Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Air Products and Chemicals, Inc. (the Company) entered
into an amended and restated employment agreement (the Agreement) with Seifollah Ghasemi, effective as of 14 November 2017. The Agreement replaces the employment agreement with Mr. Ghasemi that became effective 1 July 2014
(the Prior Agreement). Pursuant to the Agreement, Mr. Ghasemi will continue to serve as the Companys Chairman of the Board of Directors (the Board), President and Chief Executive Officer. The Agreement has a term
ending on 30 September 2022, unless earlier terminated in accordance with the Agreement.
Pursuant to the Agreement, certain elements of
Mr. Ghasemis current compensation that were added by the Board after the Prior Agreement are formalized. Specifically, Mr. Ghasemis minimum target annual cash bonus opportunity will be equal to 150% of his base salary; and he
will have access to Company-provided automobiles and drivers for business and personal travel for security purposes.
In addition, the Agreement clarifies
the treatment of Mr. Ghasemis equity compensation awards under various termination scenarios. If Mr. Ghasemi terminates his employment without Good Reason (as defined in the Prior Agreement), (i) any stock options and stock
appreciation rights granted to him at least one year prior to his termination will continue to vest and be exercisable for their full term, (ii) any restricted shares and deferred stock units (or similar awards) subject only to time-based
vesting conditions and granted to him at least one year prior to his termination will vest on the termination date and be paid out in accordance with their terms and (iii) any equity awards that are conditioned on the satisfaction of
performance conditions and granted to him at least one year prior to his termination will vest and be paid out at the same time as such equity awards are paid to other senior executives of the Company, based on actual performance for the applicable
performance period, but prorated for the time Mr. Ghasemi remained employed with the Company.
Upon a termination of Mr. Ghasemis
employment by the Company without Cause (as defined in the Prior Agreement), or by him for Good Reason, upon his death or disability or upon the expiration of the term, (i) all of his stock options and stock appreciation rights will continue to
vest and be exercisable for their full term, (ii) all of his restricted shares and deferred stock units (or similar awards) subject only to time-based vesting conditions will vest on the termination date and (iii) all of his equity awards
that are conditioned on the satisfaction of performance conditions will vest and be paid out at the same time as such equity awards are generally paid to other senior executives of the Company, based on actual performance for the applicable
performance period; provided that, if Mr. Ghasemis termination of employment is due to his death or disability, performance awards shall be prorated for the time Mr. Ghasemi remained employed with the Company. As provided for in the
Prior Agreement, Mr. Ghasemi continues to be entitled to benefits under the Executive Separation Program described in the Companys 2016 proxy
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statement on a termination of his employment by the Company without Cause or by him for Good Reason. However, pursuant to the Agreement, upon a termination of Mr. Ghasemis employment
by the Company without Cause or by him for Good Reason after 30 September 2020, any cash severance payment he is entitled to receive will be prorated based on the number of days remaining from the last day of his employment until
30 September 2022, and he will not be entitled to such cash severance if such termination occurs on or after 30 September 2022. Notwithstanding the foregoing, in certain cases, Mr. Ghasemis equity awards will be treated in
accordance with the retirement provisions set forth in the Companys Long-Term Incentive Plan and existing award agreements applicable to the equity awards, to the extent such treatment is more favorable to Mr. Ghasemi.
All other terms of Mr. Ghasemis employment will remain materially consistent with the Prior Agreement.
The foregoing description of the Agreement is qualified in its entirety by reference to the full text of the Agreement, which is filed as Exhibit 10.1 to this
Current Report on Form
8-K
and is incorporated by reference herein.