INTERNATIONAL FLAVORS & FRAGRANCES INC.
EXHIBIT
10.1
INTERNATIONAL
FLAVORS & FRAGRANCES INC.
September
8, 2009
Xx.
Xxxxxxx X. Xxxxx
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Re:
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Employment
Terms
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Dear
Xxxx:
On behalf
of the Board of Directors (the “Board”) of International Flavors &
Fragrances Inc. (the “Company”), I am pleased to offer you employment with the
Company on the following terms under this agreement (“Agreement”):
1. EFFECTIVE
DATE; TERM: Your employment with the Company will commence on
October 1, 2009, or as soon thereafter as you have fulfilled all employment
obligations to your current employer (the “Effective Date”); provided, this
Agreement shall be void ab initio if
your employment does not commence by April 1, 2010. Subject to the
provisions of this Agreement, your employment with the Company will be on an “at
will” basis.
2. POSITION;
PRINCIPAL PLACE OF EMPLOYMENT: You will be employed as the Chief
Executive Officer of the Company (“CEO”) with all of the normal duties and
authorities of such position. Your principal place of employment will
be at the Company’s headquarters in New York, New York.
3. BOARD
MEMBERSHIP; CHAIRMANSHIP: The Board shall take such action as
may be necessary to elect you as Chairman of the Board as of the Effective
Date. Thereafter, during your employment with the Company, the Board
shall nominate you for re-election as a member of the Board at each expiration
of your then-current term as a director. You agree that on and after
the Effective Date you will serve without additional compensation as a member of
the Board and as an officer and director of any of the Company’s
subsidiaries. You may, with the Board’s approval, serve on outside
boards of directors so long as your duties as a director on those other boards
do not interfere with your performance as Chairman and CEO of the
Company.
4. BASE
SALARY: You will be paid a minimum base salary (the “Base
Salary”) at an annual rate of one million two hundred thousand dollars
($1,200,000), payable in accordance with the regular payroll practices of the
Company. Your Base Salary shall be reviewed for increase annually by
the Board (or a committee thereof) beginning after the second anniversary of the
Effective Date and may be increased, but not decreased, from time to time by the
Board.
5. ANNUAL
BONUS: You will be eligible to participate in the Company’s
Annual Incentive Plan (the “AIP”) at a level commensurate with your
position. You will have the
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September 8, 2009
Page 2
opportunity
to earn a target annual AIP bonus measured against objective criteria to be
determined by the Board (or a committee thereof) of one hundred twenty percent
(120%) of Base Salary (“Target AIP Bonus”) and a maximum annual AIP bonus of two
hundred forty percent (240%) of Base Salary. To the extent that the
Effective Date occurs during the 2009 fiscal year, your 2009 annual AIP bonus
shall be based on the achievement of the applicable performance goals and
pro-rated based on the number of days that you are employed during the fiscal
year. Your 2009 AIP bonus shall be not less than one-half of your
pro-rated Target AIP Bonus.
6. LONG
TERM INCENTIVE: You will participate in the Company’s current
Long-Term Incentive (LTI) Plan Cycles as follows:
(a) 2008 – 2010
Cycle: You will participate in the cycle for the 2008 – 2010
fiscal years based on an LTI target-level award of $2,000,000, pro-rated based
on the number of days you are employed during the cycle divided by
1095. Your LTI payout will be based on Company performance during the
cycle, with no guaranteed minimum.
(b) 2009 – 2011
Cycle: You will participate in the cycle for the 2009 – 2011
fiscal years based on an LTI target-level award of $2,000,000, pro-rated based
on the number of days you are employed during the cycle divided by
1095. Your LTI payout will be based on Company performance during the
cycle, with no guaranteed minimum.
7. SIGN-ON
EQUITY AWARD: On the Effective Date, you will receive an
initial Equity Choice Award with a face value of $750,000 (“Sign-On
Award”). You may elect to receive your Sign-On Award as you may
allocate, in accordance with the Equity Choice Program, from among settled stock
appreciation rights (“SARs”), purchased restricted stock and restricted stock
units. The Sign-On Award xxxx xxxxx vest on the first anniversary of
the Effective Date, provided that you are employed on such anniversary for the
Sign-On Award to so vest (except as provided below).
