accumulation benefits granted to the Executive under the Waters Investment Plan, Waters 401(k) Restoration Plan and the Waters Health Care Reimbursement Plan for Retirees (or any plans that may become the successors to such plans), as applicable, to become immediately vested (subject to applicable law).
(e) No Duplication of Benefits. In no event shall the Executive be entitled to duplication of severance amounts or benefits under this Agreement and the Employment Letter. Amounts that are paid under the terms of the Employment Letter and referenced herein shall not again be paid under this Agreement.
2. Termination Following a Change of Control. If, at any time during a period commencing with a Change of Control and ending eighteen (18) months after such Change of Control, the Company terminates the Executives employment for a reason other than Cause, death, or Disability or the Executive terminates employment with the Company for Good Reason, the Company shall pay to the Executive the Final Compensation (as such term is defined in the Employment Letter) in accordance with the terms of the Employment Letter, and, subject to the Executives satisfaction of the Release Condition (as such term is defined in Section 3 below):
(a) Cash Payment. Pay to the Executive a lump sum amount (reduced by any required withholding), within ten (10) business days following the Executives last date of employment, equal to the sum of (i) thirty-six (36) times his monthly base salary (at the highest monthly base salary rate in effect for the Executive in the twelve (12)-month period prior to the termination of his employment) and (ii) an amount equal to the amount payable pursuant to the immediately preceding clause (i) times the greater of (X) his target bonus percentage under the Companys Annual Incentive Plan or any successor plan for the year in which the termination of the Executives employment occurs or (Y) his bonus percentage theretofore accrued thereunder for that year;
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(b) Benefits. Pay to the Executive a lump sum amount (reduced by any required withholding) within ten (10) business days following the Executives last date of employment equal to the amount the Company would have paid in premiums under the life, accident, health and dental insurance plans of the Company in which the Executive and his dependents were participating immediately prior to the termination of his employment for the thirty-six (36)- month period following the date of the Change of Control, with such lump sum amount payable pursuant to this Section 2(b) to be determined based on the premium rates in effect at the time of the termination of the Executives employment;
(c) Equity Arrangements. In the event of a termination of employment described in this Section 2 and notwithstanding any contrary provisions of the 2020 Equity Incentive Plan (or any plans that may become the successors to such plan) and any equity incentive agreements entered into between the Company and the Executive pursuant to such plan or otherwise, the Company shall cause any outstanding equity awards that are unvested or unexercisable and held by the Executive on the date of such termination of employment to fully vest and, if stock options or become exercisable upon such termination; and
(d) Qualified Plan Arrangements. Cause any unvested portion of any qualified and non-qualified capital accumulation benefits granted to the Executive under the Waters Investment Plan, Waters 401(k) Restoration Plan and the Waters Health Care Reimbursement Plan for Retirees (or any plans that may become the successors to such plans), as applicable, to become immediately vested (subject to applicable law);
provided, however, that any amounts and benefits set forth in this Section 2 shall be reduced by any and all other severance or other amounts or benefits paid or payable to the Executive as a result of the termination of his employment. For the avoidance of doubt, upon a termination of employment that meets the conditions set forth in this Section 2 the Executive shall only be entitled to receive the payments and benefits under this Section 2 and shall not be entitled to receive any payments or benefits under the Employment Letter.
(e) Definition of Good Reason. For purposes of Section 2 above, Good Reason shall mean the occurrence (without the Executives express written consent) of one or more of the following events following a Change of Control, as the case may be:
(i) A material diminution in the Executives authority, duties, responsibilities or reporting lines from his authority, duties, responsibilities or reporting lines immediately prior to the Change of Control; or
(ii) A material reduction in the Executives base salary (other than that which results in a base salary reduction of no more than ten percent (10%) in the aggregate from the Executives highest base salary and is proportional to reductions of other senior executives) or target annual bonus opportunity; or
(iii) A material change in the Executives place of business (provided, however, that travel for business purposes consistent with past practices shall not be considered a change in the place of business for the purpose of this clause (iii)); or
(iv) A material breach by the Company of any agreement under which the Executive provides services to the Company, including without limitation Section 3(h) of this Agreement and any plan of incentive compensation;
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provided, that the occurrence of any of the events listed in clauses (i) through (iv) shall not mean Good Reason (x) unless the Executive shall have given notice of the event to the Company within ninety (90) days after it first existed, (y) the Company shall have failed to remedy the condition within thirty (30) days after the notice, and (z) the Executive actually terminates employment within thirty (30) days after the expiration of the Companys cure period.
3. General.
(a) Release. Notwithstanding any other provision of this Agreement to the contrary, benefits shall be payable under this Agreement only if the Executive enters into a release of claims (the Release) substantially in the form attached hereto as Exhibit A, with such changes as may be necessary to comply with applicable law at the time of termination of the Executives employment, within a period of time not to exceed forty-five (45) days from the date of termination of the Executives employment and the Executive does not revoke such Release (the Release Condition). Except as otherwise provided in Section 3(i) of this Agreement, any payment under this Agreement to be made in a lump sum shall be paid as soon as administratively practicable following the date the Release becomes effective, but not later than the date that is sixty (60) days following the date the Executives employment terminates. Notwithstanding the foregoing, if the date the Executives employment terminates occurs in one taxable year and the date that is sixty (60) days following such termination date occurs in a second taxable year, to the extent required by Section 409A of the Internal Revenue Code, as amended (Section 409A), such lump sum payment shall not be made prior to the first day of the second taxable year. For the avoidance of doubt, if the Executive does not execute the Release within the period specified in this Section 3(a) or if the Executive revokes the executed Release within the time period permitted by law, the Executive will not be entitled to any payments or benefits (including the accelerated vesting of equity and equity-based awards) set forth in this Agreement, any equity and equity-based awards that vested on account of such termination as provided for in this Agreement shall be cancelled with no consideration due to the Executive, and neither the Company nor any of its affiliates will have any further obligations to the Executive under this Agreement or otherwise.
