Exhibit 10.1
ADDENDUM TO EMPLOYMENT LETTER
     This ADDENDUM (this “Addendum”) is made as of the 7th day of May, 2006
between Fisher Scientific International Inc., a Delaware corporation having its
primary place of business at Liberty Lane, Hampton, New Hampshire 03842 (the
“Company”) and Mr. Thomas L. Rea (the “Executive”).
     The Company’s severance obligations to the Executive are governed by a
letter agreement dated as of the 22nd day of December, 1997 (the “Employment
Letter”). The Company and the Executive have agreed to execute this Addendum to
the Employment Letter to provide additional severance payments and benefits in
the event that the Executive’s employment is terminated under certain
circumstances within the two year period following a Change in Control, as more
fully described below. Capitalized terms used but not otherwise defined in this
Addendum shall have the meaning set forth in Section 6.

1.   Upon a termination of employment by the Executive for Good Reason or by the
Company without Cause, in either case within two (2) years immediately following
a Change in Control of the Company, then in lieu of any severance payments set
forth in the Employment Letter (but not in lieu of the provisions of the
Employment Letter with respect to the distribution of shares from the rabbi
trust), the Executive shall be entitled to receive and the Company shall provide
to the Executive those payments and benefits set forth in Section 2 of this
Addendum. Notwithstanding anything in this Addendum to the contrary, if a Change
in Control of the Company occurs and if the Executive’s employment with the
Company is terminated prior to the date on which the Change in Control of the
Company occurs, and if there is a reasonable basis that such termination of
employment (1) was at the request of a third party that has taken steps
reasonably calculated to effect a Change in Control of the Company or
(2) otherwise arose in connection with or anticipation of a Change in Control of
the Company and in each of (1) and (2) a Change in Control occurs within one
(1) year following the Executive’s termination of employment as set forth in
this Section 1, then such termination of employment shall be treated as a
termination of the Executive’s employment following a Change in Control of the
Company and the Executive shall be entitled to receive the compensation and
benefits set forth in Section 2 of this Addendum.   2.   Upon a termination of
employment as described in Section 1 of this Addendum, the Executive shall be
entitled to receive and the Company shall provide to the Executive the following
payments and benefits:

  (a)   a lump sum payment, within five (5) days of the Revocation Date (except
with respect to deferred compensation payments described under Accrued
Obligations, which shall be paid in accordance with their terms, subject to
Section 5 of this Addendum), equal to the sum of: (1) two and a half (2.5) times
the sum of (i) Executive’s then current Annual Base Salary (or if greater, the
Executive’s Annual Base Salary in effect immediately prior to the Change in
Control), plus (ii) the cash value of Executive’s target annual incentive
compensation for the year in

 

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      which the termination of employment occurs (the “Annual Bonus”), plus
(2) the Accrued Obligations, provided that any accrued but unpaid annual
incentive payments for previous years shall be determined based upon actual
Company results and not reduced for individual performance, plus (3) the product
of (x) the Annual Bonus and (y) a fraction, the numerator of which is the number
of days in the fiscal year in which the date of termination of employment occurs
through such date of termination and the denominator of which is 365, plus
(4) an amount equal to the total value of two and a half (2.5) years of matching
contributions made by the Company on behalf of Executive under the Company’s tax
qualified defined contribution plan (and under any non-qualified defined
contribution plan providing matching contributions) at a matching level equal to
the level of participation of the Executive prior to the date of termination,
plus any Company matching contributions under such plans forfeited as of the
Date of Termination;     (b)   the Company shall continue to provide the
Executive and his eligible dependents, for a period of two and a half (2.5)
years following the date of termination (the “Severance Period”) of employment
(but not beyond the maximum date upon which the provision of such benefits would
become subject to the provisions of Section 409A of the Code), with medical,
dental, vision, life insurance and accidental death and dismemberment insurance,
in a manner and timing consistent with the benefit and welfare plans, policies
and programs, executive services, perquisites and insurance plans or programs in
which the Executive participates in effect immediately prior to the time of the
Change in Control of the Company (or any successor benefit and welfare plans,
policies and programs, executive services, perquisites and insurance plans or
programs, to the extent more favorable to the Executive) and such benefits, and
costs to the Executive of such coverage, shall be no less favorable to the
Executive than as in effect as of the Change in Control of the Company and shall
not be affected by any subsequent employment of the Executive. As of the Date of
Termination, Executive shall be fully vested in any account balance, matching
and all other benefits under any non-qualified defined contribution plans.
Following the end of the two and a half (2.5) year period during which medical
benefits are provided, the Executive shall be eligible for continued health
coverage under “COBRA” as if the Executive’s employment with the Company had
terminated as of the end of such period. In the event the Executive is
ineligible, for whatever reason, to continue to be so covered with respect to
any of the above-referenced plans or programs, the Company shall provide
substantially the cash value of purchasing essentially equivalent coverage
through other sources;     (c)   the Executive shall be entitled to receive all
benefits set forth under the terms and conditions of the Fisher Scientific
International Inc. Executive Retirement and Savings Program (the “Retirement and
Savings Program”) including, without limitation, those set forth in Article VII
thereof with respect to medical benefits. For purposes of calculating the
Executive’s retirement benefits under the Retirement and Savings Program, the
Executive shall be deemed to have