8. SPECIAL
BONUS PAYMENT: In order to compensate you for certain
forfeited bonus opportunities at your current employer and as an inducement for
you to join the Company, on July 1, 2010, you will be paid $500,000 if you are
an active employee on that date (the “Special Bonus”).
9. FUTURE
EQUITY GRANTS: Beginning
in 2010, you will participate in all Company equity and LTI programs at levels
commensurate with your position.
10. EMPLOYEE
BENEFITS; PERQUISITES; VACATION: You will be entitled to participate in
all employee and executive 401(k) and welfare benefit plans, programs and
arrangements, and all employee and executive perquisite arrangements, generally
applicable to senior executives, in accordance with Company policy, including,
but not limited to, (i) dues for a luncheon club in Manhattan, (ii) access to a
Company provided automobile, and (iii) a financial planning, tax preparation and
estate planning services allowance in the amount of $25,000 per
year. You will be entitled to annual paid vacation in accordance with
the Company’s policy
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September 8, 2009
Page 3
applicable
to senior executives, but in no event less than four (4) weeks per calendar year
(as prorated for partial years).
11. TERMINATION: Your
employment may be terminated by either the Company or you at any
time: due to your death or Disability, by the Company for Cause or
without Cause, or by you for Good Reason or without Good Reason (Disability,
Cause and Good Reason are each defined on Attachment A). Any
termination by you (other than due to death or Disability) shall require thirty
(30) days prior written notice to the general counsel of the
Company.
(a) DEATH OR
DISABILITY. In the event that your employment terminates on
account of your death or Disability, the Company shall pay or provide you
(or your designated beneficiary, or if you have not designated a
beneficiary, your estate) (i) any unpaid Base Salary through the date of
termination and any accrued but unused vacation in accordance with Company
policy; (ii) any unpaid bonus earned with respect to any fiscal year ending
on or preceding the date of termination, whether calculated at the date of
termination or thereafter; (iii) reimbursement for any unreimbursed
expenses incurred in accordance with Company policy through the date of
termination; and (iv) all other payments, benefits or perquisites to which
you may be entitled under the terms of any applicable compensation arrangement
or benefit, equity or perquisite plan or program or grant (collectively,
“Accrued Amounts”). In addition, you (or your estate) will be paid a
pro-rata AIP bonus for the fiscal year in which your termination occurs, based
on actual performance and payable when bonuses are paid to other senior
executives. The balance of any unvested portion of the Sign-On Equity
Award will fully vest on the date of termination of employment on account of
your death or Disability, and other long-term incentive awards shall vest pro
rata in accordance with the terms of the Company’s Executive Separation
Policy. If your death or Disability occurs prior to July 1, 2010, you
(or your estate) will be paid the Special Bonus on July 1,
2010.
(b) TERMINATION FOR
CAUSE OR WITHOUT GOOD REASON. If your employment is terminated
(i) by the Company for Cause or by you without Good Reason, the Company
will pay you only the Accrued Amounts (but not including any unpaid bonus
described in Section 11(a)(ii) above).
