Document:

EX-10.6

 

Exhibit 10.6

EMPLOYMENT AGREEMENT

Matthew J. Klaben

          EMPLOYMENT AGREEMENT (the “Agreement”) dated March 29, 2006 by and between Chart
Industries, Inc. (the “Company”) and Matthew J. Klaben (the “Executive”).

          The Company desires to employ Executive and to enter into an agreement embodying the terms of
such employment; and

          Executive desires to accept such employment and enter into such an agreement.

          In consideration of the premises and mutual covenants herein and for other good and valuable
consideration, the parties agree as follows:

     1. Term of Employment. Subject to the provisions of Section 8 of this Agreement,
Executive shall be employed by the Company, on the terms and subject to the conditions set forth in
this Agreement, for a constantly renewing one (1) year term, commencing on March 29, 2006, so that
the remaining term of employment under this Agreement shall always be one year (the “Employment
Term”), unless: (a) either party gives written notice to the other that the Employment Term
shall no longer constantly renew (the “Non-Renewal Notice”) in which event the Employment
Term shall expire on the first anniversary of the delivery of such Non-Renewal Notice or (b)
Executive’s employment under this Agreement is earlier terminated in accordance with Section 8 of
this Agreement.

     2. Position.

               a. During the Employment Term, Executive shall serve as the Company’s Vice President and
General Counsel. In such position, Executive shall have such duties, authority and responsibility
as shall be determined from time to time by the Board of Directors of the Company (the
“Board”), the Chief Executive Officer or the Chief Financial Officer of the Company, which
duties, authority and responsibility are consistent with the position of Vice President and General
Counsel of the Company. If requested, Executive shall also serve as a member of the Board without
additional compensation.

               b. During the Employment Term, Executive will devote Executive’s full business time and best
efforts to the performance of Executive’s duties hereunder and will not engage in any other
business, profession or occupation for compensation or otherwise which would conflict or interfere
with the rendition of such services either directly or indirectly, without the prior written
consent of the Board; provided that nothing herein shall preclude Executive, subject to the
prior approval of the Board, from accepting appointment to or continue to serve on any board of
directors or trustees of any business corporation or any charitable organization; provided
in each case, and in the aggregate, that such activities do not conflict or interfere with the
performance of Executive’s duties hereunder or conflict with Section 9.

     3. Base Salary. During the Employment Term, the Company shall pay Executive a base
salary at the annual rate of $193,000, payable in regular installments in accordance with the
Company’s usual payment practices. Executive shall be entitled to such increases in Executive’s
base salary, if any, as may be determined from time to time in the sole

 

 

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discretion of the Board. Executive’s annual base salary, as in effect from time to time, is
hereinafter referred to as the “Base Salary.”

     4. Bonus.

          (a) Signing Bonus. Executive shall be entitled to receive a lump sum cash bonus equal
to $25,000 within thirty (30) days of the date of this Agreement. In the event the Executive
resigns without Good Reason (as defined in Section 8(c)) prior to March 29, 2007, such bonus will
be forfeited and the Executive shall be required to repay such amount to the Company within thirty
(30) days of Executive’s termination of employment.

          (b) Annual Bonus. With respect to each full fiscal year during the Employment Term
(commencing with the 2006 fiscal year), Executive shall be eligible to earn an annual bonus award
(an “Annual Bonus”) of up to one hundred and fifty percent (150%) of seventy percent (70%)
of the Executive’s Base Salary (the “Target”) based upon the achievement of EBITDA and
working capital performance targets established by the Board within the first three months of each
fiscal year during the Employment Term. The Annual Bonus, if any, shall be paid to Executive within
two and one-half (2.5) months after the end of the applicable fiscal year.

     5. Employee Benefits. During the Employment Term, Executive shall be entitled to
participate in the Company’s employee benefit plans (other than annual bonus and incentive plans)
providing for health, life and disability insurance, retirement, deferred compensation and fringe
benefits, as well as any stock option plans, as in effect from time to time (collectively
“Employee Benefits”), on the same basis as those benefits are generally made available to
other senior executives of the Company.

     6. Vacation. During the Employment Term, Executive shall be entitled to three (3)
weeks of paid vacation annually to be taken at such times as chosen by Executive. Notwithstanding
the foregoing, after five (5) years of employment with the Company, Executive shall be entitled to
four (4) weeks of paid vacation annually to be taken at such times as chosen by Executive.

     7. Business Expenses and Perquisites.

               a. Expenses. During the Employment Term, reasonable business expenses incurred by
Executive in the performance of Executive’s duties hereunder shall be reimbursed by the Company in
accordance with Company policies.

               b. Perquisites. During the Employment Term, Executive shall be eligible for an
automobile allowance of up to $800 per month, consistent with the Company’s current practices.

     8. Termination. The Employment Term and Executive’s employment hereunder may be
terminated by either party at any time and for any reason; provided that Executive will be required
to give the Company at least 60 days advance written notice of any resignation of Executive’s
employment. Notwithstanding any other provision of this Agreement, the provisions of this Section
8 shall exclusively govern Executive’s rights upon termination of employment with the Company and
its affiliates.

 

 

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               a. By the Company For Cause or By Executive Resignation Without Good Reason.

               (i) The Employment Term and Executive’s employment hereunder may be terminated by the
Company for Cause (as defined below) and shall terminate automatically upon Executive’s
resignation without Good Reason (as defined in Section 8(c)); provided that Executive will be
required to give the Company at least 60 days advance written notice of a resignation without
Good Reason.

               (ii) For purposes of this Agreement, “Cause” shall mean the Executive’s (A) willful
failure to perform duties which, if curable, is not cured promptly, or in any event within ten
(10) days, following the first written notice of such failure from the Company, (B) commission
of, or plea of guilty or no contest to a (x) felony or (y) crime involving moral turpitude, (C)
willful malfeasance or misconduct which is demonstrably injurious to the Company or its
subsidiaries or affiliates, (D) material breach of the material terms of this Agreement,
including, without limitation, any non-competition, non-solicitation or confidentiality
provisions, (E) commission of any act of gross negligence, corporate waste, disloyalty or
unfaithfulness to the Company which adversely affects the business of the Company or its
subsidiaries or affiliates, or (F) any other act or course of conduct which will demonstrably
have a material adverse effect on the Company, a subsidiary or affiliate’s business.

               (iii) If Executive’s employment is terminated by the Company for Cause, or if Executive
resigns without Good Reason, Executive shall be entitled to receive:

               (A) the Base Salary through the date of termination;

               (B) any Annual Bonus earned, but unpaid, as of the date of termination for the
immediately preceding fiscal year, paid in accordance with Section 4(b) (except to the
extent payment is otherwise deferred pursuant to any applicable deferred compensation
arrangement with the Company);

               (C) reimbursement, within 60 days following submission by Executive to the Company
of appropriate supporting documentation, for any unreimbursed business expenses properly
incurred by Executive in accordance with Company policy prior to the date of Executive’s
termination; provided claims for such reimbursement (accompanied by appropriate
supporting documentation) are submitted to the Company within 90 days following the date
of Executive’s termination of employment; and

               (D) such Employee Benefits, if any, as to which Executive may be entitled under the
employee benefit plans of the Company, including payment for any accrued but unused
vacation within 30 days following the date of Executive’s termination of employment (the
amounts described in clauses (A) through (D) hereof being referred to as the
“Accrued Rights”).

          Following such termination of Executive’s employment by the Company for Cause or resignation
by Executive without Good Reason, except as set forth in this Section

 

 

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8(a)(iii), Executive shall have no further rights to any compensation or any other benefits
under this Agreement.

               b. Disability or Death.

               (i) The Employment Term and Executive’s employment hereunder shall terminate upon
Executive’s death and may be terminated by the Company if Executive becomes physically or
mentally incapacitated and is therefore unable for a period of six (6) consecutive months or for
an aggregate of nine (9) months in any twenty-four (24) consecutive month period to perform
Executive’s duties (such incapacity is hereinafter referred to as “Disability”). Any
question as to the existence of the Disability of Executive as to which Executive and the Company
cannot agree shall be determined in writing by a qualified independent physician mutually
acceptable to Executive and the Company. If Executive and the Company cannot agree as to a
qualified independent physician, each shall appoint such a physician and those two physicians
shall select a third who shall make such determination in writing. The determination of
Disability made in writing to the Company and Executive shall be final and conclusive for all
purposes of the Agreement.

               (ii) Upon termination of Executive’s employment hereunder for either Disability or death,
Executive or Executive’s estate (as the case may be) shall be entitled to receive:

               (A) the Accrued Rights; and

               (B) a pro rata portion of any Annual Bonus, if any, that Executive would have been
entitled to receive pursuant to Section 4(b) hereof for such year based upon the
Company’s actual results for the year of termination and the percentage of the fiscal
year that shall have elapsed through the date of Executive’s termination of employment,
payable to Executive pursuant to Section 4(b) had Executive’s employment not terminated.

          Following Executive’s termination of employment due to death or Disability, except as set
forth in this Section 8(b)(ii), Executive shall have no further rights to any compensation or any
other benefits under this Agreement.

               c. By the Company Without Cause or Resignation by Executive for Good Reason.

               (i) The Employment Term and Executive’s employment hereunder may be terminated by the
Company without Cause or by Executive’s resignation for Good Reason.

               (ii) For purposes of this Agreement, “Good Reason” shall mean, without Executive’s
consent, (i) a substantial diminution in Executive’s position or duties, material adverse change
in reporting lines, or assignment of duties materially inconsistent with his position or (ii) any
reduction in Executive’s base salary and/or material reduction in employee benefits in the
aggregate provided to Executive (excluding any general salary reduction or reduction in employee
benefits similarly affecting substantially all other senior executives of the Company as a result
of a material adverse change in the Company’s prospects or business),

 

 

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in each case which is not cured within 30 days following the Company’s receipt of written
notice from the Executive describing the event constituting Good Reason.

               (iii) If Executive’s employment is terminated by the Company without Cause (other than by
reason of death or Disability) or if Executive resigns for Good Reason, Executive shall be
entitled to receive:

               (A) the Accrued Rights;

               (B) subject to Executive’s (x) continued compliance with the provisions of Sections
9 and 10 and (y) execution and delivery of a general release of claims against the
Company and its affiliates in a form reasonably acceptable to the Company, continued
payment of the greater of the current Base Salary or Executive’s highest Base Salary
paid within the Employment Term in accordance with the Company’s usual payment
practices, as in effect on the date of termination of Executive’s employment, until the
expiration of the otherwise remaining portion of the Employment Term determined, for
this purpose only, as if such termination of employment and the Employment Term had not
occurred (the “Severance Period”); and

               (C) continued coverage under the Company’s group health plans during the Severance
Period on the same basis as active employees of the Company.

          Following Executive’s termination of employment by the Company without Cause (other than by
reason of Executive’s death or Disability) or by Executive’s resignation for Good Reason, except as
set forth in this Section 8(c)(iii), Executive shall have no further rights to any compensation or
any other benefits under this Agreement.

               d. Expiration of Employment Term.

               (i) Election Not to Renew the Employment Term. In the event either party provides
the other with the Non-Renewal Notice pursuant to Section 1, unless Executive’s employment is
earlier terminated pursuant to paragraphs (a), (b) or (c) of this Section 8, the expiration of
the Employment Term and the Executive’s termination of employment hereunder (whether or not
Executive continues as an employee of the Company thereafter) shall be deemed to occur on the
close of business on the first anniversary of the delivery of such Non-Renewal Notice and
Executive shall be entitled to receive the Accrued Rights.

          Following such termination of Executive’s employment hereunder, except as set forth in this
Section 8(d)(i), Executive shall have no further rights to any compensation or any other benefits
under this Agreement.

               (ii) Continued Employment Beyond the Expiration of the Employment Term. Unless the
parties otherwise agree in writing, continuation of Executive’s employment with the Company
beyond the expiration of the Employment Term shall be deemed an employment at-will and shall not
be deemed to extend any of the provisions of this Agreement and Executive’s employment may
thereafter be terminated at will by either Executive or the Company; provided that the
provisions of Sections 9, 10 and 11 of this Agreement shall

 

 

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survive any termination of this Agreement or Executive’s termination of employment
hereunder.

               e. Notice of Termination. Any purported termination of employment by the Company or
by Executive (other than due to Executive’s death) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 12(i) hereof. For purposes of
this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of employment under the
provision so indicated.

               f. Board/Committee Resignation. Upon termination of Executive’s employment for any
reason, Executive agrees to resign, as of the date of such termination and to the extent
applicable, from the Board (and any committees thereof) and the Board of Directors (and any
committees thereof) of any of the Company’s affiliates.

     9. Non-Competition.

               a. Executive acknowledges and recognizes the highly competitive nature of the businesses of
the Company and its affiliates and accordingly agrees as follows:

          (1) During the Employment Term and, for a period of one (1) year following the date Executive
ceases to be employed by the Company (the “Restricted Period”), Executive will not, whether
on Executive’s own behalf or on behalf of or in conjunction with any person, firm, partnership,
joint venture, association, corporation or other business organization, entity or enterprise
whatsoever (“Person”), directly or indirectly solicit or assist in soliciting in
competition with the Company, the business of any client or customer or prospective client or
customer:

	 	(i)	 	with whom Executive had personal contact or
dealings on behalf of the Company during the one year period preceding
Executive’s termination of employment;
	 
	 	(ii)	 	with whom employees reporting to Executive have
had personal contact or dealings on behalf of the Company during the
one year immediately preceding the Executive’s termination of
employment; or
	 
	 	(iii)	 	for whom Executive had direct or indirect
responsibility during the one year immediately preceding Executive’s
termination of employment.

	 	(2)	 	During the Restricted Period, Executive will not directly or indirectly:

	 	(i)	 	engage in (A) the business of manufacturing
equipment used in (x) the production, storage and end-use of
hydrocarbon and industrial gases business or (y) low temperature and
cryogenic applications, (B) any other businesses which the Company or
its subsidiaries engage in during the term of Executive’s employment
with the

 

 

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	 	 	 	Company and (C) any businesses which, as of the date of Executive’s
termination of employment, the Company or its subsidiaries both (x)
have specific plans to conduct in the future (and as to which
Executive is aware of such planning) and (y) have allocated or
invested capital as of the date of such termination of employment (a
“Competitive Business”);
	 
	 	(ii)	 	enter the employ of, or render any services to,
any Person (or any division or controlled or controlling affiliate of
any Person) who or which engages in a Competitive Business;
	 
	 	(iii)	 	acquire a financial interest in, or otherwise
become actively involved with, any Competitive Business, directly or
indirectly, as an individual, partner, shareholder, officer, director,
principal, agent, trustee or consultant; or
	 
	 	(iv)	 	interfere with, or attempt to interfere with,
business relationships (whether formed before, on or after the date of
this Agreement) between the Company or any of its affiliates and
customers, clients, suppliers, partners, members or investors of the
Company or its affiliates.

          (3) Notwithstanding anything to the contrary in this Agreement, Executive may, directly or
indirectly own, solely as an investment, securities of any Person engaged in the business of the
Company or its affiliates which are publicly traded on a national or regional stock exchange or
quotation system or on the over-the-counter market if Executive (i) is not a controlling person of,
or a member of a group which controls, such person and (ii) does not, directly or indirectly, own
5% or more of any class of securities of such Person.

          (4) During the Restricted Period, Executive will not, whether on Executive’s own behalf or on
behalf of or in conjunction with any Person, directly or indirectly:

	 	(i)	 	solicit or encourage any employee of the
Company or its affiliates to leave the employment of the Company or its
affiliates; or
	 
	 	(ii)	 	hire any such employee who was employed by the
Company or its affiliates as of the date of Executive’s termination of
employment with the Company or who left the employment of the Company
or its affiliates coincident with, or within one year prior to or
after, the termination of Executive’s employment with the Company.

          (5) During the Restricted Period, Executive will not, directly or indirectly, solicit or
encourage to cease to work with the Company or its affiliates any consultant then under contract
with the Company or its affiliates.

b.
 It is expressly understood and agreed that although Executive and the Company consider the
restrictions contained in this Section 9 to be reasonable, if a final judicial determination is
made by a court of competent jurisdiction that the time or territory or any other restriction
contained in this Agreement is an unenforceable restriction against

 

 

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Executive, the provisions of this Agreement shall not be rendered void but shall be deemed
amended to apply as to such maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable. Alternatively, if any court of competent
jurisdiction finds that any restriction contained in this Agreement is unenforceable, and such
restriction cannot be amended so as to make it enforceable, such finding shall not affect the
enforceability of any of the other restrictions contained herein.

     10. Confidentiality; Intellectual Property.

	 	a.	 	Confidentiality.

               (i) Executive will not at any time (whether during or after Executive’s employment with the
Company) (x) retain or use for the benefit, purposes or account of Executive or any other Person
other than the Company; or (y) disclose, divulge, reveal, communicate, share, transfer or provide
access to any Person outside the Company (other than its professional advisers who are bound by
confidentiality obligations or other than in performing his duties on behalf of the Company
consistent with Company policies and as authorized by the Board), any non-public, proprietary or
confidential information —including without limitation trade secrets, know-how, research and
development, software, databases, inventions, processes, formulae, technology, designs and other
intellectual property, information concerning finances, investments, profits, pricing, costs,
products, services, vendors, customers, clients, partners, investors, personnel, compensation,
recruiting, training, advertising, sales, marketing, promotions, government and regulatory
activities and approvals — concerning the past, current or future business, activities and
operations of the Company, its subsidiaries or affiliates and/or any third party that has disclosed
or provided any of same to the Company on a confidential basis (“Confidential Information”)
without the prior written authorization of the Board.

               (ii) “Confidential Information” shall not include any information that is (a) generally
known to the industry or the public other than as a result of Executive’s breach of this covenant
or any breach of other confidentiality obligations by third parties; (b) made legitimately
available to Executive by a third party without breach of any confidentiality obligation; or (c)
required by law to be disclosed; provided that Executive shall give prompt written notice
to the Company of such requirement, disclose no more information than is so required, and
cooperate with any attempts by the Company to obtain a protective order or similar treatment.