 

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      completed two and one-half additional years of Credited Service (as
defined in the Retirement and Savings Program) and received the amounts payable
under Section 2(a) of this Addendum ratably during the Severance Period as
compensation includable in Highest Average Earnings for such period. The
provisions of the preceding sentence will not affect the Executive’s elections
with respect to the commencement of benefit payments pursuant to Article IV of
the Executive Retirement and Savings Program;     (d)   within five (5) days of
the Revocation Date, the Company shall provide the Executive with a $20,000 cash
payment, which may be used by the Executive for outplacement services; and    
(e)   to the extent accrued but not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or that the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company.

3.   Any termination by the Company for Cause, or by the Executive for Good
Reason, shall be communicated by Notice of Termination to the other party
hereto. For purposes of this Addendum, a “Notice of Termination” means a written
notice which:

  (a)   indicates the specific termination provision in this Addendum relied
upon;     (b)   to the extent applicable, sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive’s employment under the provision so indicated; and     (c)   if the
date of termination is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than thirty (30) days after
the giving of such notice).

    In the event the Executive provides the Company with a Notice of Termination
for Good Reason, the Company shall have thirty (30) days to cure the
circumstances that the Executive alleges constitute Good Reason; and if so
cured, no Good Reason shall be deemed to have occurred hereunder. The failure by
the Executive or the Company to set forth in the Notice of Termination any fact
or circumstance which contributes to a showing of Good Reason or Cause shall not
waive any right of the Executive or the Company, respectively, hereunder or
preclude the Executive or the Company, respectively, from asserting such fact or
circumstance in enforcing the Executive’s or the Company’s rights hereunder.

 

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4.   Notwithstanding anything herein to the contrary, no payments shall be made
or benefits provided to the Executive under this Addendum unless the Executive
shall have executed a customary release and waiver of claims (the “Release”) and
the last day of any applicable revocation period (“Revocation Date”) under such
Release shall have expired.   5.   This Addendum is intended to comply with the
provisions of Section 409A of the Code in such a way that the Executive will not
be subject to taxation in advance of the related distribution, excise taxes or
underpayments, penalties as a result of the timing or form of the payments to
the Executive. Notwithstanding anything to the contrary contained herein, if the
Executive is a Specified Employee (as defined in Section 409A of the Code) at
the time he would otherwise be entitled to receive any specific payment
hereunder, no distributions shall be made with respect to that specific payment
until the earliest date which does not result in the imposition of a penalty
under Section 409A(a)(2) of the Code. All other payments which do not result in
any additional payments, liability or penalties shall be made as specified. To
the extent any payment is delayed, interest will accrue at the rate of the
United States five-year Treasury rate plus 2 percent on such delayed payment and
be paid to the Executive at the same time as the delayed payment is made.   6.  
For purposes of this Addendum, the following definitions shall apply:

  (a)   “Accrued Obligations” shall mean (i) the Executive’s Annual Base Salary
through the Date of Termination; (ii) any previous years’ regular annual bonus,
to the extent earned but not previously paid; (iii) any earned but unpaid
previous years’ Annual Bonus(es); (iv) payment for any accrued vacation; and
(v) any compensation previously deferred by the Executive (together with any
accrued interest or earnings thereon) as provided by the terms of such deferred
compensation plan or program.     (b)   “Annual Base Salary” shall mean the
Executive’s annual base salary as in effect on the date hereof, as it may be
increased from time to time, provided, however, that the Annual Base Salary
shall be determined without taking into account any reduction in salary effected
due to the Executive’s participation in the Company’s Restricted Stock Unit
Purchase Program under the Company’s 2005 Equity and Incentive Plan.     (c)  
“Board” shall mean the Board of Directors of the Company.     (d)   “Cause”
shall mean:

