Brown-Forman Corporation
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):
August 1, 2007 (July 26, 2007)
(Exact name of registrant as specified in its charter)
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| Delaware
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002-26821
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61-0243150 |
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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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| 850 Dixie Highway, Louisville, Kentucky
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40210 |
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| (Address of principal executive offices)
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(Zip Code) |
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Registrant’s telephone number, including area code:
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(502) 585-1100 |
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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 (see General Instruction
A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of
Certain Officers; Compensation Arrangements of Certain Officers.
On July 26, 2007, the Compensation Committee (the “Committee”) of the Board of Directors of
Brown-Forman Corporation (the “Company”) approved targeted
incentive compensation for performance periods
beginning in fiscal 2008, as well as the goals on which such
compensation will be based, for the
individuals who constituted the Company’s Named Executive
Officers for fiscal 2007.
The
incentive compensation plan, approved pursuant to the Company’s 2004 Omnibus Compensation Plan, establishes
performance goals pursuant to which such officers may receive
Short-Term (annual) and Long-Term compensation opportunities. Such
opportunities at target are as follows:
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Short-Term |
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Long-Term |
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Total Incentive |
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Opportunity at |
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Opportunity at |
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Opportunity at |
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| Officer |
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Target |
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Target |
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Target |
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Paul Varga,
Chief Executive
Officer |
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$ |
1,212,295 |
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$ |
2,051,858 |
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$ |
3,264,153 |
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Phoebe A. Wood,
Vice Chairman &
Chief Financial
Officer |
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$ |
260,000 |
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$ |
600,000 |
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$ |
860,000 |
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James L. Bareuther,
Chief Operating
Officer |
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$ |
260,000 |
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$ |
625,000 |
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$ |
885,000 |
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Owsley
Brown*, Chairman |
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$ |
452,705 |
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$ |
191,448 |
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$ |
644,153 |
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Michael
Crutcher*, Vice Chairman & General Counsel |
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$ |
84,016 |
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$ |
168,033 |
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$ |
252,049 |
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*
Mr. Brown will retire effective September 30, 2007 and Mr. Crutcher
will retire effective August 31, 2007. For each of Mr. Brown and
Mr. Crutcher, all incentive payments will be made in cash and
target opportunities have been pro-rated to reflect the number of days to be worked in fiscal 2008
prior to retirement.
Short-Term
Opportunity at Target for each named executive officer will be paid in cash.
For Mr. Varga, the Long-Term Opportunity at Target takes the form of performance-based
restricted stock and a long-term cash opportunity based on Company performance for the
performance period comprising fiscal 2008 through fiscal 2010.
For each of the other named executive officers, the Long-Term Opportunity at Target will
be awarded in a combination of stock-settled stock appreciation rights, performance-based
restricted stock and a long-term cash opportunity for the performance period fiscal 2008
through fiscal 2010.
Description
of Incentive Plan Elements
The
incentive compensation plan described above requires the Company to
achieve certain threshold levels
of adjusted operating income before any payments can be made. Target
incentive compensation is paid for targeted levels of adjusted operating income attained, greater-than-target bonus is paid for higher levels of adjusted operating income
attained and lower-than-target bonus is paid for lower levels of operating income attained. The
maximum Short-Term Opportunity is capped at 200% of the target. The
Long-Term Opportunity is uncapped.
Stock-settled stock appreciation rights have a grant price equal to the closing market value of
Brown-Forman Class B Common Stock on the grant date of July 26, 2007, have a term of ten fiscal
years and cannot be exercised in the first three fiscal years.
Restricted stock awards are initially designated in cash, then adjusted based on fiscal 2008 performance against adjusted operating income goals and
converted to restricted Class A Common shares at the end of fiscal 2008, with restrictions on
shares remaining in place through April 30, 2011.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Brown-Forman Corporation |
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(Registrant) |
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August 1, 2007
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/s/ Nelea A. Absher |
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(Date)
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Nelea A. Absher |
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Vice President and Assistant Corporate Secretary |