8-KLeadership Changes

FEDEX CORP 8-K Report, Executive Changes (Dec 22, 2016)

Filed December 22, 2016For Securities:FDX

Summary

This 8-K filing from FedEx Corporation details a consulting agreement entered into on December 21, 2016, with T. Michael Glenn, who is retiring from his Executive Vice President role effective December 31, 2016. The agreement outlines Mr. Glenn's services as a strategic advisor to the Chairman and CEO, limited to 30 hours per month, for a term of five years (January 1, 2017, to December 31, 2021). Investors should note the financial implications of this agreement, including a significant upfront payment of $884,112 and ongoing quarterly payments of $54,800. The agreement also includes provisions for administrative support, expense reimbursement, and access to company resources, alongside a non-compete clause restricting Mr. Glenn from working with key competitors. This arrangement ensures continued access to Mr. Glenn's expertise while managing potential competitive risks.

Key Highlights

  • 1FedEx has entered into a 5-year consulting agreement with retiring Executive Vice President T. Michael Glenn, effective January 1, 2017.
  • 2Mr. Glenn will provide strategic marketing and communications advice, limited to 30 hours per month, at the request of the Chairman and CEO.
  • 3The agreement includes an initial payment of $884,112 to Mr. Glenn.
  • 4Ongoing compensation consists of quarterly payments of $54,800.
  • 5FedEx will provide administrative support, expense reimbursement, and access to certain company resources and systems to Mr. Glenn.
  • 6A non-compete clause restricts Mr. Glenn from engaging with major competitors (USPS, UPS, Amazon, DHL) during the agreement term without FedEx's consent.

Frequently Asked Questions

The consulting agreement is to retain T. Michael Glenn's expertise in strategic marketing and communications for a limited number of hours per month, following his retirement from his executive role. He will provide advice upon the request of FedEx's Chairman and CEO.

Mr. Glenn will receive an initial payment of $884,112 on January 31, 2017. Additionally, he will be paid $54,800 at the end of each calendar quarter from March 31, 2017, through December 31, 2021. FedEx will also reimburse certain expenses and provide administrative support and access to company resources.

During the term of the agreement, Mr. Glenn is subject to a non-compete clause. He cannot work for or with specific competitors, including the United States Postal Service, United Parcel Service, Amazon.com, or DHL, in any capacity, unless he obtains prior written consent from FedEx.

The consulting agreement begins on January 1, 2017, and is set to end on December 31, 2021, making it a five-year term. However, either party can terminate the agreement earlier with 90 days' written notice.