Kodak 2006 Annual Report Download - page 221

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Philip J. Faraci
Pursuant to an existing agreement, Mr. Faraci will be eligible to receive certain severance benefi ts if his employment is terminated by the Company
prior to November 15, 2009 for any reason other than cause or disability. He will be entitled to a severance allowance equal to one times his current
annual base salary plus target EXCEL award, payable over a twelve-month period commencing on the six-month anniversary of his last day at work.
Additionally, Mr. Faraci will be entitled to a pro rated portion of his individual enhanced retirement benefi t if his employment is terminated prior to
November 15, 2009.
As a condition to receiving these severance benefi ts, Mr. Faraci must execute a general release in favor of the Company. He will also be subject to the
restrictive covenants under the Eastman Kodak Company’s Employee’s Agreement. In the event Mr. Faraci breaches his waiver and release agreement
or the Eastman Kodak Company’s Employee’s Agreement, all severance payments will cease and he will be required to repay all severance amounts
previously paid by the Company.
Mary Jane Hellyar
Pursuant to an existing agreement, Ms. Hellyar will be entitled to certain severance benefi ts if her employment is terminated due to disability or if we
terminate her employment without cause without offering her a reasonably comparable position. She will be entitled to a severance allowance equal
to two times her current annual base salary plus target EXCEL award, payable over a twelve-month period commencing on the six-month anniversary
of her last day at work. In addition to outplacement services, she will also be entitled to fully paid continued coverage under the Kodak medical and
dental plan and for basic coverage under the Kodak Life Insurance Plan for four months.
Additionally, if her employment is terminated prior to June 1, 2007 as a result of disability or by the Company for any reason other than cause without
offering comparable employment, she will eligible to receive an additional severance payment of $680,000. If her employment is terminated under
similar circumstances between June 1, 2007 and June 1, 2008, she will receive a payment of $320,000. This amount will be payable within 60 days
after termination of employment in a lump sum.
If her employment is terminated without cause, Kodak will also recommend that her termination be treated as an “approved reason” with respect to
any outstanding restricted shares granted in connection with her 2006 retention award.
As a condition to receive these severance benefi ts, Ms. Hellyar must execute a general waiver and release in favor of the Company. She will also be
subject to the restrictive covenants under the Eastman Kodak Company’s Employee’s Agreement. In the event Ms. Hellyar breaches the waiver and
release or the Eastman Kodak Company’s Employee’s Agreement, all severance payments will cease and she will be required to repay all severance
amounts previously paid by the Company.
Former Executive
Daniel T. Meek
Mr. Meek’s employment was terminated by the Company without cause on June 30, 2006. Pursuant to the terms of his pre-existing agreement with
the Company, Mr. Meek received a severance allowance equal to $1,620,000 payable in equal consecutive monthly payments over the twelve-month
period commencing in December 2006. In addition, Mr. Meek’s termination of employment is being treated as an approved reason for purposes of any
stock options he holds and pursuant to the terms of the Company’s Leadership Stock Program described on page 37 of this Proxy Statement, so he did
not forfeit these awards as a result of his separation from service. However, as Mr. Meek’s employment terminated in the fi rst year of the 2006-2007
performance cycle of the Leadership Stock Program, Mr. Meek forfeited any awards for this cycle. Mr. Meek also remained eligible for a prorated
award under the EXCEL plan for the 2006 performance period, but no bonus was payable under EXCEL. The Committee approved a prorated discre-
tionary performance bonus of 81% for Mr. Meek. Because Mr. Meek’s employment was terminated by the Company without cause, Mr. Meek is eligible
to receive $1,395,000, the maximum award available, under the Company’s long-term incentive and retention plan associated with the restructuring of
Global Manufacturing & Logistics. This amount is payable in Kodak common stock in 2008, on or before March 15, 2008. He also received continued
health, medical and life insurance benefi ts at no cost to him for four months following termination of his employment, as well as outplacement services
and fi nancial counseling services until March 15, 2007. Mr. Meek received his enhanced retirement benefi t payable in a lump-sum cash payment, as
described on page 61 of this Proxy Statement.
In connection with his termination of employment and receipt of severance benefi ts, Mr. Meek signed a waiver and release agreement whereby he
released the Company and certain of its affi liates and employees from future claims. Mr. Meek is subject to a confi dentiality agreement and may not
engage in any work or activities on behalf of a competitor of the Company for 18 months after his termination of employment. To the extent Mr. Meek
violates this agreement, the Company will be entitled to stop making severance payments and may seek repayment of any severance benefi ts previ-
ously paid. Mr. Meek is also subject to a two-year non-disparagement agreement and has agreed to fully cooperate with the Company on all matters
relating to his prior employment for two years from the date his employment was terminated.