(c) TERMINATION WITHOUT
CAUSE OR FOR GOOD REASON. If your employment is terminated by
the Company without Cause (other than a termination due to Disability) or by you
for Good Reason, the Company will pay or provide you with the Accrued Amounts
and severance benefits under the Company’s Executive Separation Policy, as
amended (“ESP”). The severance benefits described in the preceding
sentence shall in no event be less than (or more than, in the case of amounts
and benefits due under clauses (ii) and (iii), if you have attained age 63 on
the date of termination) (i) a pro-rata AIP bonus for the fiscal year in
which your termination occurs, based on actual performance and payable when
bonuses are paid to other senior executives; (ii) an amount equal to the
product of (A) the sum of (x) your then Base Salary and (y) your
then Target AIP Bonus multiplied by (B) two (2) (or one and one-half (1.5)
if you have attained age 63 and not age 64 on the date of termination or one (1)
if you have attained age 64 on the date of termination), payable in
substantially equal installments in accordance with the Company’s regular
payroll cycle over a period of 24 months (or 18 months
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September 8, 2009
Page 4
or 12
months if the severance multiplier is one and one-half (1.5) or one (1),
respectively) (each payment continuation period, as applicable, the “Severance
Period”) from your date of termination (with such payments commencing on the
earliest payroll date that does not result in adverse tax consequences to you
under Section 409A of the Internal Revenue Code, and with the initial
payment including any payments that have been delayed because of Code
Section 409A); and (iii) subject to your continued co-payment of premiums,
continued participation for the applicable Severance Period in all welfare
benefit plans which cover you (and eligible dependents) upon the same terms and
conditions (except for the requirements of your continued employment) in effect
for active employees of the Company, provided that if such benefits are not
available to former employees of the Company under the terms of the applicable
benefit plan or program, you will receive the value thereof to the extent
permitted by Code Section 409A. In the event you obtain other
employment that offers comparable benefits as to any particular welfare benefit
plan or program, the coverage by the Company for such welfare plan or program
under this subsection will be reduced or eliminated, as the case may be, by such
comparable subsequent employer benefits, but in no event will you be required to
seek other employment. The continuation of health, dental and vision
benefits under this subsection shall be coterminous with your rights to continue
benefits under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”). In addition, if your employment terminates under
this Section prior to July 1, 2010, you will be paid that Special Bonus
described in Section 8 above on July 1, 2010. If your employment
terminates under this Section prior to the first anniversary of the Effective
Date, your Sign-On Equity Award will vest pro rata based on the number of days
you are employed prior to the first anniversary of the Effective
Date. All other equity and LTI awards will be treated in accordance
with the Company’s Executive Separation Policy.
12.
CONDITIONS: Any
payments or benefits made or provided pursuant to Section 11 (other than
Accrued Amounts) are subject to your:
(a) compliance
with the restrictive covenant provisions of Section 14
hereof;
(b) delivery
to the Company of an executed Release (the “Release”)
substantially in the form attached hereto as Attachment B (with such
changes therein or additions thereto as needed under then applicable law to give
effect to its intent and purpose) within twenty-one (21) days of the date of
termination of your employment; and
(c) delivery
to the Company of a resignation from all offices, directorships and fiduciary
positions with the Company, its affiliates and employee benefit
plans.
13. CHANGE
IN CONTROL:
(a) You will
receive Change in Control benefits under the ESP that are no less favorable than
those provided to senior executives generally; provided that, in the event of a
termination of your employment by the Company without Cause or by you for Good
Reason in contemplation of or within two years after a Change in Control (as
defined in Attachment A), (I) the severance multiplier set forth in
Section 11(c)(ii)(B) above will be three (3) rather than two (2) (or two
(2) rather than one and one-half (1.5) or one and five-tenths (1.5) rather than
one (1)
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September 8, 2009
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as set
forth therein upon attainment of age 63 or age 64, as the case may be), and (II)
only for purposes of the benefits continuation period set forth in
Section 11(c)(iii) above, the Severance Period will be 36 months for a
severance multiplier of three (3), 24 months for a severance multiplier of two
(2), and 18 months for a severance multiplier of one and five-tenths
(1.5).
(b) Any
provision of the ESP to the contrary notwithstanding, you will not be entitled
to any payment (including no tax gross-up) in respect of any taxes you may
owe pursuant to Section 4999 of the Internal Revenue Code. In the
event that any Change in Control benefits or other benefits otherwise payable to
you (i) constitute “parachute payments” within the meaning of Section 280G of
the Code, and (ii) but for this Section 13(b), would be subject to the excise
tax imposed by Section 4999 of the Code, then your Change in Control benefits
and other benefits hereunder shall be either (x) delivered in full, or (y)
delivered as to such lesser extent which would result in no portion of such
benefits being subject to excise tax under Section 4999 of the Code, whichever
of the foregoing amounts, taking into account the applicable federal, state and
local income and employment taxes and the excise tax imposed by Section 4999 of
the Code (and any equivalent state or local excise taxes), results in the
receipt by you on an after-tax basis, of the greatest amount of benefits,
notwithstanding that all or some portion of such benefits may be taxable under
Section 4999 of the Code. Unless the Company and you otherwise agree
in writing, any determination required under this Section 13(b) will be made in
writing by independent public accountants as the Company and you agree (the
“Accountants”), whose determination will be conclusive and binding upon you and
the Company for all purposes. For purposes of making the calculations
required by this Section 13(b), the Accountants may make reasonable assumptions
and approximations concerning applicable taxes and may rely on reasonable, good
faith interpretations concerning the application of Sections 280G and 4999 of
the Code. The Company and you agree to furnish to the Accountants
such information and documents as the Accountants may reasonably request in
order to make a determination under this provision. The Company will
bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this provision. Any reduction in
payments and/or benefits required by this provision shall occur in the following
order: (1) reduction of cash payments; (2) reduction of vesting acceleration of
equity awards; and (3) reduction of other benefits paid or provided to
you. In the event that acceleration of vesting of equity awards is to
be reduced, such acceleration of vesting shall be cancelled in the reverse order
of the date of grant for your equity awards. If two or more equity
awards are granted on the same date, each award will be reduced on a pro-rata
basis.
