8-KLeadership ChangesExhibits & Filings

EXXON MOBIL CORP 8-K Report, Executive Changes (Dec 4, 2012)

Filed December 4, 2012For Securities:XOM

Summary

Exxon Mobil Corporation (XOM) filed an 8-K on December 3, 2012, reporting on executive compensation arrangements. The Compensation Committee established a total ceiling of $266 million for bonuses under the Short Term Incentive Program for 2012, with specific amounts awarded to key officers. A significant portion of these bonuses will be paid in cash, with the remainder deferred as "earnings bonus units" (EBUs) tied to the company's future earnings per share, providing a performance-based incentive. Additionally, the report details the grant of performance stock awards under the 2003 Incentive Program, with a total ceiling of 11 million shares available for 2012. These restricted stock awards come with substantial holding periods, ranging from five to ten years, or until retirement, aligning executive interests with long-term company performance and shareholder value. The filing also notes upcoming salary increases for two named executive officers effective January 1, 2013, and clarifies that all executive officers are employed "at will."

Key Highlights

  • 1Total ceiling of $266 million established for 2012 Short Term Incentive Program bonuses.
  • 2Key executives, including R. W. Tillerson, received significant cash and deferred bonus awards.
  • 3Deferred bonuses are in the form of "earnings bonus units" (EBUs) tied to future earnings per share, with a payout dependent on cumulative EPS or a maximum settlement value.
  • 4Up to 11 million shares were authorized for grant under the 2003 Incentive Program as performance stock awards.
  • 5Restricted stock awards have long vesting periods of 5 to 10 years or until retirement, with limited acceleration clauses.
  • 6Shares granted under the restricted stock program are subject to forfeiture under certain conditions, including detrimental activity.
  • 7Annual salaries for R. W. Tillerson and S. D. Pryor are set to increase effective January 1, 2013.

Frequently Asked Questions

This 8-K filing primarily serves to disclose details regarding executive compensation arrangements for Exxon Mobil Corporation's officers, specifically the establishment of bonus pools, the grant of performance-based bonuses (EBUs), and the awarding of restricted stock for the year 2012.

Approximately 50% of the 2012 bonus is paid in cash by year-end. The remaining 50% is paid through "earnings bonus units" (EBUs), which are tied to ExxonMobil's future cumulative earnings per share and have specific payout conditions based on reported quarterly earnings or reaching a maximum settlement value.

The restricted stock awards have substantial holding periods, with half the shares subject to a five-year restriction and the other half to a ten-year restriction or until retirement. These shares are subject to forfeiture if employment is terminated early or if the executive engages in detrimental activity, and they can be voted and receive dividends during the restricted period.

Yes, effective January 1, 2013, the annual salaries of R. W. Tillerson are set to increase to $2,717,000, and S. D. Pryor's salary will increase to $1,040,000.