8-KLeadership ChangesExhibits & Filings

CHURCH & DWIGHT CO INC /DE/ 8-K Report, Executive Changes (Aug 5, 2019)

Filed August 5, 2019For Securities:CHD

Summary

Church & Dwight Co., Inc. (CHD) filed an 8-K on August 5, 2019, primarily to disclose an amendment to its Amended and Restated Omnibus Equity Compensation Plan, approved by the Board of Directors on July 30, 2019. The key change is the introduction of a "double trigger" vesting provision for equity grants made on or after July 30, 2019, to participants holding the title of Executive Vice President or Chief Executive Officer. This "double trigger" mechanism means that these equity awards will only vest upon the occurrence of a change of control event AND the subsequent termination of the executive's employment without cause or for good reason within 24 months following that event, provided the acquirer assumes or substitutes the awards on an equivalent basis. However, if the acquirer does not assume or substitute the awards, a "single trigger" vesting will occur immediately upon the change of control. This amendment represents a shift from the previous "single trigger" vesting policy for all change of control scenarios.

Key Highlights

  • 1Amendment to equity compensation plan introduces "double trigger" vesting for top executives (EVPs and CEO).
  • 2Grants made on or after July 30, 2019, are subject to the new "double trigger" vesting provisions.
  • 3Under "double trigger" vesting, awards vest only if there's a change of control AND subsequent termination without cause or for good reason within 24 months.
  • 4Exception: If acquirer does not assume or substitute awards, "single trigger" vesting occurs immediately upon change of control.
  • 5Prior to this amendment, all change of control events triggered immediate vesting ("single trigger").
  • 6The amendment aims to better align executive retention with change of control events.

Frequently Asked Questions

The primary change is the introduction of a "double trigger" vesting requirement for equity grants made to Executive Vice Presidents and the Chief Executive Officer on or after July 30, 2019. This means these awards will only vest if a change of control occurs AND the executive's employment is terminated without cause or for good reason within 24 months after the change of control.

This amendment specifically applies to equity grants made on or after July 30, 2019. Any grants made prior to this date remain subject to the prior vesting provisions of the plan, which were generally "single trigger" upon a change of control.

In such a scenario, where the acquirer does not assume or substitute the equity awards on an economically equivalent basis, the awards will vest immediately upon the change of control, regardless of whether the executive's employment continues or is terminated. This is referred to as "single trigger" vesting.

While not explicitly stated, the shift to a "double trigger" mechanism is often intended to incentivize executive retention during a change of control process. It ensures that executives remain with the company through the transaction and potentially for a period afterward, rather than immediately cashing out their equity upon a change of control.