Exhibit 10.16
Xylem
Senior Executive Severance Pay Plan
EFFECTIVE AS OF 10/31/11
1. Purpose
     The purpose of this Xylem Senior Executive Severance Pay Plan (“Plan”) is
to assist in occupational transition by providing severance pay for employees
covered by this Plan whose employment is terminated under conditions set forth
in this Plan.
     The Plan first became effective as of October 31, 2011 following the
spin-off of Xylem Inc. from ITT Corporation (the “Predecessor Corporation”) on
October 31, 2011. The Predecessor Corporation maintained a similar plan prior to
the spin-off (the “Predecessor Plan”), and the Plan was created to continue
service accruals under the Predecessor Plan. The Plan shall remain in effect as
provided in Section 12 hereof, and Executives shall receive full credit for
their service and participation with the Predecessor Corporation as provided in
Section 4 hereof.
2. Covered Employees
     Covered employees under this Plan (“Executives”) are full-time, regular
salaried employees of Xylem Inc. (“Xylem”) and of any subsidiary company (“Xylem
Subsidiary”) (collectively or individually as the context requires “Company”)
who are United States citizens, or who are employed in the United States, in
Band A currently (Senior Vice Presidents and above to be further defined by the
Xylem Compensation and Personnel Committee) at any time within the two year
period immediately preceding the date the Company selects as the Executive’s
last day of active employment (“Scheduled Termination Date”).
3. Severance Pay Upon Termination of Employment
     If the Company terminates an Executive’s employment, the Executive shall be
provided severance pay in accordance with the terms of this Plan except where
the Executive:
     • is terminated for cause,
     • accepts employment or refuses comparable employment with a purchaser as
provided in Section 8, “Divestiture”,
     • is terminated with a Scheduled Termination Date on or after the
Executive’s Normal Retirement Date as defined herein, or
     • voluntarily terminates employment with the Company prior to the Scheduled
Termination Date.
     No severance pay will be provided under this Plan where the Executive
terminates employment by:

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     • voluntarily resigning,
     • voluntarily retiring, or
     • failing to return from an approved leave of absence (including a medical
leave of absence).
     No severance pay will be provided under this Plan upon any termination of
employment as a result of the Executive’s death or disability.
     “Normal Retirement Date” shall mean the first of the month which coincides
with or follows the Executive’s 65th birthday.
4. Schedule of Severance Pay
     Severance pay will be provided in accordance with the following Schedule of
Severance Pay which sets forth the months of Base Pay which is provided to an
Executive based upon the Executive’s Years of Service as of the Scheduled
Termination Date.

          Years of Service   Months of Base Pay
Less than 4
    12  
4
    13  
5
    14  
6
    15  
7
    16  
8
    17  
9
    18  
10
    19  
11
    20  
12
    21  
13
    22  
14
    23  
15 or more
    24  

     “Base Pay” shall mean the annual base salary rate payable or in effect with
respect to the Executive at the Scheduled Termination Date divided by twelve
(12) months. Such annual base salary rate shall in no event be less than the
highest annual base salary rate paid or in effect with respect to the Executive
at any time during the twenty-four month (24) period immediately preceding the
Scheduled Termination Date.
     “Years of Service” shall mean the total number of completed years of
employment since the Executive’s Xylem system service date to the Scheduled
Termination Date, rounded to the nearest whole year; provided that, for the
purposes of “Years of Service,” service shall include years with the Predecessor
Corporation. The Xylem system service date is the date from which employment in
the Xylem system is recognized for purposes of determining eligibility for
vesting under the applicable Company retirement plan covering the Executive on
the Scheduled Termination Date; provided, however, that for purposes of service
under the Predecessor Plan,

