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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.
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On June 16, 2021, Philip Morris International Inc. (the “Company”) disclosed that effective August 31, 2021, Martin G. King, who has served in many roles at the Company, but most recently as CEO, PMI America, will retire from the Company. As such, in connection with Mr. King's retirement, on August 16, 2021, he and Philip Morris Services S.A., a subsidiary of the Company, entered into a Separation Agreement and Release (the “Separation Agreement”), with the following key terms, which key terms were set forth in his Employment Agreement with Philip Morris Services S.A., effective June 1, 2020, and previously disclosed by the Company:
–Mr. King will receive a severance payment of CHF 1,267,506 (or $1,387,374)1, which was determined based on his years of service;
–Mr. King’s 2021 incentive compensation award will be based on actual Company business rating and the assessment of his individual performance, pro-rated through August 31, 2021, and paid at the end of February 2022;
–Mr. King’s restricted share units will vest fully, and his performance share units will vest as scheduled and certified by the Compensation and Leadership Development Committee of the Board of Directors of the Company; and
–Mr. King will receive a cash payment of CHF 1,267,506 (or $1,387,374)1 subject to compliance with a 24-month non-compete obligation.
The Separation Agreement also includes a release of claims, confidentiality and other provisions customary for an agreement of this type. Pursuant to applicable law, Mr. King has a period of seven calendar days to revoke the Separation Agreement. Any revocation of the Separation Agreement, however, shall not affect the finality of Mr. King’s last date of employment with the Company on August 31, 2021.
The foregoing summary of the Separation Agreement is qualified in its entirety by reference to the Separation Agreement, which is filed as Exhibit 10.1 hereto and is incorporated herein by reference.
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1 Using the conversion rate on August 16, 2021 of CHF 1.00 = USD 1.09457.