Document:

Exhibit 10.10

 

POLYPORE INTERNATIONAL, INC. 

STOCK INCENTIVE PLAN

1.            
PURPOSE.

The purpose of the Plan is to assist the Company in
attracting, retaining, motivating and rewarding Eligible Persons, and to
promote the creation of long-term value for stockholders by closely aligning
the interests of Participants with those of stockholders.  The Plan
authorizes the award stock-based incentives to Participants, to encourage such
persons to expend their maximum efforts in the creation of stockholder value. 
The Plan is also intended to qualify certain compensation awarded under the
Plan for tax deductibility under Section 162(m) of the Code to the extent
deemed appropriate by the Committee which administers the Plan.

2.            
DEFINITIONS.

For purposes of the Plan, the following terms shall be
defined as set forth below:

(a)          
“Affiliate” means, with respect to any entity, any other entity that,
directly or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with such entity.

(b)          
“Award” means any award of an Option, SAR, Restricted Stock, Restricted
Stock Units, Stock granted as a bonus or in lieu of another award, or Other
Stock-Based Award.

(c)          
“Board” means the Board of Directors of the Company.

(d)          
“Change in Control” means (i)
a change in ownership or control of the Company effected through a transaction
or series of transactions (other than an offering of Stock to the general
public through a registration statement filed with the Securities and Exchange
Commission) whereby any “person” or related “group” of “persons” (as such terms
are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the
Company, any of its subsidiaries, an employee benefit plan maintained by the
Company or any of its subsidiaries, a Principal Stockholder or an Affiliate of
the Company or a Principal Stockholder) directly or indirectly acquires
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act)
of securities of the Company possessing more than fifty percent (50%) of the
total combined voting power of the Company’s securities outstanding immediately
after such acquisition; or (ii) the sale or conveyance of all or substantially
all of the assets of the Company.

(e)          
“Code” means the Internal Revenue Code of 1986, as amended from time to
time, including regulations thereunder and successor provisions and regulations
thereto.

(f)           
“Committee” means a committee of two or more directors designated by the
Board to administer the Plan; provided, however, that directors appointed as
members of the Committee shall not be employees of the Company or any
subsidiary.  In appointing members of the Committee, the Board will
consider whether a member is or will be a Quali­fied Member, but such members
are not required to be Qualified Members at the time of appointment or during
their term of service on the Committee, and no action of the Committee shall be
void or invalid

 

due
to the participation of a member who is not a Qualified Member. 
Initially, the Committee shall be the Compensation Committee of the Board.

(g)          
“Company” means Polypore International, Inc., a Delaware corporation.

(h)          
“Covered Employee” means a
person designated by the Committee as likely to be a “covered employee,” as
defined under Code Section 162(m) of the Code, with respect to a specified
fiscal year or other performance period.

(i)           
“Dividend Equivalents” shall have the meaning set forth in Section 9
hereof.

(j)           
“Eligible Person” means each employee of the Company or of any
subsidiary, including each such person who may also be a director of the
Company, each non-employee director of the Company, each other person who
provides substantial services to the Company and/or its Affiliates and who is
designated as eligible by the Committee, and any person who has been offered
employment by the Company or an Affiliate, provided that such prospective
employee may not receive any payment or exercise any right relating to an Award
until such person has commenced employment with the Company or a subsidiary or
affiliate.  An employee on an approved leave of absence may be considered
as still in the employ of the Company or an Affiliate for purposes of
eligibility for participation in the Plan.

(k)          
“Exchange Act” means the Securities Exchange Act of 1934, as amended
from time to time, including rules thereunder and successor provisions and
rules thereto.

(l)           
“Fair Market Value” means (i)
prior to an IPO, the fair market value per share of Stock, as determined by the
Board in good faith, (ii) at the time of an IPO, the per share price to the
public in such IPO, and (iii) after an IPO, on any date (A) if the Stock is
listed on a national securities exchange, the mean between the highest and
lowest sale prices reported as having occurred on the primary exchange with
which the Stock is listed and traded on the date prior to such date, or, if
there is no such sale on that date, then on the last preceding date on which
such a sale was reported, or (B) if the Stock is not listed on any national
securities exchange but is quoted in the National Market System of the National
Association of Securities Dealers Automated Quotation System (“NASDAQ-NMS”)
on a last sale basis, the average between the high bid price and low ask price
reported on the date prior to such date, or, if there is no such sale on that
date then on the last preceding date on which such a sale was reported. 
If, after an IPO, the Stock is not quoted on NASDAQ-NMS or listed on an
exchange, or representative quotes are not otherwise available, the Fair Market
Value shall mean the amount determined by the Board in good faith to be the
fair market value per share of Stock, on a fully diluted basis.

(m)          “Fund”
means Warburg Pincus Private Equity VIII, L.P. or Warburg Pincus International
Partners, L.P.

(n)          
“IPO” means an initial public offering of the Stock registered under the
Securities Act pursuant to an effective registration statement.

 

 

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(o)          
“IPO Date” means the effective date of the registration statement for
the IPO.

(p)          
“Option” means a conditional right, granted to a Participant under
Section 6 hereof, to purchase Stock or other Awards at a specified price during
specified time periods.  Options under the Plan are not intended to
qualify as incentive stock options meeting the requirements of Section 422 of
the Code.

