Summary
Freeport-McMoRan Inc. (FCX) filed an 8-K on February 11, 2019, reporting on its newly approved Annual Incentive Plan (AIP), effective for fiscal years beginning January 1, 2019. This plan replaces the previous incentive plan and is designed to provide a framework for annual cash incentive awards for the Company's senior executives. The AIP's structure is a response to the repeal of the performance-based compensation exception under Section 162(m) of the Internal Revenue Code. The Compensation Committee will administer the plan, setting performance goals and designating target awards within the first 90 days of each plan year. A key provision limits individual annual awards to a maximum of $5 million, providing a clear cap for executive compensation under this program.
Key Highlights
- 1Freeport-McMoRan (FCX) approved a new Annual Incentive Plan (AIP) effective January 1, 2019.
- 2The AIP replaces the prior incentive plan utilized for fiscal years 2014-2018.
- 3The new plan is designed to comply with changes in tax law, specifically the repeal of the Section 162(m) performance-based compensation exception.
- 4The Compensation Committee will administer the AIP, establishing performance goals and participant awards.
- 5Awards will be determined within the first 90 days of each plan year.
- 6A cap of $5 million is set for any individual participant's annual award.
- 7All executive officers are participants in the AIP for the 2019 fiscal year.