| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On May 18, 2023, Science Applications International Corporation (the “Company”) announced the retirement of Nazzic S. Keene as Chief Executive Officer of the Company, effective as of October 2, 2023 (the “Effective Date”). Ms. Keene has also resigned from the Board of Directors of the Company (the “Board”), effective as of the Effective Date.
In connection with her retirement, Ms. Keene will provide certain transition services to the Company through February 2, 2024 (the “Retirement Date”), as Special Executive Advisor, pursuant to a transition letter, dated May 15, 2023 (the “Transition Letter”). In exchange for such services, among other things, (i) Ms. Keene will continue to receive her current annual base salary through the Retirement Date, (ii) Ms. Keene will receive a lump-sum transition payment of $1,250,000, subject to the achievement of a successful transition of her responsibilities and provided Ms. Keene continues to be employed by the Company through the Retirement Date, to be paid by March 15, 2024, (iii) Ms. Keene will receive her annual short-term incentive cash bonus for the fiscal year ending February 2, 2024 (“fiscal 2024”) to be calculated and paid in the normal course based on the Company’s fiscal 2024 annual bonus financial performance score, (iv) Ms. Keene will receive a lump-sum cash payment equal to the total amount of the monthly COBRA insurance premiums for twenty-four (24) months, to be paid by the 60th day following the Retirement Date, and (v) Ms. Keene will receive continued vesting of certain outstanding equity awards after the Retirement Date.
The foregoing description of the Transition Letter does not purport to be complete and is qualified in its entirety by reference to the full text of the Transition Letter, a copy of which is filed as Exhibit 10.1 hereto and incorporated by reference in this Current Report on Form 8-K.
On May 15, 2023, Toni Townes-Whitley was appointed as CEO-elect of the Company, effective as of June 12, 2023, and was appointed to succeed Ms. Keene as Chief Executive Officer of the Company effective as of the Effective Date and as a member of the Board for an initial term beginning on the Effective Date and expiring at the Company’s annual meeting of stockholders for fiscal 2024.
Ms. Townes-Whitley, 59, is the former President, U.S. Regulated Industries of Microsoft Corporation. Prior to that role, Ms. Townes-Whitley was Corporate Vice President for Global Industry at Microsoft from 2015 to July 2018. Prior to joining Microsoft, Ms. Townes-Whitley was President of CGI Federal and held several management roles at Unisys Corporation, leading global, public and commercial sector systems integration. Ms. Townes-Whitley currently serves on the Boards of Directors of the following U.S. public companies: Marathon Petroleum Corporation, Nasdaq, Inc. and The PNC Financial Services Group, Inc.
In connection with her appointment as Chief Executive Officer of the Company, Ms. Townes-Whitley’s annual compensation for fiscal 2024 will be as follows: (i) an annual base salary of $1,200,000 effective as of June 12, 2023, provided that she will earn a prorated percentage of her annual base salary for the period from June 12, 2023 until the Effective Date, (ii) a short-term incentive cash bonus target equal to 140% of her annual base salary, and (iii) $6,350,000 of long-term incentive awards in the form of performance stock units and restricted stock units under the Company’s executive compensation plan, of which $750,000 is a one-time enhancement in connection with Ms. Townes-Whitley agreeing to join the Company. Ms. Townes-Whitley will be eligible to participate in the SAIC Executive Severance, Change in Control and Retirement Policy and the Company’s deferred compensation plan. As an employee director, Ms. Townes-Whitley will not serve on any standing committees of the Board and will not receive any additional compensation for her service as a member of the Board.
There are no family relationships between Ms. Townes-Whitley and any other executive officer or director of the Company that require disclosure under Item 401(d) of Regulation S-K. There are no transactions between Ms. Townes-Whitley or any member of her immediate family and the Company that require disclosure under Item 404(a) of Regulation S-K.
| Item 7.01. | Regulation FD Disclosure. |
On May 18, 2023, the Company issued a press release announcing the events discussed in Item 5.02 above, the text of which is furnished as Exhibit 99.1 hereto and incorporated herein by reference. The information contained in this Item 7.01 and Exhibit 99.1 is being furnished, and shall not be deemed “filed” for purposes of Section 18 of
