8-KLeadership ChangesExhibits & Filings

Mondelez International, Inc. 8-K Report, Executive Changes (Jun 30, 2008)

Filed June 30, 2008For Securities:MDLZ

Summary

This Form 8-K filing from Kraft Foods Inc. (prior to its separation into Mondelez International and the current Kraft Heinz) reports on the adoption of the Kraft Executive Deferred Compensation Plan (the "Plan") by its wholly owned subsidiary, Kraft Foods Global, Inc., effective June 1, 2008. The Plan allows eligible senior management to defer a portion of their compensation, including salaries and bonuses. This move is a common practice for companies to retain and incentivize key executives by offering tax-deferred growth opportunities on their earnings. Investors should note that this plan is unfunded, meaning participants have the rights of unsecured creditors. The filing details the election and distribution rules, which are subject to Internal Revenue Code Section 409A, and highlights the investment options are for measurement purposes only.

Key Highlights

  • 1Kraft Foods Inc. adopted the Kraft Executive Deferred Compensation Plan (the "Plan") for eligible senior management, effective June 1, 2008.
  • 2Eligible employees can defer up to 50% of their salaries and up to 100% of cash bonuses.
  • 3Deferral elections must generally be made in the year prior to compensation earning, with exceptions for newly eligible participants.
  • 4Distribution timing can be elected until termination of employment or retirement, or earlier with a minimum two-year deferral period.
  • 5Distributions can be made as a lump sum or in annual installments over two to ten years.
  • 6The Plan is an unfunded plan for tax purposes, with participant rights as unsecured creditors.
  • 7Investment options are for hypothetical performance measurement and not actual investments.

Frequently Asked Questions

The primary purpose of the Plan is to allow eligible senior management to defer receipt of a portion of their compensation, including salaries and bonuses, on a tax-deferred basis. This is a common executive compensation tool used to retain and incentivize key employees.

An unfunded plan means that the company does not set aside specific assets to cover the deferred compensation obligations. Participants have the status of general, unsecured creditors of Kraft Foods Inc. In the event of the company's insolvency, their claims would be subject to the claims of other creditors.

Participants have flexibility in electing to defer compensation and choosing distribution timing (e.g., termination, retirement, or a minimum two-year period). However, elections must generally be made in advance, and changes to distribution elections are subject to strict rules, including those under Internal Revenue Code Section 409A, to maintain tax deferral benefits.

No, the investment funds available for participants to elect are for measurement purposes only. They are hypothetical and used to determine the growth or earnings on the deferred compensation amount. Participants do not actually own or invest in these funds.