Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On April 6, 2021, the Leadership Development and Compensation Committee of the
Board of Directors (the "Board") of Alphabet Inc. ("Alphabet") approved a new
compensation arrangement for Ruth Porat, Chief Financial Officer of Alphabet and
Google LLC.
Ms. Porat was granted an equity award consisting of one tranche of performance
stock units ("PSUs") with a target value of $5,000,000. The target number of
PSUs was calculated by dividing the target value of $5,000,000 by the average
closing price of Alphabet's Class C capital stock during the month of March 2021
(the "Average Closing Price"). The PSUs will vest, if at all, based on the Total
Shareholder Return ("TSR") performance of Alphabet relative to the companies
comprising the S&P 100 over a 2021-2023 performance period, subject to continued
employment. Depending upon performance, the number of PSUs that vest will range
from 0%-200% of target. Upon vesting, each PSU will entitle Ms. Porat to receive
one share of Alphabet's Class C capital stock. Upon termination of employment by
reason of death, unvested PSUs will immediately vest, assuming target (or actual
if the performance period ended prior to death) and be settled in shares of
Alphabet's Class C capital stock. Upon termination of employment by Alphabet
without cause, PSUs will vest based on actual performance but will be prorated
based on the number of calendar days in the performance period Ms. Porat
performed services and any remaining unvested PSUs will be forfeited. The PSUs
are subject to the terms and conditions of Alphabet's Amended and Restated 2012
Stock Plan.
This grant is intended to be part of a transition to a performance-based equity
structure for Ms. Porat. Going forward, we anticipate that a portion of
Ms. Porat's equity compensation will be granted in the form of PSUs.
The foregoing description is only a summary of the terms of the PSU award and is
qualified in its entirety by reference to the full text of the Performance Stock
Unit Agreement, which will be filed as an exhibit to Alphabet's Form 10-Q.
Ms. Porat was also granted an award of $5,000,000 in the form of restricted
stock units ("GSUs"). The number of GSUs comprising the grant was calculated by
dividing the equity award amount by the Average Closing Price. These GSUs will
vest as follows: 1/4th will vest on March 25, 2022 and an additional 1/4th will
vest quarterly thereafter until fully vested, in each case subject to continued
employment. Upon vesting, each GSU will entitle Ms. Porat to receive one share
of Alphabet's Class C capital stock. Upon termination of employment by reason of
death, all unvested GSUs will immediately vest in full and be settled in shares
of Alphabet's Class C capital stock. All GSUs are subject to the terms and
conditions of Alphabet's Amended and Restated 2012 Stock Plan.
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