Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On December 7, 2010, the Board of Directors (the “Board”) of Darling International Inc. (the "Company") resolved to amend certain Senior Executive Termination Benefits Agreements previously entered into by and between the Company and each of Neil Katchen, John O. Muse and John F. Sterling (each, an "Agreement" and together, the "Agreements"). Each of Messrs. Katchen, Muse and Sterling is referred to herein individually as "Executive" and together as the "Executives."
Set forth below is a brief description of the material terms and conditions of the Agreements. The summary set forth below is not intended to be complete and is qualified in its entirety with respect to Mr. Katchen and Mr. Sterling by reference to the full text of the Form of Senior Executive Termination Benefits Agreement attached as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on November 29, 2007 and with respect to Mr. Muse by reference to the full text of the Amended and Restated Senior Executive Termination Benefits Agreement dated as of January 15, 2009 between the Company and Mr. Muse attached as Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on Jan uary 21, 2009, as amended by a First Addendum to Amended and Restated Senior Executive Termination Benefits Agreement dated as of December 8, 2009 between the Company and Mr. Muse attached as Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on December 14, 2009.
Pursuant to the Agreements, the Company must provide the applicable Executive certain benefits upon any termination of his employment except (i) termination by reason of the voluntary resignation by such Executive, (ii) termination for Cause (as defined in the Agreements) or (iii) termination upon such Executive's normal retirement. Neither permanent or long-term disability status nor death of an Executive is deemed a termination for purposes of the Agreements. Such termination with the exceptions set forth above is referred to herein as an "Eligible Termination Event."
Subject to the mitigation provisions (discussed below) and Executive’s execution of a release of claims in respect of Executive’s employment with the Company, the Company shall provide Executive certain benefits upon an Eligible Termination Event. Prior to the amendments described below, continued health and dental insurance was included in the list of fringe benefits to be provided upon an Eligible Termination Event. Pursuant to the amendments described below and in order to comply with applicable law that was recently adopted, in lieu of health and dental insurance being included in the fringe benefits, the Agreements now provide that the Company shall pay the Executive an amou nt equal to the applicable COBRA premium rate, if any, for a period of one year from the date of termination (or 18 months in the case of Mr. Muse) for health, dental and other similar COBRA coverage for the Executive and his eligible dependants, and such payments shall be includible in the Executive’s gross income. See the Company's Proxy Statement filed with the Securities and Exchange Commission on April 6, 2010 for salary and other benefits information for each of the Executives.
Executive is not entitled to any bonus under the Company's Executive Bonus Plan for the year in which the Eligible Termination Event occurs.
Executive is required to mitigate the payments under the Agreements by seeking other comparable employment as promptly as practicable after the Eligible Termination Event. Amounts due under the Agreements will be offset against or reduced by any amount earned from such other employment. The fringe benefits shall terminate upon Executive's obtaining such other employment.
The Agreements also contain obligations on Executive’s part regarding nondisclosure of confidential information, return of Company property, non-solicitation of employees during employment and for a period of one year following the termination of employment for any reason, non-disparagement of the Company and its business and continued cooperation in certain matters involving the Company.