14.
RESTRICTIVE
COVENANTS.
(a) NON-COMPETITION. During
the Restricted Period (defined below), you will not, acting alone or with
others, directly or indirectly, either as employee, employer, consultant,
advisor, or director, or as an owner, investor, partner, or shareholder unless
your interest is insubstantial, engage in or become associated with a
“Competitive Activity.” For this purpose, (A) the “Restricted
Period” means the period of time during which you are employed by the Company
and two (2) years following a termination of your employment for any reason (or
one and one-half (1.5) years if you have attained age 63 and not age 64 on the
date of your termination of employment or one (1) year if you have attained age
64 on the date of termination
Xxxxxxx X. Xxxxx
September 8, 2009
Page 6
of your
employment); and (B) the term “Competitive Activity” means any business or
other endeavor that engages in a line of business in any geographic location
that is substantially the same as either (1) any line of operating business
which the Company or a subsidiary engages in, conducts, or to your knowledge,
has definitive plans to engage in or conduct, as of the date of termination of
your employment, or (2) any operating business that has been engaged in or
conducted by the Company or a subsidiary and as to which, to your knowledge, the
Company or subsidiary has covenanted in writing, in connection with the
disposition of such business, not to compete therewith as of the date of
termination of your employment. The Compensation Committee of the
Board (the “Committee”) shall, in the reasonable exercise of its discretion,
determine which lines of business the Company and its subsidiaries conduct as of
your termination date and which third parties may reasonably be deemed to be in
competition with the Company and its subsidiaries. Within 10 days
following your termination of employment, the Compensation Committee will
provide you with a listing of the Company’s lines of business and the third
parties that it deems to be in competition with the Company and its
subsidiaries. For purposes of this Section 13(a), your interest
as a shareholder is insubstantial if it represents beneficial ownership of less
than five (5%) percent of the outstanding stock, and your interest as an owner,
investor, or partner is insubstantial if it represents ownership, as determined
by the Committee in its discretion, of less than five (5%) percent of the
outstanding equity of the entity.
(b) NON-SOLICITATION. During
the Restricted Period, you, acting alone or with others, directly or indirectly,
shall not, directly or indirectly (A) induce any customer or supplier of
the Company or a subsidiary or affiliate, or other company with which the
Company or a subsidiary or affiliate has a business relationship, to curtail,
cancel, not renew, or not continue his or her or its business with the Company
or any subsidiary or affiliate; or (B) induce, or attempt to influence, any
employee of, or service provider to, the Company or a subsidiary or affiliate to
terminate such employment or service. Anything to the contrary
notwithstanding, the Company agrees that (i) your responding to an unsolicited
request from any former employee of the Company for advice on employment
matters, and (ii) your responding to an unsolicited request for an employment
reference regarding any former employee of the Company from such former
employee, or from a third party, by providing a reference setting forth your
personal views about such former employee, shall not be deemed a violation of
this Covenant.
(c) CONFIDENTIALITY. You
shall not disclose, use, sell, or otherwise transfer any confidential or
proprietary information of the Company or any subsidiary or affiliate, known to
you to be confidential or proprietary belonging to the Company, including but
not limited to information regarding the Company’s current and potential
customers, organization, employees, finances, and methods of operation and
investments, to any person or entity other than the Company without the express
written authorization of the Company, so long as such information has not
otherwise been disclosed to the public or is not otherwise in the public domain,
except as required by law or pursuant to legal process, including any legal
process to enforce the terms of this Agreement.
