8-KLeadership ChangesShareholder MattersExhibits & Filings

MORGAN STANLEY 8-K Report, Executive Changes (May 22, 2017)

Filed May 22, 2017For Securities:MSMS-PKMS-POMS-PQMS-PAMS-PFMS-PIMS-PLMS-PPMS-PEMSTLW

Summary

Morgan Stanley's 8-K filing on May 22, 2017, details the outcomes of its Annual Meeting of Shareholders. Key to investors is the shareholder approval of amendments to the Equity Incentive Compensation Plan (EICP) and the Directors' Equity Capital Accumulation Plan (DECAP). The EICP was amended to increase available shares by 50 million and extend its term by five years, while also re-approving performance criteria for Section 162(m) of the Internal Revenue Code. The DECAP was similarly amended to add 1 million shares. Furthermore, the filing confirms the election of directors, ratification of Deloitte & Touche LLP as the independent auditor, and approval of executive compensation through a non-binding advisory vote. A significant outcome was the shareholder decision, by advisory vote, to hold annual advisory votes on executive compensation. Shareholder proposals concerning abstention treatment in vote counting and the prohibition of deferred equity award vesting for executives entering government service were not approved.

Key Highlights

  • 1Shareholders approved the amended and restated Equity Incentive Compensation Plan (EICP), increasing available shares by 50 million and extending its term by five years.
  • 2The EICP was re-approved for Section 162(m) performance criteria, crucial for executive compensation deductibility.
  • 3The amended and restated Directors’ Equity Capital Accumulation Plan (DECAP) was approved, increasing available shares by 1 million.
  • 4All director nominees were elected to the Board of Directors.
  • 5Shareholders ratified the appointment of Deloitte & Touche LLP as the company's independent auditor.
  • 6An advisory vote on executive compensation was approved.
  • 7Shareholders voted for annual advisory votes on executive compensation, a frequency that the Board has accepted.
  • 8Two shareholder proposals, regarding abstention vote counting and executive equity award vesting upon entering government service, were not approved.

Frequently Asked Questions

The EICP was amended and restated to increase the number of available shares by 50 million, extend its term by an additional five years, and re-approve the performance criteria for compliance with Section 162(m) of the Internal Revenue Code. This ensures continued flexibility in offering equity-based compensation to employees and executives.

Shareholders approved the executive compensation as disclosed in the proxy statement through a non-binding advisory vote. Additionally, shareholders voted by advisory means to hold these votes annually, a decision the Board of Directors has agreed to follow.

Shareholder proposals concerning the treatment of abstentions in vote counting and a policy to prohibit deferred equity award vesting for executives entering government service were both rejected by the shareholders. The proposals to amend the EICP and DECAP were approved.

The approval of these plans provides Morgan Stanley with continued ability to incentivize its employees and directors through equity awards. The increased share pool and extended term allow for ongoing compensation flexibility, which is important for talent retention and attraction in the financial services industry.