EX-10.7






Exhibit 10.7


SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN

FOR CORPORATE MANAGEMENT





	I.	 	THE PLAN
	 
	 	 	The name of this Plan is the Sensient Technologies Corporation Management Incentive Plan for
Corporate Management. The purpose of this Plan is to promote the interests of the
shareholders and to provide incentive to those corporate management employees who can
contribute most to the profitability of the Company. It is separate and distinct from other
Company incentive plans currently in effect.
	 
	II.	 	DEFINITIONS
	 
	 	 	In this Plan, the terms used will have the following definitions:






	 	A.	 	“Board of Directors” means the Board of Directors of the Company.
	 
	 	B.	 	“Bonus Award” means a lump-sum cash award paid no later than March
15th of the Fiscal Year following the Fiscal Year during which the Bonus
Award was earned.
	 
	 	C.	 	“Bonus Provision” means monies available for distribution as a Bonus Award as
the result of the operation of this Plan.
	 
	 	D.	 	“Company” means Sensient Technologies Corporation.
	 
	 	E.	 	“Employee” means any employee regularly employed by the Company, and paid on a
salary basis.
	 
	 	F.	 	“Fiscal Year” means each twelve (12) consecutive month period beginning on
January 1 and ending on December 31.
	 
	 	G.	 	“Fiscal Year Salary” means the base pay earned by a participant during the
relevant Fiscal Year, exclusive of any incentive compensation or supplemental payments
by the Company.
	 
	 	H.	 	“Independent Auditors” means with respect to any Fiscal Year, the independent
public accountants appointed by the Board of Directors to certify to the Board of
Directors the financial statements of the Company.
	 
	 	I.	 	“Earnings per share” is defined as net basis earnings per share, as shown in
the Company’s Statement of Consolidated Earnings as certified by the Company’s
Independent Auditors. Earnings per share shall be further adjusted for extraordinary
items of income or expense if, in the opinion of the Chairman and Chief Executive
Officer, it is appropriate to do so.





 








 






	 	J.	 	“Plan” means this Sensient Technologies Corporation Management Incentive Plan
for Corporate Management.
	 
	 	K.	 	“Subsidiary” means with respect to any year, any corporation in which the
Company owns a stock interest of more than 50%, and the financial results of whose
operations are consolidated with those of the Company in the financial statements
included in the annual report to shareholders for that year.






	III.	 	PLAN ADMINISTRATION
	 
	 	 	The Board of Directors of the Company has delegated to the Chairman and Chief Executive
Officer the authority to adopt eligibility and other rules not inconsistent with the
provisions of the Plan (hereinafter referred to as the “Regulations” and attached hereto as
“Exhibit A”) for the administration thereof and to alter, amend, or revoke any Regulations
so adopted.
	 
	IV.	 	PLAN PARTICIPATION






	 	A.	 	At the beginning of the Fiscal Year, the Chairman and Chief Executive Officer
shall determine who should participate in the Plan for that Fiscal Year.
	 
	 	B.	 	Not all management employees need be selected as participants, and selection as
a participant one year does not automatically ensure selection in future years, if such
Plans should be implemented.
	 
	 	C.	 	At the end of each Fiscal Year, the Chairman and Chief Executive Officer shall
determine the amount of Bonus Award each participant in the Plan should receive for
that Fiscal Year.
	 
	 	D.	 	The Chairman and Chief Executive Officer’s selection of the Employees to whom a
Bonus Award shall be made and his determination of the amount of each such Bonus Award
shall be final.
	 
	 	E.	 	This Plan is not a part of the Company’s regular compensation plan nor is it
part of the Employee’s regular compensation.






	V.	 	BONUS AWARDS
	 
	 	 	The performance measurement upon which the Bonus Award is based is determined in accordance
with the Regulations for each Fiscal Year.
	 
	VI.	 	SUCCESSORS AND ASSIGNS
	 
	 	 	If the Company sells, assigns or transfers all or substantially all of its business and
assets to any person, excluding affiliates of the Company, or if the Company merges into or
consolidates or otherwise combines with any person which is a continuing or successor
entity, then the Company shall assign all of its right, title and interest in this Plan as
of the date of such event to the person which is either the acquiring or successor
corporation,




 









 






	 	 	and such person(s) shall assume and perform from and after the date of such assignment all
of the terms, conditions and provisions imposed by this Plan upon the Company.
	 
