8-KLeadership ChangesExhibits & Filings

BROWN & BROWN, INC. 8-K Report, Executive Changes (Feb 23, 2022)

Filed February 23, 2022For Securities:BRO

Summary

Brown & Brown, Inc. (BRO) announced on February 23, 2022, through an 8-K filing, details regarding the annual cash incentive plan for 2022 and equity awards granted to a key executive. The 2022 cash incentive program for certain officers, including named executive officers, is structured with three components: 40% tied to organic revenue growth, 40% linked to EBITDAC margin performance, and 20% based on personal objectives. The program allows for payouts ranging from 0% to 200% of the target incentive, with specific target amounts set for key executives like J. Powell Brown ($2,000,000), R. Andrew Watts ($700,000), J. Scott Penny ($900,000), and Chris L. Walker ($1,000,000). Additionally, Chris L. Walker received a significant equity grant comprising 5,669 Performance Stock Units (PSUs) and 1,889 Restricted Stock Units (RSUs). The PSUs vest based on achieving specific organic revenue growth and EPS compound annual growth rate targets over a three-year period, with potential payouts from 0% to 200%. The RSUs are time-based and vest on the fifth anniversary of the grant date. These compensation arrangements signal a focus on performance-driven incentives tied to key financial metrics and long-term value creation for shareholders.

Key Highlights

  • 12022 Annual Cash Incentive Plan established for executive officers, with payouts linked to performance objectives.
  • 2Incentive plan has three components: 40% organic revenue growth, 40% EBITDAC margin, and 20% personal objectives.
  • 3Both cash incentives and PSU payouts can range from 0% to 200% of the target amount.
  • 4Named executive officers' target cash incentives for 2022 are detailed, with J. Powell Brown at $2,000,000.
  • 5Chris L. Walker received a grant of 5,669 Performance Stock Units (PSUs) and 1,889 Restricted Stock Units (RSUs).
  • 6PSUs for Mr. Walker are contingent on achieving organic revenue growth and EPS growth targets over three years.
  • 7RSUs for Mr. Walker are time-based, vesting on the fifth anniversary of the grant date.

Frequently Asked Questions

The 2022 executive cash incentive plan is based on three equally weighted components: specified organic revenue growth targets, the Company's EBITDAC margin performance, and the achievement of personal objectives set by the Compensation Committee. Each component can range from 0% to 200% of the executive's target incentive.

Chris L. Walker was granted 5,669 Performance Stock Units (PSUs) that vest based on achieving specific organic revenue growth and compound annual growth rate targets for earnings per share over a three-year period, with potential payouts from 0% to 200% of the target. He also received 1,889 time-based Restricted Stock Units (RSUs) that vest on the fifth anniversary of the grant date.

For both the annual cash incentive and the Performance Stock Units (PSUs), there is a minimum payout of 0% of the target amount and a maximum payout of 200% of the target amount, contingent on meeting the specified performance conditions.

The filing states that the terms of the annual cash incentive for 2022 are not contained in a formal written document, but were adopted by the Compensation Committee of the Board of Directors.