(q)          
“Other Stock-Based Awards” means Awards granted to a Participant under
Section 11 hereof.

(r)           
“Participant” means a person who has been granted an Award under the
Plan which remains outstanding, or if applicable, such other person or entity who
holds an outstanding Award.

(s)          
“Plan” means this Polypore International, Inc. Stock Incentive Plan.

(t)           
“Principal Stockholder” means either Fund or any of their respective
Affiliates.

(u)          
“Qualified Member” means a member of the Committee who is a
“Non-Employee Director” within the meaning of Rule 16b-3(b)(3) and an “outside
director” within the meaning of Regulation 1.162-27(c) under Code Section
162(m).

(v)          
“Restricted Stock” means Stock granted to a Participant under Section 8
hereof, that is subject to certain restrictions and to a risk of forfeiture.

(w)          “Restricted
Stock Agreement” means a written agreement between the Company and a
Participant evidencing the terms and conditions of an individual Restricted
Stock grant.

(x)           
“Restricted Stock Unit” means a notional unit representing the right to
receive one share of Stock on the Settlement Date.

(y)          
“Restricted Stock Unit Agreement” means a written agreement between the
Company and a Participant evidencing the terms and conditions of an individual
Restricted Stock Unit grant.

(z)           
“Rule 16b-3” means Rule 16b-3, as from time to time in effect and
applicable to the Plan and Participants, promulgated by the Securities and Exchange
Commission under Section 16 of the Exchange Act.

(aa)         “Securities
Act” means the Securities Act of 1933, as amended from time to time,
including rules thereunder and successor provisions and rules thereto.

(bb)         “Settlement
Date” shall have the meaning set forth in Section 9 hereof.

 

 

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(cc)         “Stock”
means the Company’s Common Stock, $.01 par value, and such other securities as
may be substituted for Stock pursuant to Section 12 hereof.

(dd)         “Stock
Appreciation Right” or “SAR” means a conditional right granted to a
Participant under Section 7 hereof.

3.            
ADMINISTRATION.

(a)          
Authority of the Committee.  Except as otherwise provided below,
the Plan shall be administered by the Committee.  The Committee shall have
full and final authority, in each case subject to and consistent with the
provisions of the Plan, to (i) select Eligible Persons to become Participants;
grant Awards; (ii) determine the type, number, and other terms and condi­tions
of, and all other matters relating to, Awards; (iii) prescribe Award agreements
(which need not be identical for each Participant) and rules and regulations
for the adminis­tration of the Plan; (iv) construe and interpret the Plan and
Award agreements and correct defects, supply omissions, or reconcile
inconsistencies therein; and (v) make all other decisions and determinations as
the Committee may deem necessary or advisable for the administration of the
Plan.  The foregoing notwithstanding, the Board shall perform the
functions of the Committee for purposes of granting Awards under the Plan to
non-employee directors.  In any case in which the Board is performing a
function of the Committee under the Plan, each reference to the Committee
herein shall be deemed to refer to the Board, except where the context
otherwise requires.  Any action of the Committee shall be final,
conclusive and binding on all persons, including, without limitation, the
Company, its subsidiaries, Eligible Persons, Participants and beneficiaries of
Participants.

(b)          
Manner of Exercise of Committee Authority.  At any time that a member of the Committee is not a
Qualified Member, (i) any action of the Committee relating to an Award intended
by the Committee to qualify as “performance-based compensation” within the
meaning of Section 162(m) of the Code and regulations thereunder may be taken
by a subcommittee, designated by the Committee or the Board, composed solely of
two or more Qualified Members; and (ii) any action relating to an Award granted
or to be granted to a Participant who is then subject to Section 16 of the
Exchange Act in respect of the Company may be taken either by such a
subcommittee or by the Committee but with each such member who is not a
Qualified Member abstaining or recusing himself or herself from such action,
provided that, upon such abstention or recusal, the Committee remains composed
of two or more Qualified Members.  Such action, authorized by such a subcommittee
or by the Committee upon the abstention or recusal of such non-Qualified
Member(s), shall be the action of the Committee for purposes of the Plan. 
The express grant of any specific power to the Committee, and the taking of any
action by the Committee, shall not be construed as limiting any power or
authority of the Committee.

(c)          
Delegation.  The Committee may delegate to officers or employees of
the Company or any subsidiary or affiliate, or committees thereof, the
authority, subject to such terms as the Committee shall determine, to perform
such functions, including but not limited to administrative functions, as the
Committee may determine, to the fullest extent permitted under Section 157 and
other applicable provisions of the Delaware General Corporation Law.  The
Committee may appoint agents to assist it in administering the Plan. 
Notwithstanding the 

 

 

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foregoing
or any other provision of the Plan to the contrary, any Award granted under the
Plan to any person or entity who is not an employee of the Company or any of
its Affiliates shall be expressly approved by the Committee.

4.            
SHARES AVAILABLE
UNDER THE PLAN.

(a)          
Number of Shares Available for Delivery.  Subject to adjustment as
provided in Section 12 hereof, the total number of shares of Stock
reserved and available for delivery in connection with Awards under the Plan
shall be 19,099.  Shares of Stock delivered under the Plan shall consist
of authorized and unissued shares or previously issued shares of Stock
reacquired by the Company on the open market or by private purchase.

