8-KLeadership ChangesExhibits & Filings

Philip Morris International Inc. 8-K Report, Executive Changes (Feb 13, 2018)

Filed February 13, 2018For Securities:PM

Summary

This 8-K filing from Philip Morris International (PM) on February 13, 2018, details executive compensation decisions made by the Compensation and Leadership Development Committee on February 8, 2018. The report outlines the granting of Restricted Stock Units (RSUs) and Performance Share Units (PSUs) to named executive officers, along with their 2017 annual incentive cash awards. These compensation components are designed to align executive interests with long-term company performance and shareholder value. Key details include the specific RSU and PSU grant amounts for top executives, including CEO André Calantzopoulos, with vesting for RSUs and PSUs set for February 17, 2021. The PSUs are contingent upon achieving pre-established performance goals over a three-year cycle (2018-2020). Additionally, the filing confirms no changes to the base salaries of these executives and notes that further compensation details will be provided in the upcoming proxy statement.

Key Highlights

  • 1Philip Morris International granted RSUs and PSUs to named executive officers on February 8, 2018, under the 2017 Performance Incentive Plan.
  • 2RSUs vest on February 17, 2021, while PSUs vest on the same date contingent upon achieving pre-established performance goals for the 2018-2020 cycle.
  • 3CEO André Calantzopoulos received the largest RSU grant (44,100) and PSU grant (66,140).
  • 4Annual incentive cash awards for 2017 were approved for named executive officers, with the CEO receiving the largest award of approximately $3.38 million.
  • 5Annual incentive awards were determined using a matrix formula based on six performance measures.
  • 6There were no changes to the base salaries of the named executive officers.
  • 7More detailed executive compensation information will be available in the company's March 2018 proxy statement.

Frequently Asked Questions

This 8-K filing primarily serves to disclose recent executive compensation decisions made by Philip Morris International's Compensation and Leadership Development Committee. It details the granting of equity awards (RSUs and PSUs) and the approval of annual cash incentive awards for the company's named executive officers.

Both the Restricted Stock Units (RSUs) and Performance Share Units (PSUs) granted on February 8, 2018, are scheduled to vest on February 17, 2021. However, the vesting of the PSUs is contingent upon the achievement of specific performance goals set for the 2018-2020 performance cycle.

Based on this filing, a significant portion of executive compensation is performance-based. Named executive officers receive 40% of their target equity awards as RSUs and 60% as PSUs, which are tied to future performance. Additionally, they receive annual cash incentives based on a pre-established matrix formula employing six performance measures. Base salaries remained unchanged.

The company states that additional information regarding the compensation of its named executive officers will be provided in Philip Morris International's proxy statement for its Annual Meeting of Shareholders, which was expected to be issued in March 2018.