Your initial base salary will be $50,000 per month ($600,000 annually). In April 2018, you will be eligible for a non-prorated merit increase. Thereafter, merit increases will follow UPS annual merit guidance and take effect with April payroll.
You will be eligible to participate in the UPS Management Incentive Program (MIP) in accordance with the terms of the MIP as in effect from time-to-time. The target value of your annual award will be 130% of your
As a UPS MIP participant, you will be eligible to receive annually a UPS Ownership Incentive Award. Under
You will be eligible to participate in the UPS Long-Term Incentive Performance award program (LTIP) in accordance with the terms of the LTIP as in effect from time-to-time. The LTIP provides for equity grants to senior UPS leaders and is focused on delivering long-term shareholder value. LTIP awards currently are paid in Performance Units that vest and convert to UPS Class A stock three years after grant. Your target LTIP award level will be 450% of your annualized base salary. The actual award values will be determined by company performance measured against the established targets for Revenue Growth, ROIC and RTSR metrics (with such metrics subject to change in future years). LTIP awards are normally granted annually in March and you will receive a full 2018 grant with a target value of $2,700,000.
You will be eligible to receive an annual non-qualified stock option grant pursuant to the applicable UPS stock incentive plan. The target stock option award value for your position currently is 50% of annualized salary. The stock options vest pro-rata over five years, with a ten-year maximum term and are subject to the terms of the stock plan and an award agreement. The number of options will be determined by dividing the total grant value by the Black-Scholes valuation of the options determined as of the date of grant.
You will be eligible for participation in the UPS Deferred Compensation Plan. This plan allows deferral of your salary as well as the cash portion of UPS Management Incentive Program awards in accordance with the limitations set forth in the terms and conditions of the plan.
You will be eligible to participate in UPS's defined contribution retirement program, subject to the terms and conditions thereof as in effect from time to time. As presently structured, the program provides:
A 50% company match on your contributions up to 6% of eligible compensation; and
A service-based UPS Retirement Contribution which begins as 5% of eligible compensation, increasing after five years of service, and is fully vested after three years of service.
You will be eligible for personal financial counseling services and tax return preparation reimbursement, within the limits established by UPS. The current annual limit for personal financial counseling and tax preparation services is $15,000.
You will be eligible to participate in the UPS Flex Benefits Plan in accordance with the terms and conditions thereof, including the following benefits:
Healthcare (multiple plan options)
Life Insurance (self, spouse, children)
Critical Illness Insurance
Healthcare Spending Account
Child/Elder Care Spending Account
You will be eligible for 30 vacation days and 5 personal days per annum.
The Senior Vice President and Chief Transformation Officer position requires you to be based in Atlanta. You will be eligible to participate in the UPS New Hire Homeowner Relocation Program (''Relocation Assistance"), including pre-move house-hunting expenses, temporary living expenses, home purchase expenses (e.g. fees), household goods moving expenses, and final moving expenses. The terms and conditions of the Relocation Assistance program will be separately provided to you.
You will receive a special one-time grant of Restricted Stock Units (RSUs) valued at $4 million as consideration for equity forfeited from your previous employer. The RSUs will be awarded pursuant to (and subject to the terms of) the UPS 2015 Omnibus Incentive Compensation Plan and a Restricted Stock Unit Award Agreement, and the number of RSUs awarded will be calculated by dividing $4 million by the closing price of UPS stock on the grant date. The grant date for your award will be January 2, 2018. This award will vest as follows: 20% in January 2018, 20% in January 2019, 20% in January 2020, 20% in January 2021, and 20% January 2022, subject to your continued employment through each applicable vesting date (however, if your employment is terminated by UPS without "Cause"1 you will continue vesting in the RSUs; similarly, if your employment is terminated by death or disability, vesting will occur in accordance with the terms of the award). Promptly following each vesting date, UPS Class A Shares will be issued to you (net of tax withholdings). The grant award agreement includes a more detailed description of the vesting and other terms of the RSUs.
You will receive a cash payment of $2,500,000 in December 2017 (less tax withholdings) as consideration for the 2017 cash and equity awards you are forfeiting from your prior employer.
You will receive Transition Payments in the total amount of $4,500,000 (less tax withholdings), paid to you as follows subject to your continued employment through each applicable payment date: $500,000 in March 2018, $2,000,000 in March 2019, $2,000,000 in March 2020.
You will be an "at-will" employee, which means either you or UPS may terminate your employment at any time and for any reason.
Your employment is contingent upon your relocation to the Atlanta metropolitan area no later than June 30, 2018.
If you are terminated for Cause or you resign from UPS within 36 months following your start date, you agree to repay the full amount of the paid Transition Payment (Excluding the December 2017 cash payment of $2.5 million) within 30 days of your last day of employment. Your signature below indicates your agreement to these repayment terms.
Core Compensation Package
$50,000 / month ($600,000 /year). First merit increase in 2018 will not be prorated.
Managers Incentive Program (MIP)
Target of 130% of annualized salary. First award paid in March 2019 in all UPS Class A stock.
1.50% of the value of eligible UPS holdings (up to one month's salary.
Long-Term Incentive Performance
Award (LTIP) Program
Target of 450% of annualized salary.
50% of annualized salary.
UPS Retirement Program
Currently 50% company match on contributions up to 6% of eligible compensation + Service-based UPS Retirement Contribution.
UPS Flex Benefits Plan
Healthcare (multiple plan options), Dental, Vision Care, AD&D Coverage, Life Insurance, Critical Illness Insurance, Healthcare Spending Account, Child /Elder Care Spending Account.
Financial Services and Tax Preparation
$15,000 / year.
UPS New Hire Homeowner Relocation
Pre-move house-hunting expenses, temporary living expenses, home purchase expenses (e.g. fees), household goods moving expenses, and final moving expenses.
Special One-Time RSU Grant as
consideration for forfeited compensation
(vests in equal installments of $800,000 in January 2018, January 2019,
January 2020, January 2021, and January 2022).
$2,500,000 in December 2017
$500,000 in March 2018
$2,000,000 in March 2019
$2,000,000 in March 2020