Exhibit 10.1

 

OSI SYSTEMS, INC
NONQUALIFIED DEFINED BENEFIT PLAN

 

Retirement Benefit Award Agreement

 

THIS AMENDED AND RESTATED AWARD AGREEMENT (“Award Agreement”) is made effective
as of January 1, 2012, (the “Effective Date”) by and between OSI Systems, Inc.
(the “Company”), and Deepak Chopra (the “Eligible Employee”).

 

WHEREAS, the Company has adopted the OSI Systems, Inc. Nonqualified Defined
Benefit Plan, effective May 9, 2008, as amended (the “Plan”) and designated the
Eligible Employee as a participant in the Plan;

 

WHEREAS, the Company now desires to accelerate vesting and change the timing of
the Eligible Employee’s current Retirement Benefit to delay commencement by five
(5) years consistent with the requirements of Section 409A of the Internal
Revenue Code (the “Code”) and to add additional benefits payable to the Eligible
Employee under the terms of the Plan;

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1.           Participant.  The Eligible Employee shall continue as a Participant
in the Plan.

 

2.           Incorporation of Plan.  The Plan, a copy of which has been reviewed
by the Eligible Employee and his/her advisors prior to execution of this Award
Agreement is made a part hereof as though set forth in full herein. Terms and
phrases used herein shall have the same definitions or usage as in the Plan. The
parties shall be bound by, and have the benefit of, each and every provision of
the Plan.

 

3.           Retirement Benefit.  The Eligible Employee’s new Normal Retirement
Date as such term is used under the terms of the Plan shall be the first day of
January following the date the Eligible Employee attains age 68.  The Eligible
Employee shall be entitled to a normal Retirement Benefit equal to the
previously promised benefit of Six Million Dollars ($6,000,000 — previously 10
installments of $600,000 each) commencing on the January 1st following the fifth
(5th) anniversary of the previously scheduled commencement date (the prior
commencement date was the month following age 65 and the new commencement date
for the prior benefits is January 1st following age 70). The prior benefit shall
be payable at a rate of One Million Dollars per year for a period of six
(6) years following attainment of ages 70, 71, 72, 73, 74 , and 75, in quarterly
installments on the first day of each calendar quarter.

 

In addition to the previously promised installment benefits, the Eligible
Employee shall be fully vested as of the Effective Date of this Agreement in
four (4) additional separate individual annual benefits of One Million Dollars
per year, payable in the calendar year following age 68, 69, 76 and 77.  For
avoidance of doubt, the intent is to increase the total benefits to Ten Million
Dollars ($10,000,000) payable over a period of ten (10) years commencing at age
68 in a manner that complies with Code Section 409A.  The benefits shall

 

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be payable in quarterly installments of Two Hundred and Fifty Thousand Dollars
($250,000) on the first day of each calendar quarter commencing on the first day
of January following the Eligible Employee’s specified birth date.  Thus the
first quarterly benefit payment will be January 1, 2019 and the last quarterly
payment will be October 1, 2028.

 

Commencing with the second year of benefit payments (in 2020), each benefit
payment shall be adjusted upward for any calendar year in which the California
CPI index for the greater Los Angeles area shall exceed two percent (2%) as
follows: the benefit payment made in any calendar year commencing after age 69
shall be increased by the amount by which the CPI index for the prior calendar
year exceed two percent (2%).  Thus, for example, if the CPI index for 2019 is
3%, commencing January 1, 2020, the amount of each benefit payment shall
thereafter be increased by 1% and, if in 2020, the CPI index is 2.5%, then,
commencing January 1, 2021, the amount of each benefit payment shall thereafter
be increased by an additional .5%.

 

4.           Vesting.  The Eligible Employee shall be fully vested under all
circumstances in both the prior and the new benefits on the Effective Date
hereof.

 

5.           Death Benefit.  Notwithstanding Section 3 above and
Section 5.1(b) or any other provisions of the Plan to the contrary, if the
Eligible Employee’s death occurs prior to the Normal Retirement Date, the
beneficiary shall receive the old and new portions of the normal Retirement
Benefit, payable over ten (10) years at One Million Dollars ($1,000,000) per
year, commencing within sixty (60) days following the Eligible Employee’s
death.  Effective February 15, 2013, the death benefits shall be paid in four
quarterly installments on the first day of each calendar quarter of the
scheduled payment year.  If, either before or after the Normal Retirement Date,
the Eligible Employee is receiving benefits at the time of his death, the unpaid
balance of the Employee’s Retirement Benefit shall be paid to the Eligible
Employee’s Beneficiary at the same time the benefit payments would have been
paid to the Eligible Employee had he lived.

 

6.           Disability Benefit.  Notwithstanding Section 3 above and
Section 5.1(a) and any other provisions of the Plan to the contrary, if the
Eligible Employee incurs a Separation from Service prior to the Normal
Retirement Date, by reason of the Eligible Employee’s Disability, as such term
is defined under Code Section 409A, the Eligible Employee shall be entitled to
receive the old and new portions of the normal Retirement Benefit, payable over
ten (10) years at One Million Dollars ($1,000,000) per year, commencing within
sixty (60) days following the Eligible Employee’s Separation from Service by
reason of Disability. Effective February 15, 2013, the disability benefits shall
be paid in four quarterly installments on the first day of each calendar quarter
of the scheduled payment year.

 

7.           Change in Control.  Notwithstanding the forgoing, as provided in
Section 5.2(c) of the Plan, in the event of the Eligible Employee’s Separation
from Service pursuant to or for any reason within twenty-four (24) months
following a Change in Control, the Eligible Employee shall receive (a) the net
present value of the old portion of the Retirement Benefit (installments in
years 3-8) payable in the form of a single lump sum within ninety (90) days
following Separation from Service, subject to Section 8 below, and (b) the net
present value of the new portion of the Retirement Benefit (installments in
years 1, 2, 9 and 10) payable in the form of a single lump sum ninety (90) days
following the first anniversary of the Eligible

 

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Employee’s Separation from Service, subject to Section 8 below.  In the event a
Change in Control occurs after the Eligible Employee’s Separation from Service
during the payout of benefits to the Eligible Employee or his Beneficiary, the
present value of all remaining payments shall be paid in the form of a single
lump sum within ninety (90) days following the Change in Control.

 

8.           Code Section 409A Compliance.  Notwithstanding any provision to the
contrary in the Plan or this Award Agreement, in the event that the Eligible
Employee is a “key employee” (as defined in Code Section 416(i) (without regard
to paragraph (5) thereof)) of the Company (or any successor or other entity
treated as the same employer under Code Section 409A) any stock in which is
publicly traded on an established securities market, to the extent required
under Code Section 409A to avoid excise taxes, the commencement of benefits
payable on Separation from Service shall be delayed until the earlier of (i) the
day after the end of the sixth (6th) complete calendar month following the
Separation from Service, or (ii) the Eligible Employee’s death.

 

IN WITNESS WHEREOF, the parties hereto have entered into this amended and
restated Award Agreement as of the day and year specified in the opening
paragraph.

 

 

OSI Systems, Inc.

 

 

 

 

By

/s/ Alan Edrick

 

Title

Executive Vice President and CFO

 

 

 

 

/s/ Deepak Chopra

 

Deepak Chopra

 

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