(b)          
Share Counting Rules.  The Committee may adopt reasonable counting
procedures to ensure appropriate counting, avoid double counting (as, for
example, in the case of tandem or substitute awards) and make adjustments if
the number of shares of Stock actually delivered differs from the number of
shares previously counted in connection with an Award.  To the extent that
an Award expires or is canceled, forfeited, settled in cash or otherwise
terminated or concluded without a delivery to the Participant of the full
number of shares to which the Award related, the undelivered shares will again
be available for Awards.  Shares withheld in payment of the exercise price
or taxes relating to an Award and shares equal to the number surrendered in
payment of any exercise price or taxes relating to an Award shall be deemed to
constitute shares not delivered to the Participant and shall be deemed to again
be available for Awards under the Plan; provided, however, that, where shares
are withheld or surrendered more than ten years after the date of the most
recent shareholder approval of the Plan or any other transaction occurs that
would result in shares becoming available under this Section 4(b), such shares
shall not become available if and to the extent that it would constitute a
material revision of the Plan subject to shareholder approval under then
applicable rules of the principle stock exchange or automated quotation system
on which the shares are then listed or designated for trading.

5.            
ELIGIBILITY;
LIMITATIONS ON AWARDS.

(a)          
Grants to Eligible Persons.  Awards may be granted under the Plan
only to Eligible Persons.

(b)          
162(m) Limitation.  Subject to Section 12 relating to adjustments,
no Employee shall be eligible to be granted Options or Stock Appreciation
Rights covering more than         
shares of Stock during any calendar year.  This subsection (b) shall not
apply prior to the IPO Date and, following the IPO Date, this subsection (b)
shall not apply until (i) the earliest of:  (1) the first material
modification of the Plan (including any increase in the number of shares of
Stock reserved for issuance under the Plan in accordance with ); (2) the
issuance of all of the shares of Stock reserved for issuance under the Plan;
(3) the expiration of the Plan; or (4) the first meeting of stockholders at
which directors are to be elected that occurs after the close of the third
calendar year following the calendar year in which occurred the first
registration of an equity security under Section 12 of the Exchange Act;
or (ii) such other date required by Section 162(m) of the Code and the
rules and regulations promulgated thereunder.

 

 

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6.            
OPTIONS.

(a)          
General.  Options granted hereunder shall be in such form and shall
contain such terms and conditions as the Committee shall deem
appropriate.  The provisions of separate Options shall be set forth in an
Option Agreement, which agreements need not be identical.

(i)           
Term.  The term of each
Option shall be set by the Committee at the time of grant; provided, however,
that no Option granted hereunder shall be exercisable after the expiration of
ten (10) years from the date it was granted.

(ii)          
Exercise Price.  The
exercise price per share of Stock for each Option shall be set by the Committee
at the time of grant but shall not be less than the par value of a share of
Stock.

(iii)         
Payment for Stock.  Payment
for shares of Stock acquired pursuant to Options granted hereunder shall be
made in full, upon exercise of the Options (i) in immediately available funds
in United States dollars, by certified or bank cashier’ s check; (ii) by
surrender to the Company of shares of Stock; (iii) by a combination of (i) and
(ii); (iv) by delivery of a notice of “net exercise” to the Company, pursuant
to which the Participant shall receive the number of shares of Stock underlying
the Options so exercised reduced by the number of shares of Stock equal to the
aggregate exercise price of the Options divided by the Fair Market Value on the
date of exercise; or (v) by any other means approved by the Committee. 
Anything herein to the contrary notwithstanding, the Company shall not directly
or indirectly extend or maintain credit, or arrange for the extension of
credit, in the form of a personal loan to or for any director or executive
officer of the Company through the Plan in violation of Section 402 of the
Sarbanes-Oxley Act of 2002 (“Section 402 of SOX”), and to the extent
that any form of payment would, in the opinion of the Company’s counsel, result
in a violation of Section 402 of SOX, such form of payment shall not be
available.

(iv)          Vesting.  Options shall vest and
become exercisable in such manner and on such date or dates set forth in the
Option Agreement, as may be determined by the Committee; provided, however,
that notwithstanding any vesting dates contained herein or otherwise set by the
Committee, the Committee may in its sole discretion accelerate the vesting of
any Option, which acceleration shall not affect the terms and conditions of any
such Option other than with respect to vesting.  Unless otherwise
specifically determined by the Committee, the vesting of an Option shall occur
only while the Participant is employed or rendering services to the Company or
its subsidiaries and all vesting shall cease upon a Participant’s termination
of employment or services for any reason.  If an Option is exercisable in
installments, such installments or portions thereof which become exercisable
shall remain exercisable until the Option expires.

(b)          
Transferability of Options.  An Option shall not be transferable
except by will or by the laws of descent and distribution and shall be
exercisable during the lifetime of the 

 

 

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Participant
only by the Participant.  Notwithstanding the foregoing, Options shall be
transferable to the extent provided in the Option Agreement or otherwise
determined by the Committee.

