Document:

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                  ASSIGNMENT No. 19 OF RECEIVABLES IN ADDITIONAL ACCOUNTS, (this
"Assignment") dated as of March 6, 2002, by and between CHASE MANHATTAN BANK
USA, NATIONAL ASSOCIATION, a national banking corporation organized and existing
under the laws of the United States of America ("Chase USA"), and THE BANK OF
NEW YORK, a banking corporation organized and existing under the laws of the
State of New York (the "Trustee") pursuant to the Pooling and Servicing
Agreement referred to below.

                              W I T N E S S E T H:
                              - - - - - - - - - -

                  WHEREAS, Chase USA, as Transferor on and after June 1, 1996,
JPMorgan Chase Bank (formerly, The Chase Manhattan Bank), as Transferor prior to
June 1, 1996 and as Servicer, and the Trustee are parties to the Third Amended
and Restated Pooling and Servicing Agreement, dated as of November 15, 1999, as
amended by the First Amendment thereto dated as of March 31, 2001 and the Second
Amendment thereto dated as of March 1, 2002 (hereinafter as such agreement may
have been, or may from time to time be, amended, supplemented or otherwise
modified, the "Pooling and Servicing Agreement");

                  WHEREAS, pursuant to the Pooling and Servicing Agreement,
Chase USA wishes to designate Additional Accounts of Chase USA to be included as
Accounts and to convey the Receivables of such Additional Accounts, whether now
existing or hereafter created, to the Trust as part of the corpus of the Trust
(as each such term is defined in the Pooling and Servicing Agreement); and

                  WHEREAS, the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof;

                  NOW, THEREFORE, Chase USA and the Trustee hereby agree as
follows:

                                    1. Defined Terms. All terms defined in the
                  Pooling and Servicing Agreement and used herein shall have
                  such defined meanings when used herein, unless otherwise
                  defined herein.

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                                    "Addition Date" shall mean, with respect to
                  the Additional Accounts designated hereby, March 6, 2002.

                                    "Notice Date" shall mean, with respect to
                  the Additional Accounts designated hereby, January 15, 2002.

                                    2. Designation of Additional Accounts. Chase
                  USA shall deliver to the Trustee not later than five Business
                  Days after the Addition Date, a computer file or microfiche
                  list containing a true and complete list of each MasterCard
                  and VISA account which as of the Addition Date shall be deemed
                  to be an Additional Account, such accounts being identified by
                  account number and by the amount of Receivables in such
                  accounts as of the close of business on the Addition Date.
                  Such list shall be delivered five Business Days after the date
                  of this Assignment and shall be marked as Schedule 1 to this
                  Assignment and, as of the Addition Date, shall be incorporated
                  into and made a part of this Assignment.

                                    3. Conveyance of Receivables.

                                    A. Chase USA does hereby transfer, assign,
                  set-over and otherwise convey to the Trustee on behalf of the
                  Trust for the benefit of the Certificateholders, without
                  recourse on and after the Addition Date, all right, title and
                  interest of Chase USA in and to the Receivables now existing
                  and hereafter created in the Additional Accounts designated
                  hereby, all monies due or to become due with respect thereto
                  (including all Finance Charge Receivables) and all proceeds of
                  such Receivables, Recoveries, Interchange, Insurance Proceeds
                  relating to such Receivables and the proceeds of any of the
                  foregoing.

                                    B. In connection with such transfer, Chase
                  USA agrees to record and file, at its own expense, a financing
                  statement with respect to the Receivables now existing and
                  hereafter created in the Additional Accounts designated hereby
                  (which may be a single financing statement with respect to all
                  such Receivables) for the transfer of accounts as defined in
                  Section 9-102 of the UCC as in effect in the State of New York
                  meeting the requirements of applicable state law in such
                  manner and such jurisdictions as are necessary to perfect the
                  assignment of such Receivables to the Trustee on behalf of the
                  Trust for the benefit of the Certificateholders (the "Secured
                  Party"), and to deliver a file-stamped copy of such financing
                  statement or other evidence of such filing (which may, for
                  purposes of this Section 3, consist of telephone confirmation
                  of such filing) to the Trustee on or prior to the date of this
                  Assignment.

                                       2

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                                    C. It is the intention of the parties hereto
                  that all transfers of Receivables to the Trust pursuant to
                  this Assignment be subject to, and be treated in accordance
                  with, the Delaware Act and each of the parties hereto agrees
                  that this Assignment has been entered into by the parties
                  hereto in express reliance upon the Delaware Act. For purposes
                  of complying with the requirements of the Delaware Act, each
                  of the parties hereto hereby agrees that any property, assets
                  or rights purported to be transferred, in whole or in part, by
                  Chase USA pursuant to this Assignment shall be deemed to no
                  longer be the property, assets or rights of Chase USA. The
                  parties hereto acknowledge and agree that each such transfer
                  is occurring in connection with a " securitization
                  transaction" within the meaning of the Delaware Act.

                                    D. In connection with such transfer, Chase
                  USA further agrees, at its own expense, on or prior to the
                  date of this Assignment to indicate in its computer files that
                  Receivables created in connection with the Additional Accounts
                  designated hereby have been transferred to the Trust pursuant
                  to this Assignment for the benefit of the Certificateholders.

                                    E. Chase USA hereby grants to the Secured
                  Party a security interest in all of Chase USA's right, title
                  and interest in, to and under the Receivables now existing and
                  hereafter created in the Additional Accounts designated
                  hereby, all monies due or to become due with respect to such
                  Receivables, Insurance Proceeds relating to such Receivables,
                  Recoveries, Interchange and the proceeds to any of the
                  foregoing to secure a loan in an amount equal to the unpaid
                  principal amount of the Investor Certificates issued or to be
                  issued pursuant to the Pooling and Servicing Agreement and the
                  interests accrued at the related Certificate Rates, and this
                  Assignment shall constitute a security agreement under
                  applicable law. Chase USA shall execute continuation
                  statements and provide other further assurances to maintain
                  the perfection and priority of such security interest of the
                  Secured Party.

                                    4. Acceptance by Trustee. The Trustee hereby
                  acknowledges its acceptance on behalf of the Trust for the
                  benefit of the Certificateholders of all right, title and
                  interest previously held by Chase USA in and to the
                  Receivables now existing and hereafter created, and declares
                  that it shall maintain such right, title and interest, upon
                  the Trust herein set forth, for the benefit of all
                  Certificateholders.

                                       3

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                           5. Representations and Warranties of Chase USA. Chase
         USA hereby represents and warrants to the Secured Party as of the
         Addition Date:

                                    A. Legal, Valid and Binding Obligation. This
                  Assignment constitutes a legal, valid and binding obligation
                  of Chase USA enforceable against Chase USA in accordance with
                  its terms, except as such enforceability may be limited by
                  applicable bankruptcy, insolvency, reorganization, moratorium
                  or other similar laws now or hereafter in effect affecting the
                  enforcement of creditors' rights in general and the rights of
                  creditors of banking associations and except as such
                  enforceability may be limited by general principles of equity
                  (whether considered in a suit at law or in equity).

                                    B. Eligibility of Accounts and Receivables.
                  Each Additional Account designated hereby is an Eligible
                  Account and each Receivable in such Additional Account is an
                  Eligible Receivable.

                                    C. Selection Procedures. No selection
                  procedures believed by Chase USA to be materially adverse to
                  the interests of the Investor Certificateholders were utilized
                  in selecting the Additional Accounts designated hereby from
                  the available Eligible Accounts in the Bank Portfolio.

                                    D. Insolvency. Chase USA is not insolvent
                  and, after giving effect to the conveyance set forth in
                  Section 3 of this Assignment, will not be insolvent.