               (iii) Except as required by law and except to the extent that the Company has disclosed the
existence or contents of this Agreement publicly, Executive will not disclose to anyone, other
than Executive’s immediate family and legal or financial advisors, the existence or contents of
this Agreement; provided that Executive may disclose to any prospective future employer
the provisions of Sections 9 and 10 of this Agreement provided they agree to maintain the
confidentiality of such terms.

               (iv) Upon termination of Executive’s employment with the Company for any reason, Executive
shall (x) cease and not thereafter commence use of any Confidential Information or intellectual
property (including without limitation, any patent, invention, copyright, trade secret,
trademark, trade name, logo, domain name or other source indicator) owned or used by the Company,
its subsidiaries or affiliates; (y) immediately destroy, delete, or return to the Company, at the
Company’s option, all originals and copies in any form or

 

 

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medium (including memoranda, books, papers, plans, computer files, letters and other data)
in Executive’s possession or control (including any of the foregoing stored or located in
Executive’s office, home, laptop or other computer, whether or not Company property) that contain
Confidential Information or otherwise relate to the business of the Company, its affiliates and
subsidiaries, except that Executive may retain only those portions of any personal notes,
notebooks and diaries that do not contain any Confidential Information; and (z) notify and fully
cooperate with the Company regarding the delivery or destruction of any other Confidential
Information of which Executive is or becomes aware.

	 	b.	 	Intellectual Property.

               (i) If Executive has created, invented, designed, developed, contributed to or improved any
works of authorship, inventions, intellectual property, materials, documents or other work product
(including without limitation, research, reports, software, databases, systems, applications,
presentations, textual works, content, or audiovisual materials) (“Works”), either alone or
with third parties, at any time during Executive’s employment by the Company and within the scope
of such employment and/or with the use of any of the Company’s resources (“Company Works”),
Executive shall promptly and fully disclose same, to the best of his knowledge, to the Company and
hereby irrevocably assigns, transfers and conveys, to the maximum extent permitted by applicable
law, all rights and intellectual property rights therein (including rights under patent, industrial
property, copyright, trademark, trade secret, unfair competition and related laws) to the Company
to the extent ownership of any such rights does not vest originally in the Company.

               (ii) Executive shall take all reasonably requested actions and execute all reasonably
requested documents (including any licenses or assignments required by a government contract) at
the Company’s expense (but without further remuneration) to assist the Company in validating,
maintaining, protecting, enforcing, perfecting, recording, patenting or registering any of the
Company’s rights in the Company Works.

               (iii) Executive shall not improperly use for the benefit of, bring to any premises of,
divulge, disclose, communicate, reveal, transfer or provide access to, or share with the Company
any confidential, proprietary or non-public information or intellectual property relating to a
former employer or other third party without the prior written permission of such third party.
Executive hereby indemnifies, holds harmless and agrees to defend the Company and its officers,
directors, partners, employees, agents and representatives from any breach of the foregoing
covenant. Executive shall comply with all relevant policies and guidelines of the Company,
including regarding the protection of confidential information and intellectual property and
potential conflicts of interest. Executive acknowledges that the Company may amend any such
policies and guidelines from time to time, and that Executive remains at all times bound by their
most current version.

               (iv) The provisions of Section 10 shall survive the termination of Executive’s employment for
any reason.

     11. Specific Performance. Executive acknowledges and agrees that the Company’s
remedies at law for a breach or threatened breach of any of the provisions of Section 9 or Section
10 would be inadequate and the Company would suffer irreparable damages as a result of such breach
or threatened breach. In recognition of this fact, Executive agrees that, in

 

 

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the event of such a breach or threatened breach, in addition to any remedies at law, the
Company, without posting any bond, shall be entitled to cease making any payments or providing any
benefit otherwise required by this Agreement and obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or any other equitable
remedy which may then be available.

     12. Miscellaneous.

               a. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, without regard to conflicts of laws principles thereof.

               b. Dispute Resolution. Except as otherwise provided in Section 11 of this Agreement,
any controversy, dispute, or claim arising out of, in connection with, or in relation to, the
interpretation, performance or breach of this Agreement, including, without limitation, the
validity, scope, and enforceability of this section, may at the election of any party, be solely
and finally settled by arbitration conducted in New York, New York, by and in accordance with the
then existing rules for commercial arbitration of the American Arbitration Association, or any
successor organization and with the Expedited Procedures thereof (collectively, the
“Rules”). Each of the parties hereto agrees that such arbitration shall be conducted by a
single arbitrator selected in accordance with the Rules; provided that such arbitrator shall be
experienced in deciding cases concerning the matter which is the subject of the dispute. Any of
the parties may demand arbitration by written notice to the other and to the Arbitrator set forth
in this Section 12(b) (“Demand for Arbitration”). Each of the parties agrees that if
possible, the award shall be made in writing no more than 30 days following the end of the
proceeding. Any award rendered by the arbitrator(s) shall be final and binding and judgment may be
entered on it in any court of competent jurisdiction. Each of the parties hereto agrees to treat
as confidential the results of any arbitration (including, without limitation, any findings of fact
and/or law made by the arbitrator) and not to disclose such results to any unauthorized person.
The parties intend that this agreement to arbitrate be valid, enforceable and irrevocable. In the
event of any arbitration with regard to this Agreement, each party shall pay its own legal fees and
expenses, provided, however, that the parties agree to share the cost of the Arbitrator’s fees.

               c. Entire Agreement/Amendments. This Agreement contains the entire understanding of
the parties with respect to the employment of Executive by the Company. There are no restrictions,
agreements, promises, warranties, covenants or undertakings between the parties with respect to the
subject matter herein other than those expressly set forth herein. This Agreement may not be
altered, modified, or amended except by written instrument signed by the parties hereto.

               d. No Waiver. The failure of a party to insist upon strict adherence to any term of
this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive
such party of the right thereafter to insist upon strict adherence to that term or any other term
of this Agreement.

               e. Severability. In the event that any one or more of the provisions of this
Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity,

 

 

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legality and enforceability of the remaining provisions of this Agreement shall not be
affected thereby.

               f. Assignment. This Agreement, and all of Executive’s rights and duties hereunder,
shall not be assignable or delegable by Executive. Any purported assignment or delegation by
Executive in violation of the foregoing shall be null and void ab initio and of no force and
effect. This Agreement may be assigned by the Company to a person or entity which is an affiliate
or a successor in interest to substantially all of the business operations of the Company. The
Company will require any person or entity which is an affiliate or a successor in interest to
substantially all of the business operations of the Company to assume all obligations of the
Company under this Agreement.

               g. Set Off; No Mitigation. The Company’s obligation to pay Executive the amounts
provided and to make the arrangements provided hereunder shall be subject to set-off, counterclaim
or recoupment of amounts owed by Executive to the Company or its affiliates. Executive shall not
be required to mitigate the amount of any payment provided for pursuant to this Agreement by
seeking other employment.

               h. Successors; Binding Agreement. This Agreement shall inure to the benefit of and be
binding upon personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.

               i. Notice. For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have been duly given when
delivered by hand or overnight courier or three days after it has been mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the respective addresses
set forth below in this Agreement, or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that notice of change of address shall be
effective only upon receipt.

If to the Company:

Chart Industries, Inc.

One Infinity Corporate Centre Drive, Suite 300

Garfield Heights, Ohio 44125

Facsimile: (440) 753-1491

Attention: Chief Financial Officer and

                  Vice President – Human Resources

If to Executive:

To
the most recent address of Executive set forth in the personnel records of the Company.

               j. Executive Representation. Executive hereby represents to the Company that the
execution and delivery of this Agreement by Executive and the Company and the performance by
Executive of Executive’s duties hereunder shall not constitute a breach of, or

 

 

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otherwise contravene, the terms of any employment agreement or other agreement or policy to
which Executive is a party or otherwise bound.

               k. Prior Agreements. This Agreement supercedes all prior agreements and
understandings (including verbal agreements) between Executive and the Company and/or its
affiliates regarding the terms and conditions of Executive’s employment with the Company and/or its
affiliates, including, without limitation, the offer letter, dated February 27, 2006.

               l. Cooperation. Executive shall provide Executive’s reasonable cooperation in
connection with any action or proceeding (or any appeal from any action or proceeding) which
relates to events occurring during Executive’s employment hereunder. This provision shall survive
any termination of this Agreement.

               m. Withholding Taxes. The Company may withhold from any amounts payable under this
Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any
applicable law or regulation.

               n. Counterparts. This Agreement may be signed in counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were upon the same
instrument.

               o. Compliance with Section 409A. Notwithstanding anything herein to the contrary, (i)
if at the time of Executive’s termination of employment with the Company Executive is a “specified
employee” as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), 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 the
imposition of 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 Executive) until the date
that is six months following Executive’s termination of employment with the Company (or the
earliest date as is permitted under Section 409A of the Code) and (ii) if any other payments of
money or other benefits due to Executive 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 Board, that does not cause such an accelerated or additional tax or
result in an additional cost to the Company. The Company shall consult with Executive in good
faith regarding the implementation of the provisions of this Section 12(o); provided that neither
the Company nor any of its employees or representatives shall have any liability to Executive with
respect thereto.

[Signature page follows]

 

 

13

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

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	CHART INDUSTRIES, INC.	 	 	 	MATTHEW J. KLABEN
	 
	 	 	 	 	 	 
	/s/ Samuel F. Thomas

	 	 	 	/s/ Matthew J. Klaben	 	 
	 	 	 	 	 	 	 
	By: Samuel F. Thomas
	 	 	 	 	 	 
	Title: Chief Executive Officer and PresidentEX-10.7

 

	 	 	 	 	 

Exhibit 10.7

IAM

AGREEMENT

2004 — 2007

ARTICLE I  - RECOGNITION

Chart Heat Exchangers (hereinafter referred to as the “Company”) recognizes Local Lodge 2191 of
District Lodge 66 of The International Association of Machinists and Aerospace Workers, AFL-CIO
(hereinafter referred to as the “Union”) as the sole and exclusive bargaining agent for its
employees at its La Crosse, Wisconsin manufacturing facility for the purpose of collective
bargaining with respect to the wages, hours and working conditions of said employees.

As used in this Agreement, the terms “employee” and “employees” shall include all production and
maintenance employees, including all craters, receiving clerks and tool room employees, but shall
exclude all administrative employees, factory office clerical employees, engineers and technical
employees, standards and factory cost department employees, professional employees, guards, safety
inspectors, nurses, student trainees and all supervisory employees as defined in the Labor
Management Relations Act.

Employees in the above excluded jobs are not covered by this Agreement; but if employees currently
in such jobs subsequently take other jobs within the coverage of this Agreement, then such
employees shall be eligible to membership in the Union upon such notification to them by the
Company.

This Agreement shall be binding on any and all successors and assigns, who by purchase, lease,
transfer of stock or merger, acquire control of the Company’s manufacturing facility in La Crosse,
Wisconsin.

ARTICLE II  - UNION SECURITY

Employees eligible for Union membership as defined in this Agreement shall be required at the
expiration of their probationary period to become and remain members of the Union in good standing
with respect to the payment of uniformly levied initiation fee and periodic dues as a condition of
employment.

ARTICLE III  - NON-DISCRIMINATION

The Company or the Union shall not discriminate against employees because of color, race, sex,
religious affiliation, nationality, age, handicap or status as a disabled veteran or Vietnam era
veteran, as prescribed by applicable state or federal law. Pronouns in the male gender appearing in
this Agreement are intended to include the female gender.

 

 

ARTICLE IV  - HOURS

Regular Work Day and Week

Eight (8) hours shall constitute a regular day’s work and not more than forty (40) hours shall
constitute a regular week’s work. The regular workweek will begin at 11:00 p.m. on Sunday and will
end on Friday.

Shift Hours

The shifts may consist of one day and two night shifts. The regular working hours are as follows:

3rd Shift 11:00 P.M. to 7:00 A.M.

1st Shift 7:00 A.M. to 3:00 P.M.

2nd Shift 3:00 P.M. to 11:00 P.M.

Third shift weekly start will be 11:00 P.M., Sunday.

Regular Lunch Periods.

1st Shift 12:00 Noon

2nd Shift 8:00 P.M.

3rd Shift 4:00 A.M.

Employees shall also be provided during their shift one (1) rest period not to exceed ten (10)
minutes in accordance with operational requirements. Normally, the break times will be as specified
below:

1st shift: 9:30 am to 9:40 am

2nd shift: 5:30 pm to 5:40 pm

3rd shift: 1:30 am to 1:40 am

The consumption of food items and visits to the lunch room shall be limited to designated lunch and
break periods and will not be permitted during other work hours. Beverages will be allowed at the
workstations.

All employees are assigned to a three-shift basis and will have a paid 15-minute lunch period
starting at one of the times listed above in this paragraph.

ARTICLE V  - OVERTIME

General

Union members will cooperate in working of necessary overtime; however, an employee shall have the
right to refuse to perform overtime work where the Company is able to secure someone else who is
experienced to perform the work.

An employee shall have the right to refuse to accept overtime work whenever they have a reasonable
excuse or where the length of time is so excessive so as to endanger their health.

2

 

It shall be the policy of the Company to ask for overtime before 12 o’clock for the day shift — 9
o’clock for the second shift and the day before for the third shift for daily overtime. In no event
shall a first or second shift employee be required to work Saturday when notification is given
later than the end of the employee’s Thursday shift nor where the Saturday shift is more than five
(5) hours. For first and second shift employees, the Company will schedule consecutive 5-hour
shifts on Saturday and/or Sunday except production needs require another schedule. When two shifts
are being scheduled, the first and second shifts will be scheduled for the same number of hours.
Third shift employees will not be required to work Saturday when notification is given later than
the end of the employee’s Thursday shift. The normal Saturday or Sunday shift for third shift
employees is eight (8) consecutive hours. 3rd shift will have the right to work five (5) hours
starting on their regular Saturday and Sunday shift. If a change in schedule is necessary, the Shop
Committee will be notified and given the reason for such deviation — this will be done before the
deviation whenever possible. 1st and 2nd shifts will have the right to work five (5) hours starting
on their regular Saturday and Sunday shift, since the regular shift on weekends is five (5) hours.

Overtime Premium

All hours worked in excess of eight (8) in a work day will be paid at one and one-half (11/2) times
the regular straight time hourly rate.

When an employee works hours prior to or after their normal shift they will be paid overtime at
time and one-half. The exception to this is when an employee requests earlier starting and stopping
time and the Management agrees, then the Company is not obligated to pay overtime hours before or
after their regularly scheduled shift.

The Management has agreed to pay double time for all overtime hours worked which exceed sixteen
(16) hours in any one week with the understanding with the Shop Committee that the Management has a
right to replace the employee that is working and has put in sixteen (16) hours overtime. The
Management will make the transfers in such cases. The Management will replace the employee with an
employee from within the department as follows:

	a.	 	With an employee from the same department and shift.
	 
	b.	 	If possible with an employee from the same department on another shift.
	 
	c.	 	Where employees for replacement are not available within the department, employees capable of
performing the work will be transferred in from other Departments.

Hours worked on a day observed, as a holiday under this Agreement will be included in such sixteen
(16) hours under this paragraph.

Saturday and Holiday Pay

All Saturday work shall be paid for at the rate of one and one-half (11/2) times the hourly rate
including third shift Saturday work which starts at 11:00 p.m. on Friday. All work done on Sunday
and legal holidays shall be paid for at the rate of double time except where a regular third

3

 

shift starts on a Sunday or a holiday and then the regular working hours shall be compensated at
the applicable regular rate.

Overtime Charging

An employee’s overtime record shall be credited with overtime when they are asked whether they work
or not. If the department works overtime, an absent employee’s overtime record shall be charged
with any overtime for which they would have been eligible had they not been absent, including an
employee on vacation or sick leave.

An employee on a day-at-a-time vacation when overtime is scheduled but who returns before the
overtime is worked shall be asked for that overtime if such employee is eligible and qualified. If
such employee replaces another employee, the employee being replaced is not charged for that
overtime. An employee’s absence on Thursday will not jeopardize that employee’s rights to weekend
overtime if they return to work on Friday. However, it will be the employee’s responsibility to
communicate with management no later than the start of the lunch period of their Friday shift to
determine if weekend overtime is available.

Where the applicable rate of pay is time and one-half, the employee will be charged with one and
one-half hours overtime for each overtime hour.

Where the applicable rate of pay is double time, the employee will be charged with two hours
overtime for each overtime hour.

An employee asked to work overtime after the deadlines defined in Paragraph 15, where the overtime
is in a department or shift other than their own, will not be charged with such overtime refused
but will be charged if they work such overtime.

An employee, who is asked to work additional overtime while working a weekend overtime shift, will
not be charged for such additional overtime if refused, but will be charged if they work such
additional overtime.

Telephone offers of overtime where management reaches the employee are charged whether or not the
overtime is worked. Where a message is left with someone other than the employee, and the employee
fails to work, the overtime will not be charged. All work, or refusal of work, on a day observed as
a holiday under this Agreement is charged.

An employee who accepts an overtime assignment but fails to report for and work such assignment
without being excused by management will be recorded with an unexcused absence.

No employee will be subject to an unexcused absence being recorded for an overtime assignment
missed due to hospitalization of the employee or death or hospitalization of a member of the
employee’s immediate family.

When an employee is transferred to a different Department, they will get the average overtime for
that Department. When they are transferred back to their Home Department, they will receive the
overtime average of their Home Department.

4

 

Overtime Distribution

The supervisor will keep daily records of all overtime worked by the employees. In order that the
overtime within the various departments is distributed as evenly as possible, those with the least
amount of overtime shall be asked to work first among those qualified to do the work. It is
recognized that an employee may be qualified to do the overtime work without holding the applicable
job classification. If an employee is eligible for overtime but declines the hours that are
offered, the overtime may be offered to the next qualified employee. The supervisor’s copy of the
overtime record will be posted at the supervisor’s desk and kept as current as possible. The names
and work centers, where applicable, of those scheduled for weekend overtime work in the department
and shift will be displayed in the department area by the supervisor prior to the overtime work to
permit checking by employees so they may determine before the overtime is worked if any errors in
selection have been made. This information is to be used by employees to point out any overtime
assignment errors to the supervisor before the overtime is worked, wherever possible. When an
entire shift in a department is scheduled for weekend work, a notice displayed to that effect need
not include names and work centers.