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employment in the Predecessor Corporation’s system is recognized for purposes of
determining eligibility for vesting under the applicable retirement plan
covering the Executive.
     Notwithstanding the above Schedule of Severance Pay, (i) in no event shall
months of Base Pay provided to an Executive exceed the number of months
remaining between the Scheduled Termination Date and the Executive’s Normal
Retirement Date or (ii) shall severance pay exceed the equivalent of twice the
Executive’s total annual compensation during the year immediately preceding the
Scheduled Termination Date.
     Notwithstanding any other provision of the Plan to the contrary, all prior
service and participation by an Executive with the Predecessor Corporation shall
be credited in full towards an Executive’s service and participation with the
Company.
5. Form of Payment of Severance Pay
     Severance pay shall be paid in the form of periodic payments according to
the regular payroll schedule (“Severance Pay”). Severance Pay will commence
within 60 days following the Scheduled Termination Date.
     In the event of an Executive’s death during the period the Executive is
receiving Severance Pay, the amount of severance pay remaining shall be paid in
a discounted lump sum to the Executive’s spouse or to such other beneficiary or
beneficiaries designated by the Executive in writing, or, if the Executive is
not married and failings such designation, to the estate of the Executive. Any
discounted lump sum paid under this Plan shall be equal to the present value of
the remaining periodic payments of severance pay as determined by Xylem using an
interest rate equal to the prime rate at Citibank in effect on the date of the
Executive’s death.
     If an Executive is receiving Severance Pay, the Executive must continue to
be available to render to the Company reasonable assistance, consistent with the
level of the Executive’s prior position with the Company, at times and locations
that are mutually acceptable. In requesting such services, the Company will take
into account any other commitments which the Executive may have. After the
Scheduled Termination Date and normal wind up of the Executive’s former duties,
the Executive will not be required to perform any regular services for the
Company. In the event the Executive secures other employment during the period
the Executive is receiving Severance Pay, the Executive must promptly notify the
Company.
     Severance Pay will cease if an Executive is rehired by the Company.
6. Benefits During Severance Pay
     As long as an Executive is receiving Severance Pay, except as provided in
this Section or in Section 7, the Executive will continue to be eligible for
participation in Company employee benefit plans in accordance with the
provisions of such plans as in effect on the Scheduled Termination Date. An
Executive will not be eligible to participate in any Company tax qualified
retirement plans, non-qualified excess or supplemental benefit plans, short-term
or long-term disability plans, the Company business travel accident plan or any
new employee benefit plan or any improvement to any existing employee benefit
plan adopted by the Company after the Scheduled Termination Date.

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7. Excluded Executive Compensation Plans, Programs, Arrangements, and
Perquisites
     During the period an Executive is receiving Severance Pay, the Executive
will not be eligible to accrue any vacation or participate in any (i) bonus
program, (ii) special termination programs, (iii) tax or financial advisory
services, (iv) new awards under any stock option or stock related plans for
executives (provided that the Executive will be eligible to exercise any
outstanding stock options in accordance with the terms of any applicable stock
option plan), (v) new or revised executive compensation programs that may be
introduced after the Scheduled Termination Date and (vi) any other executive
compensation program, plan, arrangement, practice, policy or perquisites unless
specifically authorized by Xylem in writing. The period during which an
Executive is receiving Severance Pay does not count as service for the purpose
of any Xylem long term incentive award program unless otherwise provided in plan
documents previously approved by the Board of Directors or Compensation and
Personnel Committee.
8. Divestiture
     If a Xylem Subsidiary or division of Xylem or a portion thereof at which an
Executive is employed is sold or divested and if (i) the Executive accepts
employment or continued employment with the purchaser or (ii) refuses employment
or continued employment with the purchaser on terms and conditions substantially
comparable to those in effect immediately preceding the sale or divestiture, the
Executive shall not be provided severance pay under this Plan. The provisions of
this Section 8 apply to divestitures accomplished through sales of assets or
through sales of corporate entities.
9. Disqualifying Conduct
     If during the period an Executive is receiving Severance Pay, the Executive
(i) engages in any activity which is inimical to the best interests of the
Company; (ii) disparages the Company; (iii) fails to comply with any Company
Covenant Against Disclosure and Assignment of Rights to Intellectual Property;
(iv) without the Company’s prior consent, induces any employees of the Company
to leave their Company employment; (v) without the Company’s prior consent,
engages in, becomes affiliated with, or becomes employed by any business
competitive with the Company; or (vi) fails to comply with applicable provisions
of the Xylem Code of Conduct or applicable Xylem Corporate Policies or any
applicable Xylem Subsidiary Code or policies, then the Company will have no
further obligation to provide severance pay.
10. Release
     The Company shall not be required to make or continue any severance
payments under this Plan unless the Executive executes and delivers to Xylem
within 45 days following the Scheduled Termination Date a release, satisfactory
to Xylem, in which the Executive discharges and releases the Company and the
Company’s directors, officers, employees and employee benefit plans from all
claims (other than for benefits to which Executive is entitled under any Company
employee benefit plan) arising out of Executive’s employment or termination of
employment.

