8-KLeadership ChangesExhibits & Filings

ALTRIA GROUP, INC. 8-K Report, Executive Changes (Feb 5, 2008)

Filed February 5, 2008For Securities:MO

Summary

This Form 8-K filing by Altria Group, Inc. (MO) on February 4, 2008, details significant executive compensation changes and grants related to the upcoming spin-off of Philip Morris International (PMI). The Compensation Committee approved substantial annual and long-term incentive awards for 2007, reflecting company performance. Notably, new base salaries were established for key executives Louis C. Camilleri and Charles R. Wall, effective upon their transition to leadership roles within PMI post-spin-off. Furthermore, the filing outlines the compensation committee's approval of formulae for future incentive awards for 2008, 2009, and 2010. These formulae are designed to comply with Section 162(m) of the Internal Revenue Code to maximize tax deductibility. Investors should note the deferred stock awards granted on January 30, 2008, which vest over three years, and the termination of the 2007-2009 Altria Long-Term Performance Incentive Plan due to the PMI spin-off, with awards re-aligned for the 2007 plan year.

Key Highlights

  • 1Altria Group announced executive compensation adjustments and awards approved by the Compensation Committee on January 30, 2008.
  • 2Substantial 2007 annual incentive awards were paid in cash to top executives, including Louis C. Camilleri ($4.75 million) and Michael E. Szymanczyk ($2.15 million).
  • 3Long-term performance incentive awards for the 2007 plan year were approved, totaling significant amounts for executives like Louis C. Camilleri ($5.03 million).
  • 4New base salaries for Louis C. Camilleri ($1.5 million) and Charles R. Wall ($1.1 million) were approved, effective upon the March 28, 2008 spin-off of Philip Morris International (PMI).
  • 5Deferred stock awards were granted to Louis C. Camilleri (330,280 shares), Michael E. Szymanczyk (28,670 shares), and Charles R. Wall (27,360 shares), vesting over three years.
  • 6Formulae for 2008 annual and long-term incentive awards, as well as 2009 deferred stock awards, were established to comply with IRS Section 162(m) for tax deductibility.
  • 7The 2007-2009 Altria Long-Term Performance Incentive Plan was terminated effective December 31, 2007, due to the PMI spin-off.

Frequently Asked Questions

The spin-off of PMI, scheduled for March 28, 2008, is a major event for Altria. It impacts executive roles and compensation. Key executives like Louis C. Camilleri and Charles R. Wall are moving to leadership positions within PMI and have had their base salaries adjusted accordingly, effective with the spin-off.

The filing details several types of awards: 2007 annual incentive awards (paid in cash), 2007 long-term performance incentive awards (paid in cash), and grants of deferred stock. Additionally, formulae for future incentive awards (2008 annual, 2008-2010 long-term, and 2009 deferred stock) were approved.

The compensation formulae for future awards are designed to qualify, to the extent possible, as tax-deductible compensation under Section 162(m) of the Internal Revenue Code. This structure aims to align maximum award amounts with company performance (adjusted net earnings) while adhering to IRS regulations and shareholder-approved limits.

The deferred stock awards granted on January 30, 2008, are subject to a three-year vesting period from the grant date.