8-KMaterial AgreementsExhibits & Filings

COCA COLA CO 8-K Report, Material Agreement (Apr 1, 2005)

Filed April 1, 2005For Securities:KO

Summary

The Coca-Cola Company (KO) filed an 8-K report on April 1, 2005, detailing an amendment to its Restricted Stock Award Agreement, specifically the Performance Share Unit Agreement. This amendment clarifies the treatment of awards upon retirement for recipients under the 1989 Restricted Stock Award Plan. The key change ensures that if an award has been held for at least twelve months and the recipient retires, the target award will be granted without proration. However, the shares will remain subject to restrictions until the end of the designated performance period. This adjustment aims to align the award's payout with the original intent, ensuring that retirees receive the target award amount but the final vesting is still contingent on the company's business performance during that period. The revised terms are specifically applicable to the December 2004 grant and are designed to provide greater clarity and fairness in executive compensation, particularly concerning long-tenured employees nearing retirement.

Key Highlights

  • 1Amendment to the Restricted Stock Award Agreement (Performance Share Unit Agreement) approved by the Compensation Committee.
  • 2Clarification of award treatment for employees retiring from the company.
  • 3Under revised terms, retired employees holding awards for at least twelve months will receive the target award (not prorated).
  • 4Vesting of shares for retirees remains subject to the end of the performance period and company performance.
  • 5Maximum award for retirees is capped at the target number of shares, regardless of superior company performance.
  • 6The revised terms apply specifically to the December 2004 grant of performance shares.
  • 7The filing includes the revised form of the Restricted Stock Agreement as an exhibit.

Frequently Asked Questions

The main purpose of this 8-K filing is to announce and detail an amendment to The Coca-Cola Company's Restricted Stock Award Agreement, specifically the Performance Share Unit Agreement, to clarify the treatment of these awards for employees who retire.

For retirees who have held their performance share unit awards for at least twelve months, the amendment ensures they will receive the target award amount, not prorated based on their retirement date. However, the shares will still be subject to the original performance period and business results for final vesting.

Even if the company's performance during the performance period would have merited an award exceeding the target, a retiree will not receive more than the target number of shares.

No, this specific amendment to the Performance Share Unit Agreement applies retroactively to the December 2004 grant, as it was intended to correct an error in its original treatment at retirement.