Business Context and Reporting Period
This Form 8-K Current Report was filed by The Coca-Cola Company on February 15, 2006. The report details actions taken by the Compensation Committee of the Board of Directors regarding executive compensation and incentive plans.
Key Financial Metrics
This filing does not contain financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on corporate governance and executive compensation agreements.
Material Changes and Executive Actions
- 2006 Annual Incentives: On February 15, 2006, the Compensation Committee approved targets and measures for annual incentives to be paid in 2007 based on 2006 performance. Measures include net income and volume for corporate responsibilities, and profit before taxes, net income, and volume for operating unit responsibilities.
- CEO Stock Options: On February 16, 2006, E. Neville Isdell (Chairman and CEO) was granted options to acquire 900,000 shares of Common Stock at an exercise price of $41.39. The options have a ten-year term and vest one-fourth annually over four years.
- CEO Performance Share Units: On February 16, 2006, Mr. Isdell received a Performance Share Unit Award for the 2006-2008 period. The target award is 160,000 units, with a threshold of 96,000 and a maximum of 240,000 units. Performance is measured by compound annual growth in earnings per share.
Guidance, Outlook, and Risks
The filing does not provide financial guidance, outlook, or general risk factors. It notes specific provisions regarding vesting and exercise in the event of Mr. Isdell's retirement for both the stock options and performance share units.
Key Facts for Investor Verification
- Verify the exercise price of $41.39 for the 900,000 stock options granted to the CEO.
- Confirm the performance metric for the 2006-2008 award is compound annual growth in earnings per share.
- Note the vesting schedule for the stock options (25% annually over four years).
- Review the attached Exhibit 99.1 for the full terms of the Performance Share Unit Agreement.