(d) COOPERATION. You
shall provide reasonable cooperation with the Company or any subsidiary or
affiliate by making yourself available (on adequate notice and consistent with
your reasonable commitments) to testify at the request of the Company or such
Xxxxxxx X. Xxxxx
September 8, 2009
Page 7
subsidiary
or affiliate in any action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, and otherwise to assist the Company or any
subsidiary or affiliate in any such action, suit, or proceeding by providing
information and meeting and consulting with members of management of, other
representatives of, or counsel to, the Company or such subsidiary or affiliate,
as reasonably requested in relation to a matter of which you had knowledge or
for which you were responsible before your termination of
employment. The Company shall promptly advance to you or reimburse
you for any out-of-pocket expenses which you incur in connection with such
cooperation including without limitation reasonable fees and disbursements of
separate counsel for you if you reasonably determine that the matter is of a
nature which indicates that you should have separate representation; provided
that if such cooperation requires your time commitment of more than 3 days (8
hours per day) within a 30 days rolling period, the Company will pay you a per
diem amount equal to the daily amount of your annual base
salary.
(e) NON-DISPARAGEMENT. You
agree that at no time will you in any way denigrate, demean or otherwise say or
do anything, whether in oral discussions or in writing, that would cause any
third party, including but not limited to suppliers, customers and competitors
of the Company, to lower its perception about the integrity, public or private
image, professional competence, or quality of products or service of the
Company, of any officer, director, employee or other representative of the
Company. The Company agrees that at no time will it or any officer or
director of the Company in any way denigrate, demean or otherwise say or do
anything, whether in oral discussions or in writing, that would cause any third
party to lower its perception about the integrity, public or private image or
professional competence of you. Notwithstanding the foregoing,
nothing contained herein shall prevent any person from (i) responding publicly
to incorrect, disparaging or derogatory public statements to the extent
reasonably necessary to correct or refute such public statements or (ii) making
any truthful statement to the extent necessary to enforce the employment
agreement or required by law or by any court, arbitrator or administrative or
legislative body (including any committee thereof) with apparent jurisdiction to
order such person to disclose or make accessible such
information.
(f) EFFECT OF YOUR
FAILURE TO COMPLY WITH OBLIGATIONS. The Company shall have no
obligations to make payments or provide benefits to you under this Agreement if
your employment terminates before a Change in Control and if you have failed or
fail to comply with the material obligations set forth in Sections 13(a)
through 13(e) during the relevant time periods set forth therein, other than
inadvertent and inconsequential events constituting
non-compliance.
(g) CLAWBACK
PROVISION. If your employment terminates before a Change in
Control, and if you have failed to comply with the material obligations under
Sections 14(a), 14(b), 14(c) or 14(d) (other than an inadvertent and
inconsequential event constituting non-compliance) during your employment with
the Company or the applicable Restricted Period following your date of
termination, all of the following forfeitures will result:
(i) The
unexercised portion of any option or SAR, whether or not vested, and any other
award not then vested will be immediately forfeited and
canceled.
Xxxxxxx X. Xxxxx
September 8, 2009
Page 8
(ii) You will
be obligated to repay to the Company, in cash, within ten (10) business days
after demand is made therefor by the Company,
(A) the total
amount of any cash payments made to you under Section 10(c) or under the
Executive Separation Policy other than Accrued Amounts;
(B) other
cash amounts paid to you under any AIP and LTI awards since the date two years
prior to your date of termination; and
(C) the Award
Gain (as defined below) realized by you upon each exercise of an option or SAR
or settlement of a restricted stock unit award (regardless of any elective
deferral) since the date two years prior to your termination
date. For purposes of this Section 14, the term “Award Gain”
shall mean (1), in respect of a given option exercise, the product of (X) the
fair market value per share of stock at the date of such exercise (without
regard to any subsequent change in the market price of shares) minus the
exercise price times (Y) the number of shares as to which the option was
exercised at that date, and (2), in respect of any other settlement of an award
granted to you, the fair market value of the cash or stock paid or payable to
you (regardless of any elective deferral) less any cash or the fair market value
of any stock or property (excluding any payment of tax withholding) paid by you
to the Company as a condition of or in connection with such
settlement.
