Document:

exv10w2

EXHIBIT 10.2

TEKELEC

2010 Executive Officer Bonus Plan

     Tekelec (“Tekelec” or the “Company”) believes that a portion of each executive
officer’s annual compensation should be directly related to the Company’s financial performance.
The 2010 Officer Bonus Plan (“2010 Bonus Plan” or the “Plan”) is designed to
motivate Tekelec’s executive officers and to reward them for their continuing contributions to the
Company’s business if, in 2010, the Company achieves certain financial results. The effective date
of the 2010 Bonus Plan is February 26, 2010 (the “Effective Date”).

2010 Bonus Plan

Each Eligible Officer (as defined below), by virtue of his or her continuing employment with
Tekelec, will be eligible to receive a 2010 1H Bonus and a 2010 Full Year bonus (referred to herein
individually as “2010 Bonus” and collectively as “2010 Bonuses”) based on the
Company’s financial performance as measured by the degree to which the Company achieves the
following pre-set, Board of Directors-approved,1 financial targets for the 2010 1H,
consisting of the first and second fiscal quarters of 2010, and the full 2010 fiscal year: (i)
Adjusted Operating Income before Bonus, (ii) revenue, and (iii) orders.

The 2010 Bonuses payable to an Eligible Officer will be calculated as a percentage of such
Officer’s annual base salary of record in effect at the end of the period for which the bonuses are
payable (the “Salary”). If an Eligible Officer is on a leave of absence in excess of 30
days during the 1H period or 60 days during the Full Year period, the Eligible Officer’s Salary
will be calculated based on the Eligible Officer’s annualized actual earnings for the that period.
In determining an Eligible Officer’s annual base salary of record or actual earnings, certain
compensation and payments (e.g., reimbursement for moving expenses, bonus payments received under
the 2009 Executive Officer Bonus Plan or this Plan, stock option or other equity incentive
compensation, discretionary bonuses, disability benefits, sign-on bonuses, vacation cash outs, and
on call pay) shall be excluded.

For purposes of determining the amount payable as a 2010 1H Bonus for an executive officer who
commences his/her employment as an Eligible Officer in the first calendar quarter of 2010, an
Officer’s annual base salary will be prorated based on the ratio of (i) the number of days that an
executive officer serves as an Eligible Officer during the period to (ii) 180 (such ratio shall not
be greater than one). An executive officer who commences his/her employment during the second
calendar quarter of 2010 will not be eligible to receive a 2010 1H Bonus.

For purposes of determining the amount payable as a 2010 Full Year Bonus for an executive officer
who commences his/her employment as an Eligible Officer in the first, second or third calendar
quarters of 2010, an Officer’s annual base salary will be prorated based on the ratio of (i) the
number of days that an executive officer serves as an Eligible Officer during the period to (ii)
360 (such ratio shall not be greater than one). An executive officer who commences his/her
employment during the fourth calendar quarter of 2010 will not be eligible to receive a 2010 Full
Year Bonus.

 

			
	1	 	This and further references to Board of Directors
(“Board”) action or approval shall be interpreted as a duly adopted Board
resolution following consideration and a recommendation by the Compensation
Committee of the Board, if the Board accepts such recommendation, or
alternatively by a duly adopted resolution of the Board based on a vote by the
independent members of the Board as defined by NASDAQ rules.

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Eligible Officers

The following executive officers have been designated by the Board as “Eligible Officers”
for purposes of the 2010 Bonus Plan and will be eligible to participate in the 2010 Bonus Plan (all
titles are positions with Tekelec unless otherwise specified):

Eligible Officers List

Chief Executive Officer & President

Executive Vice President, Global Product Solutions

Senior Vice President, Chief Financial Officer

Senior Vice President, Corporate Affairs & General Counsel

Senior Vice President, Global Operations & Service

Vice President, Information Technology & Chief Information Officer

A person appointed as an Executive Officer of the Company after the Effective Date shall be
eligible to participate in the 2010 Bonus Plan if he/she is expressly designated by the Board as an
Eligible Officer under the 2010 Bonus Plan.

An Eligible Officer whose title changes after the Effective Date shall be entitled to participate
in the 2010 Bonus Plan on the same terms and conditions as applied immediately prior to such title
change unless either (i) the terms of such Eligible Officer’s participation in the 2010 Bonus Plan
are changed pursuant to a duly adopted resolution of the Board; (ii) the Board amends this Plan to
add the new title as an Eligible Officer in the Eligible Officer table above in which case such
Officer shall participate at the bonus participation level corresponding to such new title; or
(iii) as a result of the change in title, such individual is no longer an Eligible Officer.