The Company will continue its practice of distributing overtime as equally as possible on the shift
in a department.

It is further agreed that the Company will maintain as close a balance of overtime hours among the
shifts within a department as production necessities and individual skills allow.

Overtime Entitlement on Transfer or Probation

A transferred employee shall have to work five (5) days before they are entitled to overtime.
However, they may work if all other people in the Department have been asked.

Probationary employees will not be asked to work until all employees with seniority working in the
department and on the shift, including transferred employees, have been asked to work; except that
when all employees in the department on all shifts who are qualified for the work involved have
been asked to work and more employees are needed, qualified probationary employees may be asked.

ARTICLE VI  - HOLIDAYS

Paid Holidays

All employees on the seniority list shall receive eight (8) hours pay at their regular straight
time hourly rate inclusive of shift premiums for the following holidays: New Year’s Day, Good
Friday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, day after Thanksgiving Day,
December twenty-fourth, Christmas Day and December thirty-first, providing the employee has worked
a major part of their last scheduled work day before and the major part of their first scheduled
work day after the holiday, providing such days are in the same work week as the holiday; except
where this work requirement is specifically waived by the Company for reasons of personal urgency.

5

 

When December twenty-fourth and December thirty-first fall on Saturday or Sunday, the holidays will
be observed on the preceding Friday. When any other holiday listed above falls on Saturday, it will
be observed on the preceding Friday.

On Layoff and Sick or Military Leave

Employees who have been laid off in a reduction of force during the workweek prior to or during the
week in which the holiday falls shall receive pay for such holiday.

In the event one of the paid holidays falls during an employee’s vacation, they have the option of
substituting the day(s) before or the day(s) after their vacation for said holiday(s).

Employees who go on sick leave during the workweek prior to or during the week in which the holiday
falls shall receive pay for such holiday.

Employees who go on military leave during the first or second workweek prior to or during the week
in which the holiday falls shall receive pay for such holiday.

ARTICLE VII  - OTHER PAY PROVISIONS

Call Back Pay

Any employee called back for work outside their regularly scheduled hours shall receive not less
than three (3) hours pay at their applicable rate.

Reporting Pay

When an employee reports for work and no work is available, they shall be paid up to four (4) hours
at their regular straight time rate for the time lost during the first half of their shift unless
they were notified in advance of the starting time of their shift not to report for work. However,
if stoppage of work is due to fire, lightning, failure of power lines or other causes beyond the
Company’s control no payment for lost time shall be made.

An employee shall be notified not to report for work by either, the supervisor of their department,
the Human Resources Department or other supervisory personnel, provided the employee has furnished
the correct phone number to the Company. If the correct phone number is not provided and the
employee cannot be contacted, no reporting pay will be paid.

Time Lost Due to Injury

If it has been established that an injury to an employee has arisen out of and in the course of
their employment with the Company, and the employee is instructed by the Company to receive outside
treatment for the injury during the current shift, they will be paid for time necessary to obtain
such treatment. If follow-up outside treatment is required which cannot be scheduled outside the
employee’s regular working hours, the employee will be paid up to three (3) hours at their regular
straight time hourly rate for time lost from their regular working hours for any such follow-up
visits.

6

 

In the event an employee is instructed by the Company to receive subsequent outside treatment
during their regular shift because of their inability to continue work due to the original injury,
they will be paid for time necessary to obtain such treatment.

In any case in which an employee believes outside treatment for the injury is necessary during
their regular working hours even though the Company has refused to instruct them to receive such
outside treatment, the employee may at their option leave work to receive outside treatment. Should
it be determined that the treatment was necessary in order the employee continue work or if it is
determined that they are unable to continue work, the employee will be paid for the time lost from
their regular working hours in accordance with Paragraphs 45, 46, and 48.

If the employee loses time and the attending physician determines they are physically unable to
work the balance of the shift on which they received outside treatment due to the severity of the
injury, they shall be paid for the balance of that regular shift, but not to exceed eight (8)
regular hours, upon furnishing proof of the physician’s determination. If an employee is injured
while working in the plant and such injury arises out of and in the course of their employment, and
the injury is of such nature as to prevent the employee’s return to work for an initial period of
three (3) or more consecutive calendar days excluding Sunday or paid holiday or vacation following
the day of injury, then the Company will pay such employee a sum equal to the current sickness and
accident daily benefit rate for each of such three (3) days; provided however, that such payment
shall not be made if the Workmen’s Compensation carrier of the Company is required to pay the
employee Workmen’s Compensation for the three (3) day period following the day of injury.

Under the following circumstances the Company will pay for up to two and one-half (21/2) hours for
working time lost by an employee on Monday:

	a.	 	An employee is injured at work on a Saturday and obtains outside treatment.
	 
	b.	 	An injured employee is instructed by their doctor to report for medical evaluation on the
following Monday morning before going to work.
	 
	c.	 	The employee notifies their supervisor in advance that they won’t be in on time.
	 
	d.	 	The employee reports for work on the Monday involved before 9:30 a.m.

Bereavement

An employee with seniority, who is working at the time, will be granted three (3) regular working
days off with pay in the event of a death in the employee’s immediate family. Immediate family is
defined as the employee’s wife, husband, father, mother, son, daughter, brother, sister,
father-in-law or mother-in-law. An employee may take the time off with pay later than the day of
death or funeral if circumstances warrant and are a direct result of the death. An employee with
seniority, who is working at the time, will be granted one (1) regular workday off with pay to
attend the funeral of a grandparent or grandchild of the employee.

7

 

Jury Duty

An employee with seniority shall be excused from work on a work day on which they are called to
perform jury service in a court of record, provided they give prior notice to the Company.

An employee with seniority who is excused from work for jury service and who furnishes the Company
with a statement from the court with regard to jury pay received and time spent on jury service
will be reimbursed by the Company as follows:

	a.	 	All employees will receive eight (8) hours pay at their regular straight time rate including
all applicable premium pay less the amount received as jury pay for each day they are called
to serve as a juror.
	 
	b.	 	A day of jury duty is defined as any day for which the employee is required to appear
regardless of having served, certified by written statement from the court.
	 
	c.	 	Hourly rate of pay shall be limited to Sixty (60) workdays annually commending with the first
day of jury service paid.

ARTICLE VIII  - SENIORITY

It shall be the policy of the Company to recognize seniority. To accomplish this, there shall be
one seniority list covering all employees in all production departments. Where two or more
employees gain seniority on the same day, their relative seniority shall be determined by last name
alphabetical sequence with, for example, an employee whose last name begins with “A” being regarded
as senior to one whose last name begins with “B”. Last name changes due to marriage, etc., which
occur after the day on which an employee gains seniority, shall not affect seniority.

In the event that, before June 1, 1988, a person who, as of the effective date of this agreement,
is an employee of the Trane Company temporarily assigned to ALBRAZE International (Chart Heat
Exchangers) the ALBRAZE (Chart) seniority date of said person will be January 5, 1986.
Notwithstanding the provisions of Paragraph 39, above, the relative seniority of employees whose
ALBRAZE (Chart) seniority date is January 5, 1986 shall be determined by the amount of Trane
Company seniority which they possessed as of the effective date of this Agreement.

Probationary Period

An employee shall have no seniority rights until the completion of their probationary period. The
probationary period shall consist of sixty (60) actual days worked. This calculation does not
include overtime outside the normal schedule. The date given the employee for their seniority
standing will be the day following the end of their probationary period.

An employee shall lose their seniority rights for the following reasons:

	a.	 	If they voluntarily terminate their employment with the Company.
	 
	b.	 	If they have been discharged for just cause.

8

 

	c.	 	After being laid off, if an employee fails to report for work within five (5) days after
being notified through the Company Human Resources department. Notification to return to work
will be confirmed by certified letter to the employee. However, no employee shall lose their
seniority rights if their failure to report is the result of sickness or causes beyond their
control, in which case the employee shall furnish written proof as to that fact.
	 
	d.	 	If for any reason an employee has had twenty-four (24) consecutive months of unemployment
with the Company or a period equal to one-half (1/2) of their seniority, whichever is greater.

Layoff

When it becomes necessary to reduce the working forces, the last employee on the plant seniority
list shall be the first employee laid off, etc., and the last employee laid off shall be the first
employee recalled, etc., except as hereinafter provided. Before any layoffs or recalls of any
employees occur, a list of employees to be laid off or recalled will be presented to the Shop
Committee as to the employees laid off or recalled and the effect on seniority; but this shall not
in any way interfere with the right of the Company to reduce its force.

Voluntary Layoff

	a.	 	Senior employees not affected by the layoff will be allowed to volunteer to replace the most
senior people on the layoff list. Employees volunteering for layoff status are required to
accept the layoff for two (2) months unless the employees involved are recalled before that
time.
	 
	b.	 	An employee opting for and receiving voluntary status may exercise this option one (1) time
per calendar year.
	 
	c.	 	This voluntary layoff procedure will be administered through one (1) list per layoff date.
When an employee on a two (2) month voluntary layoff returns to work, the junior employee will
be laid off unless another senior employee has signed the list for the specific layoff or
until the list is exhausted.
	 
	d.	 	A new list will be used for each successive layoff date and the procedure stated above will
apply. The previous list will be cancelled at this time. Employees not receiving voluntary
layoff on previous lists will be allowed to sign these new lists to determine the availability
and opportunity for voluntary layoff status.
	 
	e.	 	The Company retains the right to recall those on a voluntary layoff at any time based on
production needs or if the skills of the volunteer are required. The Company also retains the
right to deny voluntary layoff if the volunteer’s skill is needed at the time of layoff.
	 
	f.	 	The Company agrees to pay their share of all insurance premiums for any employee on voluntary
layoff. Also, the employee agrees to pay their share of all insurance premiums. All other
benefit restrictions will apply as for employees on normal layoff. Insurance payments are due
the first of the month of applicable coverage.

9

 

Exemptions and Deviations From Layoff

All welders, electricians, and tool room employees are exempt from the seniority clause as to
layoff as long as they are needed on their exempted jobs. It is understood that an exempted
employee must have demonstrated the capability to perform the required job. If the Company replaces
an employee exempted in one of the above jobs with an older qualified employee, the exempted
employee will be laid off.

Deviations from straight plant seniority in addition to those listed above can only be made for
justifiable reasons, that is, when an employee’s qualifications are essential on available work and
no senior employee not subject to layoff has the necessary qualifications. The Company will specify
such exemptions to the Shop Committee sufficiently in advance of the layoff giving the specific
reasons for such deviations in each case. The Company will endeavor to find alternate qualified
employees not subject to layoff for such exempted employees to replace those so exempted. The
Company will not be required to make more than two transfers to replace one employee under this
paragraph.

The parties may discuss from time to time the problem of deviations from seniority on layoff.

If the Union does not agree with certain exemptions, the Company and the Shop Committee shall make
every effort to resolve their differences before resorting to the grievance procedure.

Layoff Notice

When layoffs, because of lack of work, are in accordance with straight seniority, the employees
affected shall be given five (5) working days notice before being laid off for a period of two (2)
weeks or more. It is further agreed that in case of material shortages resulting from conditions
beyond the Company’s control, the five (5) days’ notice provision will be waived. Employees
exempted from layoff who are to be laid off because they are no longer needed on the work for which
they are exempted may be laid off without notice. However, first and second shift exempted
employees will work to the end of the shift in which layoff notice is given. Paragraph 43 will
apply to third shift exempt employees who are to be laid off without notice.

One-Day Layoffs

Layoffs, due to lack of work or material shortages, will be made by seniority in a department,
provided such a layoff does not exceed eight (8) hours in any one week. For any layoff in excess of
eight (8) hours in any one-week, the procedure set forth in Paragraphs 57-61 will be followed. This
paragraph is not intended to be used to establish a regular work week of less than five (5) days
for the employees in any department, and shall be applied in such a way that no employee is
affected in their department more than six (6) times nor more than three (3) consecutive weeks in a
twelve (12) month period. The Union Committee will be notified in advance of any layoff under this
paragraph.

Inventory

In the event that production is interrupted due to the taking of inventory, the parties will meet
to discuss appropriate work assignments.

10

 

ARTICLE IX  - TRANSFER

Requests for Transfer

All requests for permanent transfers by employees may be granted by the mutual consent of the Shop
Committee and Management. The selection of employees shall be based upon the Job Selection
Guidelines.

When an employee is granted a job or department transfer at their own request they shall have a
trial period of up to thirty (30) days. The exception to the foregoing sentence is in cases where
an extension of a trial period, due to skills is requested by the Company or the Union, and such
extension is agreed to by the Company and the Union. They will receive the rate of the job they are
performing while on transfer if they are qualified. If it is decided to make the transfer
permanent, the employee will be given a rating for which they are qualified.

	a.	 	When such request is made, the Union and the employee and the supervisor will receive a
written notification.
	 
	b.	 	In the event that an employee is accepted for training on a job with a labor grade higher
than their present job they shall, when they complete the trial period, be paid the time and
grade rate of the new job but not less than their time and grade rate on their former job.
	 
	c.	 	In a posting requesting multiple employees for the same labor grade and classification, the
senior employee will not be paid less than the time and grade rate of the junior employee(s).

Temporary/Forced Transfers

Employees will be considered as temporarily transferred until notified of being forced to accept a
permanent job or department transfer due to shortage of work, material, manpower, etc. Said
employee shall carry their present classification and pay rate for a period not less than six (6)
months. Employees will receive the rate of the job they are performing while on transfer if they
are qualified and if the rate is higher than their current rate. After six (6) months the employee
will be given a rating in the new department for which they are qualified.

If, up to three (3) months from the employee’s date of forced transfer a position opens up in their
home department, the employee will have the option to return to their home department, if they are
qualified for the position.

Seniority Principle

It shall be the policy of the Company to follow the principle of seniority whenever skill is not a
consideration when moving transferred employees out and returning employees to their home
department. Employees will be transferred from their home department by inverse seniority
regardless of shift assignment provided the remaining employees are qualified to perform the work.

11

 

When it is necessary to transfer employees and the position to be transferred to is a job of a
higher labor grade than in the department, employees are to be transferred by seniority. Senior
employees will be offered said transfer prior to junior employees being forced to transfer,
provided the remaining employees are qualified to perform the work. Transferred employees will be
returned to their home department on the basis of seniority whenever skill is not a consideration.

Exception for Union Representatives

	a.	 	A department steward or a member of the Shop Committee may be transferred or farmed, by
inverse seniority, from their home department, but not subject to being replaced on their
shift. This provision shall not be construed to give extra seniority to such representative in
the event of a layoff, nor to prevent such Union Representative from exercising their
seniority.
	 
	b.	 	In the event the selection of a safety steward is other than a department steward, the
language of paragraph #1 above will apply to said safety stewards.

Calling Back Transferred Employees

When it is established that there is a need for additional personnel for ten (10) working days or
more in a Department, with employees out on transfer such employees will be returned to their Home
Department to fill the need in accordance with Paragraph 51 unless such need is being met
temporarily by an employee with physical limitations who is unable to perform their normal duties.
Such needed employees will be returned to their home department as soon as possible but not later
than thirty (30) calendar days. Presence of a physically limited employee in a Department will not
result in a senior employee on transfer losing their rate or job.

Except where production needs reasonably require otherwise, employees shall not be placed in a
department where employees are transferred out prior to returning those on transferred back to
their home department by seniority.

It is recognized that in order to use the work force efficiently and keep people working in so far
as possible, the company requires flexibility in farming or transferring employees for a period of
time, due to the reduction of work in the Home Department, or their specific skill is needed in
another department, or because of the production need of another department. The farming of an
employee shall be by inverse seniority by shift, and will not exceed 15 working days.

Wage Rate Handling

When an employee is transferred into a job classification they previously carried, they shall
receive the rate for that job retroactively, after accumulating three (3) full days, provided such
a rate is higher than they are carrying. If they continue on the job for a period of six (6)
months, their short-term rate shall become their new classification.

12

 

Notice of Transfer

The Company will endeavor to give each employee a Notice to Report Form on the day preceding the
transfer or shift change by 12:00 P.M. (noon) on the first shift, 9:00 P.M. on the second shift and
4:45 A.M. on the third shift.

New Technology, Product Transfer or Discontinuance

The Company and the Union agree that it is to both their mutual benefit and a sound economic and
social goal to utilize the most efficient machines, processes, methods and/or materials. In this
way, the Company will be able to compete effectively in the market place and, thereby, provide
economically secure jobs for its employees.

When the Company changes technology, transfers a product line or a portion thereof from La Crosse,
or discontinues the manufacture of a product line or portion thereof at La Crosse, or merges two or
more departments and as a result of such action a department is dissolved or a major portion of the
regular employees in such department are no longer needed on their jobs, each employee in the
department whose job is abolished because of this action will be subject to the following
procedure:

	a.	 	Prior to the implementation of any of the above, the Company will meet with the Union to
discuss the impact.
	 
	b.	 	The Company agrees to train displaced employees within a reasonable period of time (6 months
or less) for available positions.
	 
	c.	 	Employees in classifications and areas will be handled in a manner consistent with marginal
paragraph 67 of the agreement.

New Department

A new department is created when a new product line is originally manufactured in a separate plant
area, and such department is assigned a new department number. When a new department is created,
the Company and the Union will agree upon a procedure for the distribution of information regarding
the department and the minimum requirements therefore. The selection of the employees will be made
in accordance with Paragraphs 65 and 87 and the provisions of Paragraph 66 shall also apply.

The Job Selection Guidelines will be the determining factor when making the selection.

Upgrading

	a.	 	The Company will continue to upgrade employees to higher skilled jobs where possible to do
so. The fact that an employee is proficient on their current job will not in itself be the
cause to prevent their being upgraded to a higher skilled job.
	 
	b.	 	When a successful bidder is selected to report to the posted/notice job they can be held up
to thirty (30) days in their current job. If it is necessary to hold the employee beyond the

13

 

	 	 	thirty (30) days, the employee will be reimbursed for any monetary loss upon the successful
completion of the training/trial period for the new job.

Transfer to Lighter Work and Incapability

When a senior employee, who is at the time working, requests a transfer to light work, or the
Company determines that such an employee can no longer perform their job due to advanced age,
physical incapacity or is incapable of performing their regular job, the Company and the Union will
discuss the problem with the intent of:

	a.	 	Assigning them to available work which they are able to perform and which needs to be
performed, and
	 
	b.	 	Paying for such work at the wage rate of the job they would be performing.

