Business Context and Reporting Period
This Form 8-K Current Report was filed by KBR, Inc. on April 9, 2020. The filing addresses Item 5.02 regarding the departure of a senior officer and the appointment of a replacement, along with associated compensatory arrangements.
Key Financial Metrics
The filing does not provide financial performance data such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on executive personnel changes and specific compensation terms.
Material Changes
- Executive Departure: Ian Mackey, Executive Vice President and Chief Corporate Officer, will retire from full-time employment on June 30, 2020.
- Executive Appointment: Jenni Myles was appointed as Executive Vice President and Chief People Officer, effective May 11, 2020. She will report directly to CEO Stuart Bradie.
- Transition Plan: Mr. Mackey will continue in a part-time capacity through March 31, 2021, to ensure a smooth transition of responsibilities.
Compensatory Arrangements and Outlook
Effective July 1, 2020, Mr. Mackey's compensation will be adjusted to reflect a reduced work schedule (approximately 25% time) through March 31, 2021. Key terms include:
- Base Salary: Reduced to $128,750 USD annually (25% of the current $515,000 USD).
- Short-Term Incentive: Eligible for the 2020 plan with a 90% target payout, though the actual payout for the last six months of the year will be reduced to 50%.
- Long-Term Incentives: No new awards under the LTI Plan. The 2018 cash performance award units will pay out in March 2021, reduced to 25% for the last six months of 2020.
- Equity Vesting: Performance stock units and RSUs scheduled for February 2021 will vest prorated to the 25% work period. Additionally, 3,333 RSUs (out of 5,624) scheduled for February 2022 will have accelerated vesting to the end of the transition period.
- Termination Provisions: In the event of involuntary termination (excluding "Cause"), salary, bonuses, and equity awards are prorated or accelerated based on the date of termination.
Investor Verification Checklist
- Verify the exact start date of Jenni Myles' tenure as Chief People Officer (May 11, 2020).
- Confirm the specific vesting schedule adjustments for the 3,333 accelerated RSUs.
- Review the definition of "Cause" in the LTI Plan to understand termination exclusions.
- Monitor future filings for the appointment of a permanent replacement for the Chief Corporate Officer role if the part-time transition concludes without a new hire.