UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 26, 2011
Chevron Corporation
(Exact name of registrant as specified in its charter)
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Delaware
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001-00368
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94-0890210 |
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(I.R.S. Employer
Identification No.) |
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6001 Bollinger Canyon Road, San Ramon, CA
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94583 |
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(Address of Principal Executive Offices)
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(Zip Code) |
Registrants telephone number, including area code: (925) 842-1000
None
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 5.02 |
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Departure of Directors or Certain Officers; Election of Directors; Appointment of
Certain Officers; Compensatory Arrangements of Certain Officers. |
(e) On January 26, 2011, the independent Directors of the Chevron Board of Directors approved the
grant of 340,000 stock options and 53,000 performance shares to J.S. Watson, Chairman and Chief
Executive Officer, and ratified the following grants by the Management Compensation Committee under
the Long Term Incentive Plan of Chevron Corporation (LTIP): P.E. Yarrington, Vice President and
Chief Financial Officer, 132,000 stock options and 21,000 performance shares; and G.L. Kirkland,
Vice Chairman and Executive Vice President, 190,000 stock options and 30,000 performance shares.
Chevron does not have employment agreements with any of the foregoing executive officers.
The stock options have a ten year term, and one-third of the grant vests at each anniversary of the
date of grant, except as described below in the last paragraph. The exercise price for the stock
options is $94.64 per share, which is based on the closing price of Chevrons common stock on
January 26, 2011, the date of grant.
The performance shares may result in a payout at the end of the three-year performance period
(January 1, 2011 through December 31, 2013) depending upon Chevrons Total Stockholder Return (TSR)
for the performance period as compared to the TSR of each company in Chevrons peer group (BP
p.l.c., Exxon Mobil Corporation, Royal Dutch Shell p.l.c. and ConocoPhillips). The cash payout, if
any, will occur in an amount equal to the number of performance shares multiplied by the 20-day
trailing average price of Chevron common stock at the end of the performance period multiplied by a
performance modifier. The performance modifier is based on Chevrons TSR ranking for the three-year
period compared to the TSR of each company in Chevrons peer group as follows (from best TSR to
lowest TSR): 200 percent, 150 percent, 100 percent, 50 percent or zero percent. If the difference
between Chevrons TSR and the TSR of any higher or lower member of the peer group is less than one
percentage point (rounded to one decimal point), the modifier will be the average of the sum of all
the modifiers for Chevron and for such other members of the peer group that fall less than one
percentage point (rounded to one decimal point) higher or lower than Chevron. The Management
Compensation Committee may, in its discretion, adjust the cash payout of performance shares
downward if it determines that business or economic considerations warrant such an adjustment.
Since Mr. Kirkland has more than 90 points (the sum of years of age and years of service) under the
LTIP, all unvested outstanding stock options and performance shares held for at least one year from
the January 26, 2011 date of grant will vest upon the separation from service for any reason other
than for cause as defined under the LTIP rules. Since Ms. Yarrington and Mr. Watson each have more
than 75 points under the LTIP, all unvested outstanding options and performance shares held for at
least one year from the January 26, 2011 date of grant will vest on a pro rata basis (the number of
outstanding shares underlying the award multiplied by the number of whole months from the grant
date to the separation from service date, divided by 36) upon the separation from service for any
reason other than for cause as defined under the LTIP rules.
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Item 9.01. |
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Financial Statements and Exhibits. |
(d) Exhibits.
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Exhibit Number |
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Description |
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10.1 |
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Form of Terms and Conditions for Awards Under the Long Term
Incentive Plan of Chevron Corporation |