It is understood that the above does not obligate the Company to make-work for an employee or to
assign an employee to work which they cannot perform satisfactorily.

Leaving or Returning to Bargaining Unit

Any member of the bargaining unit who has been promoted or transferred or is promoted or
transferred to a position outside the bargaining unit described to a position outside the
bargaining unit described in Article I shall maintain the amount of seniority they had at the time
of such promotion or transfer and will not continue to accumulate seniority within the bargaining
unit.

Should such employee request to return to the bargaining unit or should the Company decide to
return such employee to the bargaining unit, they will be reinstated with the amount of seniority
they maintained at the time of their promotion or transfer. The Company agrees that it will not
return employees to the bargaining unit for the purpose of temporarily reducing the staff of
non-bargaining unit employees. When such employee returns to the bargaining unit, their job and
department assignment will be at the discretion of the Company. The Union will be notified of the
job and department assignment five (5) days prior to such assignment wherever possible. However,
they will not be placed in a department where their assignment would cause the transfer of a
regular department employee then working in the department or where there are employees out of such
department on transfer, or where there is not a need for them in the department for at least ten
(10) working days. Furthermore, upon return to the bargaining unit, such an employee will be
assigned a labor grade no higher than the highest they held in the three-year period just prior to
their promotion from the bargaining unit.

Nothing, however, contained in Paragraph 82 shall be construed as limiting the Company’s right to
discharge any employee promoted or transferred from the bargaining unit for cause.

Should any employee who has been promoted or transferred from the bargaining unit and then returned
to the bargaining unit under the above procedures, be subsequently again promoted or transferred
from the bargaining unit, they will lose all seniority status ion the bargaining unit on the date
of such promotion or transfer.

14

 

An initial temporary vacation replacement assignment of up to 3 months outside the bargaining unit
will not be counted toward the limitations of this paragraph.

Transfers Not Covered

All transfers not covered elsewhere in this Agreement shall be discussed with the Shop Committee
before such transfers are made.

ARTICLE X  - SHIFT TRANSFERS

Voluntary Shift Exchange (up to 1 week)

Voluntary shift exchanges, which are approved by management, will be permitted between two (2)
employees in the same department on a temporary basis (up to 1 week) if such exchange conforms to
the Walsh-Healey Act and does not cause overtime payments. No changes in night shift premium will
be made for either employee involved in temporary shift exchange under this paragraph.

For all voluntary shift exchanges, both employees must report to the department and shift from
which they intend to switch for a minimum of one (1) week.

Voluntary Shift Exchange (more than 1 week)

A request for an exchange of shifts — for up to one (1) year by two employees in the same
department will be permitted providing:

	a.	 	Neither employee puts in more than eight (8) hours in a 24-hour period in making the
exchange, to conform with the Walsh-Healey Act.
	 
	b.	 	Neither of the employees making the exchange may do so more than three (3) times within a
year.
	 
	c.	 	The qualifications and experience of both employees are relatively equal.

Relatively equal is defined as:

	a.	 	Two (2) employees who can perform similar job(s).
	 
	b.	 	An employee that is not from the department must be approved by the cell leader (engineer)
and department supervisor affected to determine what job(s) they can perform or have working
knowledge of before any trade with a Home Department employee.
	 
	c.	 	Such request must be in writing to the Company, signed by the employees involved, specifying
the duration of the voluntary shift exchange, with a copy to the Union.
	 
	d.	 	With respect to this paragraph, all other provisions of this Agreement shall apply.
	 
	e.	 	For all voluntary shift exchanges, both employees must report to the department and shift
from which they intend to switch for a minimum of one (1) week.

15

 

Shift Preference

An employee upon attaining seniority may replace a junior employee in the same skill on a different
shift in the same department subject to the following:

	a.	 	When an employee gains seniority they can be replaced by a senior employee.
	 
	b.	 	Where the senior employee is replacing an employee in the same or a lower rated labor grade,
the Company will in all instances where possible train a replacement within three (3) months
for the senior employee so that they will be able to exercise their shift transfer. The
training period will start within a one (1) week period after the employee’s written request
is acted on at the regular meeting.
	 
	c.	 	Employees shall have the right to change shifts under this Section no more than (4) times
within each calendar year.

Transfer to Night Shift

When it is necessary to transfer a first shift worker to the second or third shift or a second
shift worker to the third shift or the starting of a second or third shift, the youngest employee
by seniority in the Department capable of doing the work involved shall be so transferred, unless a
senior employee has preference to be transferred to the shift involved.

ARTICLE XI  - POSTED VACANCIES

Should a vacancy occur within the Department due to retirement, termination, promotion, etc., the
Company will discuss with the Union if said vacancy needs to be filled.

	a.	 	Employees from within the department where the opening is will be offered said openings by
seniority before moving to step #2 of this paragraph.
	 
	b.	 	When a vacancy exists, the posting shall indicate the department, shift and for information
purposes only, an identification of the major department functions(s), and a listing of
typical labor grades in the department.
	 
	c.	 	If the posted vacancy is filled by an employee from the posted department from another shift,
this transfer may result in a vacancy on their shift, which in that event will be posted. No
further transfer or postings will be made.
	 
	d.	 	If the posted vacancy is not filled by someone from the posted department, it may be filled
by a bidder from another department.
	 
	e.	 	If an employee, after having received a posted vacancy, returns to their home department, a
second employee from the original list of bidders may be selected to fill the vacancy.
	 
	f.	 	If an employee is selected for a posted vacancy and subsequently returns to their Home
Department at their own request, they shall be restricted from bidding on another posting for
a period of six (6) months from the date of transfer to the posted vacancy.

16

 

	g.	 	Vacancies will be filled based on the Job Selection Guidelines established and agreed to by
the Union and Company.
	 
	h.	 	When additional personnel are required the Company will post a notice.
	 
	i.	 	The Company and Union will review notices prior to publication.
	 
	j.	 	When an employee is selected for a position and completes the training period, said employee
will be restricted from bidding on another posting or notice for four (4) months. This is not
intended to prevent an employee from bidding on a higher skilled job during this four (4)
month period.

ARTICLE XII  - RULES AND REGULATIONS

	a.	 	Stealing or taking away of any Company property, including scrap without the written
permission of the Manager of Manufacturing or other supervisory personnel is prohibited.
	 
	b.	 	Falsification by an employee of their own starting and stopping time is prohibited.
	 
	c.	 	Carelessness of an employee which contributes to the injury of a fellow employee; any act of
an employee which does or might contribute to the serious injury of an employee, which
includes fighting on Company property; or any intentional act which results in the
destruction, the defacing of Company property, or the writing of indecent language, drawing
obscene drawings on cards, bulletin boards, walls, or any other part of the Company property,
is prohibited.

A VIOLATION OF ANY OF THE RULES a

THROUGH c WILL BE CAUSE FOR IMMEDIATE

DISCHARGE.

d. Those employees who are capable of performing their assigned job efficiently and capably, but
who fail to do so, will receive a written warning, a copy of which will be given to the Shop
Committee. The employee will be given at least thirty (30) days to show satisfactory
improvement. If following receipt of the written warning, the employee fails to show
satisfactory improvement; they will, not earlier than thirty (30) days and not later than
sixty (60) days following such receipt, be given a one (1) week suspension. Where an
employee’s previous service record has been good, the length of suspension may be modified. If
the employee receives a second written warning within six (6) months of the beginning of their
suspension, they will be given at least thirty (30) additional days to show satisfactory
improvement. If, following receipt of the second written warning, the employee fails to show
satisfactory improvement, they may, not earlier than thirty (30) days and not later than sixty
(60) days following such receipt, be discharged. In all cases under this rule, an employee’s
previous Company service record shall be given consideration before the discharge penalty is
invoked. The time periods given in this paragraph are understood to be periods “of working
time”.

“Working Time” Defined

17

 

The phrase “working time” referred to in Article XI of this Agreement shall include periods during
which the employee is actually working, vacations, time lost due to bona fide illness or injury,
military training, and a consecutive absence of six (6) months or more for any reason. Each period
of time three (3) months, one (1) year, etc. followed by “working time” will in every case
terminate no later than eighteen (18) months after the date it begins.

	e.	 	Insubordination.
	 
	f.	 	The refusal of any employee to obey the work orders of their immediate supervisor(s) is
prohibited.
	 
	g.	 	Extreme insubordination will be cause for discharge.
	 
	h.	 	Any employee who directly or indirectly willfully slows down or limits production of himself
or another employee, or machine, will have violated these Rules.

ANY VIOLATION OF RULES d THROUGH h SHALL SUBJECT THE EMPLOYEE TO A ONE (1) WEEK SUSPENSION WITHOUT
PAY FOR THE FIRST VIOLATION AND DISCHARGE FOR THE SECOND VIOLATION WITHIN A PERIOD OF ONE (1) YEAR
OF WORKING TIME.

	i.	 	The employees agree not to loaf during regular working hours.
	 
	j.	 	Employees are prohibited from doing other than Company work during working hours or using
Company machinery, tools, equipment or materials for personal use.

ANY VIOLATION OF RULES i OR j SHALL SUBJECT THE EMPLOYEE TO A ONE (1) WEEK SUSPENSION WITHOUT PAY
FOR THE FIRST VIOLATION. A SECOND VIOLATION WITHIN THREE (3) MONTHS OF WORKING TIME OR THREE (3)
VIOLATIONS WITHIN A YEAR OF WORKING TIME WILL SUBJECT THE EMPLOYEE TO DISMISSAL.

	k.	 	Employees shall be at their work at the designated starting and stopping times. Washing up,
except when designated by the supervisor or for safety or hygienic purposes, shall be done
after the designated stopping times.
	 
	l.	 	Employees shall observe designated starting and stopping times.
	 
	m.	 	Leaving the plant without permission.

FOR THE FIRST VIOLATION OF THE RULES k THOUGH m THE EMPLOYEE WILL BE SUBJECT TO A WRITTEN WARNING.
FOR A SECOND OFFENSE WITHIN SIX (6) MONTHS OF WORKING TIME, THE EMPLOYEE WILL BE SUBJECT TO
SUSPENSION FOR ONE (1) WEEK. FOR A THIRD OFFENSE WITHIN ONE (1) YEAR OF WORKING TIME, THE EMPLOYEE
WILL BE SUBJECT TO DISCHARGE.

18

 

If an employee’s attendance record is good, permission to leave for personal reasons will be
granted by their supervisor provided the request is made not later than one-half (1/2) hour after
the beginning of their work shift.

It is agreed that the intent of this paragraph is to enable an employee with a good attendance
record to leave work to attend to pressing matters not readily attended to outside their regular
working hours. Any abuse of this intent by an employee will be a violation of Rule m.

Permission to leave the plant shall be granted in cases of extreme emergency (death, serious
illness or accident in family, etc.). However, in such emergency cases, the employee shall notify
their supervisor or other company representative before their departure.

Reporting Absence

All employees must call into the Central Reporting System no later than ten (10) minutes before the
start of the employee’s shift when they are unable to report for work, unless their absence has
been approved in advance by their supervisor. Employees calling into the Central Reporting System
must clearly give the reason for their absence and when they expect to return to work.

Excused Absence Defined

The following absences will be excused when approved by the Company and will not be subject to the
progressive discipline procedure:

	a.	 	Jury duty, military duty, funeral leave, occupational illness/injury, supervisory
pre-approved leaves of absence, vacation, paid holidays, not scheduled for work, Union
business, sickness, and situations that are caused by extenuating circumstances not
preventable by the employee.
	 
	b.	 	Employee must provide medical proof acceptable to the Company upon returning to work, if they
have excessive absenteeism, as defined in Par. 108c.

Unexcused Absence Defined

Unexcused absence is defined as:

	a.	 	Failure to notify the Company before the absence or failure to notify the Company in
accordance with Paragraph 106, except where the employee furnishes proof that it was
impossible to give such required notice, the absence will be excused.
	 
	b.	 	Absence, which is not excused by the Company even though it is reported on time.

The following language will apply when an employee has reached the THIRD STEP of the

 Unexcused Absence Discipline as defined in Paragraph

109 of the current labor agreement

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	c.	 	An employee having an excessive absentee record must furnish proof acceptable to the Company
that their absence was the result of sickness or causes beyond their control to be excused for
such absence.

Unexcused Absence — Discipline

Unexcused absences will be subject to the following schedule of discipline:

	 	 	 
	Step 1:

	 	An unexcused absence for any violation for any regular workday will result in a
documented verbal warning to the employee for the first violation.
	 
	 	 
	Step 2:

	 	A second unexcused absence within a period of six (6) months from the date of the first
violation will result in a second documented verbal warning.
	 
	 	 
	Step 3:

	 	A third unexcused absence within a period of six (6) months from the date of the second
documented verbal warning will result in a written warning.
	 
	 	 
	Step 4:

	 	A fourth unexcused absence within a period of six (6) months from the second documented
verbal warning will result in a three (3) day suspension without pay.
	 
	 	 
	Step 5:

	 	A fifth unexcused absence within a period of six (6) months from the second documented
verbal warning will result in a five (5) day suspension without pay.
	 
	 	 
	Step 6:

	 	A sixth unexcused absence within a period of one (1) year from the second documented
verbal warning will subject the employee to immediate discharge.

MEDICAL DOCUMENTATION REQUIRED

Employees must obtain medical documentation from the attending physician, when they are requesting
an excused absence(s). The documentation must state that it is medically necessary to be off work
and must designate the date(s) the employee is requesting to be excused and a return to work date.
Medical documentation that simply states that the employee was “seen and treated” will not be
accepted.

Medical documentation should not include a diagnosis or details of the employee’s medical
condition, unless the medical excuse is for work related injury or illness. However, it is
important to provide documentation regarding any work limitations an employee may have upon return
to work.

Documented medical appointments will be excused absences when notice is given to the employee’s
supervisor by the end of the shift prior to the day of the appointment.

Medical excuses will not be accepted that retroactively excuse absences prior to the date the
employee received medical care. If an employee cannot see a doctor on the first day due to the
illness and they see a doctor on the second day, the previous sick day will be excused if
acceptable documentation is provided. In these cases, the doctor must specifically identify that
due to medical reasons, the employee was unable to work and missed the first day due to illness.
The employee must see the doctor on their own time.

20

 

The intent of these guidelines is to insure the information provided the Company for excused time
off is specific and necessary and is not intended to diminish an employee’s potential excessive
absentee record.

Consecutive regular working days of unexcused absence will be considered as a separate

violation.

	a.	 	Insubordination.
	 
	b.	 	The refusal of any employee to obey the work orders of their immediate supervisor(s) is
prohibited.
	 
	c.	 	Extreme insubordination will be cause for discharge.
	 
	d.	 	Any employee who directly or indirectly willfully slows down or limits production of himself
or another employee, or machine, will have violated these Rules and Regulations.

ANY VIOLATION OF THE RULES AND REGULATIONS a, OR d ABOVE SHALL SUBJECT THE EMPLOYEE TO ONE (1)
WEEK’S LAYOFF WITHOUT PAY FOR THE FIRST VIOLATION AND DISCHARGE FOR THE SECOND VIOLATION WITHIN A
PERIOD OF ONE (1) YEAR OF WORKING TIME.

	a.	 	The employees agree not to loaf during regular working hours.
	 
	b.	 	Employees are prohibited from doing other than Company work during working hours, and from
using machinery, tools and equipment or Company materials for personal use.

ANY VIOLATION OF THE RULES AND REGULATIONS a THROUGH b ABOVE SHALL SUBJECT THE EMPLOYEE TO A ONE
(1) WEEK’S LAYOFF WITHOUT PAY AND TWO (2) VIOLATIONS WITHIN THREE (3) MONTHS OF WORKING TIME OR
THREE (3) VIOLATIONS WITHIN A YEAR OF WORKING TIME WILL SUBJECT THE EMPLOYEE TO DISMISSAL.

	a.	 	Employees shall be at their work at the designated starting and stopping times. Washing up
except when designated by the supervisor or for safety or hygienic purposes shall be done
after the designated stopping times.
	 
	b.	 	Employees shall observe designated starting and stopping times.
	 
	c.	 	Leaving the plant without permission.

If an employee’s attendance record is good, permission to leave for personal reasons will be
granted by their supervisor provided the request is made not later than one-half (1/2) hour after
the beginning of their work shift.

It is agreed that the intent of this paragraph is to enable an employee with a good attendance
record to leave work to attend to pressing matters not readily attended to outside their regular
working hours. Any abuse of this intent by an employee will be a violation of Rule c above.

21

 

Permission shall be automatically granted in cases of extreme emergency (death, serious illness or
accident in family, etc.). However, in such emergency cases, the employee shall notify their
supervisor wherever possible before their departure.

FOR THE FIRST VIOLATION OF THE RULES AND REGULATIONS a THOUGH c, ABOVE, THE EMPLOYEE WILL BE
SUBJECT TO A WRITTEN WARNING. FOR A SECOND OFFENSE WITHIN SIX (6) MONTHS OF WORKING TIME, THE
EMPLOYEE WILL BE SUBJECT TO SUSPENSION FOR ONE (1) WEEK. FOR A THIRD OFFENSE WITHIN ONE (1) YEAR OF
WORKING TIME, THE EMPLOYEE WILL BE SUBJECT TO DISCHARGE.

Tardiness

If an employee is tardy, they will be excused provided they have a reason for their tardiness
acceptable to the Company. In deciding on the acceptability of such reason, the Company will not
act in an arbitrary manner.

An employee who has an unexcused tardy two (2) times or more will receive a written warning slip
from the Company. Receipt of three (3) warning slips within one (1) year will subject an employee
to a three (3) day disciplinary suspension.

Receipt of three (3) warning slips within six (6) months of the date of the three (3) day
suspension warning will result in a five (5) day suspension.

Receipt of three (3) warning slips within six (6) months of the five (5) day suspension warning
will subject the employee to immediate discharge.

Discipline or Discharge

When it is necessary to discipline or discharge an employee for just cause, the Company will issue
a written notification to the employee and to the Union within four (4) working days after the
Manager of Manufacturing or designated Company representative has knowledge of the improper conduct
or performance, unless special investigation is required and the Union is so notified. A
disciplined or discharged employee must file a written grievance within five (5) working days of
the foregoing notification otherwise the discipline or discharge will be final.

