REG - BAE SYSTEMS PLC - Directorate Change

BAE SystemsAnnouncement

08/08/2019 11:00

RNS Number : 4021I
BAE SYSTEMS PLC
08 August 2019
 


 
BAE SYSTEMS PLC - NOTICE OF DIRECTORATE CHANGE
Peter Lynas, Group Finance Director, has informed the Board of BAE Systems plc that he will retire from the Company on 31 March 2020. The Company has appointed Brad Greve as Group Finance Director Designate to succeed Peter Lynas as Group Finance Director and join the BAE Systems plc Board on 1 April 2020. Brad will join BAE Systems and become a member of the Executive Committee in September 2019 and will work with Peter to help ensure a smooth handover of responsibilities.
Brad brings more than 30 years' international experience with large capital projects and programmes, having worked for large multinational organisations in the oil and gas industry across Europe, the United States, South America and Africa. Most recently, Brad has been the top financial executive responsible for overseeing US$20bn of annual revenue and US$1bn of annual capital expenditure as Financial Controller of the Wells business at Schlumberger.
Commenting on today's announcement Charles Woodburn, Chief Executive of BAE Systems plc, said: "I would like to thank Peter for his many years of service and valuable contribution to BAE Systems throughout his distinguished career, during which he has played a significant role in the strategic development of the Group. 
"I'm delighted to welcome Brad who, with more than 30 years' experience growing large international portfolios in a complex sector, brings considerable talent to the business and is well positioned to take the Company forward. As part of our planned succession process, Brad will work closely with Peter over the coming months to prepare for the leadership transition in 2020 and ensure continued focus on our strategic priorities."
Brad Greve has no details to disclose under Listing Rule 9.6.13.
Notes:
Remuneration of Brad Greve
Remuneration arrangements are in line with the Company's Remuneration Policy approved by shareholders:
-     Base salary of £610,000
-     Eligible for participation in the BAE Systems plc Annual Incentive and Long Term Incentive Plan
-     Minimum Shareholding Requirement of 200% of base salary
-     Pension - Company contribution of up to 8% of reference salary
 
One-off payment for forfeited earnings
In accordance with the Remuneration Policy, the Company will buy out certain incentives previously awarded by Schlumberger and forfeited as a consequence of joining BAE Systems at a level consistent with the fair value at the time of recruitment:
-     £210,000 cash payment to be paid within 30 days of commencing employment. 50% of the net amount must be used to purchase BAE Systems plc shares within 120 days following payment.
 
Retirement of Peter Lynas    
The following arrangements will apply in relation to Peter Lynas when he retires as a director and ceases employment on 31 March 2020. The arrangements are in accordance with the Company's Remuneration Policy, approved by shareholders and the Rules of the Company's 2000 Pension Plan and Executive Pension Scheme outlined in the 2018 Annual Report:
(a)  For pension and share plan purposes, Mr Lynas' retirement on 31 March 2020 will be at his Normal Retirement Date and accordingly:
(i)         He will be entitled to receive his accrued pension benefit in accordance with the Rules of the BAE Systems 2000 Pension Plan and the BAE Systems Executive Pension Scheme. 
(ii)        Under the Rules of the BAE Systems Long Term Incentive Plan, any unvested share awards will vest at the normal vesting date, subject to the relevant performance conditions and time pro-rating.  Awards will be reduced pro-rata for time based on the period from grant date to 31 March 2020 (calculated on the basis of actual days employed). The applicable performance conditions will be tested at the end of the normal performance period. In the case of any such award which vests after 31 March 2020, the award remains exercisable for a period of six months from the day on which the award vests.
(iii)       Bonus shares under the BAE Systems Deferred Bonus Plan will continue to be deferred and will be released on the normal release dates.
(iv)       Any share awards held by him, which have vested on or before 31 March 2020 but have not been exercised at that date will lapse unless exercised in the six month period from 31 March 2020 or, if earlier, the date on which such award normally lapses.
(v)        Following termination of employment, he will be subject to a reduced minimum shareholding requirement equivalent to 100% of salary for a period of two years from leaving employment.
(vi)       He will remain eligible to receive an annual incentive payment for 2019 in accordance with the Company's Remuneration Policy. Any bonus will be subject to compulsory deferral of one third of the net amount under the BAE Systems Deferred Bonus Plan in the normal way with the balance being paid at the normal bonus payment date in March 2020.
(vii)      He will be eligible for an annual incentive payment for 2020, determined by the Remuneration Committee, subject to an assessment of performance and pro-rated for three months of service during 2020.  Any bonus will be paid at the normal bonus payment date following the end of the 2020 financial year and subject to compulsory deferral of one third of the net amount under the BAE Systems Deferred Bonus Plan in the normal way.
(viii)     He will continue to be covered by the Company's D&O insurance policy and his current director's indemnification arrangements will remain in place.
(ix)       He will continue to be bound by the terms of his service contract which continue to apply following cessation of employment including post-termination restrictive covenants and confidentiality provisions.
(x)        His annual salary will remain at the current level until his retirement date.
(xi)       No payment in lieu of notice or other termination payment will be payable.
(xii)      Taxable benefits comprising the provision of a car allowance and the private use of a chauffeur-driven car will cease from 31 March 2020.
 
Brad Greve Background
Brad is a finance graduate of Southern Methodist University in Dallas, Texas, and holds an MBA from the London Business School. He joined Schlumberger in 2000, having previously worked for a number of its predecessor companies. After progressing through a number of senior finance positions across the UK, Europe, South America and the US, he was appointed Director of Internal Audit for Schlumberger in 2016.
In his most recent position as Financial Controller of the Wells business, he was the top financial executive responsible for global product lines with US$20bn of revenue and US$1bn capital expenditure and led the business planning and resource management processes making key decisions on staffing, equipment deployment and pricing strategy.
 




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