Delaware
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000-24620
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36-2495346
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(State
or Other Jurisdiction
of
Incorporation)
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(Commission
File
Number)
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(IRS
Employer
Identification
No.)
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Item
5.02
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Departure
of Directors or Certain Officers; Election of Directors; Appointment
of
Certain Officers; Compensatory Arrangements of Certain
Officers.
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On
November 27, 2007, the Board of Directors of Darling International
Inc.
(the "Company") approved a new form of Senior Executive Termination
Benefits Agreement and resolved for the Company to enter
into the new form
of Senior Executive Termination Benefits Agreement with each
of Neil
Katchen, John O. Muse, Mark A. Myers and Robert H. Seemann
(each, a "New
Agreement" and together, the "New Agreements"). Each of Messrs.
Katchen, Muse, Myers and Seemann is referred to herein individually
as
"Executive" and together as the "Executives."
The
Company is currently a
party to a Senior Executive Termination Benefits Agreement
with each of
Messrs. Katchen, Muse and Seemann (the “Current Agreements”), which
agreements expire on December 31, 2007. In addition, the
Company is currently a party to an Employment Agreement with
Mr. Myers
(the “Myers Agreement”), which agreement expires on December 31,
2007. The New Agreements will become effective on December 31,
2007 and will replace the Current Agreements and the Myers
Agreement. Set forth below is a brief description of the
material terms and conditions of the New Agreements. The
summary set forth below is not intended to be complete and
is qualified in
its entirety by reference to the full text of the Form of
Senior Executive
Termination Benefits Agreement attached hereto as Exhibit
10.1.
Pursuant
to the New Agreements,
the Company must provide the applicable Executive certain
benefits
(discussed below) 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 New 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 the following benefits upon an Eligible
Termination Event: (i) periodic payment in the amount of
Executive's
salary at the rate in effect on the date of the Eligible
Termination Event
until such Executive has been paid one times his annual base
salary, (ii)
any accrued vacation pay due but not yet taken at the date
of the Eligible
Termination Event, (iii) life, disability, health and dental
insurance,
and certain other similar fringe benefits of the Company
(or similar
benefits provided by the Company) (the "Fringe Benefits")
in effect
immediately prior to the date of termination for a period
of one year from
the date of termination to the extent allowed under the applicable
policies. See the Company's Proxy Statement filed with the
Securities and Exchange Commission on April 12, 2007 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.
In
addition, upon an Eligible
Termination Event, the Company shall engage an outplacement
counseling
service of national reputation, at its own expense, to assist
Executive in
obtaining employment until the earliest of (i) two years
from the date of
the Eligible Termination Event, (ii) such date as Executive
obtains
employment or (iii) Company expenses related thereto equal
$10,000.
Executive
is required to mitigate the payments under the New Agreements
by seeking
other comparable employment as promptly as practicable after
the Eligible
Termination Event. Amounts due under the New 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
New Agreement also contains
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.
Messrs.
Katchen, Muse and Myers signed the New Agreement on November
27, 2007, and
Mr. Seemann signed the New Agreement on November 29, 2007. The
term of each of the New Agreements will expire on December
31,
2008.
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Item
9.01
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Financial
Statements and Exhibits.
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(d)
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Exhibits
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10.1
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Form
of Senior Ececutive Termination Benefits Agreement.
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10.1
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Form
of Senior Executive Termination Benefits Agreement.
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Subject
to the Executive’s execution of a general release (on the Company’s
standard form) in favor of the Company pursuant to which the Executive
waives, effective as of the Termination Date (as hereinafter defined),
any
and all claims, known or unknown, relating to the Executive’s employment
by the Company or the termination thereof, the Company shall provide
the
Executive with the benefits set forth in Section 3 upon any termination
of
the Executive’s employment for any reason except the
following:
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(a)
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Termination
by reason of the Executive’s “voluntary termination.”
For the purposes
of this Agreement, “
voluntary termination
” shall mean the voluntary
resignation by the Executive of his employment with the
Company;
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(b)
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“Termination
with Cause.”
