01—Abstract
Summary
Summary of the 8-K filed February 26, 2021. Cited figures are marked; the original filing is the authoritative source.
This 8-K filing from Expedia Group, Inc. (EXPE) announces the formalization of an Employment Agreement with CEO Peter Kern, effective February 25, 2021, with a term extending to April 22, 2024.
The agreement details Kern's compensation, including an annualized base salary of $1,000,000,a and a one-time payment of $728,000 for back pay, reflecting a previously implemented COVID-19 related salary reduction. This filing is significant as it establishes a clear framework for the CEO's compensation and tenure, providing investors with visibility into the executive leadership structure and associated costs. Furthermore, the agreement outlines severance provisions and restrictive covenants.
Notably, it includes substantial long-term equity awards, comprising an option to purchase 2,275,000 shares and a restricted stock unit award for 1,000,000 shares, with vesting schedules tied to continued employment and specific termination conditions. These equity grants underscore the company's commitment to retaining its CEO and aligning his incentives with long-term shareholder value.
02—Key points
Key Highlights
- Formalized Employment Agreement for CEO Peter Kern with a term through April 22, 2024.
- Annual base salary of $1,000,000 established for Mr. Kern.
- A one-time payment of $728,000 issued for back pay, covering the period Mr. Kern served as CEO without base salary.
- Significant long-term equity awards granted: an option for 2,275,000 shares and 1,000,000 RSUs.
- Detailed severance package for termination without cause or resignation for good reason, including salary continuation and accelerated equity vesting.
- Mr. Kern subject to 18-month post-employment non-compete and non-solicitation clauses.
- Vesting schedules for equity awards are detailed, with provisions for accelerated vesting upon certain termination events.
03—Questions
Frequently Asked Questions
What is the new annual base salary for Peter Kern?
Peter Kern's new annualized base salary is $1,000,000.
What are the key components of Mr. Kern's new equity awards?
Mr. Kern received an option award to purchase 2,275,000 shares of common stock with a strike price of $157.18 and a seven-year term, along with a restricted stock unit award covering 1,000,000 shares. Both awards have specific vesting schedules tied to continued employment.
Under what conditions would Mr. Kern receive severance benefits?
Mr. Kern is eligible for severance benefits upon termination by the Company without cause (other than death or disability) or by Mr. Kern for good reason, subject to his execution of a release and compliance with restrictive covenants. Benefits include continued base salary, accelerated equity vesting, and COBRA premium payments.
How long will Mr. Kern be restricted from competing with Expedia?
Mr. Kern is restricted from competing with the Company and soliciting its employees and business partners for an eighteen-month period following the termination of his employment for any reason.
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