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Shareholders' Equity

12 Months Ended

Dec. 31, 2020

TANGIBLE EQUITY UNITSOn September 17, 2018, the Company issued and sold 16,500,000, 6.00% TEUs at $50 per unit and received proceeds of $800.2 million, net of discounts and issuance costs of $24.8 million. Each TEU is comprised of: (i) a prepaid SPC to be settled by delivery of a specified number of shares of the Company's common stock, and (ii) a senior amortizing note (“Amortizing Note”), with an initial principal amount of $8.45 and a final installment payment date of September 15, 2021. The Company pays equal quarterly cash installments of $0.75 per Amortizing Note on March 15, June 15, September 15, and December 15 of each year, with the exception of the first installment payment of $0.7333 per Amortizing Note which was due on December 15, 2018. In the aggregate, the annual quarterly cash installments will be equivalent to 6.00% per year. Each installment payment constitutes a payment of interest and a partial repayment of principal, computed at an annual rate of 3.79%. Each TEU may be separated by a holder into its constituent SPC and Amortizing Note after the initial issuance date of the TEUs, and the separate components may be combined to create a TEU after the initial issuance date, in accordance with the terms of the SPC. The TEUs are listed on the New York Stock Exchange under the symbol “IFFT”.

The proceeds from the issuance of the TEUs were allocated to equity and debt based on the relative fair value of the respective components of each TEU as follows:


(IN MILLIONS, EXCEPT FAIR VALUE PER TEU)	SPC		Amortizing Note		Total
Fair Value per TEU	$	41.5	$	8.5	$	50.0

Gross Proceeds	$	685.5	$	139.5	$	825.0
Less: Issuance costs	20.4		4.4		24.8
Net Proceeds	$	665.1	$	135.1	$	800.2

The net proceeds of the SPCs were recorded as additional paid in capital, net of issuance costs. The net proceeds of the Amortizing Notes were recorded as debt, with deferred financing costs recorded as a reduction of the carrying amount of the debt in the Company's consolidated balance sheet. Deferred financing costs related to the Amortizing Notes are amortized through the maturity date using the effective interest rate method.

Unless settled early at the holder’s or the Company's election, each SPC will automatically settle on September 15, 2021 for a number of shares of common stock per SPC based on the 20 day volume-weighted average price (“VWAP”) of the Company's common stock as follows:


VWAP of IFF Common Stock						Common Stock Issued
Equal to or greater than $159.54						0.3134 shares (minimum settlement rate)
Less than $159.54, but greater than $130.25						$50 divided by VWAP
Less than or equal to $130.25						0.3839 shares (maximum settlement rate)

At any time prior to the second scheduled trading day immediately preceding September 15, 2021, any holder of an SPC may settle any or all of its SPCs early, and the Company will deliver 0.3134 shares of its common stock for each SPC, subject to adjustment. Additionally, the SPCs may be redeemed in the event of a fundamental change as defined in the SPC.

SHAREHOLDERS’ EQUITY

Dividends

Cash dividends declared per share were $3.04, $2.96 and $2.84 for the years ended December 31, 2020, 2019 and 2018, respectively. The Consolidated Balance Sheet reflects $82.3 million of dividends payable at December 31, 2020. This amount relates to a cash dividend of $0.77 per share declared in December 2020 and paid in January 2021. Dividends declared, but not paid as of December 31, 2019 and December 31, 2018 were $80.0 million ($0.75 per share) and $77.8 million ($0.73 per share), respectively.

Share Repurchases

In December 2012, the Board of Directors authorized a $250.0 million share repurchase program, which commenced in the first quarter of 2013. In August 2015, the Board of Directors approved an additional $250.0 million share repurchase authorization and extension through December 31, 2017. Based on the total remaining amount of $56.1 million available under the amended repurchase program as of October 31, 2017, the Board of Directors re-approved on November 1, 2017 a $250.0

million share repurchase authorization and extension for a total value of $300.0 million available under the program, which expires on November 1, 2022.

A summary of the stock repurchase activity under the stock repurchase program, reported based on the trade date, is summarized as follows:


(DOLLARS IN THOUSANDS)	Shares Repurchased	Weighted- Average Price per Share		Dollar Amount Repurchased
Year Ended December 31, 2018	108,109	$	143.15	$	15,475

Based on the total remaining amount of $279.7 million available under the repurchase program, 2,569,517 shares, or 2.3% of shares outstanding (based on the market price and weighted average shares outstanding as of December 31, 2020) could be repurchased under the program as of December 31, 2020.

As of May 7, 2018, the Company has suspended its share repurchases.