7.            
STOCK
APPRECIATION RIGHTS.

(a)          
General.  The Committee is authorized to grant SARs to Participants
on the following terms and conditions:

(i)           
Right to Payment.  A SAR
shall confer on the Participant to whom it is granted a right to receive, upon
exercise thereof, the excess of (A) the Fair Market Value of one share of Stock
on the date of exercise over (B) the grant price of the SAR as determined by
the Committee.

(ii)          
Term.  The term of each SAR
shall be set by the Committee at the time of grant; provided, however, that no
SAR granted hereunder shall be exercisable after the expiration of ten (10)
years from the date it was granted.

(iii)         
Grant Price.  The grant
price per share of Stock for each Option shall be set by the Committee at the
time of grant.

(iv)          Other Terms.  The Committee shall
determine at the date of grant or thereafter:  (A) the time or times at
which and the circumstances under which a SAR may be exercised in whole or in
part (including based on achievement of performance goals and/or future service
requirements); (B) the method of exercise; (C) the method of settlement; (D)
whether cash or Stock will be payable to the Participant upon exercise of the
SAR; (E) the method by or forms in which Stock will be delivered or deemed to
be delivered to Participants; (F) whether or not a SAR shall be alone, in
tandem or in combination with any other Award; and (G) and any other terms and
conditions of any SAR.

8.            
RESTRICTED STOCK.

(a)          
General.  Restricted Stock granted hereunder shall be in such form
and shall contain such terms and conditions as the Committee shall deem
appropriate.  The terms and conditions of each Restricted Stock grant
shall be evidenced by a Restricted Stock Agreement, which agreements need not
be identical.   Subject to the restrictions set forth in Section
8(b), except as otherwise in the applicable Restricted Stock Agreement, the
Participant shall generally have the rights and privileges of a stockholder as
to such Restricted Stock, including the right to vote such Restricted
Stock.  At the discretion of the Committee, cash dividends and stock
dividends, if any, with respect to the Restricted Stock may be either currently
paid to the Participant or withheld by the Company for the Participant’s
account.  A Participant’s Restricted Stock Agreement may provide that cash
dividends or stock dividends so withheld shall be subject to forfeiture to the
same degree as the shares of Restricted Stock to which they relate. 
Except as otherwise determined by the Committee, no interest will accrue or be
paid on the amount of any cash dividends withheld.

(b)          
Restrictions on Transfer.  In addition to any other restrictions
set forth in a Participant’s Restricted Stock Agreement, until such time that
the Restricted Stock has vested 

 

 

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pursuant
to the terms of the Restricted Stock Agreement, which vesting the Committee may
in its sole discretion accelerate at any time, the Participant shall not be
permitted to sell, transfer, pledge, or otherwise encumber the Restricted Stock. 
Notwithstanding anything contained herein to the contrary, the Committee shall
have the authority to remove any or all of the restrictions on the Restricted
Stock whenever it may determine that, by reason of changes in applicable laws
or other changes in circumstances arising after the date of the Restricted
Stock Award, such action is appropriate.

(c)          
Certificates.  Restricted Stock granted under the Plan may be
evidenced in such manner as the Committee shall determine.  If
certificates representing Restricted Stock are registered in the name of the
Participant, the Committee may require that such certificates bear an
appropriate legend referring to the terms, conditions and restrictions
applicable to such Restricted Stock, that the Company retain physical
possession of the certificates, and that the Participant deliver a stock power
to the Company, endorsed in blank, relating to the Restricted Stock. 
Notwithstanding the foregoing, the Committee may determine, in its sole
discretion, that the Restricted Stock shall be held in book entry form rather
than delivered to the Participant pending the release of the applicable
restrictions.

9.            
RESTRICTED STOCK
UNITS

(a)          
General.  Restricted Stock Units granted hereunder shall be in such
form and shall contain such terms and conditions as the Committee shall deem
appropriate.  The terms and conditions of each Restricted Stock Unit grant
shall be evidenced by a Restricted Stock Unit Agreement.  No shares of
Stock shall be issued at the time a Restricted Stock Unit grant is made, and
the Company will not be required to set aside a fund for the payment of any
such Award; provided, however, that for purposes of Section 4(a) hereof, a
share of Stock shall be deemed awarded at the time of grant.  Recipients
of Restricted Stock Units may, in the sole discretion of the Committee, be
entitled to an amount equal to the cash dividends paid by the Company upon one
share of Stock for each Restricted Stock Unit then credited to such recipient’s
account (“Dividend Equivalents”).  To the extent a Participant
receiving Restricted Stock Units is entitled to Dividend Equivalents, the
Committee shall, in its sole discretion, determine whether to credit to the
account of, or to currently pay to, such Participant the Dividend
Equivalents.  A Participant’s Restricted Stock Unit Agreement may provide
that Dividends Equivalents shall be subject to forfeiture to the same degree as
the shares of Restricted Stock Units to which they relate.  Except as
otherwise determined by the Committee, no interest will accrue or be paid on
Dividend Equivalents credited to a recipient’s account.