	 	 	In case of such assignment by the Company and of such assumption and agreement by the
Company and of such person(s), all further rights as well as all other obligations of the
Company under this Agreement thenceforth shall cease and terminate and thereafter the
expression “the Company” wherever used herein shall be deemed to mean such person(s).






	VII.	 	PLAN AMENDMENTS
	 
	 	 	The Chairman and Chief Executive Officer may suspend or discontinue the Plan at any time.




 









 











Exhibit A – Regulations




SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN FOR CORPORATE MANAGEMENT

REGULATIONS Fiscal Year 2008



These Regulations apply to the Management Incentive Plan for Corporate Management for the Fiscal
Year January 1, 2008 through December 31, 2008.





	1.	 	Participants will be notified of their selection and be provided with a copy of the Plan with
specific provisions related to their level of participation.
	 
	2.	 	An Employee may be selected as a participant after the beginning of a Fiscal Year and, if
eligible, may receive a Bonus Award prorated to reflect duration of Plan participation, paid
at the same time as all other Bonus Awards under the Plan.
	 
	3.	 	A participant may receive a Bonus Award based on prorated participation in more than one plan
if eligible to do so under provisions of the plan(s).
	 
	4.	 	The Bonus Award granted to individual participants shall be based upon achievement of defined
EPS objectives.
	 
	5.	 	The bonus award amount may, at the sole discretion of the Chairman and Chief Executive
Officer, be adjusted up or down by five to twenty percent (5% to 20%) to recognize individual
performance.
	 
	6.	 	If an Employee ceases to be a Plan participant during the Fiscal Year, but remains in the
Company’s service, the Employee may, at the discretion of the Chairman and Chief Executive
Officer, receive a pro-rata Bonus Award based upon the number of months spent as a
participant, paid at the same time as all other Bonus Awards under the Plan.
	 
	7.	 	The Bonus Award shall not be paid to participants who resigned or were discharged for cause
prior to their receiving the Bonus award unless the Chairman and Chief Executive Officer
decides otherwise.
	 
	8.	 	If an Employee ceases to be a Plan participant during the Fiscal Year as a result of death,
disability, or retirement under the Company’s ESOP, the Employee or his/her estate may, at the
discretion of the Chairman and Chief Executive Officer, receive a pro-rata Bonus Award based
upon the number of months spent as a participant, paid at the same time as all other Bonus
Awards under the Plan.
	 
	 	 	In such cases, the Chairman and Chief Executive Officer may increase the Bonus Award up to,
but not in excess of, the amount that would have been earned for a full year of
participation.




 









 











Exhibit B – Performance Measures




CORPORATE MANAGEMENT

SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN FOR CORPORATE MANAGEMENT

PERFORMANCE MEASURES Fiscal Year 2008




	 	 	 
	NAME:

	 	TITLE:






Maximum Bonus Award as Percentage

of Fiscal Year Salary




 






	 	 	 	 	 
	TARGET
	 	 	%	 
	 
	 	 	 	 
	MAXIMUM
	 	 	%	 






 









 






Exhibit C – Performance Measures — Schedule




SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN FOR CORPORATE MANAGEMENT

PERFORMANCE MEASURES-SCHEDULE Fiscal Year 2008




GUIDELINES



Upon the determination of the amount of the Bonus Provision for the Fiscal Year, an amount may be
awarded by the Chairman and Chief Executive Officer as a Bonus Award to selected Plan participants
according to the following guidelines:





	 	1.	 	Formula Award
	 
	 	 	 	The Fiscal Year 2008 objective is to attain a Corporate Earnings Per Share of $1.73
(Target).





