8-KLeadership Changes

PFIZER INC 8-K Report, Executive Changes (Oct 27, 2016)

Filed October 27, 2016For Securities:PFE

Summary

Pfizer Inc. (PFE) filed an 8-K on October 27, 2016, reporting a modification to its Total Shareholder Return Units (TSRUs) awards program, effective October 26, 2016. This amendment allows "retiree eligible" employees (defined as those aged 55 or older with at least 10 years of service) to elect to convert vested TSRUs into Profit Units (PTUs). The conversion mechanism involves calculating the change in stock price over a 20-day average, plus accumulated dividends, relative to the grant price. The resulting value determines the number of PTUs issued. These PTUs, along with Dividend Equivalent Units (DEUs), will be settled in Pfizer common stock on the original settlement date of the TSRUs, typically the fifth or seventh anniversary of the grant date. All original grant terms, including forfeiture provisions, remain applicable.

Key Highlights

  • 1Pfizer modified its Total Shareholder Return Units (TSRUs) program.
  • 2The modification allows "retiree eligible" employees to convert vested TSRUs into Profit Units (PTUs).
  • 3Retiree eligibility is defined as age 55+ with 10+ years of service.
  • 4The conversion calculation considers stock price appreciation and accumulated dividends.
  • 5PTUs and Dividend Equivalent Units (DEUs) will be settled in Pfizer common stock.
  • 6Settlement will occur on the original scheduled vesting date of the TSRUs.
  • 7Original grant terms, including forfeiture conditions, continue to apply to the converted awards.

Frequently Asked Questions

The primary change allows employees who meet the 'retiree eligible' criteria (at least 55 years old with 10 years of service) to elect to convert their vested Total Shareholder Return Units (TSRUs) into Profit Units (PTUs).

The value is calculated based on the change in Pfizer's stock price (averaged over 20 trading days ending on the election date) plus any accumulated dividends, minus the original grant price. This value, divided by the average stock price on the election date, determines the number of PTUs received.

The PTUs and DEUs will be settled in Pfizer common stock on the original settlement date of the TSRUs, which is typically the fifth or seventh anniversary of the grant date.

No new conditions are introduced beyond the original grant's terms. The converted PTUs and DEUs remain subject to the original forfeiture provisions and other terms outlined in the initial TSRU award agreement.