01—Abstract
Summary
Summary of the 8-K filed May 3, 2024. Cited figures are marked; the original filing is the authoritative source.
PACCAR's 8-K reports board refreshment and a recalculation of executive pay.
The Board elected Pierre R. Breber (former Chevron CFO) and Brice C. Hill (Applied Materials CFO) effective July 1, 2024, expanding the Board from 13 to 14 members.
Both will join the Audit Committee. Luiz A. S.
Pretti, former Cargill Brasil CEO, was elected effective September 1, 2024, to replace Franklin L. Feder, who retires on August 30, 2024. Pretti will join the Compensation Committee.
The added directors bring finance, international operations, and South American business experience, which the company ties to its global growth strategy. The Compensation Committee approved 2021-2023 Long Term Performance Cash Awards on April 29, 2024, and restated the Summary Compensation Table totals. CEO Ron Feight's total compensation rises to $20,908,665a after a $5,250,000 LTIP cash award, and the CEO pay ratio is 224 to 1 against a median employee's pay of $93,387.
Investors should note that the restated totals are materially higher than the originally proxied figures because the LTIP awards were added. Shareholders at the April 30, 2024 annual meeting re-elected all 13 directors and approved the Third Amended and Restated Restricted Stock and Deferred Compensation Plan for Non-Employee Directors. Say-on-pay passed with roughly 424.7 million votes for and 28.0 million against.
A majority of votes favored holding the say-on-pay vote annually. A stockholder proposal on a report on climate-related policy engagement failed, with about 129.1 million for and 311.9 million against.
02—Key points
Key Highlights
- Board expands to 14 members effective July 1, 2024, with Pierre R. Breber (ex-Chevron CFO) and Brice C. Hill (Applied Materials CFO) joining the Audit Committee
- Luiz A. S. Pretti (former Cargill Brasil CEO) joins the Board September 1, 2024, replacing retiring director Franklin L. Feder and joining the Compensation Committee
- CEO Ron Feight's total 2023 compensation restated to $20,908,665 after adding a $5,250,000 2021-2023 LTIP cash award
- CEO pay ratio disclosed at 224 to 1 (CEO $20.9M vs. median employee $93,387), based on about 30,000 employees as of October 1, 2023
- Say-on-pay advisory vote passed with approximately 424.7M shares for and 28.0M against
- Shareholders approved the Third Amended and Restated Restricted Stock and Deferred Compensation Plan for Non-Employee Directors with about 442.1M shares for and 10.5M against
- Climate-related policy engagement stockholder proposal failed, with about 129.1M for and 311.9M against
03—Questions
Frequently Asked Questions
Why did PACCAR's CEO pay figure change, and how much did it increase?
The Compensation Committee added a $5,250,000 Non-Equity Incentive Plan LTIP cash award for the 2021-2023 cycle to the Summary Compensation Table. CEO Ron Feight's reported total compensation for 2023 is now $20,908,665. The filing does not state the prior total, so the exact increase versus the original proxy cannot be computed from this document alone.
Will the new directors change PACCAR's committee structure?
Breber and Hill will join the Audit Committee on July 1, 2024, and Pretti will join the Compensation Committee on September 1, 2024. Board membership rises to 14 on July 1, 2024, and returns to a level that accounts for Feder's departure after Pretti's appointment. The company states that no reportable related-person transactions under Item 404(a) of Regulation S-K exist for these directors.
How did shareholders vote on executive compensation and the say-on-pay frequency?
The advisory say-on-pay resolution received about 424.7 million votes for and 28.0 million against, with 0.8 million abstentions and 25.9 million broker nonvotes. On frequency, 'One Year' received the most votes at about 287.2 million, ahead of 'Three Years' at about 157.9 million and 'Two Years' at about 1.1 million. The filing reports the plurality outcome without stating whether the Board will adopt annual votes.
Why did the climate-related stockholder proposal fail?
The proposal requesting a report on climate-related policy engagement received about 129.1 million votes for and 311.9 million against, with 12.4 million abstentions. It did not receive the majority of votes cast needed for approval, so the Board and management face no mandated action from this vote.
04—Continue