Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On July 20, 2022, the Compensation and Human Capital Committee of the Board of
Directors (the "Board") of Lamb Weston Holdings, Inc. ("Lamb Weston," the
"Company," "we" or "our") approved one-time equity awards of performance-based
units and stock options to certain executive officers of the Company, including
the Company's named executive officers ("NEOs"), as part of the Board's
executive retention program and to further incentivize management to enhance
stockholder value over the long-term.
The target award value for each NEO will be distributed equally between a
one-time leveraged performance unit ("LPUs") grant and a one-time stock option
grant, each to be effective on or about July 29, 2022. Our NEOs will realize
compensation from the LPUs only to the extent our stock price increases by the
end of a 3-year performance period (comprised of the Company's 2023 through 2025
fiscal years) as follows: stock price appreciation will be measured at the end
of the Company's 2025 fiscal year and, subject to the NEO's continued service,
50% of the target LPUs will be earned for 25% appreciation, 100% of the target
LPUs for 50% appreciation, and 300% of the target LPUs for 75% or greater
appreciation, with amounts between those levels interpolated. Stock price
appreciation will be based on the difference between the closing price of Lamb
Weston common stock on the LPU date of grant and the 20 trading-day average
closing price of Lamb Weston common stock on and including the last trading day
in the Company's 2025 fiscal year. LPUs will be settled in shares of Lamb Weston
common stock upon vesting and the payout value is capped at eight times the
target grant value of the award. The stock option awards have a term of seven
years and vest 33%, 33% and 34% on each of the first three anniversaries of the
date of grant, subject to the NEO's continued service. The following table shows
the target grant values for the one-time equity awards for our NEOs:
50%
One-time Equity 50% Delivered in
Award Total Delivered in Stock
Named Executive Officer Target Value LPUs Options
Thomas P. Werner $ 10,500,000 $ 5,250,000 $ 5,250,000
Bernadette M. Madarieta $ 2,280,000 $ 1,140,000 $ 1,140,000
Michael J. Smith $ 2,700,000 $ 1,350,000 $ 1,350,000
Sharon L. Miller $ 2,320,000 $ 1,160,000 $ 1,160,000
Eryk J. Spytek $ 1,800,000 $ 900,000 $ 900,000
The information set forth above reflects a summary description of the
performance-based unit and stock option grants and is qualified in its entirety
by reference to the complete terms and conditions of the LPU agreement and stock
option agreement, the forms of which we expect to file with our Quarterly Report
on Form 10-Q for the quarter ending August 28, 2022.
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