For the purposes hereof, “
Cause
” shall mean
termination of employment of the Executive by the Company following
(1)
failure of the Executive to render services to the Company in accordance
with the reasonable directions of the Company’s Chief Executive Officer or
Board of Directors, which failure shall continue after written
notice from
the Company, (2) the commission by the Executive of an act of fraud
or
dishonesty or of an act which he knew to be in material violation
of his
duties to the Company (including the unauthorized disclosure of
confidential information) or (3) following a felony conviction
of the
Executive; or
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(c)
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Termination
upon the Executive’s normal retirement.
For the purposes of
this Agreement, “normal retirement” shall mean the termination of
employment of the Executive by the Company or the Executive in
accordance
with the Company’s retirement policy (including early retirement, if
included in such policy and elected by the Executive in writing)
generally
applicable to its senior executive employees, or in accordance
with any
other retirement agreement entered into by and between the Executive
and
the Company.
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For
the purpose of this Agreement, the placement of the Executive on
permanent
or long-term disability status as defined by the Company’s long-term
disability policy covering the Executive and the death of the Executive
shall not be deemed a termination and shall not qualify the Executive
for
the benefits set forth in this
Agreement.
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This
Agreement shall not be construed as and does not constitute a promise
or
guaranty of continued employment. In consideration of this Agreement,
the
Executive acknowledges and agrees that his employment with the Company
is
“At Will”. The Executive understands that his employment with the Company
is not for a specified term and is at the mutual consent of the Executive
and the Company and, therefore, the Company can terminate the employment
relationship at will, with or without
Cause.
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Subject
to the conditions set forth in Section 1, and subject to the mitigation
provisions contained in Section 5, the following benefits (subject
to any
changes in benefit programs that may occur in the future and any
applicable payroll or other taxes required to be withheld) shall
be
provided to the Executive:
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(a)
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Compensation.
Commencing on the Termination Date (as defined below), the Executive
shall
be paid periodically, according to his unit’s wage practices, the amount
of his periodic base salary until he has been paid one (1) times
his
annual base salary (“
Termination Pay Amount
”) at the rate in effect
on the date of the termination of his employment with the Company
(the
“
Termination Date
”). Each such periodic termination
payment is hereby designated a separate payment for purposes of
Section
409A of the Internal Revenue Code of 1986, as amended (the
“
Code
”).
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(b)
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Vacation
Pay.
Any accrued vacation pay due but not yet taken at the Termination
Date shall be paid to the Executive on the Termination
Date.
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(c)
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Welfare
Benefits, etc.
The Executive’s participation (including dependent
coverage) in any life, disability, health and dental plans, and
any other
similar fringe benefits of the Company (except business accident
insurance
and continued contributions to qualified retirement plans) in effect
immediately prior to the Termination Date shall be continued, or
equivalent benefits provided by the Company, for a period of one
year from
the Termination Date to the extent allowed under the policies or
agreements pursuant to which the Company obtains and provides such
benefits.
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(d)
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Bonus
and Retirement Benefits
. The Executive shall not be
entitled to any bonus under the Company’s executive bonus plan for the
year in which his termination occurs. The Agreement shall not affect
the
Executive’s entitlement to benefits under the Company’s retirement plan
accrued as of his termination.
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(e)
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Executive
Outplacement Counseling
. The Company shall engage an
outplacement counseling service of national reputation, at its
own expense
provided that such expense shall not exceed Ten Thousand Dollars
($10,000), to assist the Executive in obtaining employment, until
the
earliest of (i) two years from the Termination Date, (ii) such
date as the
Executive has obtained employment, or (iii) until such time the
Company’s
expenses equal Ten Thousand Dollars
($10,000).
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This
Agreement constitutes the entire agreement between the parties pertaining
to the subject matter contained herein and supersedes all prior and
contemporaneous agreements, representations and understandings of
the
parties. No supplement, modification or amendment of this Agreement
shall
be binding unless referring specifically to this Agreement and executed
in
writing by the parties hereto. In no event will the Executive
be entitled to severance under both this Agreement and the Company’s
severance policy, if any, as it is the intent of the parties hereto
that
the severance provided for in this Agreement shall be in lieu of,
and not
in addition to, the severance that the Executive would otherwise
be
entitled to under the Company’s severance policy, if
any.
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The
Executive is required to mitigate the Termination Pay Amount by seeking
other comparable employment as promptly as practicable after the
Termination Date and amounts due hereunder shall be offset against
or
reduced by any amount earned from such other employment. The benefits
provided for in Section 3(c) shall terminate upon the Executive’s
obtaining such other employment. The Executive hereby agrees to notify
the
Company promptly upon obtaining
employment.