                                    E. Security Interest. This Assignment
                  constitutes either: (i) a valid transfer and assignment to the
                  Trust of all right, title and interest of Chase USA in and to
                  Receivables now existing and hereafter created in the
                  Additional Accounts designated hereby, and all proceeds (as
                  defined in the UCC) of such Receivables and Insurance Proceeds
                  relating thereto, and such Receivables and any proceeds
                  thereof and Insurance Proceeds relating thereto will be held
                  by the Secured Party free and clear of any Lien of any Person
                  claiming through or under Chase USA or any of its Affiliates
                  except for (x) Liens permitted

                                       4

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                  under subsection 2.5(b) of the Pooling and Servicing
                  Agreement, (y) the interest of the holder of the Transferor
                  Certificate and (z) Chase USA's right to receive interest
                  accruing on, and investment earnings in respect of, the
                  Finance Charge Account and the Principal Account as provided
                  in the Pooling and Servicing Agreement; or (ii) a valid and
                  continuing security interest (as defined in the UCC) in the
                  Additional Accounts in favor of the Secured Party, the
                  proceeds (as defined in the UCC) thereof and Insurance
                  Proceeds relating thereto, upon the conveyance of such
                  Receivables to the Trust, which security interest is prior to
                  all other Liens, and is enforceable against creditors of and
                  purchasers from Chase USA, and which will be enforceable with
                  respect to the Receivables thereafter created in respect of
                  Additional Accounts designated hereby, the proceeds (as
                  defined in the UCC) thereof and Insurance Proceeds relating
                  thereto, upon such creation; and (iii) if this Assignment
                  constitutes the grant of a security interest to the Secured
                  Party in such property, upon the filing of a financing
                  statement described in Section 3 of this Assignment with
                  respect to the Additional Accounts designated hereby and in
                  the case of the Receivables of such Additional Accounts
                  thereafter created and the proceeds (as defined in the UCC)
                  thereof, and Insurance Proceeds relating to such Receivables,
                  upon such creation, the Secured Party shall have a first
                  priority perfected security interest in such property (subject
                  to Section 9-315 the UCC as in effect in the State of
                  Delaware), except for Liens permitted under subsection 2.5(b)
                  of the Pooling and Servicing Agreement. Chase USA has caused
                  or will have caused, within ten days, the filing of all
                  appropriate financing statements in the proper filing office
                  in the appropriate jurisdictions under applicable law in order
                  to perfect the security interest in the Receivables granted to
                  the Secured Party hereunder. The Receivables constitute
                  "accounts" within the meaning of the applicable UCC.

                                    F. Other Liens. Other than the security
                  interest granted to the Secured Party pursuant to this
                  Assignment, Chase USA has not pledged, assigned, sold, granted
                  a security interest in, or otherwise conveyed any of the
                  Receivables. Chase USA has not authorized the filing of and is
                  not aware of any financing statements against Chase USA that
                  include a description of collateral covering the Receivables
                  other than any financing statement (i) relating to the
                  security interest granted to the Secured Party hereunder, (ii)
                  that has been terminated, or (iii) that names The Bank of New
                  York as secured party. Chase USA is not aware of any judgment
                  or tax lien filings against Chase USA. Chase USA owns and has
                  good and marketable title to the Receivables free and clear of
                  any Lien, claim or encumbrance of any Person.

                                       5

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                                    G. Breach of Representations and Warranties.
                  The provision set forth in Section 2.4(d) of the Pooling and
                  Servicing Agreement shall be applicable to any breach of the
                  representations and warranties of this Section 5 with respect
                  to any Receivable.

                           6. Conditions Precedent. The acceptance by the
         Trustee set forth in Section 4 and the amendment of the Pooling and
         Servicing Agreement set forth in Section 7 are subject to the
         satisfaction, on or prior to the Addition Date, of the following
         conditions precedent:

                                    A. Officer's Certificate. Chase USA shall
                  have delivered to the Trustee a certificate of a Vice
                  President or more senior officer substantially in the form of
                  Schedule 2 hereto, certifying that (i) all requirements set
                  forth in Section 2.6 of the Pooling and Servicing Agreement
                  for designating Additional Accounts and conveying the
                  Principal Receivables of such Account, whether now existing or
                  hereafter created, have been satisfied and (ii) each of the
                  representations and warranties made by Chase USA in Section 5
                  is true and correct as of the Addition Date. The Trustee may
                  conclusively rely on such Officer's Certificate, shall have no
                  duty to make inquiries with regard to the matters set forth
                  therein, and shall incur no liability in so relying.

                                    B. Opinion of Counsel. Chase USA shall have
                  delivered to the Trustee an Opinion of Counsel with respect to
                  the Additional Accounts designated hereby substantially in the
                  form of Exhibit E to the Pooling and Servicing Agreement.

                           7. Amendment of the Pooling and Servicing Agreement.
         The Pooling and Servicing Agreement is hereby amended to provide that
         all references therein to the "Pooling and Servicing Agreement," to
         "this Agreement" and "herein" shall be deemed from and after the
         Addition Date to be a dual reference to the Pooling and Servicing
         Agreement as supplemented by this Assignment and by Assignment No. 1 of
         Receivables in Additional Accounts, dated as of July 1, 1996,
         Assignment No. 2 of Receivables in

                                       6

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         Additional Accounts, dated as of September 1, 1996, Assignment No.3 of
         Receivables in Additional Accounts, dated as of December 1, 1997,
         Assignment No. 4 of Receivables in Additional Accounts, dated as of
         February 1, 1998, Assignment No. 5 of Receivables in Additional
         Accounts, dated as of April 1, 1998, Assignment No. 6 of Receivables in
         Additional Accounts, dated as of August 1, 1998, Assignment No. 7 of
         Receivables in Additional Accounts, dated as of November 1, 1998,
         Assignment No. 8 of Receivables in Additional Accounts, dated as of
         February 1, 1999, Assignment No. 9 of Receivables in Additional
         Accounts, dated as of April 1, 1999, Assignment No. 10 of Receivables
         in Additional Accounts, dated as of July 1, 1999, Assignment No. 11 of
         Receivables in Additional Accounts, dated as of October 1, 1999,
         Assignment No. 12 of Receivables in Additional Accounts, dated as of
         February 1, 2000, Assignment No. 13 of Receivables in Additional
         Accounts, dated as of April 1, 2000, Assignment No. 14 of Receivables
         in Additional Accounts, dated as of May 1, 2000, Assignment No. 15 of
         Receivables in Additional Accounts, dated as of August 1, 2000,
         Assignment No. 16 of Receivables in Additional Accounts, dated as of
         July 1, 2001, Assignment No. 17 dated as of September 1, 2001,
         Assignment No. 18 of Receivables in Additional Accounts, dated as of
         November 1, 2001, Reassignment No. 1 of Receivables in Removed
         Accounts, dated as of September 30, 1997 and Reassignment No. 2 of
         Receivables in Removed Accounts, dated as of December 1, 1997. Except
         as expressly amended hereby, all of the representations, warranties,
         terms, covenants and conditions to the Pooling and Servicing Agreement
         shall remain unamended and shall continue to be, and shall remain, in
         full force and effect in accordance with its terms and except as
         expressly provided herein shall not constitute or be deemed to
         constitute a waiver of compliance with or a consent to noncompliance
         with any term or provisions of the Pooling and Servicing Agreement.

                           8. Survival. The representations, warranties and
         covenants of the parties hereto shall survive the assignment of the
         Receivables pursuant to this Assignment and the termination of this
         Assignment, and shall inure to the benefit of the Trust.
         Notwithstanding to the contrary in this Assignment, the representations
         and warranties of the Chase USA herein shall not survive after the
         tenth (10th) anniversary of the Addition Date.