In order to earn and be eligible to receive bonuses payable under the 2010 Bonus Plan, an Eligible
Officer must be actively employed by Tekelec or one of its subsidiaries as an Eligible Officer on
the date on which such bonuses are paid, unless such requirement is waived by the Board. An
Eligible Officer who is on an approved leave of absence from the Company at any time during 2010
will, for purposes of determining eligibility under the 2010 Bonus Plan, be treated as being
employed by the Company during such leave of absence provided, however, that an Eligible Officer
who is on an approved leave of absence from the Company on the date on which the 2010 Bonus is paid
by the Company and thereafter returns to active status as an Eligible Officer upon the end of such
leave of absence, will be paid his/her Company Bonus to which he/she is otherwise entitled within
30 days following his/her return to active status as an Eligible Officer. An Eligible Officer who
is on an approved leave of absence from the Company on the date on which the 2010 Bonus is paid by
the Company and thereafter fails to return to active status as an Eligible Officer upon the end of
such leave of absence, will not be eligible to receive a 2010 Bonus.

2010 Bonus Computation

The Company’s consolidated operating income from continuing operations before bonus (as adjusted to
exclude the effects of equity incentive compensation expense, restructuring charges, impairment
charges, acquisition-related amortization and other M&A-related charges or income, and similar
non-GAAP charges or income, “Adjusted Operating Income before Bonus”), revenue and orders
will be the financial measures for calculating the amount of the Company Bonuses under the 2010
Bonus Plan.

All payouts under the 2010 Bonus Plan are contingent upon the company performing at or above a
threshold percentage of the Adjusted Operating Income before Bonus target established by the Board
(“OI Target”). The threshold percentage is 90% of the OI Target, and thus for performance
below 90%

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of the OI Target, there is no funding of a pool for payouts of a bonus. The Board will also
establish performance targets for Orders and Revenue (“Orders Target” and “Revenue
Target”, respectively, and together with the OI Target or individually, “Targets”).

Upon Tekelec’s achievement of 90% of the Operating Income Target, the 2010 Bonuses shall be
calculated as the sum of the result of one of the following computations applied to each of the
Targets:

	 	•	 	If 1H and Full Year Performance Relative to Target is equal to or greater than 90% but
all are individually less than 100%, the product of A (x) B (x) C (x) T, where “A” is the
Eligible Officer’s Salary, “B” is the Payout Percentage corresponding to the Performance
Relative to Target in the Payout Percentage Table below, “C” is the 2010 1H or 2010
Full-Year Bonus Opportunity, as applicable, in the Bonus Participation Table below, and “T”
is the Target Weighting corresponding to the Target, and the performance against such
Target, in the Target Weighting Table below, provided that the calculated payment for 1H
performance is capped at 100% of the 2010 1H Bonus Opportunity from the Bonus Participation
Table below.
	 
	 	•	 	If both 1H and Full Year Performance Relative to Target for all Targets is 100% or
greater, the product of A (x) B (x) C (x) T, as each is defined above with the exception of
“C” which in such case “C” is the 2010 Total Bonus Opportunity in the Bonus Participation
Table below.
	 
	 	•	 	If any one of the targets is not equal to or greater than 100%, then all targets are
individually capped at 100%.

Payout Percentage Table

	 	 	 	 	 	 
	 	Performance Relative to Target

(OI, Orders, and Revenue)
	 	 	Payout Percentage	 
	 	<90%
	 	 	0%	 
	 	90%
	 	 	50%	 
	 	95%
	 	 	75%	 
	 	100%
	 	 	100%	 
	 	 
	 	 	 	 
	 	Performance Relative to Target

(OI and Orders)
	 	 	Additional Payout Percentage	 
	 	105%
	 	 	25%	 
	 	3110%
	 	 	50%	 
	 

The Payout Percentages in the above table increase in a linear manner between each performance
level relative to each target.

Target Weighting Table

	 	 	 	 	 	 	 	 	 
	 	Target
	 	 	Target Weighting for Performance

390% £100%
	 	 	Target Weighting for Performance

>100%	 
	 	OI
	 	 	50%
	 	 	75%	 
	 	Orders
	 	 	25%
	 	 	25%	 
	 	Revenue
	 	 	25%
	 	 	0%	 
	 

Any bonus earned for 1H performance will be accrued and paid with any earned Full Year bonus.