(b)          
Conditions of Grant.  Restricted Stock Units awarded to any
eligible individual shall be subject to (i) forfeiture until the expiration of
the restricted period, to the extent provided in the Restricted Stock Unit
Agreement, and to the extent such Awards are forfeited, all rights of the
recipient to such Awards shall terminate without further obligation on the part
of the Company, and (ii) such other terms and conditions as may be set forth in
the applicable Award agreement.  Notwithstanding anything contained herein
to the contrary, the Committee shall have the authority to remove any or all of
the restrictions on the Restricted Stock Units whenever it may determine that,
by reason of changes in applicable laws or other changes in circumstances
arising after the date of the Restricted Stock Unit Award, such action is
appropriate.

 

 

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(c)          
Settlement of Restricted Stock Units.  Upon a date or dates on or
following the expiration of the restricted period as shall be determined by the
Committee and set forth in a Participant’s Restricted Stock Unit Agreement (the
“Settlement Date(s)”), unless earlier forfeited, the Company shall
settle the Restricted Stock Unit by delivering (i) a number of shares of Stock
equal to the number of Restricted Stock Units then vested and not otherwise
forfeited, and (ii) if applicable, a number of shares of Stock having a value
equal to any unpaid Dividend Equivalents accrued with respect to the Restricted
Stock Units.  The Company may, in the Committee’s sole discretion, settle
a Restricted Stock Unit Award in cash in lieu of the delivery of shares of
Stock or partially in cash and partially in shares of Stock.  A settlement
in cash shall be based on the value of the shares of Stock otherwise to be
delivered on the Settlement Date.

(d)          
Creditor’s Rights.  A holder of Restricted Stock Units shall have
no rights other than those of a general creditor of the Company. 
Restricted Stock Units represent an unfunded and unsecured obligation of the
Company, subject to the terms and conditions of the applicable Restricted Stock
Unit Agreement.

10.          
BONUS STOCK AND
AWARDS IN LIEU OF OBLIGATIONS.

The Committee is authorized to grant Stock as a bonus,
or to grant Stock or other Awards in lieu of obligations of the Company or a
subsidiary of the Company under the Plan or under other plans or compensatory
arrangements, subject to such terms and conditions as shall be determined by
the Committee.

11.          
OTHER STOCK-BASED
AWARDS.

The Committee is authorized, subject to limitations
under applicable law, to grant to Participants such other Awards that may be
denominated or payable in, valued in whole or in part by reference to, or
otherwise based on, or related to, Stock, as deemed by the Committee to be
consistent with the purposes of the Plan.

12.          
ADJUSTMENT FOR
RECAPITALIZATION, MERGER, ETC.

(a)          
Capitalization Adjustments.  The aggregate number of shares of
Stock which may be granted or purchased pursuant to Awards granted hereunder,
the number of shares of Stock covered by each outstanding Award, the maximum
number of shares of Stock with respect to which any one person may be granted
Options or Stock Appreciation Rights in any calendar year, and the price per
share thereof in each such Award shall be equitably and proportionally adjusted
or substituted, as determined by the Committee in good faith and in its sole
discretion, as to the number, price or kind of a share of Stock or other
consideration subject to such Awards or as otherwise determined by the
Committee in good faith to be fair and equitable (i) in the event of changes in
the outstanding Stock or in the capital structure of the Company by reason of
stock dividends, stock splits, reverse stock splits, recapitalizations,
reorganizations, mergers, consolidations, combinations, exchanges, or other
relevant changes in capitalization occurring after the date of grant of any
such Option, (ii) in the event of any change in applicable laws or any change
in circumstances which results in or would result in any substantial dilution
or enlargement of the rights granted to, or available for, Participants in the

 

 

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Plan,
or (iii) for any other reason which the Committee determines, in its sole
discretion and acting in good faith, to otherwise warrant equitable adjustment. 
Absent manifest error, any adjustment shall be conclusively determined by the
Committee; provided, in each case, the fair value of the Option immediately
following any such adjustment shall be equal to the fair value of the Option
immediately prior to such adjustment.

(b)          
Corporate Events.  Notwithstanding the foregoing, except as may
otherwise be provided in an Award agreement, in the event of (i) a merger or
consolidation involving the Company in which the Company is not the surviving
corporation, (ii) a merger or consolidation involving the Company in which the
Company is the surviving corporation but the holders of shares of Stock receive
securities of another corporation and/or other property, including cash, (iii)
the sale of all or substantially all of the assets of the Company, (iv) the
reorganization or liquidation of the Company or (v) a Change in Control (a “Corporate
Event”), in lieu of providing the adjustment set forth in subsection (a)
above, the Committee may, in its discretion, provide that all outstanding
Awards shall terminate as of the consummation of such Corporate Event, and
provide that holders of Awards will receive a payment in respect of
cancellation of their Awards based on the amount of the per share consideration
being paid for the Stock in connection with such Corporate Event, and in the
case of Options, Stock Appreciation Rights and other Awards with an exercise
price or similar provision, less the applicable exercise price.  Payments
to holders pursuant to the preceding sentence shall be made in cash, or, in the
sole discretion of the Committee, in such other consideration necessary for a
holder of an Award to receive property, cash or securities as such holder would
have been entitled to receive upon the occurrence of the transaction if the
holder had been, immediately prior to such transaction, the holder of the
number of shares of Stock covered by the Award at such time; provided, that if
such consideration received in the transaction is not solely equity securities
of the successor entity, the Committee may, with the consent of the successor
entity, provide for the consideration to be received in respect of the Award to
be solely equity securities of the successor entity equal to the Fair Market
Value of the per share consideration received by holders of Stock in the
Corporate Event.

