Kodak 2009 Annual Report Download - page 203

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The Company believes that our tax-qualified retirement plans and non-qualified supplemental retirement plans effectively serve to attract
and retain employees.
Supplemental Individual Retirement Arrangements
We have also entered into individual letter agreements with Messrs. Perez, Faraci and Sklarsky to provide additional retirement benefits
beyond those available under our tax-qualified retirement plans and non-qualified supplemental retirement plans. For Messrs. Perez and
Faraci, these agreements provide for eligibility for the traditional benefit component of KRIP and KURIP and for additional years of service
in calculating those benefits. For Mr. Sklarsky, the agreement provides for credits to a phantom cash balance account. Supplemental
individual retirement arrangements were necessary to recruit these Named Executive Officers. The benefits provided to our Named
Executive Officers under any individual retirement arrangement are described on page 75 of this Proxy Statement.
Deferred Compensation Plan
The Company has maintained a non-qualified deferred compensation plan for its executives, known as the Eastman Kodak Company 1982
Executive Deferred Compensation Plan (EDCP). In 2009, the Committee froze the receipt of new monies into this plan indefinitely due to
the plan’s low utilization and administrative costs. Prior to 2009, the Committee had made annual decisions to freeze the receipt of new
monies in both 2007 and 2008. When in effect, the plan permitted the Company’s executives to defer a portion of their base salary for the
following year and up to a portion of any bonus earned under EXCEL the following year. The details of this plan are described under the
Non-Qualified Deferred Compensation Table on page 76 of this Proxy Statement.
Perquisites
The Company provides certain perquisites, which are reviewed periodically, to ensure the personal security of senior executives, to
maximize an executive’s time spent on Company business or to attract and retain them. The primary perquisites that our Named Executive
Officers receive are financial counseling services and personal umbrella liability insurance coverage. Home security services are provided
for Mr. Perez but were no longer reimbursed after January 2009 for Messrs. Sklarsky, Faraci, and Berman, and for Ms. Haag and Ms.
Hellyar.
Our executive security program requires our CEO to use Company aircraft for all air travel, whether personal or business. Our Named
Executive Officers, other than our CEO, are not permitted to use corporate aircraft for personal travel without approval from our CEO. This
restriction applies to personal travel of these Named Executive Officers as well as the travel of a spouse when accompanying the Named
Executive Officer on business travel.
The compensation attributed to our Named Executive Officers for 2009 for perquisites is included in the Summary Compensation Table on
page 61 of this Proxy Statement.
SEVERANCE AND CHANGE IN CONTROL ARRANGEMENTS
Severance Arrangements
Our Named Executive Officers are responsible for the continued success of the Company and the execution of the Company’s strategic
plan to grow our digital portfolio and manage a sustainable business model for our traditional businesses. The Committee believes that it is
important to provide our senior management some measure of financial security in the event their employment is terminated without cause.
Three of our Named Executive Officers have an individual letter agreement that provides various severance benefits in the event their
employment is terminated under various circumstances. These individual letter agreements were established at the time each Named
Executive Officer commenced employment with the Company, or later in connection with entering into a retention arrangement.
Additionally, when determining the appropriate severance arrangement for a Named Executive Officer, the Committee generally applies
pre-established guidelines. Under these guidelines, our Named Executive Officers may be eligible to receive a severance allowance equal
to one to two times their target cash compensation depending on their position, length of service and the circumstances surrounding their
departure. The individual letter agreements for Named Executive Officers are approved by the Committee and are consistent with
guidelines for executive severance that the Committee has established.
Our individual severance arrangements are designed to serve as a retention tool and to eliminate any reluctance of executives to
implement any transformational components of the Company’s strategic plan. In certain instances, an executive’s successful completion of
his or her responsibilities may result in the elimination of his or her job. These arrangements also provide an incentive for individuals to
sign a release of claims against the Company, to refrain from competing with the Company and to cooperate with the Company both
before and after their employment is terminated.
Mr. Perez’s individual severance arrangement provides him with severance benefits that are payable in the event his employment is
terminated by the Company without “cause” or if he terminates for “good reason.” Mr. Sklarsky’s arrangement provides him with severance
benefits for termination by the Company without “cause” or in the event of his long-term disability. Mr. Faraci’s agreement provided him
with severance benefits for termination by the Company without “cause,” but the provision expired on December 6, 2009. The definitions of
“cause” and “good reason” as applicable to Mr. Perez’s and Mr. Sklarsky’s letter agreements are set forth on pages 64 and 65 of this Proxy