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.