https://seekingalpha.com/filing/4320246
connection with his appointment as Chief Executive Officer, Intel entered into an offer letter with Mr. Swan (the “Offer Letter”) setting forth the terms of his employment and compensation. Pursuant to the Offer Letter, Mr. Swan’s base salary will be $1,250,000, and he will be eligible for an annual incentive cash bonus with a target amount of $3,437,500 under Intel’s 2014 Annual Performance Bonus Plan (“APB”) and a quarterly incentive cash bonus under Intel’s broad-based quarterly bonus program.
he Compensation Committee of the Board (“Committee”) also approved the grant of annual equity awards to Mr. Swan for 2019 with a target aggregate grant date value of approximately $15,500,000, composed of approximately 80% performance-based stock units (“PSUs”) and 20% time-based restricted stock units (“RSUs”), by value. The PSUs have similar terms to the awards Intel previously referred to as “outperformance stock units” or “OSUs” and will vest in January 2022 based on Intel’s earnings per share and relative total stockholder return performance during the PSUs’ performance period, and the RSUs will vest quarterly over a 3-year period from the grant date.
The Offer Letter provides for certain strategic growth equity awards to be granted to Mr. Swan in connection with his appointment as Chief Executive Officer. These include performance-based stock units (“Promotional PSUs”) with a target grant date value of approximately $13,000,000. On each of the second and third anniversaries of the Effective Date, subject to Mr. Swan’s continued employment with Intel through the applicable date, 50% of the target number of such Promotional PSUs shall vest, subject to an adjustment up or down of up to 25% based on Intel’s average corporate plan multiplier under the APB over the two- or three-year vesting period, as applicable. If Mr. Swan’s employment is terminated by Intel without “Cause” (as defined in the Offer Letter) or by Mr. Swan for “Good Reason” (as defined in the Offer Letter), all of the then-unvested Promotional PSUs shall vest.
The Offer Letter further provides that Mr. Swan receive an additional grant of Promotional PSUs for a target amount of 450,000 Intel shares, which will be earned based on the appreciation of Intel’s closing stock price over a five-year period following the grant date. The maximum number of Intel shares that may be earned under such Promotional PSUs is 900,000 shares. The Offer Letter also provides that Mr. Swan be granted an option to purchase 1,800,000 Intel shares, which shall vest annually over a four-year period from the grant date. The option shall become exercisable only if, during the five-year period following the grant date, Intel’s closing stock price trades at 30% or more above the closing stock price on the grant date for 30 consecutive trading days.