Kodak 2003 Annual Report Download - page 110

Proxy Statement
110
EMPLOYMENT CONTRACTS AND ARRANGEMENTS
Daniel A. Carp
Effective December 10, 1999, the Company entered into a letter agreement with Mr. Carp providing for his employment as President and Chief Executive
Officer. The letter agreement provides for a base salary of $1,000,000, subject to annual adjustment, and a target annual bonus of 105% of his base
salary. Mr. Carp’s compensation will be reviewed annually by the Executive Compensation and Development Committee. The Executive Compensation
and Development Committee approved an increase of Mr. Carp’s annual base salary to $1,100,000 effective May 5, 2003. Mr Carp’s target award under
the Company’s variable pay plan will remain at 155% of his base salary.
If the Company terminates Mr. Carp’s employment without cause, Mr. Carp will be permitted to retain his stock options and restricted stock. He will also
receive severance pay equal to three times his base salary plus target annual bonus and prorated awards under the Company’s bonus plans. The letter
agreement also provides that for pension purposes, Mr. Carp will be treated as if he were age 55, if he is less than age 55 at the time of his termination,
or age 60, if he is age 55 or older but less than age 60, at the time of his termination of employment.
In the event of Mr. Carp’s disability, he will receive the same severance pay as he would receive upon termination without cause; except it will be
reduced by the present value of any Company-provided disability benefits he receives. The letter agreement also states that upon Mr. Carp’s disability, he
will be permitted to retain all of his stock options.
Antonio M. Perez
The Company employed Mr. Perez as President and Chief Operating Officer under an offer letter dated March 3, 2003. In addition to the information pro-
vided elsewhere in this Proxy Statement, the offer letter provides Mr. Perez a base salary of $900,000, subject to adjustment at least annually,
and a target award under the Company’s annual variable compensation plan of 100% of his base salary. As a hiring bonus, Mr. Perez received a grant of
stock options for 500,000 shares and 100,000 shares of restricted stock. The offer letter also provides Mr. Perez with a severance allowance equal to
two times his base salary plus target annual bonus if he terminates for good reason or is terminated without cause.
Robert H. Brust
The Company employed Mr. Brust under an offer letter dated December 20, 1999, that was most recently amended on October 2, 2003. In addition to
the information provided elsewhere in this Proxy Statement, the amended offer letter provides Mr. Brust a special severance benefit. If, during the first
seven years of Mr. Brust’s employment, the Company terminates his employment without cause, he will receive severance pay equal to two times his
base salary plus target annual bonus. After completing five years of service with the Company, Mr. Brust will be allowed to keep his stock options upon
his termination of employment for other than cause.
Michael P. Morley
The Company entered into a retention agreement with Mr. Morley to encourage him to delay his retirement. This retention agreement was most recently
amended on October 23, 2003 to incent Mr. Morley to further delay his retirement until July 1, 2004. In addition to the information provided elsewhere in
this Proxy Statement, the amended retention agreement provided Mr. Morley a retention benefit of $350,000 if he remained employed through December
31, 2003 and provides Mr. Morley a retention benefit of $45,000 for each month thereafter he remains employed. The retention paid to Mr. Morley for
2003 is reported in the Summary Compensation Table on page 104. The amended retention agreement also provides Mr. Morley a death benefit equal to
the projected lump-sum value of his retirement income benefit should he die prior to his retirement from the Company. The amended retention agree-
ment permits Mr. Morley upon his retirement to retain his stock options, restricted stock, restricted stock units and awards under the Performance Stock
Program.