(c)          
Fractional Shares.  Any such adjustment may provide for the
elimination of any fractional share which might otherwise become subject to an
Award.

13.          
CHANGE IN CONTROL

The Committee may, in its sole discretion, may provide
in an Award agreement that in the event of a Change in Control, (a) Options
shall become immediately exercisable with respect to 100% of the shares subject
to such Options, (b) shares of Restricted Stock become 100% vested, (c)
Restricted Stock Units shall be settled as if the Settlement Date occurred
immediately prior to such Change in Control, or (d) all other Awards shall
become fully vested and/or payable to the fullest extent of any Award or
portion thereof that has not then expired and any restrictions with respect
thereto shall expire.  The Committee shall have full authority and
discretion to interpret this Section 13 and to implement any course of action
with respect to any Award so as to satisfy the intent of this provision.

 

 

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14.          
USE OF PROCEEDS.

The proceeds received from the
sale of Stock pursuant to the Plan shall be used for general corporate
purposes.

15.          
RIGHTS AND
PRIVILEGES AS A STOCKHOLDER.

Except as otherwise specifically provided in the Plan,
no person shall be entitled to the rights and privileges of stock ownership in
respect of shares of Stock which are subject to Awards hereunder until such
shares have been issued to that person.

16.          
EMPLOYMENT OR
SERVICE RIGHTS.

No individual shall have any claim or right to be
granted an Award under the Plan or, having been selected for the grant of an
Award, to be selected for a grant of any other Award.  Neither the Plan
nor any action taken hereunder shall be construed as giving any individual any
right to be retained in the employ or service of the Company or an Affiliate.

17.          
COMPLIANCE WITH
LAWS.

The obligation of the Company to make payment of
Awards in Stock or otherwise shall be subject to all applicable laws, rules,
and regulations, and to such approvals by governmental agencies as may be
required.  Notwithstanding any terms or conditions of any Award to the
contrary, the Company shall be under no obligation to offer to sell or to sell
and shall be prohibited from offering to sell or selling any shares of Stock
pursuant to an Award unless such shares have been properly registered for sale
pursuant to the Securities Act with the Securities and Exchange Commission or
unless the Company has received an opinion of counsel, satisfactory to the
Company, that such shares may be offered or sold without such registration
pursuant to an available exemption therefrom and the terms and conditions of such
exemption have been fully complied with.  The Company shall be under no
obligation to register for sale or resale under the Securities Act any of the
shares of Stock to be offered or sold under the Plan or any shares of Stock
issued upon exercise or settlement of Awards.  If the shares of Stock
offered for sale or sold under the Plan are offered or sold pursuant to an
exemption from registration under the Securities Act, the Company may restrict
the transfer of such shares and may legend the Stock certificates representing
such shares in such manner as it deems advisable to ensure the availability of
any such exemption.

18.          
MARKET STANDOFF
AGREEMENT.

As a condition of receiving any Award hereunder, the
Participant agrees that in connection with any registration of the Stock and
upon the request of the Committee or the underwriters managing any public
offering of the Stock, the Participant will not sell or otherwise dispose of
any Stock without prior written consent of the Committee or such underwriters,
as the case may be, for a period of time (not to exceed 180 days) from the
effective date of such registration as the Committee or the underwriters may
specify for employee-shareholders generally.

 

 

11

 

19.          
WITHHOLDING
OBLIGATIONS.

As a condition to the exercise or vesting, as
applicable, of any Award, the Committee may require that a Participant satisfy,
through deduction or withholding from any payment of any kind otherwise due to
the Participant, or through such other arrangements as are satisfactory to the
Committee, the minimum amount of all Federal, state and local income and other
taxes of any kind required or permitted to be withheld in connection with such
vesting or exercise.  The Committee, in its discretion, may permit shares
of Stock to be used to satisfy tax withholding requirements and such shares
shall be valued at their Fair Market Value as of the settlement date of the
Award.  For purposes of this Section 19, the term “Company” shall be
deemed to mean any Affiliate that may have a tax withholding obligation due to
its relationship with a Participant.

20.          
AMENDMENT OF THE
PLAN OR AWARDS.

(a)          
Amendment of Plan.  The Board at any time, and from time to time,
may amend the Plan; provided, however, that without further stockholder
approval the Board shall not make any amendment to the Plan which would
increase the maximum number of shares of Stock which may be issued pursuant to
Awards under the Plan, except as contemplated by Section 12 hereof, or,
following the IPO Date, which would otherwise violate the shareholder approval
requirements of the national securities exchange on which the Stock is listed
or Nasdaq, as applicable.

(b)          
No Impairment of Rights.  Rights under any Award granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
the Participant consents in writing.

(c)          
Amendment of Stock Awards.  The Committee, at any time, and from
time to time, may amend the terms of any one or more Awards; provided, however,
that the rights under any Award shall not be impaired by any such amendment
unless the Participant consents in writing.