                                       7

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                           9. Waivers and Amendments. This Assignment may be
         amended, superseded, canceled, renewed or extended and the terms hereof
         may be waived, only by a written instrument signed by authorized
         representatives of the parties or, in the case of a waiver, by an
         authorized representative of the party waiving compliance and, in all
         cases, subject to confirmation by each Rating Agency then rating any
         Investor Certificates. No such written instrument shall be effective
         unless it expressly recites that it is intended to amend, supersede,
         cancel, renew or extend this Assignment or to waive compliance with one
         or more of the terms hereof, as the case may be. No delay on the part
         of any party in exercising any right, power or privilege hereunder
         shall operate as a waiver thereof, nor shall any waiver on the part of
         any party of any such right, power or privilege, or any single or
         partial exercise of any such right, power or privilege, preclude any
         further exercise thereof or the exercise of any other such right, power
         or privilege.

                           10. Counterparts. This Assignment may be executed in
         two or more counterparts (and by different parties on separate
         counterparts), each of which shall be an original, but all of which
         together shall constitute one and the same instrument.

                           11. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
         BY, CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE
         OF DELAWARE WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND
         THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
         DETERMINED IN ACCORDANCE WITH SUCH LAWS.

                                       8

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                  IN WITNESS WHEREOF, the undersigned have caused this
Assignment of Receivables in Additional Accounts to be duly executed and
delivered by their respective duly authorized officers on the day and year first
above written.

                                   CHASE MANHATTAN BANK USA,
                                   NATIONAL ASSOCIATION

                                   By:________________________
                                      Name:
                                      Title:

                                   THE BANK OF NEW YORK,
                                     as Trustee

                                   By:________________________
                                      Name:
                                      Title:

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                                                                 Schedule 1
                                                             to Assignment of
                                                              Receivables in
                                                           Additional Accounts
                                                           -------------------

                               ADDITIONAL ACCOUNTS
                               -------------------<PAGE>

                                                                    EXHIBIT 10.1

         EMPLOYMENT AGREEMENT dated December 18, 2001, between PALL CORPORATION,
a New York corporation (the "Company"), and ERIC KRASNOFF ("Executive").

         WHEREAS, the parties hereto are parties to an Employment Agreement
dated November 15, 2001 (the "Existing Agreement"), and

         WHEREAS, on the date hereof the Compensation Committee of the Board of
Directors of the Company has approved the substitution of subsection (f) of ss.6
hereof for ss.6(f) of the Existing Agreement and, accordingly, the parties
desire to terminate the Existing Agreement and simultaneously replace it with
this Agreement, effective August 1, 2001 (that having been the effective date of
the Existing Agreement),

         NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements hereinafter set forth, the parties hereto agree as follows:

         ss.1. Employment and Term.

         The Company hereby employs Executive, and Executive hereby agrees to
serve, as an executive employee of the Company, with the duties set forth in
ss.2, for a term (hereinafter called the "Term of Employment") which began
August 1, 2001 (the "Term Commencement Date") and ending, unless sooner
terminated under ss.2 or ss.4, on the effective date specified in a notice of
termination given by either party to the other except that such effective date
shall not be earlier than the second anniversary of the date on which such
notice is given.

         ss.2. Duties.

         (a) As used herein, the term "chief executive officer" means the person
who has the title of chief executive officer of the Company and also has such
authority and duties as are customarily possessed by and assigned to a chief
executive officer. If at any time during the Term of Employment--

                  (i) the Board of Directors shall fail to elect Executive to,
         or shall remove him from, the office which, in accordance with the
         by-laws as then in effect or any resolution or resolutions of the Board
         of Directors, carries with it the title, authority and duties of chief
         executive officer, or

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                  (ii) the by-laws are amended in such a way that, or the Board
         of Directors takes any action the effect of which is that, Executive no
         longer has the title of and the authority and duties which are
         customarily possessed by and assigned to a chief executive officer,

then in either such event Executive shall have the right at his option to
terminate the Term of Employment by not less than 30 days' notice to the
Secretary of the Company given at any time thereafter. During any period of time
when Executive has the right to terminate under this paragraph but elects not to
do so, he shall hold such office or offices in the Company, and perform such
duties and assignments relating to the business of the Company, as the Board of
Directors and/or the chief executive officer shall direct except that Executive
shall not be required to hold any office or perform any duties or assignment
inconsistent with his experience and qualifications or not customarily performed
by a senior executive corporate officer. So long as Executive is performing or
stands ready to perform duties and assignments in accordance with the preceding
sentence, the Term of Employment shall continue until it thereafter terminates
or is terminated pursuant to any applicable provision hereof (including but not
limited to termination at Executive's option under this paragraph).

                  (b) During the Term of Employment, Executive shall, except
         during customary vacation periods and periods of illness, devote
         substantially all of his business time and attention to the performance
         of his duties hereunder and to the business and affairs of the Company
         and its subsidiaries and to promoting the best interests of the Company
         and its subsidiaries, and he shall not, either during or outside of
         such normal business hours, engage in any activity inimical to such
         best interests.

         ss.3. Compensation and Benefits During Term of Employment.

         (a) Base Salary. With respect to the period beginning on the Term
Commencement Date and ending on July 31, 2002, the Company shall pay to
Executive a Base Salary (in addition to the compensation provided for elsewhere
in this Agreement) at the rate of $666,916 per annum (hereinafter called the
"Original Base Salary"). With respect to each Contract Year beginning with the
Contract Year which starts August 1, 2002, the Company shall pay Executive a
Base Salary at such rate as the Board of Directors may determine but not less
than the Original Base Salary adjusted as follows: The term "Contract Year" as
used herein means the period from August 1 of each year through July 31 of the
following year. For each Contract Year during the Term of Employment beginning
with the Contract Year which starts August 1, 2002, the minimum compensation
payable to Executive under this ss.3(a) (hereinafter called the "Minimum Base
Salary") shall be determined by increasing (or decreasing) the Original Base
Salary by the percentage increase (or decrease) of the Consumer Price Index (as
hereinafter defined) for the month of June immediately preceding the start of
the Contract Year in question over (or below) the Consumer Price Index for June
2001. The term "Consumer Price Index" as used herein means the "Consumer Price
Index for all Urban Consumers" compiled and published by the Bureau of Labor
Statistics of the United States Department of Labor for "New York - Northern N.
J. - Long Island, NY-NJ-CT-PA". To illustrate the operation of the foregoing
provisions of this ss.3(a): Executive's Base Salary for the Contract Year August
1, 2002 through July 31, 2003 shall be not less than the Original Base Salary
adjusted by the percentage increase (or decrease) of the Consumer Price Index
for June 2002 over (or below) said Index for June 2001. Further adjustment in
the Minimum Base Salary shall be made for each ensuing Contract Year, in each
case (i) using the Consumer Price Index for June 2001 as the base except as
provided in the immediately following paragraph hereof and (ii) applying the
percentage increase (or decrease) in the Consumer Price Index since said base
month to the Original Base Salary to determine the Minimum Base Salary. The Base
Salary shall be paid in such periodic installments as the Company may determine
but not less often than monthly.

                                      -2-
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         If with respect to any Contract Year (including the Contract Year
beginning August 1, 2002) the Board of Directors fixes the Base Salary at an
amount higher than the Minimum Base Salary, then (unless a resolution adopted
simultaneously with the resolution fixing such higher Base Salary for such
Contract Year provides otherwise), for the purpose of determining the Minimum
Base Salary for subsequent Contract Years: (i) the amount of the higher Base
Salary so fixed shall be deemed substituted for the Original Base Salary
wherever the Original Base Salary is referred to in the immediately preceding
paragraph hereof, and (ii) the base month for determining the Consumer Price
Index adjustment shall be June of the calendar year in which the Contract Year
to which such higher Base Salary is applicable begins (e.g., if the Board fixes
a Base Salary for the Contract Year beginning August 1, 2002 which is higher
than the Minimum Base Salary, then June 2002 would become the base month for the
purposes of making the CPI adjustment to determine the Minimum Base Salary for
subsequent Contract Years).

