Summary
Microsoft Corporation (MSFT) filed an 8-K on September 19, 2018, to announce an update to its Executive Incentive Plan. Effective for fiscal year 2019 and onward, the Compensation Committee approved a new plan that replaces the existing one. The primary driver for this change is to align with amendments made to the Internal Revenue Code. Importantly, the company states that this updated plan does not alter the nature or value of executive awards. Awards can still be granted in the form of cash, stock awards, or performance stock awards, with payouts determined by pre-established formulas. Cash awards may be based on either qualitative or quantitative metrics, while stock and performance stock awards will be issued under the existing Microsoft Corporation 2017 Stock Plan or the 2001 Stock Plan for French-qualified awards. Investors should note that the full details of the new plan are available as an exhibit to this filing.
Key Highlights
- 1Microsoft's Compensation Committee approved a new Executive Incentive Plan, effective for fiscal year 2019.
- 2The new plan replaces the previous Executive Incentive Plan.
- 3The primary reason for the change is to comply with updates to the Internal Revenue Code.
- 4The company explicitly states that the type or amount of executive awards will not change.
- 5Awards can be in the form of cash, stock awards, or performance stock awards.
- 6Cash awards may be based on qualitative or quantitative measures.
- 7Stock awards are issued under existing stock plans (2017 or 2001 for French-qualified).