BALL CORPORATION (NYSE:BLL) Files An 8-K Other Events

ME Staff 8-k
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BALL CORPORATION (NYSE:BLL) Files An 8-K Other Events
Item 8.01. Other Events – Disclosure of Special Acquisition-Related Incentive Plan Targets.

In order to supplement disclosure in its 2018 proxy statement on FormDEF14A filed with the Securities and Exchange Commission (the “SEC”) on March14, 2018, related to its Special Acquisition-Related Incentive Plan (the “SAIP”) associated with integration activities mainly relating to the June30, 2016, Rexam transaction, Ball Corporation hereby discloses the SAIP’s financial performance measures. The key SAIP parameters were disclosed on Form8-K, filed with the SEC August1, 2016. For perspective, the cumulative trailing economic value added (“EVA”) and free cash flow for Ball Corporation for the 42-month period prior to June30, 2016, were approximately $620 million and $1,324 million, respectively, and as such the SAIP targets were set with meaningful improvements in EVA and free cash flow growth required in order for the participants to receive any such awards.

The SAIP award range, performance measures, performance period and award vest date are set forth in the table below.

AwardRange:

0%

Target50%

Maximum200%

Performance Measures: (Defined cumulative goals over Performance Period)

EVA® $Goal $749 Million Cash Flow $Goal

$2,119 Million

EVA® $Goal $832 Million Cash Flow $Goal

$2,355 Million

EVA® $Goal $915 Million Cash Flow $Goal

$2,591 Million

Performance Period:

July1, 2016 through December31, 2019 (42-month period)

Award Vest Date:

January31, 2020 or the date of the first quarterly Board of Directors meeting following the end of the Performance Period, whichever is later.

Free cash flow and EVA® are not defined terms under U.S. GAAP. Ball Corporation defines free cash flow as cash flow from operating activities less capital expenditures. Free cash flow is typically derived directly from Ball Corporation’s consolidated statement of cash flows; however, it may be adjusted for items that affect comparability between periods. EVA® is calculated by subtracting a charge for the use of invested capital from net operating profit after-tax as illustrated below:

EVA®=

(

Net Operating Profit After-Tax

("NOPAT")

)

minus

(

Capital Charge (the Amount of Capital Invested by Ball multiplied

by Ball's After-Tax Hurdle Rate)

)

Generating profits in excess of both operating and capital costs (debt and equity) creates EVA® dollars. If EVA® improves, value has been created.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

As previously disclosed, on July26, 2016, the Human Resources Committee (the “Committee”) of the Board of Directors (the “Board”) of Ball Corporation (the “Company”) took the following action which was ratified by the Board on July27, 2016:

The Committee approved, in addition to taking other actions as previously disclosed, a Special Acquisition-Related Incentive Plan (the “Plan”), available to key executives and employees who are in a position to have a significant impact on the successful integration of the recently acquired Rexam business into the Company. The Plan is based on a 42-month performance period, beginning July2016, and ending on December31, 2019. Participant awards will be stock-based, in the form of Performance Restricted Stock Units (“PRSUs”). The payout of a participant’s award may range from 0 percent to 200 percent of that participant’s target award opportunity. The PRSUs will cliff vest after the end of the 42-month cycle, based on financial performance. Financial performance measures will be EVA® (economic value added) and cash flow, weighted 50 percent/50 percent, respectively.


About BALL CORPORATION (NYSE:BLL)

Ball Corporation (Ball) is a supplier of metal packaging to the beverage, food, personal care and household products industries. The Company’s packaging products are produced for a range of end uses and are manufactured in facilities around the world. The Company operates in four segments: metal beverage packaging, Americas and Asia; metal beverage packaging, Europe; metal food and household products packaging, and aerospace and technologies. Its product lines include aluminum and steel beverage containers. The Company also produces steel food, aerosol, paint, general line and decorative specialty containers, as well as extruded aluminum aerosol and beverage containers and aluminum slugs. The Company sells its packaging products to multinational beverage, food, personal care and household products companies. Its aerospace business is engaged in the designing, development and manufacturing of aerospace systems for civil, commercial and national security aerospace markets.