                                      -3-
<PAGE>

         (b) Bonus Compensation. With respect to each Fiscal Year of the Company
falling in whole or in part within the Term of Employment beginning with the
Fiscal Year ending August 3, 2002, Executive shall be eligible to receive a
Bonus (in addition to his Base Salary) in accordance with the terms of the Pall
Corporation Executive Incentive Bonus Plan adopted by the Compensation Committee
of the Board of Directors of the Company on July 17, 2001 and approved by
shareholders at the annual meeting of shareholders on November 14, 2001, a copy
of which is annexed hereto and incorporated herein by reference (the "Bonus
Plan"). Words and terms used herein with initial capital letters and not defined
herein are used herein as defined in the Bonus Plan. For purposes of determining
the amount of the Bonus payable to Executive for any Fiscal Year under the Bonus
Plan (the "Plan Bonus"), Executive's Target Bonus Percentage shall be 100% of
his Base Salary for such Fiscal Year.

         (c) Fringe Benefits and Perquisites. During the Term of Employment,
Executive shall enjoy the customary perquisites of office, including but not
limited to office space and furnishings, secretarial services, expense
reimbursements, and any similar emoluments customarily afforded to senior
executive officers of the Company. Executive shall also be entitled to receive
or participate in all "fringe benefits" and employee benefit plans provided or
made available by the Company to its executives or management personnel
generally, such as, but not limited to, group hospitalization, medical, life and
disability insurance, and pension, retirement, profit-sharing and stock option
or purchase plans.

         (d) Vacation. Executive shall be entitled each year to a vacation or
vacations in accordance with the policies of the Company as determined by the
Board or by an authorized senior officer of the Company from time to time. The
Company shall not pay Executive any additional compensation for any vacation
time not used by Executive.

         (e) Relocation Expenses. If at any time during the Term of Employment
Executive changes the location of his principal office, either at the request of
the Company or because it is in the best interests of the Company for him to do
so, to a location more than one hour's commuting time from the present principal
office of the Company in East Hills, Long Island, New York, the Company shall
reimburse Executive for all costs and expenses reasonably related to or arising
from such relocation, including but not limited to the cost of suitable housing
at the new location, the cost of continuing to maintain his residence at the old
location if he so elects, moving expenses, and the amounts necessary to equalize
Executive's taxes and cost of living between the old and new locations so that
Executive will not have suffered any financial disadvantage from having
relocated.

                                      -4-
<PAGE>

         ss.4. Termination by Reason of Disability, Death, Retirement or Change
               in Control.

         (a) Disability or Death. If, during the Term of Employment, Executive,
by reason of physical or mental disability, has been incapable of performing his
principal duties hereunder for an aggregate of 130 working days out of any
period of 12 consecutive months, the Company at its option may terminate the
Term of Employment effective immediately by notice to Executive given within 90
days after the end of such 12-month period. If Executive shall die during the
Term of Employment or if the Company terminates the Term of Employment pursuant
to the immediately preceding sentence by reason of Executive's disability, the
Company shall pay to Executive, or to Executive's legal representatives, or in
accordance with a direction given by Executive to the Company in writing, (i)
Executive's Base Salary to the end of the month in which such death or
termination for disability occurs and (ii) any Plan Bonus or pro rata portion
thereof that Executive is entitled to receive in accordance with the terms of
the Bonus Plan.

         (b) Retirement.

                  (i) The Term of Employment shall end automatically, without
         action by either party, on Executive's 65th birthday unless prior to
         such birthday Executive and the Company have agreed in writing that the
         Term of Employment shall continue past such 65th birthday. In the
         latter event, unless the parties have agreed otherwise, the Term of
         Employment shall be automatically renewed and extended each year, as of
         Executive's birthday, for an additional one-year term, unless either
         party has given a Non-Renewal Notice. A Non-Renewal Notice shall be
         effective as of Executive's ensuing birthday only if given not less
         than 60 days before such birthday and shall state that the party giving
         such notice elects that this Agreement shall not automatically renew
         itself further, with the result that the Term of Employment shall end
         on Executive's ensuing birthday.

                  (ii) If the Term of Employment ends pursuant to this ss.4(b)
         by reason of a notice given by either party as herein permitted or
         automatically at age 65 or any subsequent birthday, the Company shall
         pay to Executive, or to another payee specified by Executive to the
         Company in writing, (i) Executive's Base Salary prorated to the date on
         which the Term of Employment ends and (ii) any Plan Bonus or pro rata
         portion thereof that Executive is entitled to receive in accordance
         with the terms of the Bonus Plan.

                                      -5-
<PAGE>

                  (iii) Anything hereinabove to the contrary notwithstanding, if
         any provision of this ss.4(b) violates federal or applicable state law
         relating to discrimination on account of age, such provision shall be
         deemed modified or suspended to the extent necessary to eliminate such
         violation of law. If at a later date, by reason of changed
         circumstances or otherwise, the enforcement of such provision as set
         forth herein would no longer constitute a violation of law, then it
         shall be enforced in accordance with its terms as set forth herein.

         (c) Change in Control. In event of a Change in Control (as defined in
the Bonus Plan), Executive shall have the right to terminate the Term of
Employment, by notice to the Company given at any time after such Change in
Control, effective on the date specified in such notice, which date shall not be
more than (but can be less than) one year after the giving of such notice.

         ss.5. Severance.

         Executive shall be entitled to receive severance pay from the Company,
in the amount determined as hereinafter in this paragraph provided, in the event
that the Term of Employment is terminated by the Company under ss.1 hereof or by
Executive under ss.2 or ss.4(c) hereof. The amount of such severance pay shall
be an amount equal to the Base Salary which would have been payable to Executive
during the 24 months following the date on which the Term of Employment ends by
reason of such termination, plus 100% of such Base Salary (representing the
maximum Bonus payable to Executive under the Bonus Plan). Executive shall have
the option of (i) having such severance payment made in installments, over the
24 months following the end of the Term of Employment, at the same times at
which Executive's Base Salary and Bonus would have been paid had the Term of
Employment not been terminated or (ii) accepting as such severance pay an amount
equal to the present value, as of the date on which the Term of Employment ends,
of the stream of payments payable under clause "(i)" of this sentence, except
that if Executive elects a lump-sum payment under this clause "(ii)", there
shall be no cost-of-living adjustment of the Base Salary as would otherwise be
made in accordance with ss.3(a) hereof (because at the time such lump-sum
payment is made, the amount of the cost-of-living adjustment would not be
known). In determining such present value, a discount rate of 8% shall be
utilized. The severance payment provided for herein if Executive elects a lump
sum shall be made within 20 days after the end of the Term of Employment.

                                      -6-
<PAGE>

         ss.6. Annual Contract Pension and Medical Coverage After Term of
               Employment.

         (a) For a period of 120 consecutive months beginning at the end of the
Term of Employment (unless Executive is entitled to severance pay under ss.5
hereof, in which event said period of months shall begin on the second
anniversary of the end of the Term of Employment), the Company shall pay