Except as otherwise provided herein, the 2010 Bonuses will be payable in one lump sum (subject to
applicable withholding taxes and other deductions) within 30 days after all the Company’s
consolidated financial results covering the annual period are filed with the Securities and
Exchange Commission.

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Bonus Participation Levels

For purposes of determining an Eligible Officer’s 2010 Bonus, the 2010 Bonus Opportunity for each
of the Eligible Officers identified below shall be as follows:

Bonus Participation Table

	 	 	 	 	 	 	 	 	 	 	 	 
	 	 
 
Title
	 	 	2010
Total
Bonus

Opportunity
	 	 	2010
1H
Bonus

Opportunity
	 	 	2010 Full Year Bonus

Opportunity	 
	 	Chief Executive Officer & President
	 	 	120%
	 	 	40.0%
	 	 	80.0%	 
	 	Executive Vice President, Global Product Solutions
	 	 	90%
	 	 	30.0%
	 	 	60.0%	 
	 	Senior Vice President & General Counsel
	 	 	70%
	 	 	23.3%
	 	 	46.7%	 
	 	Senior Vice President, Global Operations & Service
	 	 	60%
	 	 	20.0%
	 	 	40.0%	 
	 	Vice President, Corporate Controller & Chief Accounting Officer
	 	 	50%
	 	 	16.7%
	 	 	33.3%	 
	 	Vice President, Information Technology & Chief Information Officer
	 	 	40%
	 	 	13.3%
	 	 	26.7%	 
	 

Discretionary Bonuses

In addition to bonuses payable under the 2010 Bonus Plan, discretionary bonuses may also be paid by
the Company, but only upon the express approval of the Board in its sole discretion.

Amendment, Termination, and Administration

The Board reserves the right to amend, modify or terminate the Plan, or any payment owed
thereunder, at any time without prior notice to participants in its sole discretion; provided, that
the Company may not amend, modify or terminate the Plan or such payments once they become Vested to
an eligible employee. A payment becomes “Vested” upon the filing of the Company’s
financial statements with the Securities and Exchange Commission covering the annual period for
which such bonus amount is earned under the terms of the Plan. The Plan shall be administered by
the Board, and the Board shall have the authority to interpret the Plan with such interpretation
being binding and final. The Plan shall be governed by the laws of North Carolina.

*      *      *      *

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Target Amounts under the 2010 Executive Officer Bonus Plan

	 	 	 	 	 	 	 	 	 
	 	Targets
	 	 	1H 2010
	 	 	2010	 
	 	Orders
	 	 	 
	 	 	 	 
	 	Revenue	 	 	 	 	 	 	 
	 	OI	 	 	 	 	 	 	 
	 

To the extent that during the 2010 Performance Period, the independent members of the Company’s
Board of Directors approve any forecasted Orders, Revenue, or incremental OI for all or any portion
of the 2010 Performance Period related to acquisitions completed during the 2010 Performance
Period, then such amounts shall be automatically added to each of the respective Objectives set
forth in this Exhibit.

5 of 5EXHIBIT 10.1

Exhibit 10.1

International Flavors & Fragrances Inc.

2010 Named Executive Officer Compensation Matters

     A summary description of certain compensation arrangements for the Company’s Chief Executive Officer (“CEO”) and the executive officers who were named in the Company’s
Proxy Statement for its 2010 Annual Meeting of Shareholders and who are still employed by the
Company (collectively, the “Named Executive Officers”) is provided below. Unless otherwise noted,
these arrangements were approved on March 8, 2010 by the Compensation Committee of the Company’s
Board of Directors (the “Compensation Committee”), and in the case of compensation decisions
concerning the CEO, the Board (upon the recommendation of the Compensation Committee).

2010 Base Salaries Effective April 1, 2010

     Below are the base salaries effective April 1, 2010 that were approved for our CEO and other
Named Executive Officers.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Base Salary Effective	 	 
	Name	 	Title	 	April 1, 2010	 	Increase
	Douglas D. Tough
	 	Chairman and Chief Executive Officer	 	$	1,200,000	 	 	 	0	 
	Nicolas Mirzayantz
	 	Group President, Fragrances	 	$	500,000	 	 	$	25,000	 
	Hernan Vaisman
	 	Group President, Flavors	 	$	500,000	 	 	$	50,000	 
	Kevin C. Berryman
	 	Executive Vice President and Chief Financial Officer	 	$	500,000	 	 	 	0	 
	Beth E. Ford
	 	Executive Vice President, Head of Supply Chain	 	$	500,000	 	 	 	0	 
	Dennis M. Meany
	 	Senior Vice President, General Counsel and Secretary	 	$	414,000	 	 	 	0	 
	Angelica T. Cantlon
	 	Senior Vice President, Human Resources	 	$	315,000	 	 	 	0	 
	Richard A. O’Leary
	 	Vice President and Controller	 	$	275,000	 	 	 	0	 

 

 

2010 Annual Incentive Plan (“AIP”)

     Under the AIP, each executive officer, including the CEO, has an annual incentive award target
based on the achievement of specific quantitative corporate and/or business unit financial
performance goals. The weighting of corporate and/or business unit financial goals varies
depending upon the role of each executive officer. For 2010 AIP, the Compensation Committee
decided not to include goals related to non-financial strategic initiatives.