	 	 	 
	Diluted Earnings Per Share	 	 
	(EPS) Target	 	% of Formula Award Earned
	1.56
	 	30%
	1.57
	 	32%
	1.58
	 	34%
	1.59
	 	36%
	1.60
	 	38%
	1.61
	 	40%
	1.62
	 	42%
	1.63
	 	45%
	1.64
	 	50%
	1.65
	 	55%
	1.66
	 	60%
	1.67
	 	65%
	1.68
	 	70%
	1.69
	 	75%
	1.70
	 	80%
	1.71
	 	85%
	1.72
	 	90%
	1.73
	 	100%
	1.74
	 	110%
	1.75
	 	120%
	1.76
	 	130%
	1.77
	 	140%
	1.78
	 	150%
	1.79
	 	160%
	1.80
	 	170%
	1.81
	 	180%
	1.82
	 	190%
	1.83
	 	200%






 









 







	2.	 	Special Adjustments




Upon the recommendations of the Senior Corporate Officers, the Chairman and Chief Executive Officer
may approve special adjustments to Earnings Per Share necessary to give consideration to unbudgeted
and/or unplanned situations which developed after finalization of the operating budget. Such
adjustments will be submitted for consideration only if required to correct major inequities.




 









 








Exhibit D —  Additional Incentive Components




SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN FOR CORPORATE MANAGEMENT

ADDITIONAL INCENTIVE COMPONENTS — Fiscal Year 2008





	I.	 	Background: The addition of four incentive components. There will be an incremental 15%
of a participant’s target given for each additional incentive component if the established
targets are achieved. This allows participants to achieve an incremental incentive of 15%
of target for each additional incentive component.
	 
	II.	 	Definitions:






	 	A.	 	“Selling, General and Administrative (SGA)” means selling and administrative
costs as reported in the Company’s quarterly and annual SEC filings.
	 
	 	B.	 	“Cash Flow” means net cash provided by operating activities as reported in the
Company’s quarterly and annual SEC filings.
	 
	 	C.	 	“Working Capital” means the quarterly average of the sum of net trade accounts
receivable and inventories less the sum of trade accounts payable and other accrued
expenses as reported in the Company’s quarterly and annual SEC filings.
	 
	 	D.	 	“Return on Invested Capital” means the operating income on an after-tax basis,
using actual effective tax rate for the year, divided by the sum of the quarterly
average of the total debt and equity balances for the year. For the purposes of this
calculation, debt will be net of any cash or marketable securities.






	III.	 	Additional Incentive Components include:






	 	•	 	SG&A Expense Reduction: If the Corporation achieves the approved minimum
SG&A threshold percentage (SG&A as a percentage of revenue), then Corporate
participants will receive the 15% addition to their Target.
	 
	 	•	 	Cash Flow Improvement: If the Corporation achieves the approved Targeted
Average Cash Flow, then Corporate participants will receive the 15% addition to
their Target.
	 
	 	•	 	Working Capital: If the Corporation achieves the approved minimum Working
Capital amount, then Corporate participants will receive the 15% addition to
their Target.
	 
	 	•	 	Return on Invested Capital: If the Corporation achieves the approved
minimum Return on Invested Capital amount, then Corporate participants will
receive the 15% addition to their Target.






	IV.	 	Each additional incentive component is an all or nothing arrangement. If the
additional incentive component is exceeded, then 15% is the maximum that is awarded. A
cumulative maximum payout for a participant is 200%.




 









 











Exhibit D – Additional Incentive Components




SENSIENT TECHNOLOGIES CORPORATION

MANAGEMENT INCENTIVE PLAN FOR CORPORATE MANAGEMENT

ADDITIONAL INCENTIVE COMPONENTS — Fiscal Year 2008




	 	 	 	 	 	 	 	 	 
	 	V.	 	 	Approved Group/Division/Business Unit/Unit
	 	Corporate
	 	 	 	 	Weighted Target Percentage
	 	 	100	%
	 	 	 	 	Targeted SG&A Threshold
	 	 	17.9	%
	 	 	 	 	Targeted Average Cash Flow
	 	$	110,465,000	 
	 	 	 	 	Targeted Average Working Capital Threshold
	 	 	*	 
	 	 	 	 	Targeted Return on Invested Capital Threshold
	 	 	8.4	%








 




			
	*	 	The increase in Average Working Capital over the prior year must be 150 basis points less than
the percentage increase in sales over the prior year. Prior year Sales and Average Working Capital
balances are $1,184,778,000 and $398,076,000, respectively.