(b) Termination for Cause. In the event the Executives employment with the Company is terminated by the Company for Cause or Executives employment terminates due to death or Disability, or the Executive terminates his employment with the Company other than during the specific time periods set forth in Section 2 in accordance with the requirements of such Section or for any reason other than Good Reason, the Executive shall not be entitled to the severance benefits or other considerations described herein by virtue of this Agreement.
(c) Definition of Change of Control. For purposes of this Agreement, Change of Control means the occurrence of any of the following, provided such occurrence is also a change in the ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company, in each case as those terms are defined in Treasury Regulation Section 1.409-3(i)(5), (i) the closing of a merger, consolidation, liquidation or reorganization of the Company into or with another company or other legal person, after which merger, consolidation, liquidation or reorganization the capital stock of the Company outstanding prior to consummation of the transaction is not converted into or exchanged for or does not represent more than 50% of the aggregate voting power of the surviving or resulting
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entity; (ii) the direct or indirect acquisition by any person (as the term person is used in Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended) of more than 50% of the voting capital stock of the Company, in a single or series of related transactions; or (iii) the sale, exchange, or transfer of all or substantially all of the Companys assets (other than a sale, exchange, or transfer to one or more entities where the stockholders of the Company immediately before such sale, exchange or transfer retain, directly or indirectly, at least a majority of the beneficial interest in the voting stock of the entities to which the assets were transferred).
(d) Definition of Cause. For purposes of this Agreement, Cause shall mean: (i) the conviction of the Executive by a court of competent jurisdiction of, or the pleading of guilty or nolo contendere to, any felony or any crime involving moral turpitude; (ii) gross negligence, breach of fiduciary duty, breach of any non-competition, non-solicitation or developments agreement or covenant in favor of the Company or material breach of any confidentiality agreement or covenant in favor of the Company; (iii) the Executive shall have willfully and continually failed to substantially perform the Executives duties with the Company after a written demand for substantial performance is delivered by the Company, which demand specifically identifies the manner in which the Company believes that the Executive has not substantially performed the Executives duties pursuant to the disciplinary procedures of the Company, and such failure of substantial performance shall have continued for a period of thirty (30) days after such written demand; (iv) the Executive has been chronically absent from work (excluding vacations, illnesses or leaves of absences); (v) the commission by the Executive of an act of fraud, embezzlement or misappropriation against the Company; or (vi) the Executive shall have refused, after explicit notice, to obey any lawful resolution or direction by the Board which is consistent with his duties as an officer of the Company.
(e) Definition of Disability. For purposes of this Agreement, Disability means an independent medical doctor (selected by the Companys health or disability insurer) has certified that the Executive has, for six (6) months consecutive or nonconsecutive in any twelve (12)- month period, been disabled in a manner that seriously interferes with his ability to perform his responsibilities as an employee of the Company. The Company shall only be permitted to terminate the Executives employment, or give the Executive notice to terminate his employment, due to Disability while the Executive is disabled. Any refusal by the Executive to submit to a medical examination for the purpose of certifying disability shall be deemed to constitute conclusive evidence of the Executives disability.
(f) No Mitigation or Offset. The Executive shall not be required, as a condition of receiving any payments or benefits under this Agreement, to seek or obtain any other employment after termination of employment hereunder or to take any steps to reduce the amount of any payment or benefit described in this Agreement. Further, the amount of any payment or benefit provided in this Agreement shall not be reduced by any compensation earned by the Executive as a result of any employment by another employer.
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(g) Timing of Payments and Section 409A.
(i) Notwithstanding anything to the contrary in this Agreement, if at the time the Executives employment terminates, the Executive is a specified employee, as defined below, any and all amounts payable under this Agreement on account of such separation from service that would (but for this provision) be payable within six (6) months following the date of termination, shall instead be paid on the next business day following the expiration of such six (6)-month period or, if earlier, upon the Executives death; except (A) to the extent of amounts that do not constitute a deferral of compensation within the meaning of Treasury regulation Section 1.409A-1(b) (including without limitation by reason of the safe harbor set forth in Section 1.409A-1(b)(9)(iii), as determined by the Company in its reasonable good faith discretion); (B) benefits which qualify as excepted welfare benefits pursuant to Treasury regulation Section 1.409A-1(a)(5); or (C) other amounts or benefits that are not subject to the requirements of Section 409A.
(ii) For purposes of this Agreement, all references to termination of employment and correlative phrases shall be construed to require a separation from service (as defined in Section 1.409A-1(h) of the Treasury regulations after giving effect to the presumptions contained therein), and the term specified employee means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i).
(iii) Each payment made under this Agreement shall be treated as a separate payment and the right to a series of installment payments under this Agreement is to be treated as a right to a series of separate payments.
(iv) It is the intent of the parties hereto that the payments under this Agreement comply with (or be exempt from) Section 409A and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted in accordance therewith. In no event, however, shall the Company have any liability relating to the failure or alleged failure of any payment or benefit under this Agreement to comply with, or be exempt from, the requirements of Section 409A, except if the same is the result of a negligent or improper act of the Company.
(h) Binding Effect. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the Company and any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) of the Company. The Company shall require any such successor to assume this Agreement expressly and to be bound by the provisions of this Agreement as if such successor were the Company and for purposes of this Agreement, any such successor of the Company shall be deemed to be the Company for all purposes.
(i) No Employment Agreement; Effect on Other Agreements. Nothing in this Agreement shall create any obligation on the part of the Company or any other person to continue the employment of the Executive, and nothing herein shall affect the Executives obligations under any non-competition, confidentiality, option or similar agreement between the Company and the Executive currently in effect or which may be entered into in the future.
(j) Withholding. All payments required to be made by the Company hereunder to the Executive shall be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as the Company may reasonably determine it must withhold pursuant to any applicable law or regulation.
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(k) Governing Law; Miscellaneous. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, except that any equity or equity-based awards granted to the Executive shall be governed by and construed in accordance with the governing law provisions set forth in the agreements evidencing such awards. Executive and the Company agree to submit to the exclusive jurisdiction of the courts of the Commonwealth of Massachusetts in connection with any dispute arising out of this Agreement or Executives employment with the Company. This Agreement constitutes the entire Agreement between the Executive and the Company concerning the subject matter hereof and supersedes any prior negotiations, understandings, or agreements concerning the subject matter hereof, whether oral or written, and may be amended or rescinded only upon the written consent of the Company and the Executive. The invalidity or unenforceability of any provision of this Agreement shall not affect the other provisions of this Agreement and this Agreement shall be construed and reformed to the fullest extent possible. The Executive may not assign any of his rights or obligations under this Agreement; the rights and obligations of the Company under this Agreement shall inure to the benefit of, and shall be binding upon, the successors and assigns of the Company. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.
(l) Section 280G.
(i) If any payment or benefit (including payments and benefits pursuant to this Agreement) that Executive would receive from the Company, or otherwise, contingent on an event covered by Section 280G(b)(2)(A)(i) of the Code (collectively, the Transaction Payment) would (i) constitute a parachute payment within the meaning of Section 280G of the Code, and (ii) but for this Section 3(m), be subject to the excise tax imposed by Section 4999 of the Code (the Excise Tax), then the Executive shall be entitled to receive, whichever of the following that results in the greater amount payable to him on an after-tax basis: (1) payment in full of the entire amount of the Transaction Payment (a Full Payment), or (2) payment of only a part of the Transaction Payment so that the Executive receives the largest payment possible without the imposition of the Excise Tax (a Reduced Payment).
For purposes of determining whether to make a Full Payment or a Reduced Payment, the Company shall cause to be taken into account all applicable federal, state and local income and employment taxes and the Excise Tax. If a Reduced Payment is made, (x) Executive shall have no rights to any additional payments and/or benefits constituting the Transaction Payment, and (y) reduction in payments and/or benefits shall occur in the manner that results in the greatest economic benefit to Executive as determined in this paragraph, to the extent permitted by Section 409A. If more than one method of reduction will result in the same economic benefit, the portions of the Payment shall be reduced pro rata, to the extent permitted by Section 409A.
(ii) The Company shall engage an independent registered public accounting firm to make all determinations required to be made under this Section 3(m), and shall bear all reasonable expenses with respect thereto. The independent registered public accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and Executive. If the independent registered public accounting firm determines that no Excise Tax is payable with respect to the Transaction Payments (whether or not by reason of payment to Executive of a Reduced Payment), it shall
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furnish the Company and Executive with detailed supporting calculations of its determination that no Excise Tax will be imposed with respect to the Transaction Payments. All good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon the Company and the Executive.
[Signature page follows.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.
WATER CORPORATION | ||
By: |
/s/ Dr. Flemming Ornskov |
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Dr. Flemming Ornskov | ||
Chairman of the Board | ||
THE EXECUTIVE | ||
By: |
/s/ Udit Batra |
[Signature Page to Severance Agreement}
EXHIBIT A
FORM OF RELEASE
General Release and Waiver of Claims
For and in consideration of certain benefits to be provided to me under the [Employment Letter, dated as of [DATE]] [Change of Control/Severance Agreement, dated as of [DATE]] (the Agreement), between me and Waters Corporation (the Company), which are conditioned on my signing this General Release and Waiver of Claims (this Release of Claims), and to which I am not otherwise entitled, and other good and valuable consideration, the receipt and sufficiency of which I hereby acknowledge, on my own behalf and on behalf of my heirs, executors, administrators, beneficiaries, representatives, successors and assigns, and all others connected with or claiming through me, I hereby release and forever discharge the Company and its affiliates, and all of their respective past, present and future officers, directors, shareholders, employees, employee benefits plans, administrators, trustees, agents, representatives, consultants, successors and assigns, and all those connected with any of them, in their official and individual capacities (collectively, the Released Parties), from any and all causes of action, suits, rights and claims, demands, damages and compensation of any kind and nature whatsoever, whether at law or in equity, whether now known or unknown, suspected or unsuspected, contingent or otherwise, which I now have or ever have had against the Released Parties, or any of them, in any way related to, connected with or arising out of my employment and/or other relationship with the Company or any of its affiliates, or pursuant to Title VII of the Civil Rights Act, the Americans With Disabilities Act, the Family and Medical Leave Act, the Age Discrimination in Employment Act (as amended by the Older Workers Benefit Protection Act), the Employee Retirement Income Security Act, the wage and hour, wage payment and fair employment practices laws of the state or states in which I have provided services to the Company (each as amended from time to time) and/or any other federal, state or local law, regulation, or other requirement (collectively, the Claims) through the date that I sign this Release of Claims, and I hereby waive all such Claims.
I understand that nothing contained in this Release of Claims shall be construed to prohibit me from filing a charge with or participating in any investigation or proceeding conducted by the federal Equal Employment Opportunity Commission or a comparable state or local agency, provided, however, that I hereby agree to waive my right to recover monetary damages or other individual relief in any charge, complaint or lawsuit filed by me or by anyone else on my behalf. I further understand that nothing contained in this Release of Claims shall be construed to limit, restrict or in any other way affect my communicating with any governmental agency or entity, or communicating with any official or staff person of a governmental agency or entity, concerning non-privileged matters relevant to the governmental agency or entity. For the avoidance of doubt, no provision of this Agreement shall be construed as prohibiting or restricting me (or my attorney) from responding to any inquiry about this Agreement or its underlying facts and circumstances by the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), any other self-regulatory organization or any governmental entity.
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I acknowledge that I will continue to be bound by my obligations under the Agreement that survive the termination of my employment by the terms thereof or by necessary implication, including without limitation my confidentiality, non-competition and non-solicitation obligations set forth therein (all of the foregoing obligations, the Continuing Obligations). I further acknowledge that the obligation of the Company to make payments to me or on my behalf under Section [●] of this Agreement, and my right to retain the same, are expressly conditioned upon my continued full performance of my obligations hereunder and of the Continuing Obligations.
I understand that nothing contained in this Release of Claims will adversely affect my rights to enforce the terms of the Agreement, and shall not adversely affect my right to any indemnification, coverage under the Companys directors and officers liability insurance policy in accordance with its terms or right to reimbursement of expenses by the Company to which I would otherwise be entitled to under, without limitation, any charter document or Company insurance policy, by reason of services I rendered for the Company or any of its subsidiaries as an officer and/or an employee thereof.
Subject to the second paragraph of this Release of Claims, I agree that I will not disparage or criticize the Company, its affiliates, their business, their directors, management or their products or services. The Company agrees that no member of the Board of Directors of the Company or any executive officer of the Company will disparage or criticize you. Notwithstanding the foregoing, nothing contained in this paragraph shall preclude you or the Company (or its directors or executive officers) from making truthful statements that are required by applicable law, regulation or legal process.
I acknowledge that this Release of Claims creates legally binding obligations, and that the Company has advised me to consult an attorney before signing it. In signing this Release of Claims, I give the Company assurance that I have signed it voluntarily and with a full understanding of its terms; that I have had sufficient opportunity of not less than [twenty-one (21)/forty-five (45)]1 days before signing this Release of Claims to consider its terms and to consult with an attorney, if I wished to do so, or to consult with any of the other persons described in the first sentence of the immediately preceding paragraph; and that I have not relied on any promises or representations, express or implied, that are not set forth expressly in this Release of Claims. I understand that I will have seven (7) days after signing this Release of Claims to revoke my signature, and that, if I intend to revoke my signature, I must do so in writing addressed and delivered to [ ] prior to the end of the seven (7)-day revocation period. I understand that this Release of Claims will become effective upon the eighth (8th) day following the date that I sign it, provided that I do not revoke my acceptance in accordance with the immediately preceding sentence.
[The remainder of this page is intentionally left blank]
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Consideration period to be determined by the Company at the time of separation. |
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Accepted and agreed: |
Signature: |
Udit Batra |
Date: |
Acknowledged (and agreed, respecting the penultimate paragraph) by: Waters Corporation
By: | Name: | |
Title: |
A-3
Exhibit 10.4
EMPLOYEE FORM
Name of Participant: | [__________] | |
Number of Shares of Stock subject to the Stock Option: | [__________] | |
Exercise Price Per Share: | $[__________] | |
Date of Grant: | [__________] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
STOCK OPTION AWARD AGREEMENT
This agreement (this Agreement) evidences a stock option granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of Option. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant an option (the Stock Option) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the Shares), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.
The Stock Option is a non-statutory option (that is, an option that is not intended to qualify as an ISO) and was granted to the Participant in connection with the Participants Employment.
2. Vesting. The term vest as used herein with respect to the Stock Option (or any portion thereof) means to become exercisable and the term vested with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable. Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to twenty percent (20%) of the Shares on each of the first five anniversaries of the Date of Grant, with the number of Shares that vest on any such date being rounded down to the nearest whole Share and the Stock Option becoming vested as to 100% of the Shares on the fifth (5th) anniversary of the Date of Grant, subject, in each case, to the Participant remaining in continuous Employment from the Date of Grant through the applicable vesting date except as described in this Section 2 or Section 4 below. Notwithstanding the foregoing, in the event the Participants Employment terminates due to his or her death, the portion of the Stock Option that is then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Exercise of the Stock Option. No portion of the Stock Option may be exercised until such portion vests. Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to a permitted transferee, the permitted transferee. Each such written or electronic exercise election must be received by the Company at its principal office or by such other party as the Administrator may prescribe and be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the
Administrator, or as otherwise provided in the Plan. The latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the Final Exercise Date) and, if not exercised by such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate. No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
4. Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period described in Section 6(a)(4) of the Plan, except that if the Participants Employment terminates due to his or her Retirement, the vested portion of the Stock Option will remain exercisable until the earlier of (i) the one-year anniversary of such Retirement or (ii) the Final Exercise Date. For purposes of this Agreement, Retirement means the Participants termination of Employment (other than for Cause or at a time when the Participants Employment could have been terminated for Cause) (i) at any time after the Participant has reached age sixty (60) with ten (10) years of service to the Company and its Affiliates and (ii) with the intention of concluding his or her working or professional career. The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Stock Option and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he or she shall be treated for purposes of the Stock Option and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
5. Company Policies. By accepting the Stock Option, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
6. Nontransferability. The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of the Stock Option may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
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7. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to be issued Shares upon exercise of the Stock Option, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes required to be withheld with respect to the Stock Option. No Shares will be issued pursuant to the exercise of the Stock Option unless and until the person exercising the Stock Option has remitted to the Company an amount in cash sufficient to satisfy any federal, state, or local withholding tax requirements, or has made other arrangements satisfactory to the Company with respect to such taxes. The Participant authorizes the Company and its subsidiaries to withhold such amount from any amounts otherwise owed to the Participant, but nothing in this sentence will be construed as relieving the Participant of any liability for satisfying his or her obligation under the preceding provisions of this Section 7.
8. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been made available to the Participant. By accepting the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
9. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
|
|
Name: |
|
|
Title: |
|
Agreed and Accepted: |
By_______________________________ |
[Participants Name] |
[Signature Page to Stock Option Award Agreement]
Exhibit 10.5
DIRECTOR FORM
Name of Participant: | [__________] | |
Number of Shares of Stock subject to the Stock Option: | [__________] | |
Exercise Price Per Share: | $[__________] | |
Date of Grant: | [__________] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
STOCK OPTION AWARD AGREEMENT
This agreement (this Agreement) evidences a stock option granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of Option. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant an option (the Stock Option) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the Shares), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.
The Stock Option is a non-statutory option (that is, an option that is not intended to qualify as an ISO) and was granted to the Participant in connection with the Participants Employment.
2. Vesting. The term vest as used herein with respect to the Stock Option (or any portion thereof) means to become exercisable and the term vested with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable. Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to one hundred percent (100%) of the Shares on the first (1st) anniversary of the Date of Grant, subject, to the Participant remaining in continuous Employment from the Date of Grant through such vesting date. Notwithstanding the foregoing, in the event the Participants Employment terminates due to his or her death, the portion of the Stock Option that is then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Exercise of the Stock Option. No portion of the Stock Option may be exercised until such portion vests. Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to a permitted transferee, the permitted transferee. Each such written or electronic exercise election must be received by the Company at its principal office or by such other party as the Administrator may prescribe and be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan. The latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the Final Exercise Date) and, if not exercised by such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate. No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
4. Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period described in Section 6(a)(4) of the Plan, except that if the Participants Employment terminates due to his or her Retirement, the vested portion of the Stock Option will remain exercisable until the earlier of (i) the one-year anniversary of such Retirement or (ii) the Final Exercise Date. For purposes of this Agreement, Retirement means the Participants termination of Employment (other than for Cause or at a time when the Participants Employment could have been terminated for Cause) (i) at any time after the Participant has reached age sixty (60) with ten (10) years of service to the Company and its Affiliates and (ii) with the intention of concluding his or her working or professional career. The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Stock Option and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he or she shall be treated for purposes of the Stock Option and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
5. Company Policies. By accepting the Stock Option, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
6. Nontransferability. The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of the Stock Option may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
7. Withholding. The Participant is responsible for satisfying and paying all taxes arising from or due in connection with the Stock Option, its exercise, or a disposition of any Shares acquired upon exercise of the Stock Option. The Company will have no liability or obligation related to the foregoing.
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8. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been made available to the Participant. By accepting the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
9. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
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|
Name: |
|
|
Title: |
|
Agreed and Accepted:
By |
|
|
[Participants Name] |
[Signature Page to Stock Option Award Agreement]
Exhibit 10.6
GENERAL FORM OF RSU
Name of Participant: | [ ] | |
Number of Restricted Stock Units: | [ ] | |
Date of Grant: | [ ] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT AWARD AGREEMENT
This agreement (this Agreement) evidences Restricted Stock Units granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of RSUs. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant the number of Restricted Stock Units set forth above (the RSUs), giving the Participant the conditional right to receive, with respect to each RSU granted hereunder, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a Share), subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof (the Award).