                  (i) to Executive during his lifetime, and

                  (ii) if Executive is not living at the time any such payment
         is due, then to such payee or payees (including a trust or trusts) as
         Executive may at any time (whether during or after the Term of
         Employment) designate by written notice to the Company or in his last
         will and testament or, if no such designation is made, then to the
         legal representatives of Executive's estate (any such designated payee
         or estate being hereinafter called "Executive's Successor")

an "Annual Contract Pension" computed as follows: The term "Final Pay" as used
herein means one-third of the aggregate of Executive's total cash compensation
(i.e., Base Salary plus incentive compensation and any other bonus payments) for
those three full fiscal years out of the last five full fiscal years of the Term
of Employment with respect to which three fiscal years Executive received the
highest total cash compensation. The Annual Contract Pension payable to
Executive for each "Retirement Year" (as hereinafter defined) shall be an amount
determined by (I) adjusting Executive's Final Pay for changes in the Consumer
Price Index in the manner set forth in ss.3(a) except that for purposes of the
adjustment under this ss.6, the base month, instead of being June 2001, shall be
the month preceding the month in which payment of the Annual Contract Pension
commences and the comparison month shall be the same month in each succeeding
year and (II) multiplying the Final Pay as so adjusted by 60% and subtracting
therefrom the amount which, as of the last day of the Term of Employment (i.e.,
the effective date of termination of the Term of Employment under any of the
provisions of ss.ss. 1, 2 or 4 hereof), is the maximum annual benefit payable,
in accordance with ss.415(b)(1)(A) of the Internal Revenue Code (or successor
section), as adjusted by the Secretary of the Treasury to such last day under
ss. 415(d) of the Code (or successor section), under a pension plan which
qualifies under ss. 401(a) of the Code (or successor section). Such maximum
annual benefit is hereinafter called the "Maximum Qualified Plan Pension". Each
12-month period beginning on the first day of the month in which the Annual
Contract Pension first becomes payable hereunder and on the first day of the
same month during each of the succeeding years in which the Annual Contract
Pension is payable hereunder is herein called a "Retirement Year." There shall
be no adjustment of the Final Pay based on the Consumer Price Index for the
purpose of determining the Annual Contract Pension for the first Retirement Year
so that during such first Retirement Year the Annual Contract Pension shall be
60% of Final Pay minus the Maximum Qualified Plan Pension; there shall be such
adjustment of Final Pay for the purpose of determining the Annual Contract
Pension for the second and each succeeding Retirement Year.

                                      -7-
<PAGE>

         (b) The Company hereby represents to and agrees with Executive, in
order to induce Executive to enter into this Employment Agreement, as follows:
For purposes of the Company's Supplementary Pension Plan, the amount of the
offset pursuant to ss. 3.1(b)(i) thereof shall be the amount of the pension in
fact payable to Executive under the Pall Corporation Cash Balance Pension Plan,
after giving effect to any distribution theretofore made under said Plan
pursuant to a qualified domestic relations order. The immediately preceding
sentence shall not, however, be deemed to modify the penultimate sentence of
said ss. 3.1, which reads and provides as follows:

         "For purposes of this Section, the amount of the pension payable to the
         Member under any Other Retirement Program shall be deemed to be the
         amount payable thereunder to the Member in the form of a single life
         annuity for the Member's life, whether or not the Member receives
         payment of such pension in such form; provided, however, that the
         amount of such pension shall be taken into account under (b)(i) above
         only on and after the date on which payment of the Member's pension
         under such Other Retirement Program commences or is paid."

         (c) The Annual Contract Pension shall be paid in equal monthly
installments on the last business day of each month during the period with
respect to which the Annual Contract Pension is payable.

         (d) So long as Executive is living it shall be a condition of the
payment of the Annual Contract Pension that, to the extent permitted by
Executive's health, he shall be available for advisory services requested by the
Board of Directors of the Company, the Executive Committee of said Board or the
chief executive officer of the Company, provided that such advisory services
shall not require more than 15 hours in any month. The Company shall reimburse
Executive for all travel and other expenses which he incurs in connection with
such advisory services.

                                      -8-
<PAGE>

         (e) At the option of the Board of Directors of the Company, payment of
the Annual Contract Pension shall cease and the right of Executive and
Executive's Successor to all future such payments shall be forfeited if
Executive shall, without the written consent of the chief executive officer of
the Company, render services to any corporation or other entity engaged in any
activity, or himself engage in any activity, which is competitive to any
material extent with the business in which the Company or any of its
subsidiaries shall be engaged at the end of the Term of Employment and in which
the Company or any such subsidiary shall still be engaged at the date such
services or activity is rendered or engaged in by Executive, provided, however,
that if the Company terminates under ss.1 following a Change in Control (as
defined in the Bonus Plan), the provisions of this ss.6(e) shall be deemed
deleted from this Agreement and shall have no force or effect.

         (f) Beginning at the end of the Term of Employment, the Company at its
sole expense shall provide, in accordance with the provisions set forth below,
medical coverage for Executive and his Dependents (as hereinafter defined)
during his lifetime and following Executive's death, for Executive's surviving
Dependents during their respective lifetimes. As used herein, the term
"Dependents" shall mean Executive's spouse and each child or stepchild of
Executive.

                  (i) Subject to (ii) and (iii) below, the medical coverage to
          be provided hereunder shall consist of the same coverages and benefits
          as provided under the terms of the hospitalization, medical and dental
          plans maintained by the Company for its U.S. employees who are not
          covered by a collective bargaining agreement (the "Company's Medical
          Plans"), as in effect immediately prior to the end of the Term of
          Employment.

                  (ii) If prior to the end of the Term of Employment any of the
          Company's Medical Plans is amended following the occurrence of a
          Change in Control (as defined in the Bonus Plan) to eliminate any
          coverage or benefit previously provided under such Plan, or to make
          any coverage or benefit so provided available on terms less favorable
          to Executive than those in effect prior to such amendment, such
          coverage or benefit, as provided under the terms of the Plan in effect
          immediately prior to such amendment, shall be included in the medical
          coverage to be provided under this Section 6 (f).

                                      -9-
<PAGE>

                  (iii) If at any time after the end of the Term of Employment
         any of the Company's Medical Plans is amended to add any coverage or
         benefit that was not provided under such Plan immediately prior to the
         end of the Term of Employment, or to provide any coverage or benefit on
         terms more favorable than those applicable to Executive, or to any of
         his surviving Dependents, under the Plan as in effect immediately prior
         to the end of the Term of Employment, the coverage or benefit so added
         or so modified shall be included in the medical coverage to be provided
         under this Section 6 (f), commencing as of the effective date of such
         amendment. As soon as practicable after any amendment is made to any of
         the Company's Medical Plans after the end of the Term of Employment,
         the Company shall furnish to Executive (or, in the case of any such
         amendment that is made after the Executive's death, to each of his
         surviving Dependents), a revised Summary Plan Description for such Plan
         and copies of any other written notices that the Company furnishes to
         its employees explaining the changes made to the Plan pursuant to such
         amendment.

                  (iv) The coverages and benefits to be provided hereunder shall
         be provided upon the same terms and conditions (including required
         deductibles, co-payments and annual and lifetime maximum benefits) as
         would have applied to Executive, or to his surviving Dependents, if
         such coverages and benefits had been provided under the Company's
         Medical Plans as in effect on the date or dates applicable hereunder,
         other than any provision therein requiring an employee or his spouse or
         other dependents to make payments to the Company, by payroll deduction
         or otherwise, towards the cost of their coverage under such Plan.

                  (v) At the Company's option, the coverages and benefits to be
         provided hereunder may be provided through insurance, or by the Company
         directly paying, or reimbursing Executive or any of his Dependents for
         his or her payment of, expenses covered under this Section 6 (f).

                  (vi) The Company's obligation to provide any coverage or
         benefit otherwise required under this Section 6(f) shall be reduced to
         the extent that such coverage or benefit has been or will be provided
         under (A) any policy of insurance maintained by Executive or any of his
         Dependents, (B) any plan, program or insurance policy maintained by a
         subsequent employer of Executive or by an employer of any of
         Executive's Dependents, or (C) the provisions of any federal or state
         law. However, neither Executive nor any of his Dependents shall be
         required to obtain any hospitalization, medical or dental coverage from
         any source referred to in clause (A), (B) or (C) of the preceding
         sentence as a condition for eligibility for the medical coverage to be
         provided under this Section 6(f).

                                      -10-
<PAGE>

                  (vii) Notwithstanding any other provision herein, medical
         coverage provided pursuant to this Section 6 (f) for any Dependent who
         is a child of Executive shall cease (A) as of the end of the calendar
         year in which such child attains age 18, or (B), if such child is a
         "student", as defined in section 151(c)(4) of the Internal Revenue Code
         of 1986, as amended (or any successor provision thereto) during the
         calendar year referred to in clause (A), as of the end of the earlier
         of (x) the calendar year in which such child attains age 23, or (y) the
         calendar year in which such child ceases to be a "student", as so
         defined.

         ss.7. Internal Revenue Code ss.4999.