When Union Representation is Required

If a Union employee is summoned into the office to answer a charge of violating the rules and
regulations, they shall have Union representation.

22

 

ARTICLE XIII

GRIEVANCE PROCEDURE AND ARBITRATION

GRIEVANCE PROCEDURE

Preamble

It is the conviction of the Parties that prompt and fair handling of complaints of employees and
charges of violation and provisions of this Agreement will lead to more efficient operations and
more harmonious relations among the employees, the Union and the Company.

If order to be considered within the grievance procedure a complaint of an employee or a charge of
violation of this Agreement must be brought to the attention of the Company within ten (10)
calendar days of the event causing the complaint or charge or within ten (10) calendar days after
the date on which such event should reasonably have become known.

Step 1

A complaint by an employee not resolved above shall be discussed in an attempt to resolve, by the
employee and steward with the Supervisor within five (5) regular working days following the initial
meeting/discussion between the employee and Supervisor.

If no resolution is met, the steward will present the matter to the Shop Committee Chairman who
will within five (5) regular working days, present the written grievance and discuss the matter
with the Supervisor and Human Resources Representative.

The Supervisor or Human Resources Representative will forward their written answer to the Shop
Committee within five (5) regular working days after their discussion.

It is understood that no settlement at Step 1 can establish a precedent for future cases. It is
further understood that no settlement at any Step of the grievance procedure can be inconsistent
with the provisions of this agreement.

If the complaint or charge (herein after referred to as a “grievance”) is not carried to Step 2
within five 5) working days from the time of the supervisor or Human Resources Representative’s
answer, it shall be considered settled.

Step 2

In investigating a grievance and in discussing it with the supervisor, the department steward or
Shop Committee Chairperson will take only such time as is reasonably necessary.

If the grievance is not settled in Step 1, the Union will present the grievance to the Manager of
Manufacturing within five (5) regular working days after receipt of the Supervisor’s or Human
Resources Representative’s answer. If the grievance is not presented to the Manager of
Manufacturing within the five (5) regular working day time limit, it shall be considered settled.

23

 

Any grievance involving disciplinary time of or discharge may be initiated by the Shop Committee
directly at Step 2.

Within ten (10) regular working days, after the grievance is presented to the Manager of
Manufacturing a meeting will be held between the Managers of Manufacturing, a Human Resources
Representative, and the Shop Committee. A representative of the IAMAW may be present and
participate in this meeting.

The Manager of Manufacturing will forward their written answer on the grievance to the Shop
Chairman within five (5) regular working days after the Step 2 meeting.

Step 3

If no settlement is reached at Step 3, the following will apply:

If the grievance involves a potentially continuing liability to the Company, a request for
arbitration must be made within seven (7) working days following receipt by the Union of the
Company’s Step 2 answer. The IAMAW representative must make such request in writing to the Manager
of Manufacturing of the Company. If no such request is made within the seven (7) regular working
day time limit, the grievance will be considered settled.

If the grievance does not involve a potentially continuing liability to the Company, a request for
arbitration must be made within sixty (60) calendar days following receipt by the Union of the
Manager of Manufacturing’s Step 2 answer. The IAMAW representative must make such request in
writing to the Manager of Manufacturing of the Company. If no such request is made within the sixty
(60) calendar day time limit, the grievance will be considered settled.

Monetary Adjustment Limitation

If any Step 1 settlement, grievance settlement, or arbitration decision involves monetary
adjustment, such adjustment shall be made effective on the date the complaint or charge was
presented to the supervisor at Step 1 or directly initiated at Step 2 and shall not be made
retroactive for any period prior to said date.

Time Limits

The time limits set forth in the grievance procedure may be extended by mutual agreement.

ARBITRATION

Selection of Arbitrator

Following a request for arbitration, The Company and the Union shall jointly request the Federal
Mediation and Conciliation Service to submit a panel of seven (7) arbitrators. Each party shall
have thirty (30) calendar days to accept or reject the first panel submitted. The thirty (30)
calendar days may be extended by mutual agreement between the parties. If such panel is rejected,
the parties shall immediately request a new panel, which must be used. Upon mutual acceptance of
the first panel or receipt of a second panel, as the case may be, the company and

24

 

the Union shall alternately strike a name from the panel until a single name remains and that
person shall be the arbitrator. The Company shall first cross out a name on the first arbitration
under this agreement and thereafter on the odd-numbered arbitration’s. The Union shall cross out a
name on the second arbitration and thereafter on the even-numbered arbitration’s.

The cost of the panel of arbitrator’s will be done in the same manner as stated above.

The Company will be responsible for the payment of the first arbitration and each odd-numbered
panel thereafter and the Union will be responsible for the second arbitration panel and each
even-numbered panel thereafter.

Arbitration Arrangements

The arbitrator chosen shall be notified of their selection by the parties. Expenses and charges by
the arbitrator shall be borne equally by the Company and the Union.

A date mutually satisfactory to the parties shall be agreed upon and the dispute or grievance shall
be submitted to the arbitrator.

General

A question raised by either party as to the arbitrability of a grievance shall be subject to
arbitration. The function of the arbitrator shall be of judicial nature. The decision of the
arbitrator will be final and binding upon the parties, but they shall not have the power to add to,
subtract from or modify the terms of this Agreement and shall decide only the issues properly
before him. An arbitrable grievance must involve a question of interpretation or application of the
terms of this agreement. The decision of the arbitrator will be complied with as soon as possible.

Resolution of Grievances

The resolution of a grievance shall be recorded and signed by the parties.

ARTICLE
XIV – UNION REPRESENTATIVES

General

The Union will inform the Company of the names of all Union officials including stewards. The
number of Union stewards may be adjusted by mutual agreement of the Company and Union. It is agreed
that no employee will be discriminated against because of elected status in the Union.

The Company will agree to such arrangements as may be necessary for the Shop Chairman and/or Union
stewards to carry on their Union duties. Such arrangements shall include permission for the Union
representatives to leave their department and go to any other department within the bargaining unit
to investigate and/or bring about a proper and expeditious disposition of a grievance or complaint.

The Company will pay the Shop Chairman and/or Union stewards for working time lost in processing
grievances, and joint Union-Company conferences.

25

 

The view of the Company’s agreement above to compensate Union representatives for working time
lost, the Union agrees that such time will be limited to that which is reasonably necessary to
accomplish the Union duties described above.

Absence for Union Business

Regular members of the Shop Committee who are to be absent on legitimate business of the Union will
be excused for such absence, providing advance notification is given to their supervisor. Upon
advance notice from a designated officer of the Union to the Manager of Manufacturing or their
designated representatives, employees other than Union representatives will be excused from work to
perform legitimate Union business provided the number requested does not interfere with production
requirements.

Any time spent on Union business in accordance with this paragraph is considered as time worked in
qualifying for vacations, pension, profit sharing and holidays. It is understood that the Union
will not abuse this privilege.

Pass Procedure

None of the department stewards nor representatives of the Union shall leave their department,
except on Company business until they have notified their supervisor.

ARTICLE
XV  – LEAVE OF ABSENCE

General

An employee must receive permission through their supervisor for time off up to one week. Any time
off in excess of one week must be supported by a leave of absence. It is understood that an
employee shall not deliberately falsify reasons for requesting a leave.

The privilege of leave of absence not to exceed (60) days in a year may be granted to any employee
if the application for such leave of absence is approved by the Company and the Financial Secretary
of the Union prior to the time off requested. The Union will be notified of leaves approved by the
Company. In case of sick leaves and emergencies, prior approval is not necessary.

Extension of a leave of absence may be granted by the Company and the Financial Secretary of the
Union for good cause shown.

Leave of absence not to exceed sixty (60) days in a year will be allowed for up to two (2)
employees total at any one time for personal reasons providing such leaves of absence are approved
in advance of the requested time off by the Company and the Financial Secretary of the Union.

No employee will receive leave of absence for the purpose of trying another job.

26

 

Public Office of Union Position

Leave of absence will be granted to an employee elected or appointed to Public Office or elected or
appointed to a Union position with the Local Lodge, the IAMAW, or such other labor organization as
the parties may mutually agree, upon proper application of the Company. Such leave shall be granted
for a period of one year, and will be extended from year to year, but only for the same purpose for
which the leave was granted.

Notwithstanding the provisions of Paragraph 56, an employee elected or appointed to Public Office
may renew their leave from year to year for a period equal to their total seniority with the
Company, except that they will not accrue seniority or service beyond a period equal to one-half
their total seniority when they went on leave.

Educational Leave – Veteran

Leave of absence up to eighteen (18) cumulative months of such leave will be granted upon request
to a military service veteran for the purpose of furthering their education providing they are
eligible for such educational benefits under applicable law and has submitted proof of enrollment
in an institution authorized to conduct such training.

Such leave of absence may be extended at the discretion of the Company for a period of up to an
additional eighteen (18) cumulative months of such leave subject to the above conditions.

Returning From Leave

An employee who returns to work within the leave of absence shall be reinstated according to their
position on the seniority list at their former rate of pay plus increases or minus decreases that
may have become effective during their absence, provided they give at least three (3) days notice
of their intention to return.

Returning From Sick Leave

An employee must present to the Human Resource Department, documentation acceptable to the Company
for return from Sick Leave to full-time work at full capacity or part-time work at limited capacity
as denoted, if warranted by the employee’s seniority standing and qualifications, will be offered
an assignment to return effective no later than the second regular working day following the date
of such presentation of medical approval. Failure to meet such offer deadline will require the
Company to pay the employee a sum equal to the current sickness and accident daily benefit rate for
each regular working day following the date of presentation of such medical evidence and continuing
until the date such offer of work is made available to the employee.

Physical Exam Requirement

When an employee who is on a leave of absence for medical reasons (non-industrial) desire to return
to work, they may be required to take and pass a physical examination to prove that they are
capable of performing their regular work or the equivalent thereof.

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ARTICLE
XVI  – JOB RATING

The Job Rating Committee shall consist of two (2) members of the Union, and at least two (2)
members of the Company. Continuity of experience in job rating is intended so that proper
administration of the plan will result. When a new job develops, or the requirements of an old job
changes the job content, the job shall first be standardized as to methods of production, tooling
and equipment etc. Within thirty (30) calendar days after the job is standardized and is
functioning satisfactorily as to quality and quantity, the Job Rating Committee will rate out the
job. The Job Rating Committee will schedule its regular meeting dates in advance on a monthly
frequency. Based on the number and the urgency of pending ratings, the parties may schedule an
interim meeting by mutual agreement.

Disagreement on Rating

In the event of a disagreement between the Company and Union members of the Job Rating Committee on
the job content of a new job or the job content change of an existing job they will conduct a floor
review within thirty (30) calendar days. If, after the floor review is completed, a disagreement
still exists a grievance will be filed. Any grievance over a job rating to be considered timely
must be filed in Step 3 of the grievance procedure within thirty (30) calendar days following the
floor review. Any settlement of such a grievance will be effective on the date of the floor review.

Newly Created Job

On a newly-created job, no permanent assignment will be made until thirty (30) days after the date
of the Committee’s rating or the date the Company-determined rate is put into affect, whichever is
the earlier. If the employee performing the job has a higher rate than that put into effect, they
may accept the lower rate for the job or, within the thirty (30) days, decide to return to their
previous job. However, the Company may retain them on the new job at their current rate for a
period of time adequate for training a replacement.

Effective Date – Grievance

Where a job is re-rated and the labor grade is increased, an employee performing the job will
receive the higher rate effective on the date of the floor review, provided a timely grievance
concerning the rating of the job was presented to the Company and, provided they have completed the
job progression.

In the event that the labor grade of a job is to be decreased, the parties will meet to determine
the appropriate means of handling the situation.

ARTICLE
XVII  – VACATION

The vacation period will run from January 1 through December 31 of each year during the term of
this Agreement. One week of vacation entitlement may be carried over from one year to the next;
however, each year’s vacation may not exceed the annual entitlement plus 1 week carryover and then
only if the employee qualifying for and requesting such consideration meets

28

 

the scheduling requirements of Paragraph 186. Accident and Sickness weekly benefits will not be
paid for the same period as vacation except with advance Company approval.

Vacation Entitlement

Years of Service as of January 1 Vacation Entitlement

	 	 	 
	1 but less than 4

4 but less than 8

8 but less than 12

12 but less than 16

16 or more
	 	2 weeks
2.5 weeks
3 weeks
3.5 weeks
4 weeks

In the calendar year during which an employee reaches their 4th and 12th anniversary date they
shall be entitled to an additional 1/2 week of vacation. With Company approval, said week may be
taken up to one month prior to the employee’s anniversary date.

Work Requirements

In order for an employee to qualify for a vacation in any vacation period they must have worked at
least six (6) months during the previous vacation period. For the purpose only of calculating such
work requirements, time lost from work due to a compensable work-related injury during the vacation
period in which the injury occurs, will be considered as time worked.

An employee who has worked for the Company less than one year prior to January 1 of a given year
shall, upon reaching their first anniversary date, become entitled to a two (2) week vacation
during such year provided they have worked at least six (6) of the twelve (12) months preceding
their first anniversary date. In the event that such employee’s anniversary date falls between
December 15 and December 31 their vacation may, with Company approval, be scheduled to commence up
to two (2) weeks prior to their first anniversary date.

If Work Requirements Not met

An employee who, as of the beginning of a vacation period has one (1) or more years’ service and
has worked during the preceding year but does not meet the six (6) months’ work requirement set
forth in marginal Paragraph 182 above shall not be entitled to a vacation during said vacation
period. They shall, instead, receive an in-lieu-of vacation payment based upon the following
formula:

Years of
Service # of Straight Time Earnings

as of January 1 During Preceding Year

	 	 	 
	1 but less than 4

4 but less than 8

8 but less than 12

12 but less than 16

16 or more
	 	4%

5%

6%

7%

8%

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Vacation Pay

An employee will be paid prior to their vacation of one week or more for the appropriate number of
hours to be taken at this regular rate subject to the above requirements and appropriate advance
scheduling. In order to receive vacation pay in advance of their vacation, notification must be
received by the Company before 9:00 a.m. of the second Thursday, which precedes the week in which
their vacation is to be taken.

Scheduling Procedure

The procedure to be followed in scheduling vacations shall include the following:

	a.	 	The number of weeks of vacation eligibility is determined for each department.
	 
	b.	 	Based on this number, the vacation quota(s) are established for the departments. The Company
follows the policy of allowing vacation weeks to be taken between January 1 and December 31.
	 
	c.	 	During December of each year, employees are asked their vacation preference for the coming
vacation year. The principle of seniority in asking vacation preference is followed within
each department and shift, insofar as possible.
	 
	d.	 	At Company option, operations may be shut down for vacation for up to four (4) working days
each year and vacation pay will be given to employees who elect to take such time as vacation.
Such days must be scheduled in conjunction with Christmas, and/or New Year’s Day, and/or July
4 holidays.
	 
	e.	 	An employee may take a day at a time vacation up to their full entitlement of such vacation.
	 
	f.	 	Seven (7) existing days of current vacation can be taken in 1/2 day increments
not to be coupled with personal business.
	 
	g.	 	Regular vacations plus day-at-a-time vacations on the last regular work day prior to and the
first regular work day after a holiday(s) and the Friday prior to deer season cannot exceed
the department or shift group established quota plus 50%.
	 
	h.	 	Requests for day-at-a-time/half day vacations should be made no later than ten (10) minutes
before the start of their shift on the day requested. If an employee is sick and calls in on
time, they may specify that day as a day of vacation to a maximum of their full entitlement.
	 
	i.	 	The use of day-at-a-time/half day vacation cannot disrupt production operations.

Pay in Lieu of Vacation

An employee who is quitting or retiring will be entitled to pro-rate vacation pay based on the
appropriate percentage for their length of service for all regular straight time earnings from the

30

 

beginning of the vacation period until their termination if they satisfy the work requirements
listed in Paragraph 185 and if they gives the Company at least five (5) working days notice of
their intention to quit or retire.

Payment in lieu of vacation may be made to any employee for a vacation not taken by the individual,
if they are eligible for a vacation in accordance with the above paragraphs, but has not actually
worked ten (10) months during the qualifying period. Upon an employee’s death, their beneficiary,
as shown in the Group Life Insurance Record, will be entitled to pro-rate vacation pay based on the
appropriate percentage for the employee’s length of service for all regular straight-time earnings
from the beginning of the vacation period until their death.

Return From Military Service

When an employee returns to work from a duly authorized leave of absence to the armed services,
their vacation rights will be determined as follows:

	a.	 	If the employee returns to work between January 1st and June 30th inclusive, they shall be
entitled to full vacation rights for the vacation period in which they return and must take
their vacation.
	 
	b.	 	If the employee returns to work between July 1st and December 31st inclusive, they shall be
depending upon their years of service, entitled to 4%, 5%, 6%, or 8% of their regular straight
time hourly earnings between July 1st and December 31st in lieu of a vacation for the vacation
year during which they return.
	 
	c.	 	All time spent in the armed services which is supported by a duly authorized leave of absence
shall be considered the same as work time for computing vacation rights for the vacation
period which follows the vacation period during which the employee returns to work.

ARTICLE
XVIII  – WAGES 

New Hire Rate and Progression

The new hire rate shall be in accordance with the Wage Rate Schedule below; but, after consultation
with the Shop Committee, the Company may employ applicants with significant experience at a higher
rate than the new hire rate. Upon attaining seniority, an employee shall receive a seniority rate
in accordance with the annual rate schedules following this paragraph, (unless they were employed
at a higher rate) and be assigned a home department. The rate increases for twelve (12) months,
twenty-four (24) months, etc., shown on the rate schedules below shall become effective once the
employee in question has actually worked fifty-two (52) calendar weeks, one hundred and four (104)
calendar weeks, etc. on the job in question. Layoffs of three (3) months or less will be considered
as time worked in the above stated time frames. (The above applies to progression rates only).

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WAGES

Sickness and Accident (S&A)

Short Term Disability

Employees are eligible after completing their probation period.

