Summary
This 8-K filing by Cardinal Health Inc. (CAH) primarily announces changes in its Board of Directors and a new employment agreement for its Chairman and CEO, George S. Barrett. The company has appointed Clayton M. Jones, CEO of Rockwell Collins, to the Board, effective September 13, 2012, and he is nominated for election at the upcoming annual meeting. Concurrently, long-serving director David W. Raisbeck will not seek re-election upon his term's expiration at the 2012 Annual Meeting. Investors will find the renewal of George S. Barrett's employment agreement significant. The new agreement extends his tenure as Chairman and CEO until at least mid-2015, superseding his prior 2009 contract. The Board's decision is attributed to Mr. Barrett's strong leadership and proven track record since the 2009 spin-off of CareFusion, highlighted by substantial growth in non-GAAP EPS, an 80% total shareholder return, and significant stock price appreciation. The terms of his compensation, including base salary, bonus targets, and long-term incentive awards, remain largely consistent with his previous agreement, with a target long-term incentive value of $8 million annually.
Key Highlights
- 1Appointment of Clayton M. Jones to the Board of Directors, effective September 13, 2012.
- 2Nomination of Clayton M. Jones for election at the 2012 Annual Meeting.
- 3Director David W. Raisbeck will not stand for re-election at the 2012 Annual Meeting.
- 4George S. Barrett enters into a new employment agreement to continue as Chairman and CEO until at least mid-2015.
- 5The new Barrett Agreement acknowledges his contributions to company growth, shareholder return, and strategic initiatives since the 2009 spin-off.
- 6Mr. Barrett's compensation structure, including a base salary of at least $1,285,000 and a target annual bonus of at least 130%, remains largely consistent.
- 7A target annual long-term incentive award grant for Mr. Barrett has a value of $8,000,000.
- 8A blackout period for the Cardinal Health 401(k) Savings Plan is scheduled from October 5, 2012, to the week of October 28, 2012, due to a transition to a new plan administrator.