         If any payments to Executive, whether under this Agreement or
otherwise, would be subject to excise tax under Section 4999 of the Internal
Revenue Code of 1986, as amended, then payments hereunder shall be reduced or
deferred to the extent required (and only to the extent required) to avoid the
application of Section 4999; provided, however, that no such reduction or
deferral shall be made unless as a result thereof Executive's after-tax economic
position (taking into account not only payments under this Agreement and the
taxes thereon, but also the taxes that would otherwise be imposed on any
payments to which Executive is otherwise entitled) would be improved. In making
the determination whether Executive's after-tax economic position would be so
improved, the judgment of a certified public accountant or attorney chosen by
Executive shall be final. In the event of a reduction or deferral of payments
pursuant to this paragraph, Executive shall be entitled to specify which
payments shall be reduced or deferred.

         ss.8. Acceleration of Stock Options.

         On the date which is 30 days before the date on which the Term of
Employment will end by reason of a notice of termination given by either party
hereto under any of the provisions hereof, all employee stock options held by
Executive shall become exercisable in full (i.e., to the extent that any such
option or portion thereof is not yet exercisable, the right to exercise the same
in full shall be accelerated) and such option shall thereafter be fully vested
and exercisable in full (to the extent not theretofore exercised) until it
expires by its terms.

                                      -11-
<PAGE>

         ss.9. Covenant Not to Compete.

         For a period of 18 months after the end of the Term of Employment if
the Term of Employment is terminated by notice to the Company given by Executive
under ss.1, ss.2 or ss.4 hereof, or for a period of 12 months after the end of
the Term of Employment if the Term of Employment is terminated by notice to
Executive given by the Company under ss.1 or ss.4 hereof or terminates under
ss.4 by reason of Executive's attaining the age of 65, Executive shall not
render services to any corporation or other entity engaged in any activity, or
himself engage directly or indirectly in any activity, which is competitive to
any material extent with the business of the Company or any of its subsidiaries,
provided, however, that if the Company terminates under ss.1 following a Change
in Control (as defined in the Bonus Plan), the foregoing covenant not to compete
shall not apply.

         ss.10. Company's Right to Injunctive Relief.

         Executive acknowledges that his services to the Company are of a unique
character, which gives them a peculiar value to the Company, the loss of which
cannot be reasonably or adequately compensated in damages in an action at law,
and that therefore, in addition to any other remedy which the Company may have
at law or in equity, the Company shall be entitled to injunctive relief for a
breach of this Agreement by Executive.

         ss.11. Inventions and Patents.

         All inventions, ideas, concepts, processes, discoveries, improvements
and trademarks (hereinafter collectively referred to as intangible rights),
whether patentable or registrable or not, which are conceived, made, invented or
suggested either by Executive alone or by Executive in collaboration with others
during the Term of Employment, and whether or not during regular working hours,
shall be disclosed to the Company and shall be the sole and exclusive property
of the Company. If the Company deems that any of such intangible rights are
patentable or otherwise registrable under any federal, state or foreign law,
Executive, at the expense of the Company, shall execute all documents and do all
things necessary or proper to obtain patents and/or registrations and to vest
the Company with full title thereto.

                                      -12-
<PAGE>

         ss.12. Trade Secrets and Confidential Information.

         Executive shall not, either directly or indirectly, except as required
in the course of his employment by the Company, disclose or use at any time,
whether during or subsequent to the Term of Employment, any information of a
proprietary nature owned by the Company, including but not limited to records,
data, formulae, documents, specifications, inventions, processes, methods and
intangible rights which are acquired by him in the performance of his duties for
the Company and which are of a confidential information or trade-secret nature.
All records, files, drawings, documents, equipment and the like, relating to the
Company's business, which Executive shall prepare, use, construct or observe,
shall be and remain the Company's sole property. Upon the termination of his
employment or at any time prior thereto upon request by the Company, Executive
shall return to the possession of the Company any materials or copies thereof
involving any confidential information or trade secrets and shall not take any
material or copies thereof from the possession of the Company.

         ss.13. Mergers and Consolidations; Assignability.

         In the event that the Company, or any entity resulting from any merger
or consolidation referred to in this ss.13 or which shall be a purchaser or
transferee so referred to, shall at any time be merged or consolidated into or
with any other entity or entities, or in the event that substantially all of the
assets of the Company or any such entity shall be sold or otherwise transferred
to another entity, the provisions of this Agreement shall be binding upon and
shall inure to the benefit of the continuing entity in or the entity resulting
from such merger or consolidation or the entity to which such assets shall be
sold or transferred. Except as provided in the immediately preceding sentence of
this ss.13, this Agreement shall not be assignable by the Company or by any
entity referred to in such immediately preceding sentence. This Agreement shall
not be assignable by Executive, but in the event of his death it shall be
binding upon and inure to the benefit of his legal representatives to the extent
required to effectuate the terms hereof.

         ss.14. Captions.

         The captions in this Agreement are not part of the provisions hereof,
are merely for the purpose of reference and shall have no force or effect for
any purpose whatsoever, including the construction of the provisions of this
Agreement, and if any caption is inconsistent with any provisions of this
Agreement, said provisions shall govern.

                                      -13-
<PAGE>

         ss.15. Choice of Law.

         This Agreement is made in, and shall be governed by and construed in
accordance with the laws of, the State of New York.

         ss.16. Entire Contract.

         This Agreement contains the entire agreement of the parties on the
subject matter hereof except that the rights of the Company hereunder shall be
deemed to be in addition to and not in substitution for its rights under the
Company's standard printed form of "Employee's Secrecy and Invention Agreement"
or "Employee Agreement" if heretofore or hereafter entered into between the
parties hereto so that the making of this Agreement shall not be construed as
depriving the Company of any of its rights or remedies under any such Secrecy
and Invention Agreement or Employee Agreement. This Agreement may not be changed
orally, but only by an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification, extension or discharge is
sought.

         ss.17. Notices.

         All notices given hereunder shall be in writing and shall be sent by
registered or certified mail or overnight delivery service such as Federal
Express or delivered by hand, and, if intended for the Company, shall be
addressed to it (if sent by mail or overnight delivery service) or delivered to
it (if delivered by hand) at its principal office for the attention of the
Secretary of the Company, or at such other address and for the attention of such
other person of which the Company shall have given notice to Executive in the
manner herein provided, and, if intended for Executive, shall be delivered to
him personally or shall be addressed to him (if sent by mail or overnight
delivery service) at his most recent residence address shown in the Company's
employment records or at such other address or to such designee of which
Executive shall have given notice to the Company in the manner herein provided.
Each such notice shall be deemed to be given on the date on which it is mailed
or received by the overnight delivery service or, if delivered personally, on
the date so delivered.

         ss.18. Termination of Existing Agreement.

         The Existing Agreement is hereby terminated and replaced and superseded
by this Agreement, effective August 1, 2001. All payments, of Base Salary or
otherwise, made by the Company under the Existing Agreement (or under the
Restated and Amended Employment Agreement dated October 6, 1997 which was
replaced by the Existing Agreement), with respect

                                      -14-
<PAGE>

to any period commencing on or after August 1, 2001, shall be credited against
the corresponding payment obligations of the Company under this Agreement.

         IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the day and year first above written.

                                                   PALL CORPORATION

                                                   By: /s/ Jeremy Hayward-Surry
                                                       ------------------------
                                                       Jeremy Hayward-Surry,
                                                       President

                                                       /s/ Eric Krasnoff
                                                       ------------------------
                                                           Eric Krasnoff

                                      -15-
<PAGE>

                                PALL CORPORATION

                         EXECUTIVE INCENTIVE BONUS PLAN

                                      -----

1.       Purpose

         This document sets forth the Pall Corporation Executive Incentive Bonus
Plan as adopted effective July 17, 2001.