2. Vesting. Unless earlier terminated, forfeited, relinquished or expired, one-fifth (1/5) of the RSUs will vest on each of the first five (5) anniversaries of the Date of Grant, with the number of RSUs that vest on any such date being rounded down to the nearest whole RSU and the Award becoming vested as to one hundred percent (100%) of the RSUs on the fifth (5th) anniversary of the Date of Grant, subject to the Participant remaining in continuous Employment from the Date of Grant through the applicable vesting date except as described in this Section 2 or Section 3 below. In the event the Participants Employment terminates due to his or her death, any RSUs that are then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the RSUs, to the extent not then vested, will be immediately forfeited for no consideration. The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Award and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he or she shall be treated for purposes of the Award and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
4. Issuance of Shares. The Company shall, as soon as practicable upon the vesting of any RSUs (but in no event later than sixty (60) days following vesting), issue Shares with respect to such vested RSUs to the Participant (or, in the event of the Participants death, to the person to whom the Award has passed by will or the laws of descent and distribution). No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
5. Company Policies. By accepting the Award, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the RSUs, including the right to any Shares issued in respect of the RSUs or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
6. Nontransferability. The RSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of vested RSUs may be transferred subject to applicable law and the terms of any policies of the Company or any of its Affiliates.
7. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to receive Shares following the vesting of any portion of the Award, are subject to the satisfaction of all taxes required to be withheld with respect to the Award. Unless otherwise determined by the Company, the Company shall automatically satisfy such tax withholding obligations by withholding from the Shares that would otherwise be issued with respect to any vested RSUs a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement. The Participant authorizes the Company and its Affiliates to withhold any amounts due in respect of any required tax withholdings by withholding from the Shares otherwise deliverable with respect to the Award, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant. Nothing in this Section 7 shall be construed as relieving the Participant of any liability for satisfying his or her tax obligations relating to the Award.
8. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been furnished or made available to the Participant. By accepting, or being deemed to have accepted, all or any part of the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
9. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument, (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder, and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
|
|
Name: |
|
|
Title: |
|
Agreed and Accepted: | ||
By |
|
|
[Participants Name] |
[Signature Page to Restricted Stock Unit Award Agreement]
Exhibit 10.7
CEO FORM
Name of Participant: | [ ] | |
Target Number of PSUs: | [ ] | |
Date of Grant: | [ ] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
PERFORMANCE-BASED RESTRICTED STOCK UNIT AWARD AGREEMENT
This agreement (this Agreement) evidences performance-based Restricted Stock Units granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of PSUs. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant the target number of performance-based Restricted Stock Units (the PSUs) set forth above (the Target Award) giving the Participant the conditional right to receive, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a Share) with respect to each PSU forming part of the Award, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof (the Award). The percentage of the Target Award that may be earned by the Participant will be determined in accordance with Exhibit A hereto.
2. Earning; Vesting; Cessation of Employment.
(a) Earned PSUs. The PSUs shall become Earned PSUs following the end of the Performance Period (as defined in Exhibit A) to the extent earned in accordance with the performance criteria set forth on Exhibit A (the Performance Criteria), based on the Administrators determination, in its sole discretion, of the level of achievement of the Performance Criteria.
(b) Vesting of Earned PSUs. Unless earlier terminated, forfeited, relinquished or expired, the Earned PSUs will vest in full on [ ] (the Vesting Date), subject to the Participant remaining in continuous Employment from the Date of Grant through the Vesting Date except as described in Section 2(c) below.
(c) Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the PSUs, to the extent not then vested, will be immediately forfeited for no consideration. Notwithstanding the foregoing, in the event the Participants Employment terminates due to the Participants death or Qualifying Retirement, in either case, prior to the Performance Period End Date (as defined in Exhibit A) and prior to a Covered Transaction, any unvested PSUs that are then outstanding shall not be forfeited upon such termination but shall instead remain outstanding and eligible to become Earned PSUs in accordance with the terms of this Agreement and, to the extent earned, shall vest in full on a prorated basis, based on the number of days the Participant was Employed during the Performance Period (without regard to any earlier termination thereof
on the consummation of a Covered Transaction or otherwise), on the earlier of the Vesting Date or immediately prior to the consummation of a Covered Transaction. For purposes of this Agreement, Qualifying Retirement means the Participants termination of Employment (other than for Cause or at a time when the Participants Employment could have been terminated for Cause) (i) at any time after the Participant has reached age sixty (60) with ten (10) years of service to the Company and its Affiliates; (ii) with the intention of concluding his or her working or professional career; and (iii) after the first anniversary of the Performance Period Start Date (as defined in Exhibit A). The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Award and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he or she shall be treated for purposes of the Award and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
3. Issuance of Shares. The Company shall, as soon as practicable upon the vesting of any PSUs (but in no event later than March 15th of the year following the year in which such PSUs vest), issue Shares with respect to such vested PSUs to the Participant (or, in the event of the Participants death, to the person to whom the Award has passed by will or the laws of descent and distribution). No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
4. Company Policies. By accepting the Award, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the PSUs, including the right to any Shares issued in respect of the PSUs or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 7 of this Agreement.
