8-KLeadership ChangesShareholder MattersCorporate Changes+1

MOODYS CORP /DE/ 8-K Report, Executive Changes (Apr 22, 2013)

Filed April 22, 2013For Securities:MCO

Summary

Moody's Corporation (MCO) filed an 8-K report on April 22, 2013, detailing key outcomes from its Annual Stockholder Meeting held on April 16, 2013. The most significant information for investors revolves around the approval of amendments to its stock incentive plans and corporate governance structure. Stockholders overwhelmingly approved the Amended and Restated 2001 Key Employees' Stock Incentive Plan and the Amended and Restated 1998 Non-Employee Directors' Stock Incentive Plan. These approvals involve increases in the number of authorized shares for awards and modifications to change-in-control provisions for employee plans, shifting to a "double-trigger" vesting requirement for awards granted after January 1, 2013. Furthermore, the report highlights the crucial approval of amendments to the company's Restated Certificate of Incorporation to declassify the Board of Directors. This change, which will be phased in over three years, means that all directors will eventually be elected annually. This represents a significant shift towards enhanced shareholder governance. The ratification of KPMG LLP as the independent auditor and the advisory vote on executive compensation also passed, indicating general shareholder support for the company's reported direction and executive pay practices.

Key Highlights

  • 1Stockholder approval obtained for the Amended and Restated 2001 Key Employees’ Stock Incentive Plan, increasing authorized shares and modifying change-in-control vesting to a 'double-trigger' for new grants.
  • 2Stockholder approval obtained for the Amended and Restated 1998 Non-Employee Directors’ Stock Incentive Plan, increasing authorized shares for director compensation.
  • 3Significant corporate governance change: Amendments to declassify the Board of Directors were approved by stockholders, with a three-year phase-in period for annual director elections.
  • 4The election of three Class III Directors to three-year terms was confirmed.
  • 5KPMG LLP was ratified as the independent registered public accounting firm for 2013.
  • 6An advisory resolution on executive compensation received stockholder approval.
  • 7The company filed a Certificate of Elimination to remove Series A Junior Participating Preferred Stock, which had no outstanding shares.

Frequently Asked Questions

The primary outcomes were the stockholder approval of amendments to the company's Key Employees' and Directors' Stock Incentive Plans, an amendment to declassify the Board of Directors over a three-year period, the election of directors, and the ratification of KPMG LLP as the independent auditor.

The declassification of the Board, approved by stockholders, will transition the company to a system where all directors are elected annually. This process will be phased in over three years, with full implementation by the 2016 Annual Meeting of Stockholders, generally leading to increased director accountability to shareholders.

The Amended and Restated 2001 Key Employees' Stock Incentive Plan saw an increase in the number of shares available for awards and a change in 'Change in Control' provisions to a 'double-trigger' vesting requirement for awards granted on or after January 1, 2013. The 1998 Directors' Plan also had its authorized share pool increased.

Yes, amendments were made to the Restated Certificate of Incorporation and the Amended and Restated By-laws to declassify the Board of Directors. Additionally, a Certificate of Elimination was filed to remove Series A Junior Participating Preferred Stock, which had no outstanding shares.