         The purpose of the Plan is to encourage greater focus on performance
among the key executives of the Corporation by relating a significant portion of
their total compensation to the achievement of annual financial objectives.

2.       Certain Definitions

         As used herein with initial capital letters, the following terms shall
have the following meanings:

         "Average Equity" shall mean, for any Fiscal Year, the average of
stockholders' equity as shown on the fiscal year-end consolidated balance sheet
of the Corporation and its subsidiaries as of the end of such Fiscal Year and as
of the end of the immediately preceding Fiscal Year except that the amounts
shown on said balance sheets as "Accumulated other comprehensive" income or
loss, as the case may be, shall be disregarded.

         "Base Salary" shall mean, with respect to any Executive and for any
Fiscal Year, the annual rate of base salary in effect for the Executive as of
the first day of such year or, if later, as of the first day of the Executive's
Term of Employment, as determined under the Executive's Employment Agreement.

         "Board of Directors" shall mean the Board of Directors of the
Corporation.

         "Bonus" shall mean the bonus payable to an Executive under this Plan
for any Fiscal Year.

         "CEO" shall mean the Chief Executive Officer of the Corporation.

         "Change in Control" means the occurrence of any of the following:

         (a)      the "Distribution Date" as defined in Section 3 of the Rights
                  Agreement dated as of November 17, 1989 between the
                  Corporation and United States Trust Company of New York as
                  Rights Agent, as amended by Amendment No. 1 thereto dated
                  April 20, 1999, and as the same may have been further amended
                  or extended to the time in question or in any successor
                  agreement (the "Rights Agreement"); or

<PAGE>

         (b)      any event described in Section 11(a)(ii)(B) of the Rights
                  Agreement; or

         (c)      any event described in Section 13 of the Rights Agreement; or

         (d)      the date on which the number of duly elected and qualified
                  directors of the Corporation who were not either elected by
                  the Board of Directors or nominated by the Board of Directors
                  or its Nominating Committee for election by the shareholders
                  shall equal or exceed one-third of the total number of
                  directors of the Corporation as fixed by its by-laws;

provided, however, that no Change in Control shall be deemed to have occurred,
and no rights arising upon a Change in Control as provided in Section 6 shall
exist, to the extent that the Board of Directors so determines by resolution
adopted prior to the Change in Control.

         "Code" shall mean the Internal Revenue Code of 1986, as amended.

         "Committee" shall mean the Compensation Committee of the Board of
Directors.

         "Corporation" shall mean Pall Corporation.

         "Covered Executive" shall mean, with respect to any Fiscal Year, each
individual who is a "Covered Employee" of the Corporation for such year for the
purpose of section 162(m) of the Code.

         "Employment Agreement" shall mean, with respect to any executive
employee of the Corporation, an employment agreement between the Corporation and
such employee which provides that the employee shall be eligible to receive
annual bonuses under this Plan.

         "Executive" shall mean an executive employee of the Corporation with
whom the Corporation has entered into an Employment Agreement.

         "Fiscal Year" shall mean the fiscal year of the Corporation ending on
August 3, 2002, and each subsequent fiscal year of the Corporation.

         "Maximum R.O.E. Target" shall mean, for any Fiscal Year, the Return on
Equity that must be achieved or exceeded in order for the Performance Percentage
for the year to equal 100%, as determined by the Committee prior to the first
day of such year or within such period of time thereafter as may be permitted
under the regulations issued under section 162(m) of the Code.

         "Minimum R.O.E. Target" shall mean, for any Fiscal Year, the Return on
Equity that must be exceeded in order for any Bonus to be paid to any Executive
for the year, as determined by the Committee prior to the first day of such year
or within such period of time thereafter as may be permitted under the
regulations issued under section 162(m) of the Code.

         "Net Earnings" shall mean, for any Fiscal Year, the after-tax
consolidated net earnings of the Corporation and its subsidiaries as certified
by the Corporation's independent accountants for inclusion in the annual report
to shareholders ("Annual Report"), adjusted so as to eliminate the effects of
any decreases in or charges to earnings for (a) the effect of foreign currency
exchange rates, (b) any acquisitions, divestitures, discontinuance of business
operations, restructuring or any other special charges, (c) the cumulative
effect of any accounting changes, and (d) any "extraordinary items" as
determined under generally accepted accounting principles, to the extent such
decreases or charges referred to in clauses (a) through (d) are separately
disclosed in the Corporation's Annual Report for the year.

                                       2
<PAGE>

         "Plan" shall mean the Pall Corporation Executive Incentive Bonus Plan,
as set forth herein and as amended from time to time.

         "Return on Equity" shall mean, for any Fiscal Year, the percentage
determined by dividing the Net Earnings for the year by the Average Equity for
the year.

         "Target Bonus Percentage" shall mean, with respect to any Executive,
the target bonus percentage specified for such Executive in his or her
Employment Agreement.

3.       Determination of Bonus Amounts

         For each Fiscal Year falling in whole or in part within an Executive's
Term of Employment, as defined in his or her Employment Agreement, the Executive
shall be entitled to receive a Bonus in an amount determined in accordance with
the provisions of this Section 3, subject, however, to the provisions of Section
4.

         (a) The amount of the Bonus payable to an Executive for each such
Fiscal Year shall be equal to (i) the Target Bonus Percentage of the Executive's
Base Salary for such year, multiplied by (ii) the Performance Percentage for
such year, as determined under (b) below.

         (b) The Performance Percentage for any Fiscal Year shall be determined
in accordance with he following provisions:

                  (i) If the Return on Equity equals or exceeds the Maximum
         R.O.E. Target for the year, the Performance Percentage for the year
         shall be 100%.

                  (ii) If the Return on Equity is less than the Maximum R.O.E.
         Target for the year but exceeds the Minimum R.O.E. Target for the year,
         the Performance Percentage for the year shall be equal to the quotient
         resulting from dividing (A) the excess of the Return on Equity for the
         year over the Minimum R.O.E. Target for the year, by (B) the excess of
         the Maximum R.O.E. Target for the year over the Minimum R.O.E. Target
         for the year.

                  (iii) If the Return on Equity equals or is less than the
         Minimum R.O.E. Target for the year, the Performance Percentage for the
         year shall be zero, and no Bonus shall be payable under the Plan for
         such year to any Executive.

                                       3
<PAGE>

         (c) If an Executive's Term of Employment commences after the start of a
Fiscal Year, or ends prior to the close of a Fiscal Year, the amount of the
Bonus payable to the Executive for the Fiscal Year in which the Executive's Term
of Employment commences, or for the Fiscal Year in which the Executive's Term of
Employment ends, as determined in accordance with the other applicable
provisions of the Plan, shall be prorated on the basis of the number of days of
such Fiscal Year that fall within the Executive's Term of Employment; provided,
however, that (i) if an Executive's Term of Employment ends within 5 days prior
to the close of a Fiscal Year, there shall be no proration and the Executive
shall be entitled to receive the entire amount of the Bonus payable to the
Executive for such year, as determined in accordance with such other provisions,
and (ii) if the Executive's Term of Employment ends within 5 days following the
start of a Fiscal Year, the Executive shall not be entitled to receive any Bonus
with respect to such Fiscal Year.

4.       Adjustment of and Limitation on Bonus Amounts

         The amount of the Bonus otherwise payable to an Executive for any
Fiscal Year in accordance with Section 3 shall be subject to the following
adjustments and limitation:

         (a) The Committee may, in its discretion, reduce the amount of the
Bonus otherwise payable to any Executive in accordance with Section 3, (i) to
reflect any decreases in or charges to earnings that were not taken into account
in determining Net Earnings for the year pursuant to clause (a), (b), (c) or (d)
contained in the definition of such term in Section 2, (ii) to reflect any
credits to earnings for extraordinary items of income or gain that were taken
into account in determining Net Earnings for the year, (iii) to reflect the
Committee's evaluation of the Executive's individual performance, or (iv) to
reflect any other events, circumstances or factors which the Committee believes
to be appropriate in determining the amount of the Bonus to be paid to the
Executive for the year.