5. Nontransferability. The PSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of vested PSUs may not be transferred for a period of twenty-four (24) months following the Vesting Date; provided, that this restriction shall not apply following the Participants death or in connection with or following a Covered Transaction. Except as described in the preceding sentence, Shares issued in respect of vested PSUs may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
6. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to receive Shares following the vesting of any portion of the Award, are subject to the satisfaction of all taxes required to be withheld with respect to the Award. Unless otherwise determined by the Company, the Company shall automatically satisfy such tax withholding obligations by withholding from the Shares that would otherwise be issued with
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respect to any vested PSUs a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement. The Participant authorizes the Company and its Affiliates to withhold any amounts due in respect of any required tax withholdings by withholding from the Shares otherwise deliverable with respect to the Award, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant. Nothing in this Section 6 shall be construed as relieving the Participant of any liability for satisfying his or her tax obligations relating to the Award.
7. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been furnished or made available to the Participant. By accepting, or being deemed to have accepted, all or any part of the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
8. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument, (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder, and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
|
|
Name: |
|
|
Title: |
|
Agreed and Accepted: | ||
By |
|
|
[Participants Name] |
Exhibit 10.8
EMPLOYEE (NON-CEO) FORM
Name of Participant: | [ ] | |
Target Number of PSUs: | [ ] | |
Date of Grant: | [ ] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
PERFORMANCE-BASED RESTRICTED STOCK UNIT AWARD AGREEMENT
This agreement (this Agreement) evidences performance-based Restricted Stock Units granted by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of PSUs. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant the target number of performance-based Restricted Stock Units (the PSUs) set forth above (the Target Award) giving the Participant the conditional right to receive, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a Share) with respect to each PSU forming part of the Award, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof (the Award). The percentage of the Target Award that may be earned by the Participant will be determined in accordance with Exhibit A hereto.
2. Earning; Vesting; Cessation of Employment.
(a) Earned PSUs. The PSUs shall become Earned PSUs following the end of the Performance Period (as defined in Exhibit A) to the extent earned in accordance with the performance criteria set forth on Exhibit A (the Performance Criteria), based on the Administrators determination, in its sole discretion, of the level of achievement of the Performance Criteria.
(b) Vesting of Earned PSUs. Unless earlier terminated, forfeited, relinquished or expired, the Earned PSUs will vest in full on [ ] (the Vesting Date), subject to the Participant remaining in continuous Employment from the Date of Grant through the Vesting Date except as described in Section 2(c) below.
(c) Cessation of Employment. If the Participants Employment ceases for any reason, except as expressly provided for in an employment, severance-benefit or other agreement between the Participant and the Company that is in effect at the time of such termination of Employment, the PSUs, to the extent not then vested, will be immediately forfeited for no consideration. Notwithstanding the foregoing, in the event the Participants Employment terminates due to the Participants death or Qualifying Retirement, in either case, prior to the Performance Period End Date (as defined in Exhibit A) and prior to a Covered Transaction, any unvested PSUs that are then outstanding shall not be forfeited upon such termination but shall instead remain outstanding and eligible to become Earned PSUs in accordance with the terms of this Agreement and, to the extent earned, shall vest in full on a prorated basis, based on the number of days the Participant was Employed during the Performance Period (without regard to any earlier termination thereof
on the consummation of a Covered Transaction or otherwise), on the earlier of the Vesting Date or immediately prior to the consummation of a Covered Transaction. For purposes of this Agreement, Qualifying Retirement means the Participants termination of Employment (other than for Cause or at a time when the Participants Employment could have been terminated for Cause) (i) at any time after the Participant has reached age sixty (60) with ten (10) years of service to the Company and its Affiliates; (ii) with the intention of concluding his or her working or professional career; and (iii) after the first anniversary of the Performance Period Start Date (as defined in Exhibit A). The Administrator will determine whether any leave or other extended period of absence results in a cessation of the Participants Employment for purposes of the Award and this Agreement; it being understood that if the Participant is on a leave or other extended period of absence that has been approved by the Administrator (i) with a duration of six (6) months or less or (ii) during which the Participants reemployment rights, if any, are guaranteed by statute or by contract, he or she shall be treated for purposes of the Award and this Agreement as remaining in Employment during such approved leave or other period of absence, unless the Administrator determines otherwise.
3. Issuance of Shares. The Company shall, as soon as practicable upon the vesting of any PSUs (but in no event later than March 15th of the year following the year in which such PSUs vest), issue Shares with respect to such vested PSUs to the Participant (or, in the event of the Participants death, to the person to whom the Award has passed by will or the laws of descent and distribution). No Shares will be issued pursuant to this Agreement unless and until all legal requirements applicable to the issuance or transfer of such Shares have been complied with to the satisfaction of the Administrator.
4. Company Policies. By accepting the Award, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the PSUs, including the right to any Shares issued in respect of the PSUs or proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by the terms of any clawback, recoupment or similar policy of the Company or any of its Affiliates and any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 7 of this Agreement.
5. Nontransferability. The PSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Shares issued in respect of vested PSUs may not be transferred for a period of twelve (12) months following the Vesting Date; provided, that this restriction shall not apply following the Participants death or in connection with or following a Covered Transaction. Except as described in the preceding sentence, Shares issued in respect of vested PSUs may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
6. Withholding. The Participant expressly acknowledges and agrees that the Participants rights hereunder, including the right to receive Shares following the vesting of any portion of the Award, are subject to the satisfaction of all taxes required to be withheld with respect to the Award. Unless otherwise determined by the Company, the Company shall automatically satisfy such tax withholding obligations by withholding from the Shares that would otherwise be issued with
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respect to any vested PSUs a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement. The Participant authorizes the Company and its Affiliates to withhold any amounts due in respect of any required tax withholdings by withholding from the Shares otherwise deliverable with respect to the Award, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant. Nothing in this Section 6 shall be construed as relieving the Participant of any liability for satisfying his or her tax obligations relating to the Award.
7. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been furnished or made available to the Participant. By accepting, or being deemed to have accepted, all or any part of the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
8. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument, (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder, and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
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Name: |
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Title: |
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Agreed and Accepted: | ||
By |
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[Participants Name] |
Exhibit 10.9
DIRECTOR FORM
Name of Participant: | [__________] | |
Number of Shares of Restricted Stock: | [__________] | |
Date of Grant: | [__________] |
WATERS CORPORATION
2020 EQUITY INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT
This agreement (this Agreement) evidences the grant of shares of Restricted Stock by Waters Corporation (the Company) to the individual named above (the Participant), pursuant to and subject to the terms and conditions of the Waters Corporation 2020 Equity Incentive Plan (as from time to time amended and in effect, the Plan). Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.
1. Grant of Restricted Stock. On the date of grant set forth above (the Date of Grant), the Company granted to the Participant, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, the number of shares of Restricted Stock set forth above (the Shares), subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.
2. Vesting. The term vest as used herein with respect to any Share means the lapsing of the forfeiture conditions described in this Section 2 with respect to such Share and the term vested as applied to any Share means that the Share is not then subject to forfeiture as described in this Section 2. Unless earlier terminated, forfeited, relinquished or expired, one hundred percent (100%) of the Shares will vest on the first (1st) anniversary of the Date of Grant, subject to the Participant remaining in continuous Employment from the Date of Grant through such vesting date. If the Participants Employment ceases for any reason prior to such vesting date, all then outstanding and unvested Shares will be automatically and immediately forfeited immediately upon such termination for no consideration. Notwithstanding the foregoing, in the event the Participants Employment terminates due to his or her death, any Shares that are then outstanding and unvested shall vest in full as of immediately prior to such termination.
3. Company Policies. By accepting the Shares, the Participant expressly acknowledges and agrees that the Participants rights, and those of any permitted transferee, with respect to the Shares, including the right to any proceeds from the disposition thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision). The Participant further agrees to be bound by any policy of the Company or any of its Affiliates that relates to trading on non-public information and permitted transactions with respect to shares of Stock, including limitations on hedging and pledging. Nothing in the preceding sentence will be construed as limiting the general application of Section 6 of this Agreement.
4. Nontransferability. Prior to becoming vested, the Shares may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. Following vesting, the Shares may be transferred subject to compliance with applicable law and the terms of any policies of the Company or any of its Affiliates.
5. Taxes. The Participant is responsible for satisfying and paying all taxes arising from or due in connection with the grant, vesting or disposition of the Shares. The Company will have no liability or obligation related to the foregoing.
6. Provisions of the Plan. This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference. A copy of the Plan as in effect on the Date of Grant has been made available to the Participant. By accepting the Shares, the Participant agrees to be bound by the terms of the Plan and this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.
7. Acknowledgements. The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.
[Signature page follows.]
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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the Date of Grant.
WATERS CORPORATION | ||
By: |
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Name: |
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Title: |
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Agreed and Accepted: | ||
By |
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[Participants Name] |
[Signature Page to Restricted Stock Agreement]
Exhibit 31.1
CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT OF 2002
I, Christopher J. OConnell, certify that:
1. |
I have reviewed this Quarterly Report on Form 10-Q of Waters Corporation; |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. |
The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) |
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) |
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) |
evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) |
disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. |
The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) |
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) |
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 29, 2020 |
/s/ Christopher J. OConnell |
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Christopher J. OConnell | ||||||
Chief Executive Officer |
Exhibit 31.2
CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT OF 2002
I, Sherry L. Buck, certify that:
1. |
I have reviewed this Quarterly Report on Form 10-Q of Waters Corporation; |
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. |
The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) |
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) |
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) |
evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) |
disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. |
The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
a) |
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and |
b) |
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 29, 2020 |
/s/ Sherry L. Buck |
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Sherry L. Buck | ||||||
Chief Financial Officer |
Exhibit 32.1
CHIEF EXECUTIVE OFFICER CERTIFICATION PURSUANT TO 18 U.S.C.
SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.
In connection with the Quarterly Report of Waters Corporation (the Company) on Form 10-Q for the period ended June 27, 2020, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Christopher J. OConnell, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
Date: July 29, 2020 |
By: /s/ Christopher J. OConnell |
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Christopher J. OConnell | ||||||
Chief Executive Officer |
Exhibit 32.2
CHIEF FINANCIAL OFFICER CERTIFICATION PURSUANT TO 18 U.S.C.
SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
The certification set forth below is hereby made solely for the purpose of satisfying the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 and may not be relied upon or used for any other purposes.
In connection with the Quarterly Report of Waters Corporation (the Company) on Form 10-Q for the period ended June 27, 2020, as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Sherry L. Buck, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
A signed original of this written statement required by Section 906 or other document authenticating, acknowledging or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
Date: July 29, 2020 |
By: /s/ Sherry L. Buck |
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Sherry L. Buck | ||||||
Chief Financial Officer |