(h) EQUITABLE RELIEF AND
OTHER REMEDIES. You acknowledge and agree that the Company’s
remedies at law for a breach or threatened breach of any of the provisions of
this Section would be inadequate and, in recognition of this fact, the
parties agree that, in the event of such a breach or threatened breach, in
addition to any remedies at law, the other party, without posting any bond,
shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, a temporary or permanent injunction or
any other equitable remedy which may then be available.
(i) REFORMATION. If
it is determined by a court of competent jurisdiction in any state that any
restriction in this Section 14 is excessive in duration or scope or is
unreasonable or unenforceable under the laws of that state, it is the intention
of the parties that such restriction may be modified or amended by the court to
render it enforceable to the maximum extent permitted by the law of that
state.
(j) SURVIVAL OF
PROVISIONS. The obligations contained in this Section 14
shall survive the termination or expiration of your employment with the Company
and shall be fully enforceable thereafter.
15.
INDEMNIFICATION;
LIABILITY INSURANCE: The Company agrees to indemnify you and
hold you harmless to the fullest extent permitted by applicable law and under
the by-laws of the Company against and in respect to any and all actions, suits,
proceedings,
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September 8, 2009
Page 9
claims,
demands, judgments, costs, expenses (including reasonable attorneys’ fees),
losses, liabilities and damages resulting from your good faith performance of
your services, duties and obligations as an officer, director or employee with
the Company or with any subsidiary or affiliate of the Company or other entity
at the request of the Company, and to advance to you or your heirs or
representatives such reasonable expenses upon written request and execution of
appropriate representations and undertakings relating to the obligation to repay
such advances. The Company shall cover you under directors and
officers liability insurance both during and, while potential liability exists,
after the term of this Agreement in the same amount and to the same extent as
the Company covers its other officers and directors.
16.
GOVERNING
LAW: The validity, construction and enforceability of this
letter agreement shall be governed in all respects by the laws of the State of
New York, without regard to its conflicts of laws rules.
17.
RESOLUTION
OF DISPUTES: Except as provided in Section 14, any disputes
under or in connection with this letter agreement shall be resolved by
arbitration, to be held in New York, New York in accordance with the rules
and procedures of the American Arbitration Association then in
effect. Judgment upon the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction. The Company shall pay for
the cost of the arbitrator. Otherwise, each party shall bear its own
costs, including but not limited to attorneys’ fees, of the arbitration or of
any litigation arising out of this letter agreement; provided that the Company
shall pay your reasonable attorneys fees if you prevail on a material issue in
dispute in the arbitration. Pending the resolution of any arbitration
or litigation, the Company shall continue payment of all amounts due you under
this letter agreement and all benefits to which you are entitled at the time the
dispute arises.
18.
CONTROLLING
DOCUMENT: If
there is a conflict between any provision of this letter agreement and any
provision of any other agreement, policy, plan or other document, the provision
of this letter agreement will control.
19.
CODE
SECTION 409A:
(a) This
letter agreement is intended to comply with Code Section 409A and the final
regulations and interpretative guidance thereunder, including the exceptions for
short-term deferrals, separation pay arrangements, reimbursements, and in-kind
distributions, and shall be administered accordingly. This letter
agreement shall be construed and interpreted with such intent. If any
provision of this Agreement needs to be revised to satisfy the requirements of
Code Section 409A, then such provision shall be modified or restricted to the
extent and in the manner necessary to be in compliance with such requirements of
the Code and any such modification will attempt to maintain the same economic
results as were intended under this letter agreement. Each payment
under this letter agreement is intended to be treated as one of a series of
separate payment for purposes of Code Section 409A and Treas. Reg.
§1.409A-2(b)(2)(iii) (or any similar or successor provisions). Any
reimbursement or similar payment required to be paid to you hereunder shall be
paid by the Company no later than the latest date on
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September 8, 2009
Page 10
which
such payment may be made under Code Section 409A and applicable regulations
without causing such payment to be deemed deferred compensation subject to Code
Section 409A.
(b) Notwithstanding
any provision to the contrary, to the extent that you are considered a
“specified employee” (as defined in Code Section 409A and Treas. Reg.
