8-KLeadership ChangesExhibits & Filings

EMERSON ELECTRIC CO 8-K Report, Executive Changes (Apr 10, 2007)

Filed April 10, 2007For Securities:EMR

Summary

This 8-K filing from Emerson Electric Co. (EMR) announces the retirement of W. Wayne Withers, who previously served as Secretary and General Counsel, and his transition to an Executive Vice President and Special Legal Advisor role until his normal retirement on November 30, 2007. The filing details a comprehensive agreement governing his departure, including a two-year consulting contract post-retirement. This agreement outlines Withers' continued compensation through retirement, eligibility for bonuses and performance-based share payouts, and the terms for exercising outstanding stock options. The company is also providing for his pension benefits and other retirement perquisites, contingent upon his adherence to non-compete and confidentiality clauses.

Key Highlights

  • 1W. Wayne Withers, Secretary and General Counsel, is retiring after 18 years with Emerson Electric Co.
  • 2Withers will serve as Executive Vice President and Special Legal Advisor until his normal retirement on November 30, 2007.
  • 3A two-year consulting agreement is in place for Withers post-retirement, with specific monthly fees and engagement terms.
  • 4Withers remains eligible for fiscal year 2007 bonuses and performance share payouts, subject to company and program performance.
  • 5Certain restricted stock awards and performance shares will vest according to their original schedules.
  • 6Retirement benefits include pension, 401(k) distributions, and extended stock option exercise periods (up to five years).
  • 7The agreement includes non-competition and confidentiality clauses, with forfeiture of certain benefits and potential recovery of gains for violations.

Frequently Asked Questions

W. Wayne Withers, a long-serving officer, is retiring from his roles as Secretary and General Counsel. The company has entered into a detailed agreement for his transition, ensuring continuity in his advisory capacity and securing his expertise for two years post-retirement through a consulting contract. This arrangement provides Withers with continued compensation and benefits while allowing Emerson to retain his knowledge during a critical transition period and beyond.

For the fiscal year ending September 30, 2007, Emerson will continue to pay Withers' base salary until his retirement date and he is eligible for a cash bonus. The company will also provide for the payout of performance shares and restricted stock awards as per their original grant terms, subject to meeting performance criteria for the shares. Consulting fees of $43,333 per month for the first six months and $21,666 per month for the subsequent 18 months, along with reimbursement for expenses and certain perquisites, represent the direct financial commitment for the consulting period.

Yes, the agreement includes significant conditions. W. Wayne Withers must adhere to non-competition and confidentiality obligations during and after his consulting term. Failure to comply with these terms, or any other obligations under the agreement, could lead to the forfeiture of outstanding performance shares, the vesting of restricted stock, and supplemental retirement plan benefits. Additionally, Emerson reserves the right to recover any gains realized from the exercise of stock options if he violates the agreement.

Upon his normal retirement on November 30, 2007, Mr. Withers will be eligible for monthly pension benefits earned under the company's retirement plans. He can also exercise his outstanding stock options for up to five years post-retirement. Furthermore, he will receive distributions from his 401(k) and related non-qualified plans, and can elect to continue post-retirement benefits and maintain coverage under a former split dollar policy.