Summary
This 8-K filing from Corning Incorporated (GLW) on February 13, 2007, details actions taken by the Compensation Committee of the Board of Directors on February 7, 2007, concerning executive compensation for the fiscal year 2007. The key actions involve the adoption of performance metrics for both the Variable Compensation Plan and the Incentive Stock Plan. These plans are designed to align executive pay with corporate performance, emphasizing adjusted net profit after taxes for variable compensation and adjusted earnings per share and operating cash flow for performance shares.
Key Highlights
- 1Corning's Compensation Committee established corporate performance metrics for 2007 variable compensation, payable in 2008, with adjusted net profit after taxes as the primary metric.
- 2Key executives, including the CEO and CFO, will have their 2007 variable compensation tied entirely to this adjusted net profit metric, with awards ranging from 0% to 10% of base salary.
- 3Target cash awards for 2007 variable compensation for top executives were disclosed, with Wendell P. Weeks (CEO) potentially receiving up to $990,000.
- 4Performance metrics for 2007 performance shares under the Incentive Stock Plan were set, focusing on adjusted earnings per share and operating cash flow.
- 5Performance shares awarded in December 2006, based on 2007 performance, will be restricted and subject to forfeiture until February 1, 2010.
- 6Named executive officers received target grants of performance shares, with the CEO, Wendell P. Weeks, awarded 123,000 shares at the target level.
- 7The filing references previous SEC filings for the Variable Compensation Plan and the 2005 Employee Equity Participation Program for further details on these plans.
Frequently Asked Questions
For the Variable Compensation Plan, the primary corporate performance metric is adjusted net profit after taxes. For the Incentive Stock Plan's performance shares, the key metrics are adjusted earnings per share and operating cash flow.
For Messrs. Weeks, Volanakis, Flaws, Gregg, and Miller, their 2007 variable compensation is based entirely on a corporate performance factor of adjusted net profit after taxes. Their goalsharing awards will be determined as the average of all employees receiving awards under all goalsharing plans, with a target of 5% of base salary.
If earned at target levels, Wendell P. Weeks, the President & Chief Executive Officer, could receive a cash award of $990,000 in 2008 for his 2007 variable compensation performance.
Performance shares earned based on 2007 corporate performance will have restrictions on transfer and the possibility of forfeiture until February 1, 2010. The number of shares actually earned will be determined in February 2008 based on the company's 2007 results against the established metrics.