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11. Administration of Plan
     This Plan shall be administered by Xylem, who shall have the exclusive
right to interpret this Plan, adopt any rules and regulations for carrying out
this Plan as may be appropriate and decide any and all matters arising under
this Plan, including but not limited to the right to determine appeals. Subject
to applicable Federal and state law, all interpretations and decisions by Xylem
shall be final, conclusive and binding on all parties affected thereby.
12. Termination or Amendment
     Xylem may terminate or amend this Plan (“Plan Change”) at any time except
that no such Plan Change may reduce or adversely affect severance pay for any
Executive whose employment terminates within two years of the effective date of
such Plan Change provided that the Executive was a covered employee under this
Plan on the date of such Plan Change.
13. Offset
     Any severance pay provided to an Executive under this Plan shall be offset
in a manner consistent with Section 15 by reducing such severance pay by any
severance pay, salary continuation, termination pay or similar pay or allowance
which Executive receives or is entitled to receive (i) under any other Company
plan, policy practice, program, arrangement; (ii) pursuant to any employment
agreement or other agreement with the Company; (iii) by virtue of any law,
custom or practice. Any severance pay provided to Executive under this Plan
shall also be offset by reducing such severance pay by any severance pay, salary
continuation pay, termination pay or similar pay or allowance received by the
Executive as a result of any prior termination of employment with the Company.
     Coordination of severance pay with any pay or benefits provided by any
applicable Xylem short-term or long-term disability plan shall be in accordance
with the provisions of those plans.
14. Miscellaneous Except as provided in this Plan, the Executive shall not be
entitled to any notice of termination or pay in lieu thereof.
     In cases where severance pay is provided under this Plan, pay in lieu of
any unused current year vacation entitlement will be paid to the Executive in a
lump sum.
     Benefits under this Plan are paid for entirely by the Company from its
general assets.
     This Plan is not a contract of employment, does not guarantee the Executive
employment for any specified period and does not limit the right of the Company
to terminate the employment of the Executive at any time.
     The section headings contained in this Plan are included solely for
convenience of reference and shall not in any way affect the meaning of any
provision of this Plan
15. Section 409A
     This Plan is intended to comply with Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”) and will be interpreted in a manner
intended to comply with

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Section 409A of the Code. Notwithstanding anything herein to the contrary,
(i) if at the time of the Executive’s termination of employment with the Company
the Executive is a “specified employee” as defined in Section 409A of the Code
(and any related regulations or other pronouncements thereunder) and the
deferral of the commencement of any payments or benefits otherwise payable
hereunder as a result of such termination of employment is necessary in order to
prevent any accelerated or additional tax under Section 409A of the Code, then
the Company will defer the commencement of the payment of any such payments or
benefits hereunder (without any reduction in such payments or benefits
ultimately paid or provided to the Executive) until a date that is six months
following the Executive’s termination of employment with the Company (or the
earliest date as is permitted under Section 409A of the Code), at which point
all payments deferred pursuant to this Section 15 shall be paid to the Executive
in a lump sum and (ii) if any other payments of money or other benefits due
hereunder could cause the application of an accelerated or additional tax under
Section 409A of the Code, such payments or other benefits shall be deferred if
deferral will make such payment or other benefits compliant under Section 409A
of the Code, or otherwise such payment or other benefits shall be restructured,
to the extent possible, in a manner, determined by the Company, that does not
cause such an accelerated or additional tax. To the extent any reimbursements or
in-kind benefits due under this Plan constitute “deferred compensation” under
Section 409A of the Code, any such reimbursements or in-kind benefits shall be
paid in a manner consistent with Treas. Reg.
     Section 1.409A-3(i)(1)(iv). Each payment made under this Plan shall be
designated as a “separate payment” within the meaning of Section 409A of the
Code. The Company shall consult with Executives in good faith regarding the
implementation of the provisions of this section; provided that neither the
Company nor any of its employees or representatives shall have any liability to
Executives with respect thereto.
16. Adoption Date and Amendments
     This Plan was adopted by Xylem on October 31, 2011 (“Adoption Date”) and
does not apply to any termination of employment which occurred or which was
communicated to the Executive prior to the Adoption Date.