21.          
TERMINATION OR
SUSPENSION OF THE PLAN.

The Board may suspend or terminate the Plan at any
time.  Unless sooner terminated, the Plan shall terminate on the day
before the tenth (10th) anniversary of the date the Plan is adopted
by the Board or approved by the stockholders of the Company, whichever is
earlier.  No Awards may be granted under the Plan while the Plan is
suspended or after it is terminated.

22.          
EFFECTIVE DATE OF
THE PLAN.

The Plan is effective as of July
__, 2004, the date upon which the Board approved the Plan.

23.          
MISCELLANEOUS.

(a)          
Awards to Participants Outside of the United States.  The Committee
may modify the terms of any Award under the Plan made to or held by a
Participant who is then resident or primarily employed outside of the United
States in any manner deemed by the Committee to be necessary or appropriate in
order that such Award shall conform to laws, 

 

 

12

 

regulations
and customs of the country in which the Participant is then resident or
primarily employed, or so that the value and other benefits of the Award to the
Participant, as affected by foreign tax laws and other restrictions applicable
as a result of the Participant’s residence or employment abroad, shall be
comparable to the value of such Award to a Participant who is resident or
primarily employed in the United States.  An Award may be modified under
this Section 23(a) in a manner that is inconsistent with the express terms of
the Plan, so long as such modifications will not contravene any applicable law
or regulation or result in actual liability under Section 16(b) of the Exchange
Act for the Participant whose Award is modified.

(b)          
No Liability of Committee Members.  No member of the Committee
shall be personally liable by reason of any contract or other instrument
executed by such member or on his behalf in his capacity as a member of the
Committee nor for any mistake of judgment made in good faith, and the Company
shall indemnify and hold harmless each member of the Committee and each other
employee, officer or director of the Company to whom any duty or power relating
to the administration or interpretation of the Plan may be allocated or
delegated, against any cost or expense (including counsel fees) or liability
(including any sum paid in settlement of a claim) arising out of any act or
omission to act in connection with the Plan unless arising out of such person’s
own fraud or willful bad faith; provided, however, that approval
of the Board shall be required for the payment of any amount in settlement of a
claim against any such person.  The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which such
persons may be entitled under the Company’s Articles of Incorporation or By-Laws,
as a matter of law, or otherwise, or any power that the Company may have to
indemnify them or hold them harmless.

(c)          
Payments Following Accidents or Illness. If the Committee shall find
that any person to whom any amount is payable under the Plan is unable to care
for his affairs because of illness or accident, or is a minor, or has died,
then any payment due to such person or his estate (unless a prior claim
therefor has been made by a duly appointed legal representative) may, if the
Committee so directs the Company, be paid to his spouse, child, relative, an
institution maintaining or having custody of such person, or any other person
deemed by the Committee to be a proper recipient on behalf of such person
otherwise entitled to payment.  Any such payment shall be a complete
discharge of the liability of the Committee and the Company therefor.

(d)          
Designation and Change of Beneficiary.  Each Participant may file
with the Company a written designation of one or more persons as the beneficiary
who shall be entitled to receive the rights or amounts payable with respect to
an Award due under the Plan upon his death.  A Participant may, from time
to time, revoke or change his beneficiary designation without the consent of
any prior beneficiary by filing a new designation with the Committee.  The
last such designation received by the Company shall be controlling; provided,
however, that no designation, or change or revocation thereof, shall be
effective unless received by the Company prior to the Participant’s death, and
in no event shall it be effective as of a date prior to such receipt.  If
no beneficiary designation is filed by the Participant, the beneficiary shall
be deemed to be his or her spouse or, if the Participant is unmarried at the time
of death, his or her estate.

 

 

13

 

(e)          
Governing Law.  The Plan shall be governed by and construed in
accordance with the internal laws of the State of Delaware without reference to
the principles of conflicts of laws thereof.

(f)           
Funding.  No provision of the Plan shall require the Company, for
the purpose of satisfying any obligations under the Plan, to purchase assets or
place any assets in a trust or other entity to which contributions are made or
otherwise to segregate any assets, nor shall the Company maintain separate bank
accounts, books, records or other evidence of the existence of a segregated or
separately maintained or administered fund for such purposes.  Participants
shall have no rights under the Plan other than as unsecured general creditors
of the Company, except that insofar as they may have become entitled to payment
of additional compensation by performance of services, they shall have the same
rights as other employees under general law.

(g)          
Reliance on Reports.  Each member of the Committee and each member
of the Board shall be fully justified in relying, acting or failing to act, and
shall not be liable for having so relied, acted or failed to act in good faith,
upon any report made by the independent public accountant of the Company and
its Affiliates and upon any other information furnished in connection with the
Plan by any person or persons other than himself.

(h)          
Titles and Headings.  The titles and headings of the sections in
the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings shall
control.

 

14Exhibit
10.11

Term Sheet

for Employment Arrangement

Frank Nasisi

This Term Sheet outlines the material provisions of
the proposed employment agreement between Frank Nasisi (the “Executive”)
and Polypore, Inc., a Delaware corporation (the “Company”).

EMPLOYMENT

	
  Current Title

  	
  President
  and Chief Executive Officer of the Company.

  
	
  Duties

  	
  Commensurate
  with responsibilities normally associated with Title.  The Executive
  will serve as a member of the Board of Directors of the Company (the “Board”)
  during the Term and if elected or appointed, as a member of the boards of
  directors of any of the Company’s subsidiaries and/or in one or more
  executive offices of any entities owned by the Company.