     The corporate and business unit financial objectives for 2010 under the AIP relate to sales
growth (excluding the effects of currency movements), operating profit (adjusted to exclude certain
items approved by the Compensation Committee), gross margin percentage and working capital as a
percentage of sales.

     Each executive officer’s AIP target award for 2010 is a stated percentage of his or her base
salary. The Compensation Committee did not approve, nor in the case of the CEO did it recommend to
the Board, any changes to the AIP target percentage of any of the Named Executive Officers, and the
Board did not approve any changes to the CEO’s AIP target percentage.

     Based on the specific quantitative financial objectives, if threshold performance is achieved
for the year, each executive officer may be paid 25% of his or her target award and if maximum
performance is achieved for the year, each executive officer may be paid up to a ceiling of 200% of
that officer’s target award. Failure to meet threshold performance for the financial objectives,
based on the performance goals, will generally result in no AIP award to the executive officer for
that year.

2010-2012 Long-Term Incentive Plan (“LTIP”)

     As with prior LTIP cycles, the Compensation Committee has determined that the 2010-2012 LTIP
cycle will consist of four segments, with each year during the cycle being a separate segment and
the entire three-year period being a fourth segment. Under the LTIP, each executive officer,
including the CEO, has an award target for each LTIP cycle segment, based on the achievement of
specific quantitative corporate financial performance goals. Each segment during the cycle will be
weighted as 25% of the executive’s total target for the cycle.

     For the 2010-2012 cycle, the corporate financial performance goals under the LTIP that the
Compensation Committee reviewed and approved will relate to (i) improvements in the Company’s
earnings per share (“EPS”) and (ii) total shareholder return (“TSR”) relative to other companies in
the S&P 500. For the first three segments of the LTIP cycle, the Company’s EPS goal and the
relative TSR goal each carry a 50% weight. For the fourth segment of the LTIP cycle, the TSR goal
carries a 100% weight. TSR means the amount, expressed as a percentage, of market price
appreciation or depreciation of a share of common stock plus dividends on a share of common stock,
assuming dividend reinvestment at the dividend payment date, measured from January 1, 2010 through
a specified year-end or cycle-end date. TSR will be calculated for the Company and for the S&P 500
so that the ranking of the Company as a percentile of the S&P 500 can be determined. The market
price for purposes of calculating the TSR of the Company and the S&P 500 on each year-end or
cycle-end date will be determined based on the average closing

 

 

price per share of each company’s common stock over the period of 20 consecutive trading days
preceding that date, as reported by a reputable reporting service.

     The EPS goal for each applicable segment of the 2010-2012 LTIP performance cycle will be
reviewed and approved by the Compensation Committee no later than the ninetieth day of each such
segment. At its meeting held on March 8, 2010, the Compensation Committee approved the EPS goal
for the first segment (2010) of the 2010-2012 LTIP cycle and the TSR goal for each of the four
segments of the LTIP cycle. The Compensation Committee also approved the same EPS goal for the
second segment (2010) of the 2009-2011 LTIP cycle. In connection with the 2008-2010 LTIP cycle, on
February 1, 2009, the Compensation Committee also approved a one-year supplemental performance
metric (based on improvement in operating margin in fiscal 2010 as compared to fiscal 2009), as
described under Item 5.02 of the Form 8-K filed by the Company on February 5, 2010, which is
incorporated herein by reference.

