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OFFON

HARLEY-DAVIDSON, INC.

(HOG)
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HARLEY-DAVIDSON, INC. : Change in Directors or Principal Officers (form 8-K)

12/03/2021 | 06:51am EST

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment

                of Certain
                Officers; Compensatory Arrangements of Certain Officers.



On December 1, 2021, Harley-Davidson, Inc. ("Harley-Davidson" or "Company")
entered into a letter agreement with its Chief Executive Officer, Jochen Zeitz,
regarding the terms of Mr. Zeitz's employment with the Company, as he continues
his service as Chief Executive Officer.

The Human Resources Committee (the "Committee") of the Company's Board of
Directors (the "Board") and the Board believe it is imperative that Mr. Zeitz
remain as Chief Executive Officer to provide continuity to Harley-Davidson as
the Company continues to implement The Hardwire, its 5-year strategic plan that
was announced in February 2021.

Since the Company announced Mr. Zeitz's appointment as Chief Executive Officer,
the Committee and Board believe he has done an effective job restructuring the
Company (The Rewire) and defining a new strategy (The Hardwire) and he has
positioned the Company very well for the future.

In developing Mr. Zeitz's ongoing pay package, the Board factored in shareholder
feedback, which included a desire for the following: reduction in base pay, more
emphasis on variable cash compensation and a long-term performance component. In
addition, the Board considered, consistent with its regular practice for
compensation decisions affecting executive officers, market compensation data
for a peer group of companies selected by the Human Resources Committee.
According to those data, Mr. Zeitz's annualized target compensation is expected
to be in a range between median and the 75th percentile of the Company's peer
group's chief executive officers. For this purpose, annualized target
compensation includes one-third of the value of the WIN stock options that we
describe below.

The letter agreement provides that Mr. Zeitz will have an annual base salary of
$1.9 million -- a reduction of $600,000 from his current base salary -- and a
target annual bonus opportunity of $2.4 million. These pay changes will become
effective January 1, 2022.

In addition, the letter agreement provides that Mr. Zeitz will be eligible to
participate in the Company's long-term incentive plan and will receive an equity
award consisting of restricted share units (RSUs) with a target value of $6.0
million as of the grant date in 2022 and an award of options to purchase 500,000
shares of the Company's common stock (the "WIN stock options"). The WIN stock
options were granted December 1, 2021. The awards were or will be granted under
the Company's 2020 Incentive Stock Plan or any successor equity incentive plan.

The RSUs will vest with respect to 50% of the total RSUs on the first
anniversary of the grant date and ratably with respect to the remaining 50% over
the subsequent 12 months. In addition, under the Company's current retirement
policy, the second 50% of the RSUs will vest on an accelerated basis if Mr.
Zeitz retires a year or more after the grant date. The WIN stock options will
vest only if stock price performance goals and continued service thresholds are
met. The Committee believes shareholders will benefit if the performance goals
are achieved and the service thresholds are met.

The Board elected to grant WIN stock options rather than performance share units
as the long-term performance component of Mr. Zeitz's pay package to provide a
focused incentive to increase shareholder value.

The WIN stock options will not become exercisable until Harley-Davidson's 10-day
average closing stock price meets or exceeds the following stock prices during
the five-year period beginning on the grant date and will become vested only to
the extent service conditions are met, as follows:




--------------------------------------------------------------------------------

10-day Average Closing Employment Through A Date Employment as CEO Through Employment as CEO or

 Stock Price Achievement During             Prior to               December 31, 2023 (%      Board-Approved Role Through
5-Year Period Beginning on Grant       December 31, 2023               Exercisable)              December 31, 2024 (%
              Date*                     (% Exercisable)                                              Exercisable)
$65.00 or higher (% Exercisable)               0%                        66.0%**                       100.0%**
     $60.00 (% Exercisable)                    0%                         52.8%                         80.0%
     $55.00 (% Exercisable)                    0%                         39.6%                         60.0%
     $50.00 (% Exercisable)                    0%                         26.4%                         40.0%
     $45.00 (% Exercisable)                    0%                         13.2%                         20.0%
          Less Than $45                        0%                          0.0%                          0.0%
         (% Exercisable)
                                                               If termination occurs before
        Stock Option Term                      NA                December
31, 2024, stock     Stock option term remains
                                                                option term reduced to six    ten years from grant date
                                                                  years from grant date

*Percentage of the WIN stock options that are exercisable will be interpolated linearly between specified stock price achievement levels. **Percentage indicates percentage of WIN stock options that become nonforfeitable (i.e., vested) based on employment through this date.


Any portion of the WIN stock options that are not vested based on continued
service at the time of Mr. Zeitz's termination of employment will be forfeited,
except that, if Mr. Zeitz's employment is terminated by the Company without
cause prior to December 31, 2023, then he will be deemed to have satisfied the
continuous employment requirement with respect to a pro rata portion of the 66%
of the WIN stock options that were tied to his continuous employment through
December 31, 2023. Any portion of the WIN stock options that are not exercisable
based on the stock price goals by December 31, 2026, will be forfeited as of
such date, and any unexercised portion of the WIN stock options will be
immediately forfeited if Mr. Zeitz's employment is terminated for cause.

Because the service conditions are strict, the WIN stock options provide a
significant incentive for Mr. Zeitz to continue as Chief Executive Officer or in
another Board approved role. In general, no WIN stock options are exercisable if
Mr. Zeitz does not continue as Chief Executive Officer through December 31,
2023. At December 31, 2023, only 66% of the WIN stock options will vest. The
remainder will vest only if Mr. Zeitz continues as Chief Executive Officer or in
another Board-approved role through December 31, 2024, absent a termination
without cause. Finally, to provide a further incentive for performance and
continued service, a voluntary termination before December 31, 2024 reduces any
WIN stock option term from 10 years to 6 years.

Subject to the approval of the Human Resources Committee, Mr. Zeitz's 2023 and
future long-term incentive grants are expected to have a target grant date value
of no less than $6,000,000 annually and are expected to be delivered entirely in
the form of RSUs that will vest with respect to 50% of the RSUs granted on the
first anniversary of the grant date and with respect to the remaining 50% of the
RSUs granted ratably over the subsequent 12 months. In addition, under the
Company's current retirement policy, the second 50% of the RSUs will vest on an
accelerated basis if Mr. Zeitz retires a year or more after the grant date.

The letter agreement also confirms Mr. Zeitz's continued entitlement to a Transition Agreement and participation in the Company's Executive Severance Policy. It also addresses certain relocation benefits at the conclusion of his tenure.


The Committee and the Board are proud that Mr. Zeitz will remain Chief Executive
Officer and believe he will be highly motivated to continue his service and to
create shareholder value.

--------------------------------------------------------------------------------



Exhibit No.           Description
104                   The cover page from this Current Report on Form 8-K,

formatted in Inline XBRL

                      (included as Exhibit 101)




--------------------------------------------------------------------------------

© Edgar Online, source Glimpses

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