  
	
  Effective Date

  	
  Upon
  consummation of the acquisition of the Company by affiliates of Warburg
  Pincus Private Equity VIII (on or about April 15, 2004) (the “Effective
  Date”).

  
	
  Term

  	
  The
  term of employment under the Agreement is for the term beginning on the
  Effective Date and ending on the second anniversary of the Effective Date
  (the “Term”); provided, that, unless earlier terminated pursuant to
  the terms of the employment agreement (including by either party giving
  written notice of intention not to renew), the Agreement shall automatically
  renew for an additional one-year period.

  
	
  COMPENSATION AND BENEFITS

  	
   

  
	
  Annual Base Salary

  	
  $435,000
  (the “Base Salary”), which may be increased by the Compensation
  Committee of the Board (the “Compensation Committee”).

  
	
  Bonuses

  	
  The
  Executive is eligible to receive an annual cash bonus based upon achievement
  of applicable EBITDA targets as follows:

  

 

 

 

	
   

   

  	
  %
  of EBITDA Target Achieved

  	
  Bonus
  Amount

  
	
   

  	
  <80%

  	
  $0

  
	
   

  	
  80%

  	
  $145,000

  
	
   

  	
  90%

  	
  $174,000

  
	
   

  	
  100%

  	
  $290,000

  
	
   

  	
  105%

  	
  $304,500

  
	
   

  	
  >110%

  	
  $319,000

  
	
   

  	
   

  	
   

  
	
  Long Term Incentive

  Compensation

  	
  The
  Executive is entitled to participate in the Company’s 2004 Management
  Incentive Option Plan (the “Option Plan”), subject to its terms and
  conditions.  A summary of the material terms and conditions of the
  Option Plan are set forth as Exhibit A to this Term Sheet.

  
	
  Expenses

  	
  The
  Company shall reimburse the Executive for expenses and costs incurred by
  Executive in connection with the performance of his duties under the
  Agreement.

  
	
  Benefits

  	
  The
  Executive will participate in all benefit plans applicable to the senior officers
  of the Company.

  
	
  SEVERANCE BENEFITS

  	
   

  
	
  Termination Events entitling

  the Executive to Severance

  	
  The
  Company will pay the Executive severance benefits upon the occurrence of any
  of the following events (a “Qualifying Termination”):

  
	
   

  	
  (a)           
  The Company terminates the Executive’s employment without Cause (other than
  by reason of death or disability); or

  
	
   

  	
  (b)          
  The Executive terminates his employment with Good Reason.

  

 

 

 

 

	
   

  	
  “Cause”
  means a good faith determination by the Board of: (i) gross negligence or
  willful misconduct by Executive in connection with Executive’s employment
  duties (including, but not limited to, Executive’s lack of capacity or
  diligence, a failure by Executive to conform to the usual standards of
  conduct, or other culpable or inappropriate behavior); (ii) failure by
  Executive to perform in any material respect his duties or responsibilities
  after notice and reasonable opportunity to cure; (iii) misappropriation by
  Executive of the assets or business opportunities of the Company or its
  affiliates; (iv) embezzlement or other financial fraud committed by Executive
  or at his direction, or with his knowledge; (v) Executive’s indictment for,
  conviction of, admission to, or entry of pleas of no contest to any felony or
  any crime involving moral turpitude; (vi) Executive’s abuse of alcohol and/or
  any use of illegal drugs which, in the Company’s judgment, materially
  interferes with the performance of Executive’s duties; or (vii) Executive’s
  breach of any material provision of the employment agreement.

  
	
   

  	
  “Good
  Reason” means, without Executive’s consent, (i) a substantial and
  material diminution in Executive’s title, duties, responsibilities, reporting
  relationship or positions, or (ii) a breach by the Company of any material
  provision of the employment agreement.

  
	
  Salary Continuation Amount

  	
  Upon
  a Qualifying Termination, the Company will continue the Executive’s Base
  Salary for the period beginning on the date of termination and ending on the
  date that is eighteen (18) months thereafter (the “Severance Period”).

  
	
  Welfare Benefit Continuation

  	
  Upon a Qualifying Termination, the Company will pay
  the his benefits for the Severance Period, including the cost of COBRA
  coverage for him and his dependents.

  
	
  OTHER PROVISIONS 

  	
   

  
	
  Confidentiality

  	
  Standard.

  
	
  Non-competition

  	
  During the Term and for an 18 month period following
  any termination of employment for any reason, unless the Executive obtains
  written consent of the Board.

  
	
  Indemnification

  	
  Fullest extent permitted under Delaware law, and
  coverage under Company’s D&O policy during the Term.

  

 

 

The foregoing represents the agreement of the parties
set forth below regarding the principal terms of the Executive’s employment,
which will be evidenced by a formal employment agreement to be effective upon
the Effective Date.

AGREED AND ACCEPTED on
this           day of January
2004:

 

	
  /s/ Frank Nasisi

  	
   

  
	
  Frank Nasisi

  	
   

  

 

 

PP Acquisition Corporation

 

 

	
  /s/ David Barr

  	
   

  
	
  By:

  	
   

  
	
  Title:

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