Benefits to be paid at 50% of the weekly rate with a minimum benefit rate of $300.00 and a maximum
benefit rate of $350.00. Benefits are payable for up to twenty-six (26) weeks.

Long Term Disability

Long-term Disability benefits will be paid at 60% of employee’s monthly base wage upon completion
of the benefit waiting period. The benefit waiting period will be 180 days of continuous
disability. A period of disability will be considered continuous even if the employee returns to
work for up to a total of 30 days during the benefit waiting period. The benefit waiting period
will be extended by the number of days the employee temporarily returned to work.

Long-term Disability benefits will continue until the earlier of the following dates: date the
employee ceases to be disabled; or the date of the employee’s normal retirement to receive full
Social Security Benefits as stated by the Social Security Administration.

Effective February 7, 2004, the Company will increase all levels of the progression rates for each
job as follows:

	 	 	 	 
	Effective 2/7/04
	 	$	.40
	Effective 2/5/05
	 	$	.55
	Effective 2/4/06
	 	$	.40

401K SAVINGS PLAN

401K match will be 25% up to the first 6% of employee’s base wage saved.

The 401K match will be made on the employee’s annual base wage except for exclusions noted in
subparagraph i of paragraph 200 – Compensation Excluded for Profit Sharing and 401K match.

The Company agrees to discuss all 401K-plan amendments or plan terminations with the Union prior to
the implementation of such plan amendments or termination of plan benefits.

PROFIT SHARING

Profit sharing for the Chart personnel shall be on the following basis, for 2004 – 2007.

	a.	 	10% common pool for all Chart employees.
	 
	b.	 	Minimum EBIT for profit sharing.

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2,000,000 each year for the duration of the agreement.

Distribution of EBIT Profit Sharing Pool

	a.	 	The profit sharing distribution will be made as a % of individual annual base wages except
for exclusions noted in sub-paragraph i.
	 
	b.	 	The base wage distribution % is determined as follows;

	 	 	 	 	 
	 

	 	Base Wage Profit Sharing % =	 	 
	 

	 	               EBIT Pool $	 	 
	 

	 	 

Total Chart Annual
	 	 
	 

	 	Base Wage Payroll	 	 

	c.	 	Actual distribution will occur in August of the current year and February of the following
year for current year profit sharing. The August distribution will be 50% of the estimated
common EBIT profit sharing pool based on mid-year EBIT. The reason for a reduced distribution
at mid-year is to allow for possible variations in profit in the last half of the year.
	 
	d.	 	Profit sharing will be a 100% distribution of the Common EBIT Pool as a % of base wage.
	 
	e.	 	The Profit Sharing Payment Schedule will be as follows;

2004 Pool $ August 2004 February 2005

2005 Pool $ August 2005 February 2006

2006 Pool $ August 2006 February 2007

COMPENSATION BASIS FOR PROFIT SHARING

	f.	 	Partial Year Distribution
	 
	 	 	It is agreed that those individuals who retired during a current year would receive a
pro-rata distribution based on that current year’s base wages earned. The same will also
apply to individuals who left the hourly work force during the duration of this agreement.
For employees terminated for disciplinary reasons, no pro-rata distribution will be made.

Probationary Employees

	g.	 	Probationary employees will be paid profit sharing on a pro-rata basis for base wages earned
in a given year. Payment will be made after the probationary employee achieves seniority.
	 
	h.	 	Determination of base wages will be based on wages from the start date.

33

 

Compensation Excluded for Profit Sharing and 401k Match

	i.	 	Compensation excluded from the wage base for purposes of calculating profit sharing and 401k
Match are:

Overtime

Service Trip Premium

S&A Benefits

Worker’s Compensation

Profit Sharing

All other compensation is included in the wage base for determination of profit sharing AND 401k
Match.

Shift Premiums

The second shift shall receive thirty-five ($.35) cents per hour over the day shift and the third
shift shall receive forty ($.40) cents per hour over the day shift.

Apprenticeship Program

The Apprenticeship Committee shall consist of two from the Company and two from the Union.

One representative of the Union will be from the Apprenticeship category required; the second
representative shall be the Local Lodge President or a designated appointee.

Before any changes are implemented in the Apprenticeship Program, the Company and the Union Shop
Committee will discuss such change.

ARTICLE
XIX  – CHECK-OFF

Upon receipt of a signed authorization of the employee involved, the Company shall deduct from the
employee’s pay the initiation fee and regular monthly dues payable by them to the Union during the
period provided for in said authorization. The amount will be certified by the Financial Secretary
of the Local Lodge.

Deductions shall be made on account of the initiation fee and regular monthly dues payable from the
first paycheck of the employee after receipt of the authorization and monthly thereafter from the
second paycheck of the employee in each month.

Deductions provided in Paragraphs 206 and 207 shall be remitted to the Financial Secretary of the
Union no later than the fifth (5th) day following the deduction and shall include all amounts due
and those dues not deducted in the previous month. The Company shall furnish the Financial
Secretary of the Union, monthly, with an alphabetical record of those for whom deductions have been
made and the amounts of the deduction.

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The parties agree that check-off authorizations shall be in the following form:

	 	 	 	 	 
	“Name of Employee	 	 
	 
	 	 	 	 
	 	 	 
	Dept. No.

	 	 

	 	 
	Clock No.

	 	 

	 	 
	Date

	 	 

	 	 

I hereby authorize and direct the Company to deduct from my pay beginning with the current month,
the initiation fee and regular monthly membership dues in the IAMAW.

I submit this authorization with the understanding that it will be effective and irrevocable for a
period of one (1) year from this date, or up to the termination date of the current collective
bargaining agreement between the Company and the IAMAW, whichever occurs sooner.

This authorization shall continue in full force and effect for yearly periods beyond the
irrevocable period set forth above unless revoked by me within fifteen (15) days prior to the end
of any such period. I shall also have the right to revoke this authorization at any time within a
period of fifteen (15) days prior to the termination date of any collective bargaining agreement
between the Company and the Union if such termination shall occur within one of the aforenoted
yearly periods. Such revocation shall be effected by written notice, sent by Registered Mail,
Return Receipt Requested, to the Company and the Union within such fifteen (15) day period.

Signature:

                                        ”.

The Union agrees to indemnify and save the Company harmless against any and all claims, demands,
suits or other forms of liability that may arise out of, or by reason of, action taken or not taken
by the Company in complying with the provisions of this Article, in reliance upon the Check-Off
Authorizations which have been furnished it.

ARTICLE
XX

CLAUSES RELATING TO PENSION PLAN

Section I: Chart Pension Plan

Subject to the provisions of Section 4 of this Article, and unless the parties otherwise agree, the
Pension Plan for Hourly Rated Employees of Chart Heat Exchangers (hereinafter referred to as the
“Pension Plan”) which was effective January 4, 1986, will continue to be maintained pursuant to the
terms of the Pension Plan, except that the Pension Plan will be frozen and no further contributions
shall be made to the Pension Plan after March 31, 1998. The Company may continue to make such
changes in the Pension Plan as, in the opinion of the Company, are required for compliance with the
Employer Retirement Income Security Act of 1974, as amended, and any rules and regulations
promulgated thereunder (hereinafter collectively referred

35

 

to as the “Act”), provided that if any such changes diminish benefits under the Pension Plan, the
Company shall attempt to minimize such effect.

To be effective, written notice of proposed change(s) must be served by one party upon the other no
less than sixty (60) days prior to any modification or change in the Pension Plan, except such as
may be required to conform with the Act or Section 401(a) of the Internal Revenue Code of 1954,
shall be prospective in its application and shall be made effective as of the date on which
agreement with respect to such modification or change is reached by the Company and the Union.

Section II: Funding of Benefits

The Company will continue to make contributions to the Chart Pension Plan to fund obligations for
past service credit.

Neither the Company nor the Union, except under the conditions specified in Paragraph 151 of this
section, shall demand any change in the Pension Plan nor shall either be requested to bargain with
respect to any change in the Pension Plan, nor during the term of the Pension Plan, nor shall any
modification, alteration, or amendment of said Pension Plan, be an objective of, or reason for, any
strike or lockout or other exercise of economic force or threat by either the Union or the Company.

Section 3: Agreement Retirement Date

The normal retirement date of each employee will be the first day of the month following the month
in which the employee’s 65th birthday occurs. An employee who retires after their normal retirement
date shall receive a retirement pension, payable commencing at their actual retirement date,
consisting of the following:

	a.	 	An amount determined as if they had retired on their normal retirement date; plus
	 
	b.	 	For service accrued after their normal retirement date, an amount determined in accordance
with the respective benefit rates in effect for each year or portion thereof in which such
service was accrued.

Other

Retirement Death Benefit

For those employees retiring after February 4, 2001, the retiree death benefit is $5,000.

Medicare Plan “B” Supplement

Actual cost up to a maximum of $55.00/month, life of agreement.

36

 

IAM NATIONAL PENSION FUND — NATIONAL PENSION PLAN

	a.	 	The Employer shall contribute to the I.A.M. National Pension Fund, National Pension Plan as
shown below for each hour for which employees in all job classifications covered by this
Agreement are entitled to receive pay under this Agreement as follows:

$.60 per hour effective February 7, 2004

$.65 per hour effective February 5, 2005

$.70 per hour effective February 4, 2006

	b.	 	The Employer shall continue contributions based on a forty (40) hour work week while an
employee is off work and being compensated for any such time by the employer.
	 
	c.	 	Contributions for a full-time employee are payable from the first day of employment.
	 
	d.	 	The I.A.M. Lodge and the Employer adopt and agree to be bound by, and hereby assent to, the
Trust Agreement, dated May 1, 1960, as amended, creating the I.A.M. National Pension Fund and
the Plan rules adopted by the Trustees of the I.A.M. National Pension Fund in establishing and
administering the foregoing Plan pursuant to the said Trust Agreement, as currently in effect
and as the Trust and Plan may be amended from time to time.
	 
	e.	 	The parties acknowledge that the Trustees of the I.A.M. National Pension Fund may terminate
the participation of the employees and the Employer in the Plan if the successor collective
bargaining agreement fails to renew the provisions of this pension Article or reduces the
Contribution Rate. The parties may increase the Contribution Rate and/or add job
classifications or categories of hours for which contributions are payable.
	 
	f.	 	This Article contains the entire agreement between the parties regarding pensions and
retirement under this Plan and any contrary provision in this Agreement shall be void. No oral
or written modification of this Agreement shall be binding upon the Trustees of the I.A.M.
National Pension Fund. No grievance procedure, settlement or arbitration decision with respect
to the obligation to contribute shall be binding upon the Trustees of the said Pension Fund.

HEALTH INSURANCE (HEALTH AND DENTAL INSURANCE)

The Company will offer individuals retiring after December 21, 1990, the opportunity to participate
in the Chart Heat Exchangers Health Care Plan for an additional 18 months beyond the 18 month
period allowed by COBRA (Consolidated Omnibus Budget Reconciliation Act), by paying 100% of the
premium cost for coverage of similarly situated individuals. This applies to individuals retiring
at age 62 or later. This offer is effective from December 21, 1990 through February 3, 2007 on a
non-precedent setting basis. Actual cost of this plan may change on a year-to-year basis as
determined by the health care provider. This provision is no longer applicable when an individual
reaches age 65 or is eligible for Medicare.

Cost experience and impact of this group on Health Insurance costs is to be followed.

37

 

Section 4: Effective Date

Any modification agreed upon between the parties under Section 1, Paragraph 215 of this Article,
resulting from negotiations commenced as a result of the sixty (60) day notice referred to therein
shall take effect on the day after the Pension Plan expiration date which was in effect at the time
the sixty (60) day notice was given.

ARTICLE
XXI  – INSURANCE

BOOKLET

The new Health Insurance Booklet will be distributed to the membership within one (1) month from
the date of receipt by the Company.

The Company will maintain an employee assistance program, which is mutually acceptable to the
Company and the Union.

Insurance Committee

The insurance committee shall consist of two (2) representatives of the Company and two (2)
representatives of the Union. The Union President or IAMAW representative or their representative
may attend meetings at any time.

This committee shall have the necessary time needed to provide Alternative Health Plans annually
and the Company shall pay the time spent. Union Committee representatives shall have the time spent
on this committee applied as hours worked on their shift for each day needed to investigate
Alternative Plans.

Duties of Insurance Committee

	a.	 	The insurance committee shall meet every three (3) months and the agenda shall be established
prior to the date of the meeting. A representative of the insurance carrier shall be asked to
attend the meetings.
	 
	b.	 	The insurance committee shall be authorized to review all financial aspects of the insurance
plan and be furnished complete expenditure and benefit data.
	 
	c.	 	Members of the insurance committee shall be authorized to inquire on the status of any claim
submitted by any member of the Union.

General

	a.	 	The group insurance coverage will terminate on February 3, 2007.
	 
	b.	 	There shall be no modification in the benefits provided under the insurance plans during the
policy term except as mutually agreed by the parties or required by law. Any dividend paid on
the insurance policy shall be paid in full to the Company.

38

 

	c.	 	In the event the insurance carrier does not pay full benefit as prescribed in the master
policy without justifiable reasons, Chart Heat Exchangers shall further process the claim on
behalf of the employee with the insurance carrier.
	 
	d.	 	If an employee’s insurance terminates due to temporary layoff or leave of absence, such
employees shall be eligible for insurance on the date of return to full time work.
	 
	e.	 	If an employee is not At Work on the date the insurance would otherwise become effective,
such effective date of insurance shall be the first day the employee returns to active work.
However, the insurance will become effective as if the employee was At Work if such employee
is off work due to vacation or holiday.
	 
	f.	 	Alternative Health Plans (HMO’s, POS, PPO plans etc.) will be provided annually in a similar
form or one that has the same benefits as the current plans. During the life of the agreement,
the Insurance Committee will evaluate other Alternative Health Plans for 2005, 2006 and 2007.
	 
	g.	 	Should alternate company health insurance plans become available, the Company and Union will
meet to discuss the opportunity to participate in such plans.
	 
	h.	 	The Company and Union agree that the Section 125 Plan is in effect for the duration of this
agreement.

Health and Dental Insurance Cost Sharing

Effective January 1, 2004

	a.	 	Chart Basic
	 
	 	 	Employee shares 10% of future premium increases or decreases for life of agreement.
	 
	b.	 	Chart Plus
	 
	 	 	Employee shares 20% of future premium increases or decreases for life of agreement.
	 
	c.	 	Alternative Health Plans (HMO’s, POS, PPO plans, etc)
	 
	 	 	Employee shares 30% of future premium increases or decreases for life of agreement.

Effective January 1, 2005

	a.	 	Chart Basic
	 
	 	 	Employee shares 20% of current total premium during the term of this agreement.
	 
	b.	 	Chart Plus
	 
	 	 	Employee shares 20% of current total Chart Basic premium plus 100% of the premium difference
between Chart Basic and Chart Plus during the term of this agreement.

39

 

	c.	 	Alternative Health Plans (HMO’s, POS, PPO plans, etc)
	 
	 	 	Employee shares 20% of current total Chart Basic premium plus 100% of the premium difference
between Chart Basic and the alternative plan during the term of this agreement.

Employees who can provide proof of other medical plan coverage may opt out of Chart plans or HMO
and receive a payment during the course of the plan year. The payment may be taken as either cash,
which is taxable, or placed on a pre-tax basis in a flexible spending account in the employee’s
name. The payment for each year is as follows:

	 	 	 	 	 	 	 	 	 
	1st Year
	 	 	—	 	 	$	1,500.00	 
	2nd Year
	 	 	—	 	 	$	1,500.00	 
	3rd Year
	 	 	—	 	 	$	1,500.00	 

Payout will occur on a monthly basis

(Ex: 12 mos X $125.00 = $1,500.00)

Dental

	a.	 	Employee shares 20% of premium increases for the remainder of 2004 calendar year.
	 
	b.	 	Employee shares 32% of total premium effective January 1, 2005.
	 
	c.	 	Employee shares 50% of total premium effective January 1, 2006.

Life Insurance

	a.	 	For the life of the agreement employees will be insured to a minimum of $23,000 or a maximum
of one times annual base wage, whichever is greater.
	 
	b.	 	Employees may purchase up to three times base wage (minimum $23,000)

ARTICLE
XXII  — COMPANY OWNED TOOLS

In an effort to provide safer and more effective production equipment, the Company and the Union,
do hereby agree to the following:

The Company shall loan to each employee, at no cost to him, a set of tools and tool container with
lock (where needed) adequate for the proper and efficient performance of their duties subject to
the following conditions:

	a.	 	The Company shall determine what tools are required for each job, and shall list against each
job the normal tools required for it. Any tools which are to be required at the worker’s
expense shall be listed accordingly.
	 
	b.	 	The Company shall replace worn tools, which are broken through normal use at no cost to the
worker.

40

 

	c.	 	The Company shall indelibly mark each tool and tool container so that it may be identified to
the individual worker.
	 
	d.	 	The Company shall, through its supervisor, make such inspections of the tools and tool
containers used by each worker as may be required. All inspections of the tools and tool
containers shall be done in the presence of the employee to whom they are charged. No tool
container shall be opened during the absence of the employee to whom they are charged. When
inspection is being made in search of a missing tool, it shall be done in the presence of an
authorized Union steward.
	 
	e.	 	Each worker shall maintain a complete set of tools at all times and shall report any and all
tools or tool containers missing, lost, or stolen from their set to their supervisor for
replacement immediately.
	 
	f.	 	Each worker shall reimburse the Company for replacement of Company tools or tool containers
lost or stolen while charged to him. If payment is not made in cash to the crib clerk, the
amount for which the worker is charged shall be deducted from their paycheck. If the cost is
more than three dollars ($3.00), deduction can be made from more than one paycheck. If the
missing, lost or stolen tool is recovered in good condition, suitable adjustment shall be made
to the worker. In the event that a toolbox equipped with tools is missing, lost or stolen, the
Company will be responsible for the cost of such equipped toolbox.
	 
	g.	 	A worker shall only use personally owned tools when authorized by their supervisor.
	 
	h.	 	Any improperly identified tools found in a worker’s possession shall be removed and placed in
the tool crib.
	 
	i.	 	Any tools or tool containers with identification markings found in any improper area shall be
returned to the worker to whom they are then charged.

Any employee leaving the employment of the Company shall satisfy their tool account before
receiving their final pay.

Safety Creed

“One must not believe the SAFETY begins with your fellow employees, it begins with
YOU! The Safety Program can do everything possible to protect you and your fellow
employees, but if YOU disregard SAFETY, you not only endanger yourself, but those
around you. SAFETY must be practiced twenty-four hours a day, as an accident requires less
than one second to happen. That “second” may mean a costly and permanent injury to yourself or to a
fellow employee, which you will think about for the rest of your life. It is far easier to live
with SAFETY than the results of a careless “accident”.

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ARTICLE
XXII  – ACCIDENT PREVENTION

Safety Committee

The Safety Committee shall consist of the Shop Chairman, Health and Safety Coordinator, Safety
Technician, Safety Steward, and other designated hourly and salaried representatives.

Function of Safety Organization

The function of the Safety Committee shall be to cooperate in reducing accidents by:

	a.	 	Reporting of hazards and unsafe practices from their respective departments.
	 
	b.	 	Bringing about the cooperation of all employees both Union and Management to carry out the
safety program.

Safety Problems

If a safety problem arises in the department, the steward will call it to the attention of the
Supervisor. Should the safety problem still not be solved within a reasonable period of time, the
steward may call the Shop Chairman to investigate the problem. The Shop Chairman may discuss the
problem with the Health and Safety Coordinator. If the problem still exists, it shall be placed on
the agenda of the next regular Safety Committee meeting. If the problem exists following
consideration by the Safety Committee, the Union may call in an outside expert to review the
problem and discuss it with the Shop committee and the Company with the objective of obtaining a
mutually satisfactory solution.

Safety Committee

The duties of the Safety Committee shall be:

	a.	 	To meet at least once during each month to consider and, if appropriate, implement safety
recommendations of the Safety Committee or others.
	 
	b.	 	To participate on inspection teams that will make monthly inspection tours of the plant. The
inspection team will consist of members of the Safety Committee or designated representatives.
	 
	c.	 	To investigate reports of hazards and unsafe practices and effect correction. Reports made by
the inspection team and any other reports from the Safety Committee will be reviewed at the
monthly safety meeting and any unsafe conditions or practices will be called to the attention
of the supervisor of the department involved. Every reasonable effort will be made to have the
unsafe condition or practice corrected promptly.
	 
	d.	 	Upon the request of the Shop Chairman or their designated representative where evidence
exists that a chemical or substance to which an employee is exposed in the workplace may be
toxic and hazardous, the Company will provide the Union and the employee with

42

 

	 	 	the Company’s safety data sheets or their equivalent, including information about any
available remedies and antidotes for such materials.
	 
	e.	 	In case of a serious injury to an employee, the Safety Technician and the Health & Safety
Coordinator will be notified promptly so that they can investigate the accident.
	 
	f.	 	In the event of a disagreement as to the liability of the Company in the case of an injury of
an employee, the Manager of Manufacturing will, upon request, review the pertinent facts of
the case with the Shop Chairman. The Company agrees to pay for the time lost by the Shop
Chairman from regular working hours for such review with the understanding that this privilege
will not be abused. No such review will be made if the case is given to an attorney.
	 
	g.	 	The Safety Steward will be permitted to carry out their duties relating to safety and health.
	 
	h.	 	The Safety Committee is responsible for making proper decisions on Safety, consistent with
established safety practices.
	 
	i.	 	The Company will be responsible for any and all discipline resulting from any safety
violation.

Safety Cooperation

The Safety Committee realizes that a safe plant is an efficient one and will devote its energies to
this accomplishment. In order to carry out this program, the Safety Committee will need 100%
cooperation of all employees of Chart Heat Exchangers. The committee encourages the making of
suggestions.

The Union and employees agree that they will cooperate in promoting safety and health programs and
will comply with all safety rules and regulations and to use safety equipment as required by OSHA
and the Company.

The general rules of safety must be observed. Failure to do so will incur the penalties as set
forth in the Safety Code. The Company and employees will cooperate to see that these rules of
safety are observed by all employees.

Selection of Committee

The Company and Union Safety Committee representatives will be chosen by the Health and Safety
Coordinator and Shop Chairman respectively, and will serve for a period of one year. Stewards
selected will serve the full period whether or not they continue as stewards for the full term. A
replacement who fills a vacancy shall serve out the balance of the term of their predecessor and
may serve the next full term, if selected.

43

 

Safety Codes

The purpose of these safety rules is to protect the employees as they work and ensure that they
work safely. By following these rules, they should avoid injury to themselves or fellow employees.
Strict enforcement of these safety rules will materially reduce the possibility that someone else
will commit an unsafe act which could endanger them.

	a.	 	The work place is to be keep clean and orderly.
	 
	b.	 	The Safety equipment prescribed for any particular job shall be used in a proper manner at
all times.
	 
	c.	 	Safety glasses and/or approved eye protection are to be worn as prescribed, in all designated
areas at all times.
	 
	d.	 	Rings, bracelets, wristwatches, loose garments or neckties are not permitted while operating
a machine. Clothing worn shall be appropriate for the shop floor environment and shall not
pose a threat to safety.
	 
	e.	 	Safety toe footwear is required by all employees on the shop floor. Safety toe footwear worn
must comply with all current American National Standard Codes (A.N.S.I. Z41-1991 Directive)
and O.S.H.A. guidelines that are in effect.
	 
	f.	 	Complete instructions and permission must be obtained from a supervisor before operating any
machine, which an individual does not normally operate. All safety guards on machines must be
in place and functional.
	 
	g.	 	A lockout on the power switch must be used while performing any maintenance work on a
machine, which requires placing any part of the body into or near its mechanism.
	 
	h.	 	Individuals must not reach through or behind a safety guard while a machine is running.
	 
	i.	 	Before cleaning, oiling, or adjusting the moving parts of a machine, it is mandatory that the
machine be completely shut down and locked out.
	 
	j.	 	Cranes must be operated only by individuals familiar with their operation.
	 
	k.	 	Only authorized personnel are permitted to operate industrial power trucks or power hand
trucks. Such authorized personnel will comply with the General Operating & Safety Rules for
Power Vehicles.
	 
	l.	 	Defective or damaged hand tools, mushroomed chisels, punches, etc., and files without handles
are not to be used.
	 
	m.	 	Aisles must not be blocked. If at any time anything is placed in an aisle, it must be moved.
If the aisle is to be blocked for any period of time, the area supervisor will notify the
appropriate personnel.

44

 

	n.	 	There will be no smoking during the period between the starting and stopping time of your
designated shifts up to and including overtime worked. Smoking will be allowed during the
employee’s designated break periods outside all Chart buildings.
	 
	o.	 	Compressed air is to be used with caution. Never use compressed air for cleaning clothing,
exposed parts of the body, or for cooling purposes. Nozzles must have an approved relief vent.
Unapproved alteration of air nozzles is prohibited.
	 
	p.	 	Projecting nails in boxes, boards, or barrels, which are exposed, are to be bent over or
removed. Other dangerous sharp projections should either be eliminated or protected.
	 
	q.	 	Electrical apparatus should be repaired only by authorized personnel, regardless of how minor
the problem seems to be. The supervisor is to be advised of the condition, they will secure
proper assistance. Electrical cabinets are not to be blocked or used for storage.
	 
	r.	 	Lift properly – with the knees and legs, and not the back. Get help rather than risk a
strain.
	 
	s.	 	All injuries, no matter how minor, are to be reported promptly to a supervisor and then to
the appropriate medical facility.
	 
	t.	 	Horseplay, scuffling, throwing of objects, and running is unsafe and it is forbidden. This
applies to all Company premises, including the parking lots.
	 
	u.	 	Industrial gases are to be stored in a safe manner, in keeping with standards established for
their storage.
	 
	v.	 	No employee shall remove, displace or damage any safety device or safeguard furnished and
provided for use in any employment or place of employment, nor interfere in any way with the
use thereof by any other person, nor shall any such employee interfere with the use of any
method or process adopted for the protection of any employee in such employment or place of
employment or frequenter of such place of employment, nor fail or neglect to do every other
thing reasonable necessary to protect the life, health, safety or welfare of such employees or
frequenters. (Extracted in part from the Wisconsin Industrial Commission statutes and
provision).
	 
	w.	 	The above safety rules are not meant to be inclusive nor do they supersede existing plant
rules, which may imply stricter measures.
	 
	x.	 	No employee shall be disciplined or discharged for refusing to work on a job if refusal is
based on a reasonable claim that said job is not safe or might unduly endanger the employee’s
health and safety.
	 
	y.	 	$130.00 per person total, life of contract for the purchase of safety toe footwear.

45

 

Reporting Violations

The reporting of violations will be conducted in the following manner: the supervisor will make out
violation forms in quadruplicate, the supervisor will retain one (1) copy and send three (3) copies
to the Health and Safety Coordinator. One completed copy will be sent to the Union.

Penalties

Penalties for the above violations will be as follows:

1ST VIOLATION: Violator will be presented with a violation slip, and instructed in accident
prevention and warned against future violations.

2ND VIOLATION: Violator will be presented with a violation slip and be suspended for a period of
five (5) hours.

3RD VIOLATION: Violator will be presented with a violation slip and be suspended for a period of
two (2) days.

4TH VIOLATION: Violator will be presented with a violation slip and will be suspended for a period
of one (1) week.

SUBSEQUENT VIOLATIONS: Violators shall be subject to further disciplinary action including
discharge.

The above penalties are based on cumulative violations within any one-year period.

General Safety Guides

Employees are not required or expected to take any risks from which they cannot protect themselves
by care and judgment.

Employees are not to rely on the watchfulness of others, but must protect themselves when and where
their own safety is involved.

In view of the possible effect on safety, no employee shall change any customary safety method or
work without first consulting the supervisor.

Learn the location of fire extinguishers in the work area and be familiar with their use and
purpose.

First Aid

Trained first aid attendants will be provided at the facility. A list of authorized first aid
attendants will be posted in a prominent place near each first aid office and will be revised as
necessary, with a copy to the Union. First Aid Attendants will receive ten (.10) cents per hour for
these duties.

46

 

Reporting Injuries

An employee shall not fail to report an injury immediately to their supervisor no matter how small
it may seem. In case the supervisor is out of their department, the injured employee shall report
the injury to the department steward or designated employee.

If it is necessary for an employee to go to the First Aid Room, they will notify their supervisor.
In case of an injury requiring emergency attention, the employee should go to the First Aid Room
immediately.

Medical attention for industrial injuries must be authorized by the Company prior to receiving
attention, except in cases of emergency.

Eye Protection

In line with the Company’s policy of providing the employee with a safe place in which to work, the
Company will maintain a 100% comprehensive eye protection program.

The type of eye protection required to be worn by employees must meet ANSI standards. The Company
will provide such eye protection to all employees. In addition, the Company will provide equipment
for protecting the eyes from damage due to grinding, burnishing, arc welding, etc.

When Company Furnishes Prescription Glasses

In the event it is determined that an employee with seniority needs corrective lenses in their
safety glasses due to near-far vision problems, the employee will furnish a copy of the
prescription and the Company will pay the cost of the glasses as follows:

a. The Company pays

	 	•	 	100% of the cost of basic single vision, bifocal, and trifocal lenses
	 
	 	•	 	100% of the cost of Basic or Group 1 frames
	 
	 	•	 	100% of the dispensing fee
	 
	 	•	 	100% of the cost of progressive lenses for all employees

b. The Employee pays

	 	•	 	100% of the cost of miscellaneous lens options (transition, tints, coatings,
etc.)
	 
	 	•	 	100% of charges for frame upgrades (frames other than Basic or Group 1)
	 
	 	•	 	100% of the eye exam charge (may be submitted to health insurance)

When it becomes necessary to replace prescription lenses after the first pair, because of a change
in prescription needs, the employee will furnish a copy of the prescription and the Company will
pay the cost of the lenses, according to Paragraph 267.

47

 

When it is necessary to replace an employee’s prescription safety glasses because they are pitted
to such an extent that they are no longer serviceable, the Company will pay for the cost of the new
lenses (according to paragraph 190) if the employee has had the glasses for a period of more than
two (2) years of working time. If the employee has had the glasses for less than two (2) years of
working time, the Company will pay the cost of the new lenses unless there has been negligence on
the part of the employee.

Damaged Glasses

Safety glasses damaged without the fault of the employee will be repaired or replaced at no cost to
the employee; however, it will be the employee’s responsibility to maintain the glasses in
acceptable condition and to replace them if they are lost, or if they are damaged through misuse or
improper care.

General

The Company will maintain adequate facilities for necessary minor repair of safety glasses. First
aid attendants will perform these functions.

All prescription safety glasses will be purchased through the Company. (Any exceptions must be
approved by the Health and Safety Coordinator.)

ARTICLE
XXIV  – MISCELLANEOUS

Limitation on Supervisor Doing Bargaining Unit

Work

The policy of the Company is to have supervisor perform supervisory work. Supervisor and other
non-bargaining unit employees of the Company shall not perform the work of employees in the
bargaining unit other than for instructive purposes, or in case of emergencies, and when attempting
to eliminate trouble on a job when employees who can eliminate the trouble or handle the emergency
are not readily available, but the work so performed shall not take away any work from any
employee.

Notices to Employees

All employees will be sent a notice to their address as it appears on the Company records. If it is
necessary to contact an employee by telephone, the message will be given to the person answering
the telephone. It is the employee’s responsibility to inform the Human Resources department of
their current phone number and address.

Physical Exam at Company Request

An employee will take a physical examination at Company expense upon the request of the Company.
Before an employee is sent for such physical examination, the Company will inform the Union and
discuss the reasons for the physical examination. The time spent for such an examination will be
paid at the rate of straight time.

48

 

Wash Up Period

A three (3) minute wash up period before the stopping signal will be granted for fin press
operators and also vacuum furnace operators to the extent that they have been working with
graphite.

Posted Union Notices

The Shop Committee will submit to the Company all proposed notices prior to the posting on Company
premises.

Educational Aid

An educational aid program will be made available to members of the bargaining unit.

Cellular Manufacturing and Quality Improvements

It is agreed between the Company and the Union that the parties will work together on the
implementation of cellular manufacturing and quality improvement, and will meet whenever necessary
to discuss issues relating to cellular manufacturing and quality improvement.

Sub-Contracting:

In cases where competition, schedule or workload require the transfer of work to outside vendors,
the Company will advise the Union of such need and the reasons for doing such prior to the
sub-contracting.

Out of Town Assignments

The Company will inform the Shop Chairman when members of the bargaining unit have been sent on
repair assignments outside La Crosse. Compensation while on such assignments will be based on the
applicable provisions of the Fair Labor Standard Act and Chart Heat Exchangers travel policy.

The Chart Heat Exchangers policy presently provides that an employee traveling on Company business
outside la Crosse will receive an additional 20% (or more for certain international trips) added to
their earnings applicable to paid travel time and work performed on the trip with the exception of
authorized time off before and/or after a trip, travel for purposes of the employee’s own training,
and any trip completed within one day.

Employees are considered first shift employees for purposes of determining normal working and
sleeping hours while traveling.

Travel, including time outside normal working hours, will be compensated according to the Chart
Heat Exchangers travel policy.

49

 

ITEMS FOR DISCUSSIONS

The Company and Union will discuss the following items should future conditions warrant:

	a.	 	Method for handling National Health Care should it be instituted.
	 
	b.	 	Catastrophic economic conditions creating hardships for either party.

ARTICLE
XXV  – STRIKES AND LOCKOUTS

No Strike – No Lockout

Since the procedures set forth in this Agreement provide the means for peaceable settlement of all
differences, disputes, complaints, and grievances that may arise between the Company and the Union,
it is agreed that, during the term of this Agreement, neither the Union nor any of its members
shall authorize, encourage, or participate in any strike or slowdown, and that there shall be no
lockouts by the Company.

Violation of Clause

In the event of an illegal, unauthorized or uncondoned strike, sit down, slowdown or interference
with the operation by an employee or employees in violation of this Agreement, the Union will
undertake all reasonable means at its disposal to terminate such action. Employees who participate
in or are responsible for such violation may be discipline or discharged, and such discipline or
discharge shall be subject to the grievance procedure except as to employees who do not terminate
the violation promptly. The question of whether an employee participated in or had any
responsibility for such violation shall in every case be subject to the grievance procedure. In the
event that the Union, using immediate action, is unable to induce the employee or employees to
terminate such unauthorized action, the Company will not hold the local Union or its officers or
the International Union or its officers financially responsible therefor.

ARTICLE XXVI

SEVERANCE PACKAGE – PLANT CLOSING

In the case of the Plant Closing, the employees affected at the Chart Heat Exchangers Division in
La Crosse, WI, will fall under the following guidelines:

Monetary Compensation as follows:

One (1) week of pay for every two (2) years of service up to a maximum of twelve (12) weeks. Years
of service to be defined as no break in seniority.

Checks are to start one (1) week after said closing and will be paid on a weekly basis until pay
entitlement is exhausted.

50

 

Insurance:

Paid in the same format (employee contribution) as if working during the paid severance period.
Insurance benefits will remain in effect until the last day of the month following the last
severance payment.

ARTICLE
XXVI

DURATION OF AGREEMENT

This Agreement shall remain in full force and effect until 11:59 p.m. on February 3, 2007 and on a
year to year basis thereafter unless on or before December 5, 2006 (or in the event of a year to
year extension, at least sixty (60) days prior to the Agreement expiration date), either the
Company or the Union serves upon the other party a written notice of its desire to terminate this
Agreement and negotiate a succeeding Agreement.

No other agreement can modify the terms of this Agreement unless entered into as a written
amendment or supplement hereto.

It is understood that if any of the above articles or article or parts thereof, are in conflict
with federal or state rulings, laws, or executive orders, such federal or state rulings, laws or
executive orders shall apply.

Agreed to this                      day of                                         , 2004.

	 	 	 
	CHART HEAT EXCHANGERS, L.P.