     For the 2010-2012 three-year LTIP cycle, each executive officer has a range of potential
awards, both above and below target, which are specified at the beginning of the cycle. The LTIP
target amounts applicable to the Named Executive Officers are as follows:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Change in LTIP
	 	 	 	 	 	 	Target from prior
	Name	 	LTIP Target Amount	 	LTIP Cycle
	Douglas D. Tough
	 	$	2,000,000	 	 	 	0	 
	Nicolas Mirzayantz
	 	$	450,000	 	 	$	70,000	 
	Hernan Vaisman
	 	$	450,000	 	 	$	90,000	 
	Kevin C. Berryman
	 	$	450,000	 	 	$	50,000	 
	Beth E. Ford
	 	$	450,000	 	 	$	50,000	 
	Dennis M. Meany
	 	$	248,400	 	 	 	0	 
	Angelica T. Cantlon
	 	$	189,000	 	 	 	0	 
	Richard A. O’Leary
	 	$	137,500	 	 	 	0	 

If any LTIP payouts are to be made for the 2010-2012 cycle, 50% would be paid in cash and 50%
would be paid in Company stock. For the 2010-2012 LTIP cycle, the number of shares of Company
stock for the 50% portion that would be paid in stock is determined at the beginning of the cycle,
based on $42.01 per share, the closing market price on January 4, 2010, the first stock trading day
of the cycle.

     Depending on the extent to which the Company achieves the corporate performance goals for each
segment of the LTIP cycle, a portion of the executive’s LTIP award may be notionally credited on
behalf of the executive, but any “credited” portion will not be paid until the

 

 

completion of the full LTIP cycle. If a portion of the executive’s LTIP award is notionally
credited for any segment during the LTIP cycle, that portion would consist of 50% cash and 50%
shares based on the cash amount and number of shares earned by the executive for that segment.

     Upon the completion of the LTIP cycle and all of its segments, the aggregate of all credited
portions of an award may be payable to each executive, subject to the negative discretion of the
Compensation Committee and, if the executive separated from employment with the Company during the
LTIP cycle, subject to the terms of the Executive Separation Policy or any other separation
arrangement between the executive and the Company.

2010 Equity Choice Program

     On April 27, 2010, the Compensation Committee approved, and in the case of the CEO, on April
28, 2010, the Board (upon the recommendation of the Compensation Committee) approved the total
value of the equity awards to be granted to each eligible senior executive, under the Company’s
Equity Choice Program (the “Equity Choice Program”). Under the Company’s Equity Choice Program
each executive who is eligible for a grant of equity awards will be entitled to choose from three
alternative types of equity awards and will be granted those equity awards under the 2000 SAIP up
to his or her total dollar award value. Grants of equity awards under the Equity Choice Program,
based on each eligible executive’s election, are anticipated to be made in June 2010, with a
vesting date in April 2013. The range of Equity Choice Program potential total dollar award values
and the actual approved 2010 Equity Choice Program award values for the CEO and each Named
Executive Officer are as follows:

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	2010 Equity Choice
	 	 	Equity Choice Program	 	Program Approved Award
	Name	 	Potential Value Range	 	Value
	Douglas D. Tough
	 	$	750,000 - $2,250,000	 	 	$	1,500,000	 
	Nicolas Mirzayantz
	 	$	225,000 - $675,000	*	 	$	600,000	 
	Hernan Vaisman
	 	$	225,000 - $675,000	*	 	$	600,000	 
	Kevin C. Berryman
	 	$	225,000 - $675,000	*	 	$	600,000	 
	Beth E. Ford
	 	$	225,000 - $675,000	*	 	$	450,000	 
	Dennis M. Meany
	 	$	150,000 - $450,000	 	 	$	350,000	 
	Angelica T. Cantlon
	 	$	150,000 - $450,000	 	 	$	350,000	 
	Richard A. O’Leary
	 	$	100,000 - $300,000	 	 	$	200,000	 

 

			
	*	 	The above range was increased from $200,000 — $600,000.

 

 

Executive Separation Policy

     At its meeting held on March 8, 2010, the Compensation Committee approved a change to the
Company’s Executive Separation Policy (the “ESP”) to provide that the provision regarding “gross-up
payments” would not apply to participants whose employment with the Company commenced on or after
March 8, 2010. This provision states that if payments to a participant would trigger the golden
parachute excise tax, the Company will pay an additional amount, a “gross-up payment,” so that the
after-tax value of the participant’s payments and benefits under the ESP and other compensation
paid by the Company would be the same as though no excise taxes applied. Effective as of March 8,
2010 this provision will apply only to participants hired prior to that date.

Other Information.

     The information contained under Item 5.02 in the Form 8-K filed by the Company on February 9,
2010 regarding a discretionary bonus of $76,893 awarded to Mr. Mirzayantz is incorporated herein by
reference. In addition, a discretionary make-whole payment, relating to the pro-ration of the
2007-2009 LTIP cycle, in the amount of $20,853 in cash and 427 shares of Company stock, was made to
Ms. Ford on March 11, 2010.

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