  (i)   the willful and continued failure of the Executive to perform
substantially the Executive’s duties hereunder with the Company or one of its
affiliates

 

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      (other than any such failure resulting from incapacity due to physical or
mental illness), after a written demand for substantial performance is delivered
to the Executive by the Vice Chairman or the Chief Executive Officer which
specifically identifies the manner in which the Vice Chairman or Chief Executive
Officer believes that the Executive has not substantially performed the
Executive’s duties, or     (ii)   the willful engaging by the Executive in
illegal conduct or gross misconduct that is materially and demonstrably
injurious to the Company.

      For purposes of this provision, no act or failure to act, on the part of
the Executive, shall be considered “willful” unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive’s action or omission was in the best interests of the Company. Any
act, or failure to act, based upon authority given by the Board, the direction
of the Vice Chairman or the Chief Executive Officer or based upon the advice of
counsel for the Company shall be conclusively presumed to be done, or omitted to
be done, by the Executive in good faith and in the best interests of the
Company, unless such authority, direction or advice is in violation of
applicable law, regulation, Company policy or the Company’s most current Code of
Conduct.     (e)   “Change in Control” of the Company shall have the meaning set
forth in the Fisher Scientific International Inc. 2005 Equity and Incentive
Plan, as that plan is in effect on the date hereof.     (f)   “Code” shall mean
the Internal Revenue Code of 1986, as amended.     (g)   “Good Reason” shall
mean any of the following:

  (i)   a material adverse change in the Executive’s position, duties, offices,
titles, reporting requirements or responsibilities with the Company as in effect
immediately prior to a Change in Control of the Company;     (ii)   a reduction
by the Company in the Executive’s remuneration as in effect immediately prior to
the time of a Change in Control of the Company, unless a similar reduction is
applied to all similarly situated executives or the Company’s failure to
increase (within twelve (12) months of the Executive’s last increase in base
salary) the Executive’s base salary after a Change in Control of the Company in
an amount similar to other similarly situated executives at the Company
receiving an increase in base salary after the Change in Control;

 

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  (iii)   any failure by the Company to continue in effect any material plan or
arrangement, including without limitation benefit and incentive plans, in which
the Executive is participating immediately prior to the time of a Change in
Control of the Company (hereinafter referred to as “Plans”), unless the Company
provides for the Executive to participate in replacement benefit and incentive
plans that are no less favorable in the aggregate than the Plans, or the taking
of any action by the Company which would materially adversely affect the
Executive’s participation in or reduce the Executive’s benefits under any such
Plan or replacement plan or provide the Executive with less favorable fringe
benefits in the aggregate as compared to those enjoyed by the Executive
immediately prior to the time of a Change in Control of the Company;     (iv)  
the Executive’s relocation to any place more than fifty (50) miles from the
location at which the Executive performed Executive’s duties immediately prior
to the time of a Change in Control of the Company, except for required travel by
the Executive on the Company’s business to an extent substantially consistent
with the Executive’s business travel obligations immediately prior to the time
of a Change in Control of the Company;     (v)   any failure by the Company to
provide the Executive on an annual basis with the number of annual vacation or
paid leave days to which the Executive is entitled on an annual basis
immediately prior to the time of a Change in Control of the Company;     (vi)  
any material breach by the Company of any provision of the Employment Letter or
any other material agreement with the Executive;     (vii)   any failure by the
Company to obtain the assumption of this Employment Letter by any successor or
assign of the Company; or     (viii)   any purported termination of the
Executive’s employment which is not effected pursuant to a Notice of Termination
and for purposes of this Employment Letter, no such purported termination shall
be effective.

      For purposes of this definition, none of the actions described in clauses
(i) through (viii) above shall constitute “Good Reason” with respect to the
Executive if it was an isolated and inadvertent action not taken in bad faith by
the Company and if it is remedied by the Company within five (5) business days
after receipt of written notice thereof given by the Executive. The Executive
may terminate Executive’s employment for Good Reason at any time after a Change
in Control either by resignation or by retirement (if eligible).

 

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7.   Except as supplemented by this Addendum, the terms and provisions of the
Employment Letter shall remain in full force and effect.

     The Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from its Board, the Company has caused this Addendum to be
executed in its name on its behalf, all as of the day and year first above
written.
                                                                
                
THOMAS L. REA
FISHER SCIENTIFIC INTERNATIONAL INC.
By: