8-KLeadership ChangesShareholder Matters

CHEVRON CORP 8-K Report, Executive Changes (Jun 4, 2013)

Filed June 4, 2013For Securities:CVX

Summary

Chevron Corporation (CVX) filed an 8-K on June 3, 2013, reporting on the results of its 2013 Annual Meeting of Stockholders held on May 29, 2013. The most significant event for investors was the stockholder approval of the amended and restated Long-Term Incentive Plan (New LTIP). This plan increases the number of shares available for issuance by 100 million and extends the plan's term for ten years from its effective date, replacing the previous plan which was set to expire in January 2014. Stockholder approval of the New LTIP also signifies their endorsement of the material terms of the performance goals associated with performance-based awards under the plan, important for tax deductibility under Section 162(m) of the IRS code. The filing also details the voting outcomes on various proposals. All director nominees were elected with substantial "for" votes. The appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for 2013 was ratified overwhelmingly. Furthermore, advisory votes on executive compensation were approved, and the New LTIP itself received strong support. Conversely, all twelve stockholder proposals, which covered a range of topics including shale energy operations, offshore oil wells, climate risk, lobbying, political spending, and corporate governance structures, were not approved by a significant margin.

Key Highlights

  • 1Stockholders approved Chevron's amended and restated Long-Term Incentive Plan (New LTIP), increasing authorized shares by 100 million and extending the plan's term for ten years.
  • 2Approval of the New LTIP also signifies stockholder endorsement of the material terms of performance goals for performance-based awards, relevant for Section 162(m) of the Internal Revenue Code.
  • 3All director nominees for the Chevron Board of Directors were elected for one-year terms with overwhelming majority support.
  • 4The appointment of PricewaterhouseCoopers LLP as Chevron's independent registered public accounting firm for 2013 was ratified with nearly 99% of the votes cast.
  • 5Stockholders provided an advisory approval for the compensation of Chevron's named executive officers with approximately 94.5% of votes cast in favor.
  • 6All twelve stockholder-submitted proposals, addressing environmental reporting, climate risk, political spending, and corporate governance, failed to gain majority approval.

Frequently Asked Questions

The primary changes in the New LTIP are an increase in the number of Chevron common stock shares issuable under the plan by 100,000,000 shares and an extension of the plan's term to ten years from its effective date of May 29, 2013. The old plan was set to expire on January 28, 2014.

Stockholder approval of the material terms of the performance goals is crucial for ensuring that performance-based awards granted under the New LTIP qualify for tax deductibility for Chevron under Section 162(m) of the Internal Revenue Code of 1986, as amended.

Chevron stockholders voted on an advisory basis to approve the compensation of the company's named executive officers. The proposal received approximately 94.5% of the votes cast in favor, indicating general support for the compensation practices.

No, all twelve stockholder proposals presented at the meeting, which covered a range of topics such as reports on shale energy, offshore oil wells, climate risk, lobbying, political spending, and corporate governance, were not approved by the stockholders.