Exhibit 10.1
Chemtura
Corporation
2009 Management Incentive
Program
1.
Establishment and Purpose. Pursuant to its authority
under the 2005 Crompton Corporation Short-Term Incentive Plan (the
“ STIP ”), and consistent with the purpose of
the STIP as stated therein, the Committee hereby establishes the
2009 Chemtura Corporation Management Incentive Program (the “
2009 MIP ”). Upon adoption by the Board of
Directors, the 2009 MIP replaces and supersedes the proposed 2009
Management Incentive Program previously approved by the Board of
Directors on March 13, 2009. Unless otherwise defined
below, all capitalized terms shall have the meaning given to such
terms in or pursuant to the STIP. The 2009 MIP provides each
Participant with an opportunity to earn a performance-based
compensation Award for the calendar year 2009 (the “ 2009
Performance Period ”), based on the attainment of
pre-established performance goals, as set forth below (a “
MIP Award ”).
2.
Threshold Performance. The Committee shall establish
an objective threshold (a “ Minimum Threshold ”)
for each measure of performance during the 2009 Performance Period
(each, a “ Performance Factor ”), below which no
MIP Award or component of a MIP Award will be paid out with respect
to that Performance Factor. Each such applicable Minimum
Threshold is set forth in the Exhibits attached hereto. In
order for any portion of the bonus to be payable, the minimum
threshold of Consolidated EBITDA performance must be
achieved. In addition, and to the extent not inconsistent
with the terms and conditions set forth herein, the Committee may
in its discretion, adjust the threshold (or other performance
targets) to: (i) reflect a change in corporate capitalization,
such as a stock split or stock dividend; (ii)reflect a corporate
transaction, such as a merger, consolidation, separation,
acquisition, divestiture, reorganization or partial or complete
liquidation; or (iii)reflect the occurrence of any extraordinary
event, any change in applicable accounting rules or
principles, any change in the Company’s method of accounting,
any change in applicable law, any change due to any merger,
consolidation, acquisition, divestiture, reorganization, stock
split, stock dividend, combination of shares or other changes in
the Company’s corporate structure or shares; or
(iv) reflect any other change of a similar nature. To
the extent applicable in determining any MIP Award, charges to
earnings, including but not limited to fines and penalties related
to past: (i) antitrust events; (ii) environmental events;
and/or (iii) corporate restructuring, including plant
closures, sale of businesses and severance, will be
excluded.
3.
Financials . To the extent applicable, the Committee,
in determining any MIP Award, shall use the information set forth
in the Company’s audited financial statements.
4.
MIP Awards . At the time of initial selection /
approval by the Committee for participation in the 2009 MIP, each
Participant shall be assigned a percentage of his or her
“base pay” (as defined in the STIP) that will be used
in calculating his or her MIP Award, if any. This percentage
of base pay shall be referred to as the “ Target
Percentage ”. The Committee shall further determine
in which unit of employees the Participant shall be included for
purposes of the 2009 MIP. The amount of a Participant’s
MIP Award will be determined by multiplying the Participant’s
base pay by the applicable Target Percentage, applicable
Performance Factor and the applicable safety multiplier, subject to
any Performance Adjustment described in the following
paragraph.
In determining a Participant’s MIP Award,
the Committee reserves the absolute discretion to increase or
decrease the amount produced under the last sentence of the
preceding paragraph, based on the Committee’s assessment of
any personal, function or other performance the Committee
determines should be taken into account (a “ Performance
Adjustment ”); the CEO will recommend to the
Committee any Performance Adjustment for each
Participant who reports directly to the CEO. The CEO and the
applicable Business or Function leader will recommend to the
Committee any Performance Adjustment for each other
Participant.
5.
Changes to Target Percentage or Performance Factor .
The Committee may at any time prior to the final determination of
MIP Awards: (i) change the Target Percentage of any
Participant; (ii) assign a different Target Percentage to a
Participant to reflect any change in the Participant’s
responsibility level or position during the course of the
Performance Period; or (iii) change a Performance Factor to
reflect a change in corporate capitalization, such as a stock split
or stock dividend, or a corporate transaction, such as a merger,
consolidation, separation, acquisition, divestiture, reorganization
or partial or complete liquidation, or to equitably reflect the
occurrence of any extraordinary event, any change in applicable
accounting rules or principles, any change in the
Company’s method of accounting, any change in applicable law,
any change due to any merger, consolidation, acquisition,
divestiture, reorganization, stock split, stock dividend,
combination of shares or other changes in the Company’s
corporate structure or shares, or any other change of a similar
nature.
6.
Eligibility. The Committee shall designate
Participants in the 2009 MIP in accordance with the terms of the
STIP and as set forth herein. Each Participant must be an
Eligible Employee as of January 1, 2009, and be actively
employed as of the date MIP Awards, if any, are paid.
Exceptions may be granted as determined by the Committee in its
sole discretion. Any employee who becomes an Eligible
Employee, as determined by the Committee, as a result of hire or
promotion after January 1, 2009 may be eligible to receive a
MIP Award, pro rated based on the number of whole months that the
employee is an Eligible Employee during calendar year 2009.
Similarly, where an Eligible Employee, for whatever reason, moves
to another role during calendar year 2009 for which different
performance measures apply, his or her MIP Award, if any, will be
calculated by taking into account the performance measures for each
role and the actual time that the Eligible Employee spent in each
role during calendar year 2009.
7.
Committee Authority . The Committee shall have the
sole discretion to make all determinations under the 2009 MIP and
the Committee’s determination shall be final, binding and
conclusive on all interested parties.
8.
Other Conditions. Eligibility for or actual
participation in the 2009 MIP shall not and in no way is intended
to create an agreement of employment for a definite term.
Nothing herein shall or is intended to, (i) obligate the
Company to offer, or offer any employee participation in, a
Management Incentive Program or similar arrangement in the future,
and/or (ii) act as a modification of any employee’s
existing terms and conditions of employment. Except as
expressly set forth herein, the 2009 MIP shall be subject to and
administered in accordance with the terms and conditions of the
STIP.
Definitions:
Consolidated EBITDA
“Consolidated EBITDA” means, for the
calendar year of 2009, net income (or net loss) from continuing
operations (1) plus, to the extent included the calculation of
net income for such period in accordance with GAAP, the sum of
(a) interest Expense, (b) income tax expense,
(c) reorganization expense, net, (d) other expense,
(e) depreciation expense, (f) amortization expense,
(g) charges related to facility closures