         (b) The Committee may, in its discretion, increase the amount of the
Bonus otherwise payable to any Executive who is not a Covered Executive, as
determined under Section 3, to reflect the Committee's evaluation of the
Executive's individual performance, or to reflect such other circumstances or
factors as the Committee believes to be appropriate in determining the amount of
the Bonus to be paid to the Executive for the year. The Committee shall not have
any discretion to increase the amount of the Bonus payable to any Covered
Executive for the year, as determined under Section 3.

         (c) Notwithstanding any other provision herein to the contrary, the
amount of the Bonus otherwise payable to any Executive for any Fiscal Year shall
not exceed the lesser of (i) $1.0 million and (ii) 100% of the Executive's Base
Salary for the year.

5.       Payment of Bonuses

         The Bonus payable to an Executive for any Fiscal Year shall be paid in
accordance with the following provisions:

         (a) Except as otherwise provided in (b) or (c) below,

                  (i) if the Executive is not a Covered Executive for such year,
         50% of the estimated amount of the Executive's Bonus shall be paid to
         the Executive at such date in August next following the close of such
         year as the Committee in its discretion shall determine, and the
         remaining amount of the Executive's Bonus shall be paid to the
         Executive by no later than January 15 next following the close of such
         year;

                                       4
<PAGE>

                  (ii) if the Executive is a Covered Executive for such year,
         50% of the amount of the Executive's Bonus shall be paid to the
         Executive as soon as practicable after the Committee has certified in
         writing that all conditions for the payment of such Bonus to the
         Executive for such year have been satisfied, and the remaining amount
         of the Executive's Bonus shall be paid to the Executive by no later
         than January 15 next following the close of such year;

                  (iii) each amount payable to an Executive under (i) and (ii)
         above, reduced by the amount of all federal, state and local taxes
         required by law to be withheld therefrom, shall be paid to the
         Executive in the form of a single lump sum cash payment.

         (b) To the extent that an Executive has elected under the applicable
provisions of the Pall Corporation Management Stock Purchase Plan (the "MSPP")
to have any part of the Bonus payable to the Executive for any Fiscal Year paid
in the form of Restricted Units to be credited to the Executive's account under
the MSPP, no cash payments shall be made to the Executive pursuant to (a) above
with respect to the part of the Executive Bonus that is subject to such
election; and the obligation of the Corporation under this Plan with respect to
payment of such part of the Executive's Bonus shall be fully discharged upon the
crediting of Restricted Units to the Executive's account under the MSPP in
accordance with the applicable provisions of such Plan.

         (c) To the extent that an Executive has elected under the applicable
provisions of the Pall Corporation Profit-Sharing Plan (the "Profit-Sharing
Plan") to have any part of the Bonus payable to the Executive for any Fiscal
Year reduced, and to have an amount equal to such part of the Executive's Bonus
contributed to the Profit-Sharing Plan as a 401(k) Contribution on the
Executive's behalf, an amount equal to such part of the Executive's Bonus shall
be contributed to the Profit-Sharing Plan on behalf of the Executive; and
thereupon, the obligation of the Corporation under this Plan with respect to
payment of such part of the Executive's Bonus shall be fully discharged.
However, no such contribution shall be made to the extent it would cause any
limitation applicable under the 401(k) Plan to be exceeded.

6.        Change in Control

         Notwithstanding any other provision in the Plan to the contrary (but
subject to the "provided, however" clause contained in the definition of "Change
in Control" in Section 2), upon the occurrence of a Change in Control, the
following provisions shall apply.

         (a) The amount of the Bonus payable to any Executive for the Fiscal
Year in which a Change in Control occurs shall be at least equal to the Target
Bonus Percentage of the Executive's Base Salary for such year or, in the case of
any Executive whose Term of Employment commences after the start of such year or
ends prior to the close of such year, a pro rata portion thereof determined on
the basis of the number of days of such Fiscal Year that fall within the
Executive's Term of Employment.

                                       5
<PAGE>

         (b) Each Executive whose Term of Employment has not ended prior to the
occurrence of a Change in Control shall be entitled to receive a Bonus for each
Contract Year (as defined in the Executive's Employment Agreement) that falls in
whole or in part within the Executive's Term of Employment and that ends after
the Fiscal Year in which the Change in Control occurs. The amount of the Bonus
payable to the Executive for each such Contract Year shall be at least equal to
the Target Bonus Percentage of the Executive's Base Salary for such Contract
Year or, in the case of any Executive whose Term of Employment ends after the
start of such Contract Year but prior to the close of such year, a pro rata
portion thereof determined on the basis of the number of days of such Contract
Year that fall within the Executive's Term of Employment.

         (c) The entire amount of the Bonus payable to an Executive for any
Fiscal Year or Contract Year pursuant to (a) or (b) above, reduced by the amount
of all federal, state and local taxes required to be withheld therefrom, shall
be paid to the Executive in a single cash lump sum as soon as practicable after
the close of such Fiscal Year or Contract Year.

7.       Rights of Executives

         An Executive's rights and interests under the Plan shall be subject to
the following provisions:

         (a) An Executive's rights to payments under the Plan shall not be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, or garnishment by creditors of the Executive.

         (b) Neither the Plan nor any action taken hereunder shall be construed
as giving any Executive any right to be retained in the employment of the
Corporation or any of its subsidiaries.

8.       Administration

         The Plan shall be administered by the Committee. A majority of the
members of the Committee shall constitute a quorum. The Committee may act at a
meeting, including a telephone meeting, by action of a majority of the members
present, or without a meeting by unanimous written consent. In addition to the
responsibilities and powers assigned to the Committee elsewhere in the Plan, the
Committee shall have the authority, in its discretion, to establish from time to
time guidelines or regulations for the administration of the Plan, interpret the
Plan, and make all determinations considered necessary or advisable for the
administration of the Plan.

         The Committee may delegate any ministerial or nondiscretionary function
pertaining to the administration of the Plan to any one or more officers of the
Corporation.

         All decisions, actions or interpretations of the Committee under the
Plan shall be final, conclusive and binding upon all parties. Notwithstanding
the foregoing, any determination made by the Committee after the occurrence of a
Change in Control that denies in whole or in part any claim made by any
individual for benefits under the Plan shall be subject to judicial review,
under a "de novo", rather than a deferential standard.

                                       6
<PAGE>

9.       Amendment or Termination

         The Board of Directors may, with prospective or retroactive effect,
amend, suspend or terminate the Plan or any portion thereof at any time;
provided, however, that (a) no amendment, suspension or termination of the Plan
shall adversely affect the rights of any Executive with respect to any Bonus
that has become payable to the Executive under the Plan, without his or her
written consent, and (b) following a Change in Control, no amendment to Section
6, and no termination of the Plan, shall be effective if such amendment or
termination adversely affects the rights of any Executive under the Plan.

10.      Successor Corporation

         The obligations of the Corporation under the Plan shall be binding upon
any successor corporation or organization resulting from the merger,
consolidation or other reorganization of the Corporation, or upon any successor
corporation or organization succeeding to substantially all of the assets and
business of the Corporation. The Corporation agrees that it will make
appropriate provision for the preservation of Executives' rights under the Plan
in any agreement or plan which it may enter into or adopt to effect any such
merger, consolidation, reorganization or transfer of assets.

11.      Governing Law

         The Plan shall be governed by and construed in accordance with the laws
of the State of New York.

12.      Effective Date

         The Plan was adopted effective as of July 17, 2001 by the Board of
Directors, acting by the Committee, subject, however, to approval by the
shareholders of the Corporation by a majority of the votes cast in person or by
proxy at the 2001 annual meeting of the Corporation's shareholders, including
any adjournment thereof.

[The Plan was approved
by shareholders at the
annual meeting on
November 14, 2001.]

                                       7

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