Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 21, 2020, the Board of Directors (the "Board") of Kellogg Company
(the "Company") made compensation determinations with respect to the Company's
named executive officers, and the Compensation and Talent Management Committee
of the Board adopted the 2020-2022 Executive Performance Plan, each as set forth
below.
2020-2022 Executive Performance Plan. The Compensation and Talent Management
Committee of the Board approved the 2020-2022 Executive Performance Plan
("2020-2022 EPP") under which certain senior executives would be eligible to
receive a portion of their long-term incentives in the form of performance
shares based on the achievement of organic net sales growth and aggregate
operating cash flow. Awards are paid in shares at the end of the performance
period, except for amounts withheld by the Company for statutory withholding
requirements. In addition, the independent members of the Board granted
2020-2022 EPP target awards of 73,270 shares for Steve Cahillane; 17,630 shares
for Amit Banati; 15,950 shares for Gary Pilnick; 20,150 shares for Chris Hood;
and 10,690 shares for Alistair Hirst. Participants in the 2020-2022 EPP have the
opportunity to earn between 0% and 200% of their EPP target. Dividend
equivalents accrue and vest in accordance with the underlying EPP award. A copy
of the 2020-2022 EPP is attached as Exhibit 10.1 and is incorporated in its
entirety into this Item.
RSU Grants. The independent members of the Board approved the following grants
of restricted stock units ("RSUs") to named executive officers of the Company:
8,820 for Mr. Banati; 7,980 RSUs for Mr. Pilnick; 10,080 RSUs for Mr. Hood; and
5,350 RSUs for Mr. Hirst. Awards are paid in shares when vesting requirements
are met, except for amounts withheld by the Company for statutory withholding
requirements. Dividend equivalents accrue and vest in accordance with the
underlying RSU award. Under the terms of the grants, the RSUs vest on the third
anniversary of the grant date. A copy of the form of RSU terms and conditions
for the grants is attached as Exhibit 10.2 and is incorporated in its entirety
into this Item.
Option Grants. The independent members of the Board approved the following
grants of stock options to named executive officers of the Company: 244,280
options for Mr. Cahillane; 44,090 options for Mr. Banati; 39,890 options for Mr.
Pilnick; 50,390 options for Mr. Hood; and 26,720 options for Mr. Hirst. The
exercise price under these grants is $65.52 per share. Under the terms of the
grants, the stock options vest in three equal annual installments from the
anniversary of the grant date. A copy of the form of option terms and conditions
for the grants is attached as Exhibit 10.3 and is incorporated in its entirety
into this Item.
Executive Deferral Program. The Compensation and Talent Management Committee
determined to eliminate the Company's Executive Deferral Program, which
currently requires senior executives to defer base salary above $950,000 into
deferred stock units that are equivalent to the fair market value of the
Company's stock. The Program will terminate at the end of fiscal year 2020.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit 10.1 2020-2022 Executive Performance Plan
Exhibit 10.2 Form of Restricted Stock Unit Terms and Conditions
Exhibit 10.3 Form of Option Terms and Conditions
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