Form 4: Caterpillar Inc. Executive Joseph E. Creed Reports Acquisition of Phantom Stock Units

Chief Operating Officer Joseph E. Creed reports acquiring 267 phantom stock units of Caterpillar Inc. on March 8, 2024.

Summary

• On March 8, 2024, Joseph E. Creed, Chief Operating Officer of Caterpillar Inc., acquired 267 phantom stock units.
• These phantom stock units are part of the company's non-qualified deferred compensation plans and are economically equivalent to one share of Caterpillar Inc. common stock each.
• The phantom stock units will be settled in cash upon Creed's retirement or separation from service.
• Following the reported transaction, Creed beneficially owns 8,329 phantom stock units, which includes accrued dividends.
• The price of the phantom stock units was $339.19.

Sentiment

Score: 7

Explanation: The document reflects a routine transaction related to executive compensation, which is generally viewed neutrally. The acquisition of phantom stock units can be seen as a positive sign of management's commitment to the company's long-term success.

Positives

• The acquisition of phantom stock units aligns the executive's interests with the long-term performance of the company.
• The deferred compensation plan provides a mechanism for retaining key executives.

Future Outlook

The phantom stock units will be settled for 100% in cash upon the reporting person's retirement or separation from service.

Industry Context

Executive compensation through stock-based awards is a common practice in publicly traded companies to incentivize performance and align management's interests with shareholders.

Comparison to Industry Standards

• Caterpillar's use of phantom stock units is consistent with compensation practices at other large industrial companies such as Deere & Company (DE) and Komatsu (KMTUY), which also utilize deferred compensation plans and equity-based awards to incentivize executives.
• These types of awards are designed to retain key personnel and align their interests with the long-term success of the company, similar to practices observed at General Electric (GE) and Siemens (SIEGY).

Stakeholder Impact

• The acquisition of phantom stock units by a key executive can positively influence shareholder confidence by aligning management's interests with the company's performance.

Key Dates