Why did Harriet Green resign from the Board?

Harriet Green resigned from the Board of Directors to fully dedicate her time and efforts to her new senior position at International Business Machines Corporation, where she leads the Global Head of Watson Internet of Things and Education.

What are the key changes to the Pension Restoration Plan?

The key changes include allowing participants to elect a lump sum payout under certain conditions (previously not an option for life annuity holders), expanding death benefits to cover estates of participants who die without a spouse, and clarifying that in a change of control scenario, all accrued benefits vest and are paid as a lump sum to retired participants.

How do the Pension Restoration Plan changes affect current executives?

The amendments provide more payment flexibility, including the option for a lump sum payout, and clarify benefits in the event of a change of control. The lump sum payments for named executive officers are consistent with amounts previously disclosed in their proxy statements, with updated calculation assumptions.

Are the Pension Restoration Plan changes retroactive?

The amendments provide new options and clarifications. For lump sum payments, future participants can elect to receive it after retirement without a five-year delay. Current participants changing from a life annuity to a lump sum would receive payment on the five-year anniversary of their originally scheduled annuity commencement. The change of control provision clarifies benefits for retired participants, indicating it applies to accrued benefits.

EMR 8-K: Leadership Changes

Summary

Emerson Electric Co. (EMR) filed an 8-K on October 6, 2015, primarily to announce the resignation of a Board member and significant amendments to its Pension Restoration Plan. Harriet Green resigned from the Board of Directors to pursue a new role at IBM, a move the company acknowledged with appreciation for her service. The amendments to the Pension Restoration Plan introduce greater flexibility for participants regarding payment options, including the ability to elect a lump sum payout under certain conditions, and expand death benefits to include estates when a participant dies without a spouse. Additionally, the amendments clarify vesting and payout procedures in the event of a change of control, ensuring all accrued benefits become fully vested and paid in a lump sum to retired participants. These changes aim to modernize the plan and provide more options to its beneficiaries.

Key Highlights

1Harriet Green resigned from the Emerson Electric Co. Board of Directors, effective October 6, 2015, to accept a position at IBM.
2Emerson Electric Co. approved amendments to its Pension Restoration Plan (the “Plan”).
3Plan participants can now change their form of payment from a life annuity to a lump sum, under specific timing conditions.
4Death benefits are expanded to include a lump sum payment to the estate of a participant who dies without a spouse.
5In the event of a change of control, all accrued benefits will become fully vested and paid out in a lump sum to retired participants.
6Assumptions used for lump sum calculations were updated to align with financial reporting standards and U.S. retirement plan accruals.
7The changes are designed to offer more flexibility and expanded benefits to pension plan participants.

EMERSON ELECTRIC CO 8-K Report, Executive Changes (Oct 6, 2015)

Summary

Key Highlights

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