§1.409A-1(c)(i) or any similar or successor provision) and would be entitled to
a payment during the six month period beginning on your date of separation from
service that is not otherwise excluded under Code Section 409A under the
exception for short-term deferrals, separation pay arrangements, reimbursements,
in-kind distributions, or any otherwise applicable exemption, the payment will
not be made to you until the earlier of the six month anniversary of your date
of separation from service or your death and will be accumulated and paid on the
first day of the seventh month following the date of
termination.
20.
ATTORNEYS
FEES: You will be reimbursed for up to $20,000 of reasonable
attorneys fees incurred by you to negotiate and document your employment
arrangements with the Company.
21.
COUNTERPARTS: This
letter agreement may be executed in two counterparts, each of which shall be
deemed to be an original and which together shall constitute one and the same
instrument. Signatures delivered by facsimile (including scanned
signatures delivered by e-mail) shall be considered for all purposes under this
letter agreement to be original signatures.
22.
OFFER
PERIOD: This offer will remain open for your acceptance until
5:00 pm New York time on Thursday, September 10, 2009. Please
scan and send the executed letter agreement to my personal e-mail
address.
[signature
page follows]
Xxxxxxx X. Xxxxx
September 8, 2009
Page 11
On behalf
of the Board, I am excited to offer you employment with the Company and look
forward to continuing our mutually rewarding relationship.
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Very
truly yours,
/s/
Xxxxxx X.
Xxxxxxxx
Xxxxxx
X. Xxxxxxxx
Member
of the International Flavors
&
Fragrances Inc. Board of Directors
and
Lead Director
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|
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Xxxxxx
and Accepted
/s/ Xxxxxxx X. Xxxxx
Xxxxxxx
X. Xxxxx
Dated:
September 8, 2009
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ATTACHMENT
A
DEFINITIONS
“Cause” shall
mean
(i) your
being indicted for or convicted of (or pleading guilty or nolo
contendere to) a felony or any crime involving moral turpitude,
dishonesty, fraud, theft or financial impropriety;
(ii) your
willful and continued failure to perform substantially your duties with the
Company (other than any such failure resulting from your incapacity due to
physical or mental illness) after a written demand for substantial performance
is delivered to you by the Board which specifically identifies the manner in
which you have not substantially performed your duties, and which provides you
with a 20 day cure period;
(iii) your
willful engagement in conduct which is not authorized by the Board or within the
normal course of your business decisions and is known by you to be materially
detrimental to the best interests of the Company or any of its subsidiaries,
including any misconduct that results in material noncompliance with any
financial reporting requirement under the Federal securities laws if such
noncompliance results in an accounting restatement (as these terms are used in
Section 304 of the Xxxxxxxx-Xxxxx Act of 2002); or
(iv) your
willful engagement in illegal conduct or any act of serious dishonesty which
adversely affects, or in the reasonable estimation of the Board, could in the
future adversely affect, your value, reliability or performance to the Company
in a material manner. Any act, or failure to act, based upon
authority given pursuant to a resolution duly adopted by the Board or based upon
the advice of counsel for the Company shall be conclusively presumed to be done,
or omitted to be done, by you in good faith and in the best interests of the
Company.
Notwithstanding
the foregoing, you shall not be deemed to have been terminated for Cause unless
and until there have been delivered to you a copy of the resolution duly adopted
by the affirmative vote of not less than three-quarters of the entire membership
of the Board of Directors after reasonable notice to you and an opportunity for
you, together with your counsel, to be heard before finding that, in the good
faith opinion of the Board, you were guilty of the conduct set forth above in
(i), (ii), (iii) or (iv) of this definition and specifying the particulars
thereof in detail.
“Change in
Control” shall have the meaning defined under the Company’s Executive
Separation Policy, as amended.
“Disability”
shall (i) have the meaning defined under the Company’s then-current
long-term disability insurance plan, policy, program or contract as entitles you
to payment of disability benefits thereunder, or (ii) if there shall be no
such plan, policy, program or contract, mean permanent and total disability as
defined in Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended.
