INTERNATIONAL FLAVORS & FRAGRANCES INC.
1997 EMPLOYEE STOCK OPTION PLAN
INTERNATIONAL FLAVORS & FRAGRANCES INC., a New York corporation (herein
together with its subsidiaries and subsidiaries which become such after the
adoption of the Plan called "IFF"), hereby establishes the 1997 Employee Stock
Option Plan (herein called the "Plan") on the following terms and conditions:
1. Purpose: To promote the best interests of IFF and its shareholders by
providing methods by which officers and key employees of IFF may acquire a
proprietary interest in IFF, thus identifying their interests with those of the
shareholders and encouraging them to make greater efforts on behalf of IFF.
2. Method of Adoption: By the favorable vote of at least two-thirds of the
Board of Directors of IFF (herein called the "Board") subject to the approval of
the holders of a majority of IFF shares.
3. Term: Options may be granted at any time and from time to time, from
the date of adoption of the Plan by the Board, subject to the approval of the
Plan by the shareholders of IFF within 12 months after the Plan is adopted, to
May 8, 2007, but no stock option shall extend for a term of more than ten years
from the date of its grant.
4. Number of Shares: The Plan shall cover an aggregate of three million
five hundred thousand (3,500,000) shares of Common Stock of IFF of the par value
of $.12-1/2 each. The maximum aggregate number of shares that may be granted
under this Plan during its term to any "Participant", as defined in Section 6
hereof, shall be five hundred thousand (500,000) shares (the "Individual Cap").
Either authorized and unissued shares or treasury shares maybe used.
If any options expire or terminate without being exercised in full,
including options voluntarily surrendered for cancellation, the shares subject
thereto which have not been purchased in accordance with the terms of such
options shall be available for the grant of new options under the Plan.
5. Purchase Price: The purchase price per share for any stock optioned at
any time under this Plan shall be such price as shall be fixed by the Stock
Option and Compensation Committee of the Board or such other Committee or a
subcommittee of a committee as may be appointed by the Board to administer the
Plan (herein called the "Committee"), but not less than the fair market value
thereof at the time of granting the option. Upon exercise of any stock option
the Participant may pay for the stock covered by the stock option and/or may pay
for any tax withholding resulting from such exercise by delivery of Common Stock
of IFF, providing the Participant has held such Common Stock for at least six
months, or such longer period as determined by the Committee. The Committee may
also allow payment upon exercise of any option by any other means which the
Committee determines to be consistent with the Plan's purpose and applicable
law.
6. Eligibility: Any officer or key employee of IFF designated by the
Committee (any such officer or key employee is referred to in this Plan as a
"Participant").
7. Employment at the Time of Each Purchase: Any stock option may be
exercised by any Participant only so long as he or she remains in the employ of
IFF; provided that if a Participant voluntarily resigns with the consent of the
Board, if he becomes totally disabled or if he or she retires, he or she may
exercise within 3 months thereafter (but not later than the expiration date of
the option) the option as to the balance, if any, of the shares which the
Participant was entitled to purchase pursuant to Section 9 hereof at the date of
such resignation, disability or retirement. Authorized leaves of absence for
military or governmental service or other purposes approved by the Committee
will be deemed a continuation of employment for purposes of the Plan, and
modifications or extensions of the periods of the option agreement or otherwise
may be made by the Committee. If a Participant dies while employed by IFF, his
or her legal representatives, distributees or legatees as the case may be, may
exercise within 3 months thereafter (but not later than the expiration date of
the option) the option as to the balance, if any, of the shares which the
Participant was entitled to purchase pursuant to Section 9 hereof at the date of
his or her death or, in case such death occurs less than 48 months from the date
of the grant of the option, that proportion of the shares covered by the option
which the number of days in the period from the date of grant to the date of the
Participant's death bears to the number 1460, less any shares previously
purchased under the option.
8. Individual Options: Notwithstanding any other provision hereof, the
selection of Participants and decisions concerning the timing, pricing, and the
number of shares covered by individual stock options shall be made solely by the
Committee. Unless otherwise determined by the Committee at the time of grant,
options granted hereunder to Participants subject to United States taxation
shall be deemed to be "incentive stock options" to the extent permitted under
Section 422 of the Internal Revenue Code, as amended (the "Code"), and the
balance of such options shall be deemed not to be incentive stock options.
The Committee may authorize the grant of an additional automatic option
("reload option") effective on the date of exercise by a Participant of an
already outstanding option under this Plan, on such terms and conditions as the
Committee shall determine. Unless otherwise provided by the Committee, the
number of shares subject to a reload option granted to a Participant with
respect to the exercise of an option shall not exceed the number of shares
delivered by the Participant in payment of the option price of such option,
and/or in payment of any tax withholding resulting from such exercise. A reload
option shall have an option price of not less than 100% of the per share fair
market value on the date of grant of such reload option, and shall be subject to
all other terms and conditions of the original grant, including the expiration
date, and to such additional terms and conditions as the Committee in its sole
discretion shall determine. Notwithstanding the foregoing, any rights a
Participant may have to a reload option under a stock option agreement or
otherwise shall be subject to (a) the availability of shares under the Plan, and
(b) the Individual Cap of such Participant.
9. Exercise of Options: The stock options may be exercised as follows: up
to one-third of the shares covered at any time after 24 months from the date of
grant; up to two-thirds of such shares at any time after 36 months from such
date; and all the shares at any time after 48 months from such date. Stock
certificates will be issued as the stock options are exercised and the shares
are paid for.
10. Rights of Participants Before Issuance of Stock Certificates: No
Participant shall have any rights as a shareholder with respect to any shares
covered by his or her stock option until the date of the issuance of the stock
certificate to him or her for such shares following his or her exercise of the
options. No adjustment shall be made for dividends or other rights for which the
record date is prior to the date such stock certificate is issued.
11. Anti-Dilution Provisions: Each option agreement shall contain such
provisions as the Committee shall deem to be appropriate, including provisions
for appropriate adjustment of the option price and the number of shares covered,
or both, to protect the Participant in the event of a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger or
consolidation (except as otherwise stated below) or in the event of any other
change in the corporate capital structure of IFF. In the event of any such
adjustment, the aggregate number and class of shares available under the Plan
and the maximum number of shares as to which options may be granted to any
Participant may also be appropriately adjusted.
12. Nonassignability: No option shall be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. All options granted to a Participant shall be
exercisable during his or her lifetime only by such Participant.
13. Administration: The Plan shall be administered by vote of a majority
of the Committee, all of the members of which shall be "outside directors" as
that term is defined in Section 162(m) of the Code, but no Board member who is
to be considered as a Participant in the Plan shall take part in the
deliberations or vote with respect to his own participation.
14. Merger or Consolidation: In the event of the merger or consolidation
of IFF with or into another corporation as a result of which IFF is not the
surviving corporation, then on written notice to the Participant given by the
surviving corporation, an option under the Plan may be exercised, as to the
entire number of shares subject thereto, on and after the effective date of such
merger or consolidation and the option shall cease and terminate as to any
shares as to which it has not been exercised on a date 180 days after the
effective date of such merger or consolidation or on the expiration date of such
option, whichever is earlier.
15. Agreements: Options issued under the Plan shall be evidenced by
agreements in such form as the Committee may approve. The terms of such
agreements shall comply with the applicable terms of the Plan outlined herein.
16. Interpretation: In the event of any difference of opinion between a
Participant and IFF concerning the meaning or effect of the Plan, such
difference shall be resolved by the Committee.
17. Compliance with Applicable Laws: No shares shall be offered under the
Plan and no stock certificate shall be delivered upon exercise of options until
such offering has been registered under the Securities Act of 1933, as amended,
and any other applicable governmental laws and regulations, unless in the
opinion of counsel such offering is exempt from registration under such Act, and
until IFF shall have complied with any applicable provisions of the Securities
Exchange Act of 1934, as amended.
18. Amendment and Termination of the Plan: The Board may from time to
time, with respect to any shares at the time not subject to options, suspend or
discontinue the Plan or amend it in any respect, provided that the Board may
not, without the approval of the holders of a majority of outstanding shares of
IFF (except as provided in paragraph 11 above), increase the aggregate number of
shares available for options, change the employees or class of employees
eligible to become Participants, reduce the option price below that provided for
hereunder, or make any change requiring shareholder approval under Section
162(m) of the Code.