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In
order to induce the Company to enter into this Agreement, the Executive
hereby agrees to the following obligations, which obligations of
the
Executive shall be in addition to, and shall not limit, any other
obligation of the Executive to the Company with respect to the matters
set
forth herein or otherwise:
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(a)
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Nondisclosure
. The
Executive hereby agrees that all documents, records, techniques,
business
secrets, price and route information, business strategy and other
information, whether in electronic form, hardcopy or other format,
which
have come into his possession from time to time during his employment
by
the Company or which may come into his possession during his employment,
shall be deemed to be confidential and proprietary to the Company
and the
Executive further agrees to retain in confidence any confidential
information known to him concerning the Company and its affiliates
and
their respective businesses, unless such information (i) is publicly
disclosed by the Company or (ii) is required to be disclosed by valid
legal process; provided, however, that prior to any such disclosure,
if
reasonably practicable, the Executive must first notify the Company
and
cooperate with the Company (at the Company’s expense) in seeking a
protective order.
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(b)
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Return
of Property
. The Executive agrees that, upon termination of
the Executive’s employment with the Company for any reason, the Executive
will return to the Company, in good condition, all property of the
Company
and any of its affiliates, including without limitation, keys; building
access cards; computers; cellular telephones; automobiles; the originals
and all copies (in whatever format) of all management, training,
marketing, pricing, strategic, routing and selling materials; promotional
materials; other training and instructional materials; financial
information; vendor, owner, manager and product information; customer
lists; other customer information; and all other selling, service
and
trade information and equipment. If such items are not
returned, the Company will have the right to charge the Executive
for all
reasonable damages, costs, attorneys’ fees and other expenses incurred in
searching for, taking, removing and/or recovering such
property.
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(c)
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Nonsolicitation
. During
the period of employment with the Company and for a period of 12
months
thereafter, the Executive will not, on the Executive’s own behalf or on
behalf of any other person, partnership, association, corporation
or other
entity, or otherwise act indirectly to hire or solicit or in any
manner
attempt to influence or induce any employee of the Company or its
affiliates to leave the employment of the Company or its affiliates,
nor
will the Executive use or disclose to any person, partnership,
association, corporation or other entity any information obtained
while an
employee of the Company concerning the names and addresses of the
employees of the Company or its
affiliates.
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(d)
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Nondisparagement
. The
Executive shall not, either during the term of this Agreement or
at any
time thereafter, make statements, whether orally or in writing, concerning
the Company, any of its directors, officers, employees or affiliates
or
any of its business strategies, policies or practices, that shall
be in
any way disparaging, derogatory or critical, or in any way harmful
to the
reputation of the Company, any such persons or entities or business
strategies, policies or practices.
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(e)
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Cooperation
. The
Executive agrees to cooperate, at the request and expense of the
Company,
in the prosecution and/or defense of any claim or litigation in which
the
Company or any affiliate is involved on the Termination Date or thereafter
that includes subject matter as to which the Executive has knowledge
and/or expertise.
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(f)
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Damages.
Notwithstanding
anything in this Agreement to the contrary, if the Executive breaches
the
covenants contained in this Section 6, the Company will have no further
obligations to the Executive pursuant to this Agreement or otherwise
and
may recover from the Executive all such damages to which it may be
entitled at law or in equity. In addition, the Executive
acknowledges that any such breach may result in immediate and irreparable
harm to the Company for which money damages are likely to be
inadequate. Accordingly, the Company may seek whatever relief
it determines to be appropriate to protect the Company’s rights under this
Agreement, including, without limitation, an injunction to prevent
the
Executive from disclosing any trade secrets or confidential or proprietary
information concerning the Company to any person or entity, to prevent
any
person or entity from receiving from the Executive or using any such
trade
secrets or confidential or proprietary information and/or to prevent
any
person or entity from retaining or seeking to retain any other employees
of the Company. The Executive acknowledges good and sufficient
consideration for the covenants of this Section
6.
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The
Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially
all
of the business and/or assets of the Company to expressly assume
and agree
to perform this Agreement in the same manner and to the same extent
that
the Company would be required to perform it if no such succession
has
taken place.
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The
validity, interpretation, construction and performance of this Agreement
shall be governed by the internal laws of the State of
Texas.
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