	 	LOCAL LODGE 2191 OF DISTRICT
	 

	 	LODGE 66 OF THE INTERNATIONAL
	 

	 	ASSOCIATION OF MACHINISTS AND
	 

	 	AEROSPACE WORKERS, AFL-CIO
	 
	 	 
	/S/ JOHN ROMAIN

	 	/S/ TOM O’HERON
	/S/ JOEL A. GUBERUD

	 	/S/ DENNIS A. GERKE
	/S/ MAX C. GRAMLING

	 	/S/ MARTIN L. CHRISTIANSON
	/S/ PHIL A. HEIMBECKER

	 	/S/ SCOTT T. PHILLIPS
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 

51

 

FREE STANDING AGREEMENT

LOCAL LODGE 2191 AND CHART HEAT EXCHANGERS

It is agreed; the company and Union will discuss the possibility of exceeding the Voluntary Shift
Exchange Language [more than one (1) week] due to manpower moves.

As in the past, these discussions will take place to allow employees the opportunity to change
shifts with other employees in excess of the limit stated in the current Labor Agreement.

This agreement is based on the additional requirements stated in the current Labor Agreement,
Voluntary Shift Exchange [more than one (1) week], and mutual agreement between the Company and
Union Shop Committee.

Any agreement to allow this to take place will be agreed to on a non-precedent basis.

It is recognized that the Company will have final say in decisions associated with the above stated
language.

DRUG AND ALCOHOL TESTING POLICY AND PROCEDURES

Purpose:

Chart Heat Exchangers is committed to providing and maintaining a safe, healthful and productive
environment for all of its employees. An integral part of such an environment is a workforce free
from individuals who are illegally and unsafely abusing drugs or alcohol. Therefore, it is in the
best interest of the Company, its customers, and its employees to recognize that illegal drug use
by employees would be a threat to the welfare and safety of Company personnel.

Policy:

Section 1.

It is the goal of this policy to eliminate or absolve illegal drug usage through education and
rehabilitation of the affected personnel. The possession, use or being under the influence of
alcoholic beverages or unauthorized drugs shall not be permitted at the Employer’s work site and/or
while an employee is on duty.

Section 2.
 
Pre-employment Testing:

As a precondition to obtaining employment with Chart Heat Exchangers to become Chart Heat
Exchangers employees, all applicants, following a conditional offer of employment, must
successfully complete a pre-employment physical examination by, in relevant part, testing negative
through urinalysis or similar tests administered to detect the use or abuse of drugs and/ or
alcohol. Such pre-employment testing bears a direct, material, and timely relationship to an
applicant’s capacity to perform his or her duties safely and effectively.

52

 

Section 3. Informing Employees About Drug and Alcohol Testing:

All employees shall be fully informed of the Chart Heat Exchangers drug and alcohol testing policy.
Employees will be provided with information concerning the impact of the use of alcohol and drugs
on job performance. In addition, the employer shall inform the employees on how the tests are
conducted, what the tests can determine and the consequence of testing positive for drug use. All
newly hired employees will be provided with this information on their initial date of hire. No
employee shall be tested before this information is provided to him/her. The Employer shall not
discipline employees who voluntarily come forward and ask for assistance to deal with a drug or
alcohol problem. Prior to any testing, the employee will be required to sign the attached consent
and release form. No disciplinary action will be taken against an employee unless he/she refuses to
sign the consent and release form, refuses to take a drug/alcohol test, refuses the opportunity for
rehabilitation, fails to complete a rehabilitation program successfully, or again tests positive
for drugs/alcohol within two (2) years of completing an appropriate rehabilitation program.

Section 4.
Employee Testing:

Employees shall not be subject to random medical testing involving urine or other similar or
related tests for the purpose of discovering possible drug or alcohol abuse however, if objective
evidence exists establishing probable cause to believe an employee’s work performance is impaired
due to drug or alcohol abuse, the employer will require the employee to undergo a medical test
consistent with the conditions set forth in this Policy. An employee that is ordered to participate
in a drug and alcohol test shall have the right to consult with the Medical Review Officer,
Treating Physician or Attending Physician following the testing process.

Section 5. Sample Collection:

The collection and testing of the samples shall be performed only by a laboratory and by a
physician or health care professional qualified and authorized to administer and determine the
meaning of any test results. The laboratory performing the test shall be one that is certified by
the National Institute of Drug Abuse (NIDA). The laboratory chosen must be agreed to between the
Union and the Employer. The laboratory used shall also be one whose procedures are periodically
tested by the NIDA where they analyze unknown samples sent to an independent party. The results of
employee’s tests shall be made available to the Medical Review Officer. Collection of urine samples
shall be conducted in a manner, which provides the highest degree of security for the sample and
freedom from adulteration. Recognized strict chain of custody procedures must be followed for all
samples as set by NIDA. The Union and the Employer agree that security of the biological urine
samples is absolutely necessary therefore the Employer agrees that if the security of the sample is
compromised in anyway, any positive test shall be invalid and may not be used for any purpose.

Urine samples will be submitted as per NIDA Standards. Employees have the right for Union or legal
counsel representative to be present during the submission of the sample.

A split sample shall be reserved in all cases for an independent analysis in the event of a
positive test result. All samples must be stored in a scientific acceptable preserved manner as
established

53

 

by NIDA. All positive confirmed samples and related paperwork must be retained by the laboratory
for at least six (6) months or for the duration of any grievance, disciplinary action or legal
proceedings whichever is longer. At the conclusion of this period, the paperwork and specimen shall
be destroyed.

Tests shall be conducted in a manner to ensure that an employee’s legal drug use and diet does not
affect the test results.

Section 6.
Drug Testing:

The laboratory shall test for only these substances and within the limits for the initial and
confirmation test as provided within the NIDA Standards. The initial test shall use an immunoassay,
which meets the requirements of the Food and Drug Administration for commercial distribution.

	 	 	 
	Marijuana metabolites

Cocaine metabolites

Opiate metabolites

Phencyclidine

Amphetamines

	 	50 ng/ml

300 ng/ml

2000 ng/ml

25 ng/ml

1000 ng/ml

If initial testing results are negative, testing shall be discontinued, all samples destroyed and
records of the testing expunged from the employee’s file. Only specimens identified as positive on
the initial test shall be confirmed using gas chromatograph/mass spectrometry (GC/MS) techniques at
the following listed cutoff values.

	 	 	 	 	 
	Marijuana metabolites
	 	15 ng/ml
	Cocaine metabolites
	 	150 ng/ml
	Opiates

	 	 
	Morphine
	 	2000 ng/ml
	Codeine
	 	2000 ng/ml
	Phencyclidine
	 	25 ng/ml
	Amphetamines

	 	 
	Amphetamine
	 	500 ng/ml
	Methamphetamine
	 	500 ng/ml

If confirmatory testing results are negative all samples shall be destroyed and records of the
testing expunged from the employee’s file.

	1.	 	If immunoassay is specific for free morphine the initial test level is 25 ng/ml
	 
	2.	 	Delta-9-tetrahydrocannabinol-9-carboxylic acid
	 
	3.	 	Benzoylecgonine

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Section 7.
Alcohol Testing:

A Breathalyzer or similar test equipment shall be used to screen for alcohol. An initial positive
alcohol level shall be, .04 grams per 210L of breath. If initial testing results are negative,
testing shall be discontinued, all samples destroyed and records of the testing expunged from the
employee’s file. Sampling handling procedures, as detailed in Section 4, shall apply.

Section 8.
Medical Review Officer:

The Medical Review Officer shall be chosen and agreed upon between the Union and the Employer and
must be a licensed physician with a knowledge of substance abuse disorders. The Medical Review
Officer shall be familiar with the characteristics of drug tests (sensitivity, specificity, and
predictive value), the laboratories running the tests and the medical conditions and work exposures
of the employees. The role of the Medical Review Officer will be to review and interpret the
positive test results. The Medical Review Officer must examine alternate medical explanations for
any positive test results. This action shall include conducting a medical interview with the
affected employee, review of the employee’s medical history and review of any other relevant
biomedical factors. The Medical Review Officer must review all medical records made available by
the tested employee when a confirmed positive test could have resulted from legally prescribed
medication.

Section 9.
Laboratory Results:

The laboratory will advise only the employee and the Medical Review Officer of any positive
results. The results of a positive drug or alcohol test can only be released to the Employer by the
Medical Review Officer once he has completed his review and analysis of the laboratory’s test. The
employer will be required to keep the results confidential and it shall not be released to the
general public.

Section 10. Testing Program Costs:

When the Company has proven a probable cause to believe that an employee is under the influence of
a substance, which is impairing job performance, the employee will be immediately placed on a
mandatory leave of absence from work, for the remainder of the shift involved, and sent for a
drug/alcohol test. The employee will report to work at the start of the next regular shift. The
Company will pay the employee for all hours (to include overtime hours) missed from work due to the
mandatory leave of absence upon receipt of verification of a negative substance test. If the result
of the substance test is positive, the Company will not pay the employee for any hours missed from
work due to the mandatory leave of absence.

For all costs associated with drug and alcohol testing, the Company will pay the medical testing
facility and Medical Review Officer.

Section 11.
Transportation:

The Company will provide transportation, at its expense, through a local taxi service to the
medical facility conducting the substance test. Both Management and the Union reserve the right to
have a representative accompany the employee to the testing facility.

55

 

The Company will provide transportation, at its expense, through a local taxi service from the
medical testing facility to the employee’s home and their return to work the following day through
a local taxi service. In no instance will the employee be permitted to drive himself or herself
home.

Section 12.
Rehabilitation and Offenses and Penalties Program:

Any employee may voluntarily enter rehabilitation without a requirement for prior testing.
Employees who enter a program on their own initiative shall not be subject to testing. The
treatment and rehabilitation shall be paid for by the medical benefits plan, in which the employee
participates, to the extent provided by the plan. Employees who have chosen to opt out of the
Company’s Health Insurance Plans will first, apply for benefits under the plan that covers them and
secondly, be covered by the company if benefits are not provided by another plan.

Any employee, who tests positive the first time shall be medically evaluated, counseled and treated
for rehabilitation as recommended by an E.A.P. Counselor. Employees who complete a rehabilitation
program can be re-tested randomly at least once every quarter for the following six (6) months, if
an employee tests positive a second time during the six (6) month period, they shall be subject to
a disciplinary action. The employee will be reevaluated by an E.A.P. Counselor to determine if the
employee requires additional counseling or treatment. The employee will also receive a last chance
agreement. If the employee does not sign the last chance agreement, he/she will be subject to
disciplinary action up to and including dismissal. If the employee tests positive a third time
during this subsequent six (6) month period, he/she will be dismissed from his/her position with
Chart Heat Exchangers.

Section 13.
Duty Assignment After Treatment:

Once an employee successfully completes rehabilitation, they shall be returned to their regular
duty assignment. Once treatment and any follow-up care is completed, and two (2) years have passed
since the employee entered the program, the employee’s personnel file shall be purged of any
reference to his/her drug or alcohol problem.

Section 14. Right of Appeal:

The employee has the right to challenge the results of the drug or alcohol tests and any discipline
imposed in the same manner that any of the employer actions under the terms of this agreement is
grievable.

Section 15. Union Held Harmless:

This drug and alcohol-testing program was initiated at the request of the employer. Chart Heat
Exchangers assumes sole responsibility for the administration of this policy and shall be solely
liable for any legal obligations and costs arising out of the provision and/or application of this
policy relating to drug and alcohol testing. The Union shall be held harmless for the violation of
any worker rights arising from the administration of the drug and alcohol-testing program.

56

 

Section 16.
Changes in Testing Procedures:

The parties recognize that there may be improvements in the technology of testing procedures, which
provide more accurate testing. In that event, the party’s shall bargain in good faith whether to
amend this procedure to include such improvements.

Section 17. Conflict With Other Laws:

This article is in no way intended to supersede or waive any constitutional or other rights that
the employee may be entitled to under Federal, State or Local Statutes.

Section 18.
Non-Workplace Drug Related Convictions:

Any employee who is convicted of an illegal drug-related crime (does not apply to ordinance
violations) shall notify the Company immediately of such convictions. For the purpose of this
Policy, a “conviction” means finding of guilt (including a plea of nolo contendere) or imposition
of sentence, or both, by any judicial body with the responsibility to determine violations of
federal, state or local criminal statutes. Information concerning any such conviction for violation
of any statute based upon conduct occurring away from the Company’s premises and outside work time
shall not be a basis for imposing discipline under the collective bargaining agreement or for
requiring probable cause testing without the observation required by this Policy.

Section 19. Diversion Agreement:

Any employee who accepts a diversion agreement, wherein the employee pleads guilty to an offense
but, the guilty plea is not accepted by the court if certain conditions are met within a prescribed
time line, will be required to notify the Company under this policy if and when the employee’s
guilty plea is accepted because of the employee’s failure to meet the set conditions.

Section 20. Training:

The training of Company and Union representatives shall be from a formal training program endorsed
by a local Hospital and/or Law Enforcement Agency in detecting signs and symptoms of substance
abuse through speech, breath odor and conduct which indicates the need for testing.

The Company and Union will have an equal number of people trained to recognize individuals under
the influence of drugs and/or alcohol. It remains the responsibility of the Company to determine
testing of employees.

Section 21. Confidentiality:

The Company will designate an official who will be responsible for receiving and maintaining
records regarding all substance tests administered under this Policy. These records shall be
maintained in separate files from routine personnel files and the Company shall limit access to
those specifically authorized management personnel listed below. The Company will conduct the
Policy in a manner calculated to preserve the employee’s privacy and dignity.

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In the event a grievance is filed as a result of a positive substance test, the Company shall
obtain from the laboratory its records relating to the drug test and, if necessary, any record
which might be in the possession of the Medical Review Officer. The Company shall provide copies of
all information to the Union, provided that the employee authorized the release of the medical
records. The Union and the Company shall confer and adopt a mutually acceptable release form.

	 	 	 
	 

	 	 
	Human Resources Manager

	 	Date
	 
	 	 
	 

	 	 
	Manager of Manufacturing

	 	Date

The Union reserves the right to grieve and/or arbitrate:

The Union reserves the right to grieve and/or arbitrate any or all of this Policy if it is deemed
necessary as determined by the Union.

58

 

CONSENT and RELEASE FORM for Drug/Alcohol Test Program

I acknowledge that I have received a copy of, have been duly informed, and understand the Chart
Heat Exchangers drug and alcohol testing policy and procedures. I have been provided with the
information concerning the impact of the use of alcohol and drugs in the work place. In addition, I
have been informed on how the tests are conducted, what the test can determine and the consequence
of testing positive for drug/alcohol use.

I have been informed of Chart Heat Exchangers Employee Assistance Program (EAP). I understand that
if I voluntarily come forward and ask for assistance to deal with a drug or alcohol problem through
EAP, that, I will not be disciplined by the employer.

I understand how drug/alcohol tests are collected and further understand that there are medical
tests that are conducted under the auspices of a Medical Review Officer (MRO). I understand that
the MRO will review and interpret any positive test results, and that I will have an opportunity to
be interviewed by the MRO to review my status, my medical history and any relevant biomedical
factors prior to Chart Heat Exchangers being informed whether I passed or failed the test.

I understand that a confirmed positive drug or alcohol test will result in my referral to Chart
Heat Exchangers EAP and that I will be required to complete a rehabilitation program. No
disciplinary action will be taken against me unless I refuse to sign this consent and release form,
refuse to take a drug/alcohol test, refuse the opportunity for rehabilitation, fail to complete a
rehabilitation program successfully, or again test positive for drugs/alcohol within two (2) years
of completing an appropriate rehabilitation program. I understand that such disciplinary action, as
described herein, may include dismissal from Chart Heat Exchangers.

A copy of this form shall be provided to Local Lodge No.2191.

I,                     , hereby consent and willingly submit to drug and alcohol testing, as stated above, to
be performed upon me and hereby authorize the Medical Review Officer to review such tests. I
further agree to have released, any positive test results and/or confirmation that the test was
performed to Chart Heat Exchangers, through its Human Resource Manager.

	 	 	 
	 

	 	 
	Signature of Employee

	 	Date
	 
	 	 
	 

	 	 
	Witness

	 	Date

59

 

LAST CHANCE AGREEMENT

It is the policy of Chart Heat Exchangers to maintain a work environment for all its employees that
is conducive toward maximum safety and optimum work standards. In application of this policy, the
use or possession, and/or sale of drugs by an employee is prohibited. Having detectable amounts of
alcohol/drugs in your body while on Company premises is also prohibited.

It is the policy of Chart Heat Exchangers to take action whenever alcohol and/or drugs are detected
through urinalysis/drug testing. Under such circumstances, the employee will be subject to
disciplinary action up to and including immediate discharge, as outlined in the Chart Heat
Exchangers substance abuse policy.

On                     , you tested positive for drugs and/or alcohol for the second time. The Company will
provide you with an opportunity to rehabilitate yourself. The Company has agreed to provide you
with a leave of absence, if necessary, for your rehabilitation.

If you elect to participate in and successfully complete a rehabilitation program, the Company is
prepared to allow you to continue employment under the following conditions:

	1.	 	You must successfully complete the rehabilitation program, including any recommended
follow-up and provide the Company with reports with regard to your attendance and your
completion of such programs. A plan of action must be agreed upon before hand.
	 
	2.	 	You agree, by your signature below, that your representatives of the Employees Assistance
Program and rehabilitation program are authorized to release to Chart Heat Exchangers
information related to your attendance and progress in an approved treatment and
rehabilitation program.
	 
	3.	 	You will not possess, use, sell, or be under the influence of drugs and/ or alcohol on
company premises or during work hours at any time in the future.
	 
	4.	 	You agree that the Company may require you to be tested for the presence of alcohol and or
drugs in your system at any time for any reason or for no reason at all in the next six (6)
months. Such tests will be conducted by a medical testing facility using any appropriate
testing procedure. If you are requested to take such an examination and refuse to take the
examination or test positive, you agree that you will be immediately terminated.

In accepting the terms of this Last Chance Agreement, you agree that if you fail to live up to any
of the terms of this agreement, you will immediately be terminated. No excuses will be accepted for
not meeting the terms of this agreement.

	 	 	 
	 
	 	 
	 

	 	 
	Human Resources Manager

	 	Date

60

 

I have read and been given a copy of this Last Chance Agreement. I have been informed that I should
review this agreement with an attorney before I sign it. I understand that this is my last chance
to keep my job and that if I violate this agreement I will be terminated.

	 	 	 
	 
	 	 
	 

	 	 
	Employer

	 	Date

61

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