Form 4: Goodyear Executive Nathaniel Madarang Receives Performance Share and Restricted Stock Units

Nathaniel Madarang, President of Asia Pacific at Goodyear Tire & Rubber Co, was granted performance share units and restricted stock units under the company's 2022 Performance Plan.

Summary

• Nathaniel Madarang, President, Asia Pacific at Goodyear Tire & Rubber Co, received grants of performance share units and restricted stock units on February 26, 2024.
• The performance share units, numbering 30,482, are contingently payable in common stock in February 2027, with the actual number of units paid depending on the achievement of certain performance goals over a three-year period ending December 31, 2026.
• The number of units paid can range from 0% to 200% of the reported units, subject to adjustments based on the company's total shareholder return compared to a peer group over the same three-year period.
• The restricted stock units (RSUs), also numbering 30,482, will vest and convert into shares of common stock in 33% increments over three years, starting on March 1, 2025.

Sentiment

Score: 7

Explanation: The document reflects a standard executive compensation practice, aligning management incentives with shareholder value. The sentiment is neutral to slightly positive as it indicates a commitment to performance-based rewards.

Positives

• The grants of performance share units and restricted stock units align executive compensation with company performance and shareholder value.
• The vesting schedule of the RSUs encourages long-term commitment from the executive.

Risks

• The actual value of the performance share units is dependent on the company's future performance, which is subject to market and economic risks.
• The executive may not receive the full value of the performance share units if performance goals are not met.

Future Outlook

The value of the performance share units is contingent on Goodyear's performance over the next three years, specifically its ability to meet certain performance goals and its total shareholder return relative to a peer group.

Industry Context

Granting equity-based compensation is a common practice in the industry to incentivize executives and align their interests with those of shareholders. The specific terms of the grants, such as the performance metrics and vesting schedules, are tailored to the company's specific goals and circumstances.

Comparison to Industry Standards

• Companies like Michelin and Bridgestone also use performance-based equity compensation for their executives.
• The vesting schedule of Goodyear's RSUs is fairly standard, with many companies using three-year vesting periods.
• The performance metrics used for the performance share units are likely tied to key financial and operational goals, such as revenue growth, profitability, and market share, similar to other companies in the industry.

Stakeholder Impact

• Shareholders: The grants aim to align executive interests with shareholder value creation.
• Employees: The grants may motivate employees by linking executive compensation to company performance.

Next Steps

• The performance share units will be evaluated based on Goodyear's performance over the three-year period ending December 31, 2026.
• The restricted stock units will vest in 33% increments annually starting March 1, 2025.

Key Dates