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“Good Reason”
shall mean your resignation from employment within 180 days after the
occurrence, without your express written consent, of one of the events
enumerated in (a) through (e) below; provided, however, that you must provide
written notice to the Company within 90 days after the occurrence of the event
allegedly constituting Good Reason, and the Company shall have 30 days after
such notice is given to cure:
(a) an
adverse change in your status or positions as Chief Executive Officer and
Chairman of the Company (including as a result of a material diminution in your
duties or responsibilities), or any removal of you from or any failure to
reappoint or reelect you to such positions (except in connection with the
termination of your employment for Cause or Disability, as a result of your
death or by you other than for Good Reason);
(b) any
reduction in your Base Salary or Target AIP Bonus;
(c) you being
required to relocate to a principal place of employment outside of the New York
City metropolitan area;
(d) the
failure by the Company to elect or to reelect you as a director or the removal
of you from such position; or
(e) the
failure of the Company to obtain an agreement from any successor to all or
substantially all of the assets or business of the Company to assume and agree
to perform this Agreement within fifteen (15) days after a merger,
consolidation, sale or similar transaction.
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ATTACHMENT
B
RELEASE
In
consideration for the severance benefits described in Section 11 of the
letter agreement to which this Release is an Attachment, I hereby irrevocably
and unconditionally release, acquit and forever discharge the Company, its
successors, assigns, agents, directors, officers, executives, representatives,
subsidiaries, divisions, parent corporations and affiliates, and all other
persons acting by, through or in concert with any of them
(collectively, the “Releasees”) from
any and all charges, complaints, claims, liabilities, obligations, promises,
agreements, actions, damages, expenses (including attorneys’ fees and costs
actually incurred), or any rights of any and every kind or nature, accrued or
unaccrued, known or unknown, which I have or claim to have arising out of facts
and circumstances which have occurred or existed prior to, or which are
occurring and do exist as of, the date of my execution of this Agreement against
each or any of the Releasees relating to or arising out of my employment and the
cessation of my employment with the Company. This release (the
“Release”) pertains to but is in no way limited to all claims for severance
benefits or other payments which are not express obligations of the Company
under this Agreement, or otherwise. The Release further pertains to,
but is in no way limited to, rights and claims under the Age Discrimination in
Employment Act of 1967, Title VII of the Civil Rights Act, as amended, the
Americans With Disabilities Act, the Family Medical Leave Act, and all other
state, local or municipal fair employment and discrimination laws, and all
claims under common law, whether based in tort or contract, law or
equity.
Notwithstanding
anything herein to the contrary, this Release does not apply to: (i)
claims that arise after my termination date; (ii) my rights under any
tax-qualified pension or claims for accrued vested benefits under any other
employee benefit plan, award, policy or arrangements maintained by the Company
or under COBRA; (iii) worker’s compensation claims and any other claims that
cannot be waived by law; (iv) my rights to enforce the letter employment
agreement or this Release; or (v) my eligibility for indemnification in
accordance with applicable laws or the certificate of incorporation or by-laws
of the Company, or any applicable insurance policy, with respect to any
liability I may incur or have incurred as an employee, officer or director of
the Company; (vi) any right I may have to obtain contribution as permitted by
law in the event of entry of judgment against me as a result of any act or
failure to act for which I and the Company are jointly liable or (vii) my rights
as a stockholder.
This
Release is not intended to and does not interfere with the Equal Employment
Opportunity Commission’s right to enforce anti-discrimination laws or to seek
relief that will benefit the public and any victim of unlawful employment
practices who have not waived their claims. Therefore, by signing
this Release, I waive any right to personally recover against the Company, but I
am not prevented from filing a charge with, or testifying, assisting, or
participating in any proceeding brought by the EEOC, concerning an alleged
discriminatory practice of the Company.
I hereby
represent that I have been given a period of twenty-one (21) days to review and
consider this Release before signing it. I further understand that I
may use more or as much of this twenty-one (21)-day period as I wish prior to
signing.
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I
acknowledge that I have consulted with an attorney before signing this
Release. I acknowledge that I may revoke this Release within seven
(7) days after I sign it by delivering a written notice of revocation
to: [General Counsel], IFF Inc., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000. I acknowledge that, for such revocation to be effective,
[General Counsel] must receive written notice not later than the close of
business on the seventh day after the day on which I execute this
Release. If I revoke this Release, it shall not be effective and
shall be null and void.
IN
WITNESS WHEREOF, I have executed this Release this ____ day of ________,
20 .
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