8-K/ALeadership Changes

CARPENTER TECHNOLOGY CORP 8-K/A Report, Executive Changes (Sep 7, 2007)

Filed September 7, 2007For Securities:CRS

Summary

Carpenter Technology Corporation (CRS) filed an amendment to its Form 8-K on September 7, 2007, primarily to correct a typographical error regarding the start date of CFO K. Douglas Ralph's employment. The amended filing confirms that Mr. Ralph began his role as CFO in July 2007, not July 2008. More significantly, the report details the finalized compensation packages for the Company's executive officers for fiscal year 2008, effective July 1, 2007. These adjustments include base salaries, annual incentive compensation (EBCP) with performance-based goals tied to Return on Net Assets (RONA) and Earnings Per Share (EPS), and long-term incentive compensation in the form of performance shares and time-vested restricted stock, along with stock options for the CEO.

Key Highlights

  • 1Correction of a typographical error in the previous 8-K filing regarding the start date of CFO K. Douglas Ralph's employment to July 2007.
  • 2Executive compensation packages for fiscal year 2008 have been finalized and are effective as of July 1, 2007.
  • 3Annual base salaries for Named Executive Officers have been established for FY 2008, with CEO Anne L. Stevens receiving $875,000.
  • 4Executive Bonus Compensation Plan (EBCP) for FY 2008 ties cash bonuses to corporate performance goals (RONA, EPS) and individual objectives.
  • 5CEO Anne L. Stevens has the highest potential bonus payout at 50/100/200% of base salary for threshold/target/maximum performance.
  • 6Long-term incentive compensation includes performance shares of restricted stock tied to RONA and EPS goals, vesting over two years.
  • 7Time-vested restricted stock grants were also issued to executives, with specific vesting dates in July 2010.
  • 8CEO Anne L. Stevens was granted stock options to purchase 14,250 shares at an exercise price of $128.34, exercisable over three years.

Frequently Asked Questions

The primary reason for filing this amended 8-K report was to correct a typographical error in a previous filing. The report clarifies that K. Douglas Ralph began his employment as CFO in July 2007, not July 2008 as initially stated.

The executive compensation for fiscal year 2008 includes base salaries, annual incentive compensation (cash bonuses) under the Executive Bonus Compensation Plan (EBCP) tied to corporate performance metrics like Return on Net Assets (RONA) and Earnings Per Share (EPS), long-term incentive compensation in the form of performance-based restricted stock, and time-vested restricted stock. The CEO also received stock options.

The annual bonus compensation for most Named Executive Officers is determined based on corporate performance goals for RONA and EPS, as well as individual performance objectives. For the Senior Vice President of Engineered Products Operations, a portion of the bonus is also tied to on-time delivery goals for his business unit.

The long-term incentive compensation includes two types of restricted stock. First, performance shares are awarded based on achieving specific RONA and EPS goals, which then vest ratably over two years. Second, time-vested shares of restricted stock were granted, which will vest on a specific date in July 2010, provided the executive remains employed by the Company.